Policies from the Past in a Modern Era

The Unintended Consequences of the AbilityOne 

Program & Section 14(c)

National Council on Disability

October 14, 2020
National Council on Disability (NCD)

1331 F Street NW, Suite 850

Washington, DC 20004

Policies from the Past in a Modern Era: The Unintended Consequences of the AbilityOne 

Program & Section 14(c)

National Council on Disability, October 14, 2020

This report is also available in alternative formats. Please visit the National Council on Disability 

(NCD) website (www.ncd.gov) or contact NCD to request an alternative format using the following 

information:

ncd@ncd.gov Email

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The views contained in this report do not necessarily represent those of the Administration, as this and 

all NCD documents are not subject to the A-19 Executive Branch review process.
National Council on Disability

An independent federal agency making recommendations to the President and Congress 

to enhance the quality of life for all Americans with disabilities and their families.

Letter of Transmittal

October 14, 2020

President Donald J. Trump

The White House

1600 Pennsylvania Ave., NW

Washington, DC 20500

Dear Mr. President,

The National Council on Disability (NCD) is pleased to provide this comprehensive analysis of the 

AbilityOne Program along with the use of Section 14(c) subminimum wage certificates under the 

Fair Labor Standards Act by AbilityOne nonprofit agencies.

The AbilityOne Program, composed of a government-appointed Commission and staff, three central 

nonprofit agencies (CNAs) that operate much of the program, and over 500 participating nonprofit 

agencies, seeks, through federal procurement, to create employment opportunities for people who 

are blind or have a significant disability.

Created in 1938 and now operating under the 1971 Javits-Wagner-O’Day Act, Federal Government 

agencies currently purchase around $3.6 billion worth of goods and services from nonprofits 

participating in the program. Section 14(c), also established in 1938, allows businesses to pay people 

with disabilities less than the federal minimum wage.

This report is informed by thorough research of relevant information and interviews of AbilityOne 

Commission members and staff, the program’s Inspector General, the three CNAs, and other 

stakeholders. NCD visited nine AbilityOne nonprofit agencies in three states and interviewed 14 other 

such agencies by phone. The work of this assessment was informed by an Advisory Committee 

composed of experts in disability employment issues, of which half of whom identified as a person 

with a disability.

NCD concludes that the AbilityOne Program is based on an outdated model that results in the 

segregation of people with disabilities and is hampered by a lack of transparency and confusion over 

compliance roles. Of even greater concern, despite increase in the amount of government sales from 

the program, the employment of people who are blind has stagnated under the program, and the 

employment of people with significant disabilities has declined. In this report, NCD offers a series of 

recommendations that NCD believes will ultimately promote the employment of people with significant 

disabilities and who are blind that aligns with modern national disability policy of full equity and 

inclusion.

NCD provides this assessment during a grim moment in world history. The United States and the 

entire world are reeling from the effects of COVID-19 virus as it threatens the health and safety of 

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millions of people, while dealing a devastating blow to our economy. In 2019, at the start of the 

research for this report, unemployment in the United States was approximately 3.5 percent. The 

COVID-19 pandemic, however, has swiftly leveled the U.S. economy with the unemployment rate rising 

to 20 percent in late spring of 2020. NCD recognizes the potential audacity of suggesting a new version 

to an 82-year-old system that today provides employment to 45,000 people with significant disabilities 

and people who are blind. As the United States works to return to normalcy after the reverberations 

caused by COVID-19 begin to fade, NCD offers this report and recommendations as a way to build an 

employment system that is based upon the God given belief in the value of every human being and 

the American belief of equity and inclusion for all Americans.

Respectfully,

Neil Romano

Chairman

(The same letter of transmittal was sent to the President Pro Tempore of the U.S. Senate and the Speaker of the 

U.S. House of Representatives.)

2 National Council on Disability
National Council on Disability Members and Staff

(Listing accurate as of the time of the vote to approve the report)

Members

Neil Romano, Chairman

James Brett, Vice Chair

Billy Altom

Jim Baldwin

Rabia Belt

Andrés Gallegos

Wendy S. Harbour

Benro Ogunyipe

Clyde Terry

Staff

Lisa Grubb, Executive Director

Joan M. Durocher, General Counsel & Director of Policy

Anne Sommers, Director of Legislative Affairs & Outreach 

Stacey S. Brown, Staff Assistant

Kimie Eacobacci, Legislative Affairs Specialist

Netterie Lewis, Administrative Support Specialist

Amy Nicholas, Attorney Advisor

Nicholas Sabula, Public Affairs Specialist

Amged Soliman, Attorney Advisor

Ana Torres-Davis, Senior Attorney Advisor

Keith Woods, Financial Management Analyst

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 3
4 National Council on Disability
Contents

Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  

Acronym Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

Problems with the AbilityOne Program . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

Chapter 1: History of the AbilityOne Program and Section 14(c) . . . . . . . . . . . . . . . . . 19

The Medical and Charity Models of Disability . . . . . . . . . . . . . . . . . . . . . . . 19

The New Deal and the Employment of People with Disabilities . . . . . . . . . 19

Changes to Section 14(c) and Passage of the JavitsWagner-O’Day Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2

Expansion of the Committee for Purchase and Creation 

of the Central Nonprofit Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2

Changes in Federal Disability Law and Policy . . . . . . . . . . . . . . . . . . . . . .  2

Chapter 2: How the AbilityOne Program Operates Today . . . . . . . . . . . . . . . . . . . . . .  2

The AbilityOne Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2

The AbilityOne Procurement and Contracting Process . . . . . . . . . . . . . . .  2

Changes to the Javits-Wagner-O’Day Act and the Role 

of Cooperative Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  3

The Role of the Central Nonprofit Agency Program Fee . . . . . . . . . . . . . .  3

Nonprofit Agencies and the Seventy-Five 

Percent Direct Labor Hour Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  3

Compliance and Roles and Responsibilities 

Within the AbilityOne Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  4

Complexities Surrounding Employee Eligibility 

Within the AbilityOne Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  4

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 5
Complexities Regarding Individual Eligibility 

by the Nonprofit Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  4

Degeneration of AbilityOne Program Integrity . . . . . . . . . . . . . . . . . . . . . .  4

AbilityOne Commission’s Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  4

Chapter 3: AbilityOne Sales, Revenue, and the Employment 

of People with Disabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5

Employment Under the AbilityOne Program . . . . . . . . . . . . . . . . . . . . . . .  5

Sales, Wages, and Central Nonprofit Agency Revenue Under 

the AbilityOne Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5

Nonprofit Agency Production, Services, and Additional Funding . . . . . .  5

Wages and the Use of 14(c) Certificates by the AbilityOne Program . . . .  5

Various Positions on Competitive Integrated Employment 

and Subminimum Wages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  6

Participation in and the Cost of Segregated Employment . . . . . . . . . . . . .  6

Section 503 of the Rehabilitation Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  6

Chapter 4: Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  7

Interim Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  7

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  7

Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  8

Nonprofit Agency Phone Interview Selection Methodology . . . . . . . . . . .  8

Endnotes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  8

6 National Council on Disability
Acknowledgments

The National Council on Disability wishes to thank the National Disability Rights Network, particularly 

David Hutt, Ph.D., Amanda Lowe, Jacqueline Hubbard, and Amy Scherer, and their partner the Institute 

for Community Inclusion at the University of Massachusetts Boston, particularly John Butterworth, 

Ph.D., and Jean Winsor, Ph.D.

The National Council on Disability also thanks the AbilityOne Commission and staff for their cooperation 

in meeting with NCD for interviews and providing data for the report.

NCD extends a special thanks to the National Federation of the Blind for its contribution to this report 

of several photographs showing blind employees.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 7
8 National Council on Disability
Executive Summary

With roots back to the New Deal 

of the 1930s, the Javits-WagnerO’Day (JWOD) Act, which operates 

today as the AbilityOne Program, is a complex 

use of federal procurement power to seek to 

increase the employment of people who are 

blind or have significant disabilities. Led by a 

15-person Commission and 32 staff members,

the AbilityOne Program relies on a network of

around 500 nonprofit agencies (NPAs) to make

products and provide services that Federal

Government agencies are

mandated to purchase. 

To increase employment 

opportunities, these 

NPAs are required to 

employ people who are 

blind or have a significant 

disability in 75 percent of 

the direct labor hours of the work performed by 

the entire NPA. Two central nonprofit agencies 

(CNAs), National Industries for the Blind (NIB) 

and SourceAmerica, play a key role within the 

program by distributing federal contracts to the 

NPAs through conducting monitoring visits and 

by working with the NPAs to add new products 

and services to the mandatory procurement list 

in an effort to further increase employment. The 

Commission recently designated the American 

Foundation for the Blind (AFB) as the third CNA, 

but AFB has yet to begin operations. In this 

report, the National Council on Disability (NCD) 

looks at the AbilityOne Program in detail as 

follow-up to a 2019 white paper.1

 This report 

further addresses the use of Section 14(c) 

subminimum wage certificates by AbilityOne 

Program NPAs as follow-up to a 2018 NCD 

report on subminimum wages and sheltered 

workshops.2

NCD found that during the most recent eightyear period for which figures are publicly available 

that employment of 

people with disabilities 

through the AbilityOne 

Program at best 

remained static for one 

subset while the other 

declined. AbilityOne 

Program sales to 

the Federal Government and revenue earned 

by CNAs through a program fee increased. 

Between FY 2011 and FY 2018, the Federal 

Government purchased on average $3.1 billion 

worth of goods and services annually through 

the AbilityOne Program. NCD found that 

between FY 2011 and FY 2018, the number of 

employees working in the program declined 

from around 50,500 to 44,000, and the number 

of hours worked declined from 49.2 million 

in FY 2011 to 47.8 million hours in FY 2018. 

[A] greater amount of federal

purchases through the program 

increased CNA revenue without 

resulting in increased employment 

of the target population.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 9
Furthermore, despite an increase in total sales 

to the government, the percentage of AbilityOne 

Program revenue going to pay wages for people 

who are blind or have a significant disability 

declined from 20.09 percent to 18.19 percent 

between those years. In 

short, a greater amount 

of federal purchases 

through the program 

increased CNA revenue 

without resulting in 

increased employment of 

the target population.

Through interviews 

of interested parties 

and statistical and other research, NCD found 

systemic issues around AbilityOne Program 

transparency, oversight and compliance, 

structural integrity, and the philosophical 

underpinnings and assumptions of the program 

when compared to 

other federal disability 

policies. The program 

has also struggled with 

key issues involving 

the CNA program 

fee—a percentage 

paid of around 3.7 to 

3.9 per year from the 

government contract, 

and the key CNA revenue 

source; financial audits; 

and a lack of clarity on 

the selection of NPAs for 

individual government contracts and individual 

eligibility for the program. Confusion around the 

oversight role of the CNAs appears to exist. The 

Government Accountability Office (GAO) and 

a panel established to study the program have 

further been critical of the use of the program fee 

on lobbying and payment of executive salaries.

In addition to transparency and oversight 

issues, advances in technology, such as the use 

of federal procurement cards and an e-commerce 

pilot; lack of knowledge 

about the AbilityOne 

mandatory preference 

by federal procurement 

officers; and veterans’ 

small business 

preferences represent 

structural problems 

with the AbilityOne 

model. Most critically, 

however, is the ongoing conflict between the 

75 percent direct labor hour ratio and current 

federal disability law and policy. The ratio 

inherently creates pressures on the AbilityOne 

NPAs to place workers with disabilities into more 

segregated settings, 

whether as work crews 

or on the production 

floor, while the entire 

program perpetuates 

a separate system for 

people who are blind 

or have significant 

disabilities at the same 

time federal laws seek 

to achieve greater 

integration.

NCD also considered 

the use of 14(c) wage 

certificates by AbilityOne NPAs. While all but 

one NPA affiliated with NIB have foregone 

their 14(c) certificate, 233 NPAs affiliated with 

SourceAmerica still possess a certificate. 

SourceAmerica recently adopted a policy 

The program has also struggled 

with key issues involving the CNA 

program fee . . .; financial audits; 

and a lack of clarity on the selection 

of NPAs for individual government 

contracts and individual eligibility 

for the program.

The [75 percent] ratio inherently 

creates pressures on the AbilityOne 

NPAs to place workers with 

disabilities into more segregated 

settings . . . while the entire 

program perpetuates a separate 

system for people who are blind 

or have significant disabilities at 

the same time federal laws seek to 

achieve greater integration.

10 National Council on Disability
to encourage NPAs to eliminate the use of 

subminimum wages. NCD found that NPAs 

typically use the 14(c) certificates under the 

AbilityOne Program to pay less than the 

prevailing wage for the job but at least the 

applicable minimum wage. NPAs also use 

the certificates to pay subminimum wages 

to employees with disabilities who do not 

work on AbilityOne 

contracts.

Given the numerous 

systemic problems that 

beleaguer the AbilityOne 

Program, coupled 

with the necessity for 

America to advance to 

the fullest extent the integration of people with 

all disabilities into the economic mainstream 

of society, NCD calls on Congress to phase 

out the AbilityOne Program over an eight-year 

period and replace the program by requiring that 

federal contractors hire a percentage of people 

who are blind or have a significant disability. 

Specifically, NCD recommends that after the 

phaseout, Congress require all federal contractors 

and subcontractors with at least $200,000 in 

contracts and 50 or more employees to hire 

a certain percentage of people who are blind 

or have significant disabilities. The program 

phaseout must ensure the 45,000 jobs currently 

within the AbilityOne Program are captured under 

the new federal hiring requirements. An extensive 

study would determine 

what percentage of 

people who are blind 

or have a significant 

disability would need 

to be hired by federal 

contractors. NCD further 

recommends, as part of 

the phaseout, that the CNAs play an important 

role to support the NPAs in transitioning from 

the current program of having a mandatory 

preference to either competing directly for federal 

contracts or fulfilling other functions, and to assist 

all other federal contractors in preparing for hiring 

and supporting people who are blind or have 

significant disabilities.

While all but one NPA affiliated 

with NIB have foregone their 14(c) 

certificate, 233 NPAs affiliated with 

SourceAmerica still possess a 

certificate.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 11
Acronym Glossary

AAP affirmative action program

ADA Americans with Disabilities Act of 1990

AFB American Foundation for the Blind

CIE competitive integrated employment

CNA central nonprofit agency

CSAVR Council of State Administrators of Vocational Rehabilitation

DOJ Department of Justice

ETS essentially the same

FLSA Fair Labor Standards Act

FTE full-time equivalent

GAO Government Accountability Office

HELP Health, Education, Labor and Pensions Committee

IDEA Individuals with Disabilities Education Act

IEE Individualized Employment Evaluation

JAN Job Accomodation Network

JWOD Javits-Wagner-O’Day

KPI key performance indicator

MOU memorandum of understanding

MRE Meals Ready to Eat

NCI National Core Indicator

NCD National Council on Disability

NDA nondisclosure agreement

NDAA National Defense Authorization Act

NIB National Industries for the Blind

NIRA National Industrial Recovery Act

NISH National Industries for the Severely Handicapped

NPA nonprofit agency

ODEP Office of Disability and Employment Policy

OFCCP Office of Federal Contract Compliance Programs

OIG Office of Inspector General

QASP Quality Assurance Surveillance Plan

RSA Rehabilitation Services Administration

12 National Council on Disability
RFP Request for Proposal

SELN State Employment Leadership Network

SSDI Social Security Disability Insurance

SSI Supplemental Security Income

TA technical assistance

VR Vocational Rehabilitation

WIOA Workforce Innovation and Opportunity Act

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 13
NCD recommends that to achieve 

true integration of people with 

significant disabilities or who are 

blind, Congress should phase 

out the AbilityOne Program and 

replace the program with a new 

requirement under Section 503 of 

the Rehabilitation Act that federal 

contractors hire at competitive 

wages a percentage of people 

with significant disabilities or 

who are blind

14 National Council on Disability
Introduction

F

or more than 80 years, the U.S. government 

has sought to increase the employment 

of people who are blind, and for almost 

50 years, people who have a significant disability, 

through what is today known as the AbilityOne 

Program. Composed of a government-appointed 

Commission and staff, three central nonprofit 

agencies (CNAs) that operate much of the 

program, and over 500 participating nonprofit 

agencies (NPAs), the AbilityOne Program 

currently employs around 45,000 people who are 

blind or classified as having a significant disability 

and provides around $3.6 billion in products 

and services to the Federal Government.3 In 

this report, the National Council on Disability 

(NCD) conducts a comprehensive analysis of 

the AbilityOne Program along with the use of 

Section 14(c) subminimum wage certificates 

under the Fair Labor Standards Act (FLSA) by 

AbilityOne NPAs as follow-up to two recent 

NCD reports on these topics.4

Methodology

In producing this report, NCD completed a 

number of interviews focused on different 

perspectives of interested program stakeholders. 

NCD researchers conducted in-person interviews 

with three AbilityOne Commission members and 

staff, the AbilityOne Program Inspector General, 

and the directors and staff of two CNAs (the 

National Industries for the Blind [NIB] and the 

American Foundation for the Blind [AFB]). NCD 

received written responses to questions from a 

third CNA, SourceAmerica, which declined NCD’s 

invitation for an in-person interview.

To better understand and gather feedback 

from the NPAs who hold AbilityOne contracts 

with the Federal Government, NCD visited 

nine AbilityOne NPAs in California, Illinois, and 

New York. NCD chose the locations based 

on NPAs that currently hold or formally held 

an FLSA Section 14(c) certificate, to achieve 

Snapshot of AbilityOne

■ Government-appointed Commission and 

staff

■ Three central nonprofit agencies (CNAs) 

operating much of the program;

■ 500+ nonprofit agencies (NPAs)

■ Currently employing approximately 45,000 

people who are blind or have a significant 

disability

■ Provides approximately $3.6 billion in 

products and services to the Federal 

Government through mandatory 

preference

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 15
geographic diversity and an appropriate balance 

between NPAs affiliated with SourceAmerica 

and NIB. One NPA affiliated with SourceAmerica 

refused NCD’s request for an on-site visit 

and interview. NCD also visited two nonprofit 

organizations that assist people with significant 

disabilities but no longer participate in the 

AbilityOne Program. The nine programs visited 

were generous with their time and willingness 

to share information and their perspectives 

about the program. All NPAs visited seemed 

committed to the mission of supporting the 

employment of people who are blind or have 

significant disabilities.

Additionally, NCD randomly selected 24 NPAs 

across the country (see Appendix for the 

methodology) to conduct phone interviews, of 

which 14 were completed. Seven NPAs did not 

respond after repeated attempts to schedule a 

phone interview, and three refused to participate. 

In an effort to represent the perspectives of 

various communities, NCD also held open 

comment sessions in California, Illinois, and 

New York for which interested people could 

NCD Research Methodology

Interview Subjects:

■ Three AbilityOne Commission members 

and staff

■ AbilityOne Inspector General

■ Directors and staff of two CNAs 

(National Industries for the Blind [NIB] 

and American Foundation for the 

Blind [AFB])

■ Written responses to questions from third 

CNA, SourceAmerica, which declined an 

in-person interview

■ Congressional staff of Senate Health, 

Education, Labor and Pensions 

Committee and House Education and 

Labor Committee

■ Staff of Council of State Administrators of 

Vocational Rehabilitation

■ Staff of State Employment Leadership 

Network

NCD Site Visits:

■ Nine AbilityOne NPAs in California, Illinois, 

and New York

■ One SourceAmerica NPA declined NCD 

request for interview and site-visit

■ Two nonprofits that assist people with 

significant disabilities but no longer 

participate in the AbilityOne program

Phone Interviews:

■ 24 attempted phone interviews with NPAs

● 14 completed

● 7 did not respond after numerous 

attempts

● 3 refused to participate

Open Comment:

■ At each site visit, NCD held open 

comment sessions to receive diverse 

perspectives by phone or in-person

16 National Council on Disability
participate either in person or by phone. Many 

comments received during these sessions 

reflected the ongoing debate about the need for 

full integration of people with disabilities and the 

concern about the potential loss of employment 

and opportunity for people who are blind or have 

significant disabilities.

To gain congressional perspective about 

the AbilityOne Program, NCD interviewed 

congressional staff members from the U.S. 

House of Representatives’ Education and Labor 

Committee, and from the U.S. Senate Committee 

on Health, Education, Labor and Pensions (HELP). 

NCD also interviewed staff from the Council of 

State Administrators of 

Vocational Rehabilitation 

(CSAVR) and the State 

Employment Leadership 

Network (SELN) to learn 

more about the transition 

of people with disabilities 

to competitive, integrated 

employment. Throughout 

this project, NCD was 

assisted by an Advisory 

Committee composed of experts from around 

the country on the employment and rights of 

people with disabilities under federal law, some 

of whom had participated in the AbilityOne 

Program as employees or NPA program staff. 

At least half of the committee self-identified as 

being a person with a disability.

Problems with the AbilityOne 

Program

The AbilityOne Program today is stymied by 

conflicting goals and an outdated legislative 

approach that runs counter to modern federal 

disability policy. The program struggles with 

a lack of transparency and overlapping and 

sometimes unclear responsibilities among the 

various program entities.5 The Commission 

complains it lacks adequate resources to 

effectively oversee the program, while use of a 

program fee paid to the CNAs as a percentage 

of each government contract to support the 

participating NPAs has been subject to significant 

scrutiny. Meanwhile, AbilityOne Program sales 

to the government continue to increase, but 

the employment of people with significant 

disabilities under the program has declined, and 

the employment of those who are blind has 

remained static.

Congress has 

taken recent steps 

to address some of 

these issues through 

the establishment of 

a review panel under 

Section 898 of the 

2017 National Defense 

Authorization Act 

(NDAA), known as 

the 898 Panel, and by 

requiring a more formal oversight structure 

through the creation of an Office of Inspector 

General (OIG) and mandated written agreements. 

These congressional actions, while rightfully 

focused on the importance of improved oversight 

and transparency, nevertheless are patching up a 

program with underlying structural issues, many 

of which stem from assumptions about persons 

with disabilities for a program originally designed 

before the Second World War, and last modified 

before the digital revolution.

The 1971 Javits-Wagner-O’Day (JWOD) 

Act, which established the current AbilityOne 

Program, mandates that (1) 75 percent of all 

AbilityOne Program sales to the 

government continue to increase, 

but the employment of people 

with significant disabilities under 

the program has declined, and the 

employment of those who are blind 

has remained static.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 17
direct labor hours on federal and nonfederal 

contracts performed by NPAs to produce goods 

and services be by people who are blind or 

have a significant disability,6 and (2) that Federal 

Government agencies must purchase goods 

and services at a fair price from a procurement 

list established by the AbilityOne Commission. 

The very structure of the program perpetuates 

the segregation of people with disabilities 

and further does not provide incentives for 

the advancement of people with disabilities 

to supervisory or managerial positions and 

does not recognize the 

importance of supporting 

functions other than 

direct labor. The 

Commission is required 

to ensure compliance 

with the JWOD Act 

and has gone further 

than statutorily required 

by setting the goal to 

expand the employment 

of people who are blind 

or have a significant 

disability under a structure that conflicts with 

modern federal disability law and policy.7

This report addresses the various goals of 

the AbilityOne Program in the broader context 

of national policies that promote disability 

employment opportunities integrated in the 

community at competitive and fair market wages 

for people with any type of disability. NCD 

provides historical context to the program in 

Chapter 1, and in Chapter 2 discusses how the 

program operates today and the perspectives of 

a number of stakeholders. Chapter 3 considers 

sales to the Federal Government under the 

These congressional actions . . . 

are patching up a program with 

underlying structural issues, many 

of which stem from assumptions 

about persons with disabilities 

for a program originally designed 

before the Second World War, and 

last modified before the digital 

revolution.

AbilityOne Program, the employment of people 

who are blind or have significant disabilities, and 

issues related to subminimum wages and the 

use of segregated settings. Chapter 4 discusses 

the recommendations that were garnered from 

the findings in the report.

NCD recommends that to achieve true 

integration of people with significant disabilities 

or who are blind, Congress should phase out 

the AbilityOne Program and replace the program 

with a new requirement under Section 503 of 

the Rehabilitation Act that federal contractors 

hire at competitive 

wages a percentage of 

people with significant 

disabilities or who are 

blind. The phaseout 

must be conducted in 

such a way to ensure 

that all employees 

working under the 

program are prepared 

to transition to the new 

requirement to avoid 

job loss, unemployment 

or underemployment, or lower wages. NCD 

understands a recommendation of this 

magnitude will take time to implement and 

recommend an eight-year time frame for the 

phaseout. The recommendations embodied in 

this report align with current federal disability 

policies’ goal of providing employment 

opportunities for people with significant 

disabilities and who are blind based on equity 

and inclusion. In the interim, NCD also provides 

recommendations to patch current problems, 

while Congress considers the more far-reaching 

recommendations.

18 National Council on Disability
Chapter 1: History of the AbilityOne Program 

and Section 14(c)

T

o fully understand the implications of both 

the AbilityOne Program and the payment 

of subminimum wages to people with 

disabilities under Section 14(c) of the Fair Labor 

Standards Act (FLSA), it is necessary to consider 

society’s evolving perception and understanding 

of disability, the clear evolution of federal 

disability policy, and the historical contexts that 

existed when Congress created and modified 

these programs.

The Medical and Charity Models 

of Disability

For much of the twentieth century, up until 

the 1970s, the medical and charity models of 

disability shaped society’s perception of people 

with disabilities. The medical model promoted 

the idea that disability was something to be 

“cured,” with medical professionals seen as the 

ultimate authority. Throughout much of the last 

century, derogatory words such as “abnormal” 

and “handicapped” were used to describe 

people with disabilities. The primary focus of this 

model was on the negative impact of a person’s 

disability rather than on the person’s unique 

skills, talents, and abilities.8 The charity model 

was closely linked to the medical model and 

promoted the idea that people with disabilities 

were “tragic” and should be “pitied.”9 It was 

within this context that the Wagner-O’Day Act, 

the forerunner to the AbilityOne Program, and 

the FLSA were passed.

The New Deal and the Employment 

of People with Disabilities

In 1933, when President Franklin D. Roosevelt 

took office, the United States was in the throes 

of the Great Depression. The United States 

had a 25 percent unemployment rate and was 

just around the corner from the start of the 

Great Dust Bowl, which saw a migration of 

up to 2.5 million people out of the American 

Midwest.10 President Roosevelt quickly set 

about to enact the “New Deal” designed 

to provide relief, reform, and recovery from 

the Great Depression. The laws and policies 

enacted during the New Deal resulted in a 

massive increase in Federal Government 

regulation that touched on many facets of life, 

including banking, public works and finance, 

farming, housing, social security, and labor and 

employment. On June 25, 1938, as part of New 

Deal reforms, both the Wagner-O’Day Act and 

provisions of the FLSA were signed into law, 

which addressed the employment of people with 

disabilities.11 The passage of these laws signaled 

a commitment from the Federal Government 

that the employment of people with disabilities 

required certain considerations as the nation 

recovered from the economic upheavals.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 19
The passage of the FLSA, which banned child 

labor and set a minimum wage and an hourly 

workweek, was a watershed moment in the 

evolution of employment law.12 The law is still 

considered to be a landmark in our nation’s social 

and economic development.13 Section 14(c) of 

the FLSA specifically affects the wages paid 

to some people with disabilities by allowing 

employers who hold a special or subminimum 

wage certificate to pay less than the federal 

minimum wage set by the FLSA.14

Section 14(c)’s legislative origins can be 

traced to the National Industrial Recovery Act 

(NIRA), which passed in 1933, and allowed the 

President to regulate industry for fair wages 

and prices to stimulate the economy. Although 

the U.S. Supreme Court declared the NIRA 

unconstitutional in 1935, the NIRA included a 

productivity-based subminimum wage specific 

to people with disabilities.15 The idea of paying 

people with disabilities less than the minimum 

wage, based on productivity, resurfaced three 

years later in the FLSA.16 Section 14(c), as 

passed in 1938, stated that, “[t]he Administrator 

[of the Wage and Hour Division], to the extent 

necessary in order to prevent curtailment of 

opportunities for employment, shall by regulation 

or by orders provide for . . . (2) the employment 

of individuals whose earning capacity is impaired 

by physical or mental deficiency or injury, under 

special certificates issued by the Administrator, 

at such wages lower than the minimum wage.”17

Since then, Section 14(c) has allowed employees 

with disabilities to be paid less than the minimum 

wage under special certificates.

The Wagner-O’Day Act sought to encourage 

Federal Government purchases as a means to 

increase the employment of people who are 

blind. Three individuals, two of whom were blind, 

Peter J. Salmon, Robert B. Irwin, and Moses 

C. Migel, spearheaded the Act. These men 

shared a common desire to increase the market, 

and thus opportunities, for certain products made 

by people who were blind. Salmon wrote in 1937, 

“I don’t think that AFB [American Foundation for 

the Blind] could possibly do anything that would 

result in more jobs [for people who are blind] in 

a shorter period of time than getting federal and 

state governments to purchase the brooms and 

mops they make.”18

The Wagner-O’Day Act specifically sought 

to aid in the employment of people who were 

blind by allowing nonprofit agencies (NPAs), 

which employed people who were blind, to 

sell manufactured goods, such as mops and 

brooms, to the Federal Government for a fair 

market price.19 The products were placed on 

the federal procurement list20 and approved by 

the “Committee for Purchase of Blind-made 

Products” created under the Wagner-O’Day Act. 

The Committee also set the fair market price 

of the goods, revised prices as necessary, and 

created rules and regulations for the NPAs.21 The 

Wagner-O’Day Act was the basis for the current 

AbilityOne Program.

Changes to Section 14(c) and Passage 

of the Javits-Wagner-O’Day Act

Congress has amended the FLSA many times 

since 1938 to reflect the changes in the construct 

of employment and the Federal Government’s 

role in the process.22 Section 14(c), on the 

other hand, has gone through comparatively 

fewer changes. In 1965, Senator Wayne Morris 

proposed two changes to Section 14(c). The first 

proposed change included a three-year transition 

period after which workers with disabilities 

would be paid no less than the federal minimum 

20 National Council on Disability
wage. The second proposed change was a 

minimum wage floor by which workers with 

significant disabilities would not be paid less than 

50 percent of the prevailing minimum wage. The 

wage floor proposal was adopted, but the threeyear transition phasing out subminimum wage 

was not.23

The only amendments to the 1938 WagnerO’Day Act occurred in 1971, when Congress 

significantly expanded the statute through 

the Javits-Wagner-O’Day (JWOD) Act. This 

expansion added goods and services provided 

by organizations that employ people with 

significant disabilities to the federal procurement 

list. During the debate over the passage of 

the JWOD Act, congressional records suggest 

a sharp division between the organizations 

representing individuals who are blind and those 

representing people with significant disabilities. 

John F. Nagle, Chief of the National Federation 

of the Blind at the time, stated, “enactment of 

[the JWOD Act] into Federal law would result 

in depriving blind employed persons wanting to 

work.”24 In 1971, Henry Viscardi, Jr., President 

of Human Resource Center, stated in support 

of the expansion that “here is an opportunity 

for increasing numbers of severely handicapped 

people to support themselves and not to be 

supported, to meet the challenges of life and not 

seek out the guaranteed existence, to seek their 

fulfillment as citizens in a great democracy.”25

Despite the controversy, Senator Jacob Javits of 

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 21
New York led the expansion of the Wagner-O’Day 

Act to include people with significant disabilities. 

More specifically, the JWOD Act expanded 

the program to include the purchase of both 

goods and services from people who are blind 

and added the purchase of goods and services 

from people with significant disabilities. In an 

apparent attempt to address the controversy of 

including people with significant disabilities in the 

procurement program, the JWOD Act includes 

a preference for goods and services provided by 

people who are blind.26

The most recent amendment to Section 14(c) 

occurred in 1986.27 The 1986 amendment 

requires that subminimum wages paid to a 

worker with a disability 

under a certificate 

be based on the 

individual’s productivity 

commensurate with 

wages paid to workers 

without disabilities 

employed in the vicinity 

for essentially the same 

type, quality, and quantity 

of work. This so-called 

commensurate wage 

paid to workers with disabilities employed under 

Section 14(c) certificates has no wage floor, 

which Congress eliminated by the amendment. 

Elimination of the wage floor has resulted in 

some employees with disabilities earning as little 

as cents per hour.28 The 1986 amendment also 

included the ability of an employee to dispute 

the payment of a subminimum wage through an 

administrative appeal to the U.S. Department of 

Labor—a process that is rarely used.

Despite the amendments to both the WagnerO’Day Act and Section 14(c), the theoretical 

underpinnings of both laws remain much the 

same. Specifically, both signal a separate path 

in society for people with disabilities through 

a federally sanctioned segregated jobs system 

for people who are blind, deaf-blind, or have 

significant disabilities and lower wages paid to 

some with disabilities.

Based on the medical and charity models, 

people with disabilities were not seen as 

possessing the capacity to work in the regular 

economy. Special exemptions and programs 

were deemed necessary—and perhaps the only 

option for people with disabilities—to participate 

in a primarily industrial and agricultural economic 

system. Congress would not consider enshrining 

any civil rights for 

people with disabilities 

for decades. Even the 

more recent JWOD 

Act was created just 

two years before one 

of the first milestones 

in the disability rights 

movement, passage 

of Title V of the 

Rehabilitation Act of 

1973. These challenges 

are also hampered by the Commission’s lack of 

a rulemaking agenda that has been stalled and 

lacks progress in modernization.

Expansion of the Committee 

for Purchase and Creation of the 

Central Nonprofit Agencies

Congress, through the JWOD Act, created the 

Committee for Purchase from People Who Are 

Blind or Severely Disabled as the replacement to 

the Wagner-O’Day Act’s Committee on Purchases 

of Blind-Made Products. The JWOD Act uses the 

Specifically, both [laws] signal a 

separate path in society for people 

with disabilities through a federally 

sanctioned segregated jobs system 

for people who are blind, deaf-blind, 

or have significant disabilities and 

lower wages paid to some with 

disabilities.

22 National Council on Disability
term “severely disabled”29; however, today the 

more appropriate term is “significant disability,” 

which will be used for this report. The Committee 

for Purchase is tasked with adding products and 

services to the procurement list for mandatory 

purchase by the Federal Government. The 

products and services under the JWOD Act must 

be made or provided by NPAs that employ people 

who are blind or have a significant disability in at 

least 75 percent of the direct labor hours for all 

work performed by the NPA.30

When Congress passed the JWOD Act, 

it instructed the Committee for Purchase, 

renamed the U.S. AbilityOne Commission in 

2011,31 to designate “a central nonprofit agency 

or agencies (CNA or CNAs) to facilitate the 

distribution” of government orders of various 

products and services to other nonprofit 

agencies employing people who are blind or 

have significant disabilities. Through the years, 

the U.S. AbilityOne Commission has designated 

three CNAs: the National Industries for the 

Blind (NIB); SourceAmerica, formerly known as 

National Industries for the Severely Handicapped 

(NISH); and more recently, AFB. The designation 

of AFB was not done through notice and 

comment and is subject to legal challenge under 

the Administrative Procedures Act and currently 

before the U.S. Court of Appeals for the Fourth 

Circuit. These national nonprofit organizations, 

discussed in greater detail in Chapter 2, have 

emerged to play a critical role in the operation 

of the program through the development of the 

procurement list, as well as the coordination and 

distribution of the government orders among the 

participating agencies. As AFB remains in the 

research phase, the National Council on Disability 

(NCD) cannot yet assess the impact of this third 

CNA on the program.

NIB has been involved in the AbilityOne 

Program almost since its inception under the 

Wagner-O’Day Act. In the late nineteenth 

and early twentieth centuries, 16 nonprofit 

organizations emerged to employ people who 

were blind. These organizations focused on 

creating hand-crafted goods like baskets and 

mops. In the late 1930s, a group of advocates 

sought to regulate and pass legislation that 

would formalize the sale of such products to 

the Federal Government in an effort to ensure 

steady employment opportunities. Through 

these initial efforts, NIB was incorporated in 

1938.32 NIB has served in the coordinating role 

of the blind nonprofit agencies since that time. 

One of NIB’s goals is to ensure that people 

who are blind have available a wide variety of 

career options.

A coalition of agencies including Goodwill 

Industries International, National Easter Seal 

Society (now known as and herein after referred 

to as Easterseals), American Congress of 

Community Support & Employment Services 

(ACCSES), The Arc, United Cerebral Palsy 

Association, and International Association of 

Jewish Vocational Services spearheaded efforts 

to successfully include people with significant 

disabilities into the Wagner-O’Day program 

during the debate over the JWOD Act in the 

early 1970s.33 These organizations eventually 

incorporated NISH in 1974, which was eventually 

designated as a CNA for people with significant 

disabilities. NISH changed its operating name to 

SourceAmerica in 2013.34

AFB was founded in 1921, and its mission 

is to maximize the potential and opportunities 

for people who are blind. AFB became a 

CNA in 2018, but it is not a full participating 

CNA and as of the date of this report is in a 

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 23
“research” phase.35 The primary focus of AFB 

will be “increasing job placement and career 

advancement opportunities in knowledge-based 

positions.”36

Changes in Federal Disability Law 

and Policy

From the inception of the AbilityOne Program 

and Section 14(c) to the current day, the 

United States has undergone innumerable 

social, political, and cultural changes. Perhaps 

the time period of most dynamic change to 

the disability community began in the latter 

part of the twentieth century. Building on the 

momentum of the civil 

rights movement of 

the 1960s, in the 1970s 

members of the disability 

community sparked a 

groundswell of action to 

create a disability rights 

movement prompting 

a significant shift from 

the previously accepted 

medical and charity 

models of disability 

to a new social model of disability. The social 

model of disability moved away from the view 

that disability is something to be fixed, cured, or 

pitied, and promoted the idea that the obstacles 

affecting persons with disabilities are caused by 

the lack of integration and universal accessibility 

within society. The social model embraces the 

idea that disabilities, no matter how significant 

they are, should not keep people from fully 

participating in the world. As such, the social 

model advances the position that society has 

a responsibility to eliminate barriers that limit 

people with disabilities, to work toward the 

inclusion of people with disabilities in all aspects 

of society rather than excluding or segregating 

them.37 Following a similar philosophy, changes in 

federal policies related to people with disabilities, 

beginning with passage of the Rehabilitation Act 

in 1973, have sounded a clear and consistent 

drumbeat toward integration and equity.38

Congress modeled Title V in the Rehabilitation 

Act of 1973 after Title VI of the Civil Rights Act 

of 1964. The Rehabilitation Act, among other 

provisions, prohibits discrimination on the basis 

of disability by recipients of federal funds.39 The 

Supreme Court later held that the Rehabilitation 

Act prohibits both intentional and unintentional 

discrimination based 

on disability,40 requiring 

entities covered by the 

Act to take positive steps 

to avoid discrimination.

Just two years after 

Congress passed the 

Rehabilitation Act, 

in 1975 it enacted 

Public Law 94-142, 

the Education for All 

Handicapped Children 

Act (P.L. 94-142), which was reauthorized 

and renamed the Individuals with Disabilities 

Education Act (IDEA). Prior to the passage of 

P.L. 94-142, students with disabilities had only 

a one in four chance of obtaining an education 

in a public school, an outcome that necessarily 

affected the poor employment rates of people 

with disabilities.41 A foundational tenant of P.L. 

94-142 was the inclusion of what has become 

known as the “least restrictive environment,” 

a clear signal of congressional intent that the nation 

must focus on greater integration of students 

with disabilities into the educational system.

[T]he social model advances 

the position that society has a 

responsibility to eliminate barriers 

that limit people with disabilities, to 

work toward the inclusion of people 

with disabilities in all aspects of 

society rather than excluding or 

segregating them.

24 National Council on Disability
In 1990, Congress took further steps to 

eliminate discrimination against and promote 

the equity and integration of people with 

disabilities through the bi-partisan passage of 

the Americans with Disabilities Act (ADA).42 The 

ADA is an “equal opportunity law” for people 

with disabilities and the first comprehensive civil 

rights law for people with disabilities. The ADA 

brought about sweeping 

changes in all facets 

of life for people with 

disabilities, and this law 

prohibits discrimination 

on the basis of 

disability in the areas 

of employment, public 

accommodation, public services, transportation, 

and telecommunications. Congress stated the 

unambiguous goal for the ADA “to provide a clear 

and comprehensive national mandate for the 

elimination of discrimination against individuals 

with disabilities.”43 Congress further emphasized 

this intent through amendments to the ADA in 

2008 to reverse restrictive interpretations of the 

law by federal courts.44

The theme of 

integration continued 

in 1999, when the U.S. 

Supreme Court ruled in 

Olmstead v. L.C. that 

under Title II of the 

ADA, services for people with disabilities must 

be made available in the most integrated setting 

possible.45 The Olmstead decision was yet 

another signal that the country was moving away 

from policies that resulted in segregation and 

toward policies that promote integration.

The most recent legislative change in 

disability policy is the Workforce Innovation and 

Opportunity Act (WIOA), which passed with 

broad bi-partisan support in 2014. Through the 

passage of WIOA, Congress unequivocally stated 

that work is an important and valued activity 

for people and society. WIOA established the 

employment of people with disabilities as a 

national priority. One of the notable achievements 

of WIOA is the codification of the definition of 

competitive integrated 

employment (CIE). 

WIOA defines CIE as a 

job that (1) pays people 

with disabilities at least 

the minimum wage and 

not less than the wage 

paid to people without 

disabilities for the same or similar work, (2) is 

performed in a location where the employee 

interacts with people without disabilities, and 

(3) provides workers with disabilities the same 

opportunities for career advancement as their 

coworkers without disabilities.46

The philosophies embraced by WIOA are 

in stark contrast to the concept of “sheltered 

workshops” for people 

with disabilities that 

arose in the 1930s.47

Current disability 

policy recognizes the 

inherent problems with 

sheltered workshops 

and encourages community job placements for 

all people with disabilities. To help accomplish 

this goal, Section 511 of WIOA made notable 

changes by placing significant limits on the use 

of subminimum wage sheltered workshops, 

particularly for transition age and out-of-school 

youth. Section 511 requires that any person 

with a disability under the age of 24 years 

The Olmstead decision was yet 

another signal that the country was 

moving away from policies that 

resulted in segregation and toward 

policies that promote integration.

Some of the notable achievements 

of WIOA are the codification of the 

definition of competitive integrated 

employment (CIE).

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 25
explore and try CIE before they can be placed 

in a subminimum wage setting. It also prohibits 

schools from contracting with subminimum wage 

providers and requires at least annual reviews of 

anyone employed in a subminimum wage setting 

to discuss CIE alternatives.48 WIOA requires state 

agencies—including Medicaid, intellectual and 

developmental disabilities 

agencies, Vocational 

Rehabilitation (VR) 

agencies, and education 

programs—to enter into 

cooperative agreements 

that prioritize CIE as the employment goal. The 

law also requires that at least 15 percent of VR 

funding be used for pre-employment transition 

services.49

The evolution of disability policy, from the 

passage of the Rehabilitation Act in 1973 to 

the passage of WIOA in 2014, has followed the 

arc of the disability rights movement and the 

changing perceptions of people with disabilities. 

No longer is disability viewed as something to be 

fixed, cured, or pitied. Rather, disability is more 

commonly viewed as a limitation or obstacle 

imposed by society and an environment which 

needs to be removed or altered to allow for full 

integration.

Since the passage 

of the Rehabilitation 

Act, disability-related 

statutes and policies 

have all sought to 

remedy inaccessibility, 

inequity, and segregation. On the contrary, 

Section 14(c) and JWOD now stand out as 

significant exceptions to the norms of modern 

disability policy. Consideration of how the 

AbilityOne Program operates and recent trends 

and outcomes further highlight concerns around 

issues of transparency, compliance, and structural 

program integrity seen throughout the program.

Section 14(c) and JWOD now stand 

out as significant exceptions to the 

norms of modern disability policy.

26 National Council on Disability
Chapter 2: How the AbilityOne Program 

Operates Today

T

he AbilityOne Program today is a complex 

public-private relationship involving the 

AbilityOne Commission and its staff 

as the governmental oversight authority; the 

central nonprofit agencies (CNAs) working with 

the participating nonprofit agencies (NPAs) and 

government agencies, the NPAs which provide 

goods and services; and the federal agency 

customer. The ultimate goal of the program 

is to employ people who are blind or have a 

significant disability who, 

based on assumptions 

made almost 50 years 

ago, would be unable 

to find employment in 

the regular private or 

public sector economy. In 

addition, the Commission 

and its partners view 

the addition of new 

products and services to the mandatory federal 

procurement list, the satisfaction of the Federal 

Government end-user, and the satisfaction 

of employees as important elements of 

the program.

The National Council on Disability (NCD) 

discovered through a review of public 

documents and interviews, confusion over roles 

and responsibilities, and a lack of transparency 

in other areas of the AbilityOne process. NCD 

also found misunderstandings about aspects 

of the program, issues with the evaluation 

process used to determine eligibility for 

employment under the program for people 

with significant disabilities, and long-standing 

concerns over the 75 percent direct labor hour 

ratio.50 In a May 2013 report, the Government 

Accountability Office (GAO) identified the need 

to enhance program oversight and transparency 

as a challenge for the 

Commission. In 2019, 

a provision increasing 

contracting goals and 

setting the stage for 

expanded Program 

growth was abandoned 

at the National Defense 

Authorization Act (NDAA) 

Conference. The reason 

discussed by lawmakers for not increasing 

the contracting goal provision was that “both 

the [AbilityOne] Inspector General and the 

[Department of Defense] Panel generated 

findings and recommendations for needed 

reforms and expectations that the AbilityOne 

Commission take appropriate steps in the future 

to increase transparency and effectiveness of 

the program.”51

The ultimate goal of the program 

is to employ people who are blind 

or have a significant disability who, 

based on assumptions made almost 

50 years ago, would be unable to 

find employment in the regular 

private or public sector economy.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 27
The AbilityOne Commission

The AbilityOne Commission consists of 

15 members appointed by the President. Eleven 

Commission members must be from the Federal 

Government, including a member each from the 

Departments of Defense 

(DoD), Army, Navy, and 

Air Force.52 The other 

required federal agencies 

include the Departments 

of Agriculture, 

Education, Commerce, 

Veterans Affairs, 

Justice, and Labor, and 

the General Services 

Administration.53 The 

four non–Federal Government members must 

include one each representing people who are 

blind and people with significant disabilities, and 

one each representing employees from NPAs 

providing services or goods under the program 

from workers who are blind and workers with 

significant disabilities.54 The Commission has 

three vital roles under the program. First, the 

Commission decides on 

the addition or removal 

of products or services 

from the AbilityOne 

procurement list.55

Second, the Commission 

sets, with significant 

support from the CNAs, 

the fair market price the 

Federal Government will pay the NPAs for the 

goods or services.56 Finally, the Commission 

has oversight over the three CNAs, two of 

whom currently operate significant aspects of 

the program, as well as ultimate oversight of 

the NPAs.57

The AbilityOne Office of Inspector General 

(OIG) identified in December 2019 a lack of 

transparency and lack of communication by the 

Commission as among the top management 

challenges for the program.58 The first identified 

challenge—a higher level of transparency and 

communication needed 

to enhance program 

confidence—noted that 

more than half of the 

Commission membership 

is vacant.59 This challenge 

was also noted by an 

AbilityOne Commission 

member interviewed by 

NCD. The OIG further 

mentioned that while the Commission holds 

open meetings four times a year, the meetings 

would be enhanced by more subcommittee 

work completed in advance, larger agendas, 

and more written materials.60 More importantly, 

the frequent use of executive sessions and 

nondisclosure agreements (NDAs), as noted by 

the OIG, adds to the perceived opacity of the 

Commission’s work 

by stakeholders.61

During interviews with 

NCD, one AbilityOne 

Commission member 

stated a disagreement 

with the OIG that the 

Commission often uses 

executive sessions, while 

another Commission member stated that they 

felt following the advice of AbilityOne general 

counsel regarding how meetings should proceed 

was appropriate. A federal district judge recently 

noted that while the selection of the American 

Foundation for the Blind (AFB) as a third CNA 

The AbilityOne Office of Inspector 

General (OIG) identified in December 

2019 a lack of transparency and 

lack of communication by the 

Commission as among the top 

management challenges for the 

program.

[T]he frequent use of executive 

sessions and nondisclosure 

agreements (NDAs) as noted by 

the OIG, adds to the perceived 

opacity of the Commission’s work 

by stakeholders.

28 National Council on Disability
was not done unlawfully, the “Commission’s 

process was not a model of exemplary agency 

decision making.”62 The case is under appeal.

The AbilityOne Procurement and 

Contracting Process

The CNAs selected by the Commission are 

assigned the responsibility to help administer 

the program through direct connection with 

the NPAs.63 As of the date of this report, the 

National Industries for the Blind (NIB) remains the 

primary CNA working toward the employment 

of people who are blind. AFB was designated as 

a new CNA in 2018 and is in a research phase 

focusing on how to achieve greater employment 

of people who are blind 

in knowledge-based 

industries in competitive, 

integrated employment. 

SourceAmerica, on the 

other hand, remains the 

sole CNA that works 

toward the employment 

of people with significant 

disabilities through the program.

A primary role of the CNAs is to help the 

NPAs understand and navigate the intricacies of 

the procurement list process. The CNAs, in most 

cases working with an NPA, must first make a 

recommendation to the Commission suggesting 

a new item or service for the mandatory 

procurement list and a suggested fair market 

price. After receiving the recommendation and 

supporting documentation, the Commission must 

determine the suitability of the recommendation 

for the goods or services.64 A suitability 

determination of an NPA must include the 

potential to generate employment opportunities 

for people who are blind or have a significant 

disability, and the NPA proposing the good or 

service must satisfy both the Commission’s 

qualification standards and the government’s 

quality standards.65

The process to add items to the federal 

procurement list normally begins after a 

federal agency identifies a need for a product 

or service. The government customer and the 

NPA may discuss and refine the requirement 

and contracting activity. Then, the NPA and 

government customer negotiate a recommended 

price, with the CNA providing technical 

assistance during the process. Based on NCD 

interviews, many ideas for new products and 

services for the procurement list are initiated 

by NPAs working with 

government agencies. 

NIB also reported that 

it scans the national 

market for potential 

new opportunities for 

its NPAs. One NPA 

interviewed stated it 

has been difficult in 

their experience to get new items added to the 

procurement list, stating it has not received an 

assignment or allocation for a new product since 

2009.

Whenever an appropriate product or service 

is identified, the CNA, working with the NPA, will 

compile an information package for review by 

the Commission staff. The package will include 

the price negotiated with the government entity 

and supporting documentation from the NPA, 

the CNA, and the customer. If the package is 

approved by the Commission staff, a summary 

of the proposed addition to the procurement 

list is published in the Federal Register for a 

30-day notice and comment period. Based 

One NPA interviewed stated it has 

been difficult in their experience 

to get new items added to the 

procurement list, stating it has not 

received an assignment or allocation 

for a new product since 2009.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 29
on comments received during this comment 

period, the Commission staff will recommend 

project approval or disapproval, and provide 

the Commission members with a decision 

package. The Commission will vote to approve 

or disapprove the suitability of the product 

or service. A final Federal Register notice is 

published with a second 30-day comment period 

before the addition to the procurement list 

becomes effective.

According to one Commission member, the 

Commission is provided a Decision Document 

that demonstrates how the suitability criteria 

are met by the proposed addition, prepared by 

AbilityOne Commission staff, along with the 

decision package of supporting information. The 

Decision Document describes details such as 

the federal agency that 

would purchase the 

service or good, the jobs 

that would be created for 

people with significant 

disabilities or people who 

are blind, an analysis 

showing that the purchase of the product or 

service would not have a severe adverse impact 

on previous contractors, a description of the 

tasks, relevant transportation information, how 

quality would be ensured by the NPA, and 

any safety issues of relevance for employees. 

According to one Commission member 

interviewed, decisions by vote may be registered 

through an online portal system or via direct 

email correspondence. The Commission member 

noted that if there is concern about a package, 

Commission members can call for a discussion 

about the recommended product or service.

Prior to the placement of a product or 

service on the procurement list, the assignment 

process begins when a CNA posts a Request 

for Proposal (RFP) (a business document used 

in the bidding process to provide details about 

the project) for the approved goods or services. 

According to Commission staff, each CNA has 

their own specific process for posting bids. The 

CNA that recommended the selected good or 

service will solicit bids from among its affiliated 

NPAs.66 According to the CNAs, after an NPA is 

recommended for a product or service, and it 

is included on the procurement list, the Federal 

Government awards the contract to an NPA. 

Once the NPA is awarded the contract, the 

Federal Government must purchase the good or 

service subject to some exceptions.

Based on interviews with NPAs, the 

process to assign AbilityOne contracts lacks 

full transparency. NCD 

heard varying responses 

from the NPAs about 

the bid posting process, 

including NPAs who 

reported they receive 

information regarding 

RFPs through weekly blasts and through 

listings on a customer portal. One NPA reported 

the process was hit or miss and that the onus 

was on the NPA to find contract opportunities. 

NCD also heard from numerous NPAs that the 

CNAs do not make it clear how they actually 

evaluate the RFPs. One NPA, in particular, 

noted frustration with the lack of transparency 

around the selection process. Specifically, the 

process was described as “random” and “not 

clear.” The NPA also expressed frustration 

about the lack of clarity about who reviews 

the contract bids, if there was a conflict with 

another NPA, as well as a lack of written 

feedback on contract bids.

NCD also heard from numerous 

NPAs that the CNAs do not make 

it clear how they actually evaluate 

the RFPs.

30 National Council on Disability
The concerns about the transparency of the 

bid process have been echoed in a number 

of reports. In 2013, the GAO recommended 

that the Commission take steps to ensure 

that the CNA process for assigning contracts 

was fair and equitable.67 Three years later, the 

Advisory Committee on 

Increasing Competitive 

Integrated Employment 

for Individuals with 

Disabilities (Workforce 

Innovation and 

Opportunity Act [WIOA] 

Advisory Committee), a 

committee established 

under WIOA to make recommendations to 

Congress, recommended that a third party (not 

SourceAmerica or NIB) be in charge of the bid 

process.68 In 2018, the 898 Panel established by 

Congress under Section 898 of the 2017 NDAA 

made essentially the same recommendation in 

its report to Congress, “[i]ncrease transparency 

in CNA’s nonprofit agency recommendation 

processes with mandatory criteria and 

certifications.”69 The Commission believes it 

has addressed many of 

the concerns voiced by 

GAO, and the 898 Panel. 

As an example, the 

Commission incorporated 

additional CNA 

reporting requirements 

pertaining to the NPA 

recommendation process within the newly 

formed cooperative agreements. A better 

assessment of the impact on transparency of 

the assignment process, however, will need to 

await completion of an audit by the AbilityOne 

OIG. The OIG included in its FY 2018–2019 Audit 

Plan and current FY 2020–2021 Audit Plan a 

high priority to complete an audit on the “CNA’s 

Process for Assigning Projects and Allocations 

of Orders.”70

Once a contract is awarded to an NPA for a 

product or service, based on NCD interviews and 

research, the contract 

historically remains 

with the NPA absent 

significant performance 

issues, the contract 

terminates without 

renewal, or the NPA no 

longer offers the product 

or service. NCD heard of 

instances of NPAs ceasing operations or stopping 

production. In several cases, this happened 

because the NPA went out of business, thus 

requiring transfer of the contract to another NPA. 

And yet, a number of NPAs reported having 

the same AbilityOne contract with a Federal 

Government agency for products or services for 

years or, in most cases, a decade or more. The 

goods and services offered by the program are 

addressed in Chapter 3.

In 2018, in an effort 

to improve contractor 

performance while saving 

the Federal Government 

money, the 898 Panel 

recommended that 

the Commission pilot 

a competitive contract 

process within the AbilityOne Program. The 

result of this recommendation was the first 

AbilityOne competition, led by the Commission 

with support from SourceAmerica. Through the 

pilot test, NPAs competed for the Facility Support 

Operations Services contract in Fort Bliss, 

The OIG included in its FY 2018–2019 

Audit Plan and current FY 2020–2021 

Audit Plan a high priority to complete 

an audit on the “CNA’s Process for 

Assigning Projects and Allocations of 

Orders.”

[A] number of NPAs reported having 

the same AbilityOne contract with 

a Federal Government agency for 

products or services for years or, in 

most cases, a decade or more.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 31
Texas.71 The pilot resulted in the competitive 

award of a $300 million (total contract value) 

Fort Bliss facility support operations services 

contract to a nonprofit agency on the AbilityOne 

Procurement List.72 A Commission after-action 

report on the pilot has not been made public to 

date despite representation that a report would 

be provided. The 898 Panel stated in its 2020 

report that the next steps will be to conduct 

debriefs with all NPAs involved; to conduct a 

review with Commission staff, the Army, and 

SourceAmerica; and to evaluate the possibility of 

future competitions.73

NCD visited a nonprofit organization that no 

longer participates in the AbilityOne Program 

but which as recently as a few years ago had 

a contract to build wooden index filing boxes 

for the Navy. The work was performed in a 

sheltered setting and required skilled woodcrafting abilities. The NPA left the AbilityOne 

Program after the director determined that 

future funding trends were moving away from 

segregated settings, and employees no longer 

had the interest or the skills to continue the 

production. The director reported the agency had 

moved away from sheltered work and toward 

locating community employment at competitive 

wages. A particular highlight during the transition 

to community employment included a former 

workshop employee who now takes the bus 

independently and volunteers with the Rotary 

Club despite persistent beliefs and fears by 

family members, now overcome, that he could 

not safely navigate within the community.

Another NPA reported losing a Department 

of Veterans Affairs (VA) contract due to the 

32 National Council on Disability
“rule of two,”74 which requires the VA to first 

consider veteran-owned small businesses 

before contracting with another entity. Further 

implications regarding the rule of two and 

program integrity are discussed later in this 

report. Additionally, some NPAs interviewed 

stated that the CNAs should focus more on 

getting NPAs contracts in new areas rather than 

being limited to products. A few even believe 

that being limited to existing products for which 

demand is in decline does not allow for growth of 

the AbilityOne Program.

Changes to the Javits-Wagner-O’Day 

Act and the Role of Cooperative 

Agreements

Although Congress has 

never amended the 

JWOD Act, there have 

been some changes, 

through interagency 

and congressional 

actions, to enhance 

the transparency 

and oversight of the 

Commission.75 For 

example, in 2006, according to Commission staff, 

the program changed its name to “AbilityOne” to 

help unify the program. Prior to 2006, the JWOD 

program was often defined by specific products 

(e.g., SKILCRAFT) that did not accurately 

represent all of the products produced or the 

services offered under the program. By changing 

the name, the Committee believes it simplified 

the description of the program and focused the 

attention on the abilities of the workers who 

produce the products and services.

Additionally, in 2016, Congress mandated 

changes to the oversight of the AbilityOne 

Commission and reporting requirements through 

the Consolidated Appropriations Act.76 These 

changes included the creation of an OIG for the 

AbilityOne Program as well as requirements that 

the Commission enter into written agreements 

with the CNAs and submit quarterly reports 

to Congress.77 The requirement of written 

agreements represented the first time the 

Commission had written agreements with the 

CNAs. While these congressionally imposed 

obligations were meant to increase the overall 

accountability and transparency of the AbilityOne 

Program, there are additional steps that must be 

taken for these measures to be more effective. 

The OIG included program transparency as one 

of the Commission’s most pressing challenges 

in a recent Semi-Annual 

Report to Congress and 

Top Management and 

Performance Challenges 

Report. The OIG 

concluded, following 

a comprehensive 

2020 audit, that the 

Cooperative Agreements 

enhanced program 

accountability and transparency. The performance 

audit report provided seven recommendations 

to assist the Commission to further strengthen 

oversight effectiveness and transparency of the 

Program and five areas to improve Commission 

oversight.78

The primary purpose of the cooperative 

agreements between the Commission and the 

CNAs is to formalize the roles and responsibilities 

of the CNAs and define the measures of 

accountability used to evaluate the CNAs. 

More specifically, as directed by Congress, the 

cooperative agreements address the roles and 

The OIG included program 

transparency as one of the 

Commission’s most pressing 

challenges in a recent SemiAnnual Report to Congress and 

Top Management and Performance 

Challenges Report.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 33
responsibilities on the part of the Commission 

and the CNAs.79 These roles and responsibilities 

include project assignment procedures (including 

decision making processes); expenditures of 

funds (including policy governing reserve levels); 

performance goals and targets; governance 

standard and other internal controls to prevent 

fraud, waste, and abuse (including conflict 

of interest disclosures and reports of alleged 

misconduct); access to data and records; 

consequences for not meeting expectations; 

periodic evaluations and audits on affiliates; 

periodic review and updates on pricing 

information; and provisions for updating the 

agreement.80

The CNAs are required 

under the cooperative 

agreements to provide 

quarterly reports to 

the Commission. With 

that information, the 

Commission then 

evaluates CNAs’ 

performance in 

accordance with internal metrics outlined in a 

Quality Assurance Surveillance Plan (QASP).81

The QASP outlines the performance standards, 

the frequency of surveillance, and the minimum 

acceptable performance levels.82 Although 

there are minimum requirements, NCD believes 

that the QASP is not fully effective since it 

lacks significant penalties for CNAs who fail 

to meet their minimum requirements. The 

Commission also sends these quarterly reports 

to Congress.83 It is worth noting that AFB 

also has a cooperative agreement; however, 

it is distinct from the NIB and SourceAmerica 

agreements, and its only focus is on research, 

CNA development, and transition to full 

CNA functionality. The OIG also noted some 

deficiencies with the QASP in a 2020 report on 

the cooperative agreements. Specifically, the 

OIG expressed some concerns with regard to 

key performance indicators (KPI), which were 

established to evaluate CNA performance under 

the agreements. Specifically, the OIG stated that 

some KPIs are out of the CNAs’ control and in 

fact do not enhance intended performance in the 

program. The auditors also noted the following 

concerns: (1) there was no formal process in 

place outlining how the KPI measurements 

were and are developed, (2) there was a lack of 

adequate procedures for CNAs to resolve KPI 

criteria disagreements with the Commission, 

and (3) there were 

no indications that 

the Commission staff 

conducts data analysis 

to assess and validate 

the Fee and Expenditure 

Reports submitted by the 

CNAs before they are 

sent to Congress.84

Additionally, congressional staff indicated 

that it was difficult to track down the quarterly 

reports required, and even if they were located, it 

was difficult to understand what exactly is in the 

reports. In addition, the OIG reported in the audit 

of the cooperative agreement problems with 

the quarterly reporting and with the analysis and 

review by the Commission. Congressional staff 

further asserted that not requiring the reports to 

be public hinders the overall transparency of the 

program, while also making it difficult to track 

the expenses and the use of the program fees 

by the CNAs.

According to one CNA, the cooperative 

agreement has been helpful in detailing 

The CNAs are required under the 

cooperative agreements to 

provide quarterly reports to the 

Commission. With that information, 

the Commission then evaluates 

CNAs’ performance . . .

34 National Council on Disability
requirements of the CNA and the metrics 

the Commission will use to evaluate CNA 

performance. Additionally, the CNA noted 

the agreements have also increased the 

overall transparency and accountability of the 

process while enhancing the collaboration 

between the Commission and the CNAs. These 

improvements have resulted in more effective 

communication and alignment between the 

interested parties.

On the other hand, according to one CNA, 

the excessive administrative requirements of the 

agreements have led to unnecessary overhead 

costs. One CNA indicated that modifications 

to the cooperative 

agreements have 

lacked meaningful 

negotiation between 

the Commission and 

the CNA. One CNA 

believed the cooperative 

agreements failed 

to clarify roles and 

responsibilities and 

stated that evaluations 

required as a result of the agreements were 

done in an inconsistent manner. In their 2020 

audit report on cooperative agreements, the 

OIG concluded that, although the cooperative 

agreements were effective and designed to 

enhance accountability, operational effectiveness, 

integrity, and transparency of the Program, there 

are opportunities for improvements with the 

Commission’s oversight of CNAs in five areas: 

(1) the criteria used to develop KPIs, (2) program 

and agreements compliance, (3) program 

performance objectives and deliverables, 

(4) performance of data analysis on CNAs’ 

reports, and (5) modernization and alignment 

of policies with cooperative agreements 

requirements.

The cooperative agreements are seen as 

important because they outline KPIs for the 

CNAs, which include employment growth; 

program administration, oversight, and integrity; 

NPA support, assistance, and development; and 

training and strategic communications. There 

appears to be, however, some confusion about 

the exact role and scope of the CNA’s oversight 

role even with the cooperative agreements. The 

Commission seeks to achieve compliance when 

issues arise with an NPA through the use of 

corrective action plans. Commission staff stated 

they rely primarily on 

the CNAs to identify 

problematic NPAs 

for the Commission 

compliance team to 

investigate. Despite 

the clear intention that 

the enactment of the 

cooperative agreements 

would increase 

transparency, clarify 

roles, and put in place performance measures, 

in their current state, there does not appear 

to be a clear consensus on the efficacy of the 

cooperative agreements.

In its 2018 report to Congress, the 898 Panel 

noted that while the cooperative agreements 

signed between AbilityOne and the CNAs was a 

positive step, no such mechanism exists with the 

NPAs.85 Although the idea of contracts between 

the NPAs and the CNAs was not a welcome 

one to all the NPAs interviewed, one NPA did 

vociferously state that not only would this be 

helpful but also that they considered it vital to their 

operation and the operation of the other NPAs.

Congressional staff further asserted 

that not requiring the reports 

to be public hinders the overall 

transparency of the program, while 

also making it difficult to track 

the expenses and the use of the 

program fees by the CNAs.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 35
The Role of the Central Nonprofit 

Agency Program Fee

The Javits-Wagner-O’Day (JWOD) Act states that 

a CNA “may charge fees to nonprofit agencies, 

thereby allowing participation in the AbilityOne 

Program. Fees are calculated based on nonprofit 

agency sales to the U.S. Government under the 

AbilityOne Program. Fees shall not exceed the 

ceiling approved by the Committee.”86 These 

fees are charged by the CNAs to their respective 

NPAs and applied to each AbilityOne contract. 

The Commission votes at least annually to set a 

separate program fee for each CNA.

Prior to the establishment of the cooperative 

agreements with the CNAs in 2016, the 

Commission based 

the fee on the CNA’s 

annual business plans 

and projected revenues, 

and evaluated the CNA’s 

revenue needs based 

on their duties.87 Since 

the creation of the 

cooperative agreements, 

the Commission bases 

the fee, now called the “program fee,” on each 

CNA’s performance according to the QASP 

metric, as well as on other considerations 

such as the CNA’s financial health metrics. The 

Commission previously set the program fee 

ceiling at 3.9 percent for NIB and 3.85 percent 

for SourceAmerica, later reducing the fee to 

3.73 percent for NIB and 3.75 percent for 

SourceAmerica starting on April 15, 2019, through 

March 2020.88 Commission staff stated that they 

have always sought to keep the CNA program 

fee at a ceiling to provide sufficient funds to allow 

the CNAs to perform required functions while 

avoiding an excess. Based on data provided by 

SourceAmerica and NIB, the total program fee 

revenue was around $121.3 million in FY 2018. 

Details of the program fee are discussed in 

Chapter 3.

The transparency of the utilization of the 

program fee has been an ongoing issue and the 

focus of a number of reports. The GAO identified 

two areas of concern regarding the program fee 

in its 2013 report.89 The first concern was CNA 

executive salaries. The GAO noted that CNA 

salaries are not limited by federal law because 

the salaries are paid through program fees. The 

GAO reported that in 2012, 11 CNA executives 

received a salary that exceeded the federal senior 

executive service salary.90 Another GAO concern 

involved use of the 

program fees for CNA 

lobbying activities. As 

with executive salaries, 

the money spent by the 

CNAs on lobbying is 

exempt from restrictions 

on the use of federal 

funds for lobbying 

activities. The exemption 

exists because the 

program fee is not a direct appropriation but, 

instead, based on government purchases. 

The GAO further reported that in 2012, NIB 

reported spending $175,729, and NISH (now 

SourceAmerica) reported spending $700,000 on 

lobbying.91

The 898 Panel reports to Congress in 2018, 

and again in 2020, also addressed program 

fees. The panel recommended a prohibition on 

the use of the program fee to cover lobbying 

expenses and suggested that Congress enact 

legislation to close this loophole. Additionally, 

the panel report released in early 2020 noted 

The GAO reported that in 2012, 

11 CNA executives received a salary 

that exceeded the federal senior 

executive service salary. Another 

GAO concern involved use of the 

program fees for CNA lobbying 

activities.

36 National Council on Disability
that Congress may seek a formal opinion from 

the GAO as to whether the program fees can 

be used for lobbying under current federal law.92

Additionally, the OIG completed a performance 

audit of the AbilityOne Program fee and reported 

the following findings: adequate guidance on the 

program fee ceiling needs improvement, current 

and complete program 

fee calculation guidance 

is not available, along 

with a lack of indicators 

and evidence that the 

Commission performs 

data analysis on CNAs’ 

reports.93

To gain further insight into the program fees, 

NCD asked the NPAs interviewed if they knew 

how their CNAs utilized the program fees. No 

NPA interviewed reported receiving details 

about the use of the program fee or knowing 

how the fee was spent. Some NPAs were aware 

of trainings made available by their CNAs, and 

several noted the receipt of technical assistance 

and the availability of interest-free capital 

requirement loans. NIB informed NCD that, while 

they are bound by the 

fee ceiling set by the 

Commission, they return 

a significant portion of 

the program fee back to 

the NPAs through grants 

and incentive programs. 

NIB reported further that the recent fee ceiling 

was 3.9 percent and after returning money to 

the NPAs, the portion NIB kept was closer to 

3.4 percent. As required by Congress, CNAs 

send the Commission data on the use of the 

program fee, which the Commission then reports 

to Congress on a quarterly basis. As noted earlier, 

these congressional reports are not available to 

the public.

The NPAs also expressed varying opinions 

about the program fees and did not have unified 

perspectives. One NPA articulated confusion as 

to why the program fee remained the same each 

year throughout the life of the contract. Rather, 

this NPA felt that the 

fee should reflect the 

heightened need for 

CNA involvement at the 

beginning of a contract 

bid and negotiation 

process, and then 

decrease when there is 

limited need for CNA involvement. Additionally, 

some NPAs felt that the program fees 

contributed to support, grants, and no-interest 

loans to the NPA. NIB reported an incentive 

mechanism for NPAs which is funded out of the 

program fee. Other NPAs felt that the program 

fees were simply a CNA profit-driven mechanism.

NPAs varied in their understanding of how 

the program fee was paid and who paid it. Some 

NPAs believed that they paid the program fee 

(a deficit to their own 

revenue), while others 

thought the government 

agency paid the program 

fee such that there was 

no reduction to NPAs’ 

revenue. Additionally, 

for some contracts, a CNA will act as the prime 

contractor with the Federal Government and 

then invoice the NPA directly for program fees. 

A handful of NPAs interviewed did not know 

anything about the program fee and did not 

even realize they were paying a program fee. 

Confusion about which pocket the program fee 

The GAO further reported that 

in 2012, NIB reported spending 

$175,729, and NISH (now 

SourceAmerica) reported spending 

$700,000 on lobbying.

No NPA interviewed reported 

receiving details about the use of 

the program fee or knowing how 

the fee was spent.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 37
came from, and whether or not the NPA lost 

revenue because of the fee increased frustrations 

among NPAs and further highlights the lack of 

transparency.

Nonprofit Agencies and the SeventyFive Percent Direct Labor Hour Ratio

According to the 

implementing regulations 

for AbilityOne, the 

CNAs must evaluate 

each individual NPA and 

provide the Commission 

with data about the 

NPA’s status, their goods/

services capabilities, 

and other relevant 

information.94 Once 

evaluations have been 

completed and an NPA has been approved, 

the CNAs monitor and assist the NPAs in 

meeting the participation requirements of the 

program.95 According to the Commission, it is the 

responsibility of the CNAs to provide the support 

and assistance necessary to ensure that NPAs 

are compliant. SourceAmerica annually conducts 

compliance visits among 

a percentage of its 

member NPAs, whereas 

NIB conducts compliance 

visits with all of its 

associated NPAs. NPAs 

must be either privately 

incorporated or state 

owned or operated to participate in the program.

As part of the compliance visits, the CNAs 

check to ensure that the NPAs meet the 

required direct labor hour ratio. Direct labor for 

production work is defined as “all work required 

for preparation, processing, and packing of 

a commodity or work directly related to the 

performance of a service, but not supervision, 

administration, inspection or shipping.”96 Direct 

labor for services is the “performance of those 

tasks directly required (or specified) in the 

contract statement of work, such as janitors and 

groundskeepers.”97 The 

JWOD Act requires that 

75 percent of the direct 

labor hours (75 percent 

ratio) be completed by 

people who are blind or 

have a severe disability 

in production or service 

work performed by the 

NPA as a whole, and not 

limited specifically to 

AbilityOne contracts.

The 75 percent ratio is a hotly debated topic. 

When first authorized, the rationale behind the 

mandate was to ensure the employment of 

people with significant disabilities and people 

who are blind. As previously discussed in 

Chapter 1, however, the country has moved 

toward the social model of disability, and 

modern disability 

laws and policies 

consistently emphasize 

greater integration and 

equity. Specifically, the 

75 percent ratio conflicts 

with the previously 

mentioned goals of 

WIOA—competitive integrated employment 

(CIE) for people with disabilities. CIE has three 

main components: a job that pays at least the 

federal minimum wage, occurs in a setting where 

employees with disabilities interact with those 

As required by Congress, CNAs 

send the Commission data on the 

use of the program fee, which 

the Commission then reports to 

Congress on a quarterly basis. As 

noted earlier, these congressional 

reports are not available to the 

public.

SourceAmerica annually conducts 

compliance visits among a 

percentage of its member NPAs, 

whereas NIB conducts compliance 

visits with all of its associated NPAs.

38 National Council on Disability
without disabilities to the same extent as others 

in comparable positions, and includes full- or 

part-time work.98 For a job placement to be 

considered a successful employment outcome 

under the federally funded and state-operated 

Vocational Rehabilitation (VR) program, the 

employment must meet the CIE definition.99

The VR program 

no longer supports 

employment outcomes 

that do not meet 

the CIE criteria. The 

AbilityOne Commission 

has been told that the 

CIE integration mandate 

found in the WIOA 

regulations and related 

guidance make it difficult 

for some NPAs to recruit 

VR clients to participate 

in their program.100 The Commission also reports 

that since the majority of AbilityOne employees 

are engaged under service contracts, many of 

which occur at military installations and in federal 

buildings, the Commission believes such jobs are 

integrated employment placements.101 A further 

discussion of the debate around what is an 

integrated setting is contained in Chapter 3.

The 75 percent ratio works against NPAs 

who seek to embrace the CIE trend. All NPA 

contracts, public or private, are effectively subject 

to this segregating ratio if they wish to remain 

in compliance with the 

program. Therefore, 

organizations with an 

integration mission are 

required to spin off other 

entities not subject 

to the ratio, thereby 

increasing management 

and administrative costs. 

Many NPAs interviewed 

expressed concerns with 

the interaction of VR and 

WIOA, specifically that 

VR determinations were not consistent and that 

they were both geographically and case worker 

dependent. While all of the NPAs interviewed 

reported they experienced little to no trouble in 

maintaining the overall 75 percent ratio, some 

NPAs believed that the 75 percent ratio limited 

their overall mission and stated it should be 

lowered to 50 percent. One NPA was open to 

considering a 30 percent ratio. It is important to 

note that the Council of State Administrators of 

Vocational Rehabilitation (CSAVR) indicated that 

VR hopes to work more collaboratively with the 

Commission in the future.

As with many other aspects of the AbilityOne 

Program, the 75 percent ratio has been a focus 

of numerous reports. The WIOA Advisory 

Committee noted in its 2016 congressional final 

report that the ratio “essentially segregates 

workers from the mainstream workforce” 

The VR program no longer supports 

employment outcomes that do not 

meet the CIE criteria. The AbilityOne 

Commission has been told that the 

CIE integration mandate found in 

the WIOA regulations and related 

guidance make it difficult for 

some NPAs to recruit VR clients to 

participate in their program.

Competitive Integrated Employment

■ A job that pays at least the federal 

minimum wage

■ Occurs in a setting where employees with 

disabilities interact with those without 

disabilities to the same extent as others in 

comparable positions

■ Includes full- or part-time work

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 39
and might be inhibiting the goal of CIE. In 

order to address these concerns, the report 

recommended considering the feasibility and 

difficulty of measuring the 75 percent ratio (or 

any ratio), changing the ratio to avoid segregation, 

and the introduction of pilots, including pilots 

that reduce contract hours.102 The 898 Panel 

has also considered 

the 75 percent ratio 

and recommended that 

JWOD’s required ratio 

be amended to “provide 

for a range of direct labor 

hour percentages to promote the employment of 

individuals in integrated work environments.”103

Additionally, AbilityOne and SourceAmerica are 

conducting an AbilityOne Project Ratio Pilot 

to examine the effects of a lower direct labor 

hour ratio.104

These reports are reflective not only of expert 

opinions, but also the sharp divide within the 

disability community about the 75 percent ratio 

and the importance 

of integration. Some 

advocates see the 

ratio as a necessary 

mechanism to protect 

jobs for a segment 

of the community 

whose unemployment 

and poverty rates are 

disproportionally high. Others, however, see the 

ratio as a throwback to a time where segregation 

of people with disabilities was the norm as well 

as a block to integration that is in direct conflict 

with the goal of CIE.

The JWOD Act’s exclusion of including 

people with disabilities in supervisory positions, 

management, or administrative positions 

(e.g., indirect labor) toward the 75 percent 

ratio is further detrimental to the advancement 

of people with disabilities and in conflict with 

modern disability policy. Some NPAs informed 

NCD that employees with disabilities could apply 

for supervisory, management, or administrative 

positions, and some 

NPAs reported a few 

occasions when this 

occurred. Employees 

with any disability, 

however, always have 

the right to apply for a position and are protected 

from discriminatory treatment under the 

Americans with Disabilities Act (ADA) if they are 

qualified and can perform the position with or 

without reasonable accommodations.

The mere fact that a person who is blind 

or has a significant disability may occasionally 

apply and receive a supervisor or management 

position does not address the detrimental 

impact of the 75 percent 

ratio on employment. 

Since NPAs must 

maintain the necessary 

ratio to remain in 

compliance, and a few 

reported a struggle 

to maintain the ratio, 

NPAs have no tangible 

reason to encourage advancement of people 

who are blind or have significant disabilities 

outside of the direct labor positions. One 

CNA and a number of NPAs shared with NCD 

the suggestion that all employment positions 

(direct and indirect) should count toward the 

75 percent ratio.

The 75 percent ratio works against 

NPAs who seek to embrace the CIE 

trend.

The WIOA Advisory Committee 

noted in its 2016 congressional final 

report that the ratio “essentially 

segregates workers from the 

mainstream workforce” and might 

be inhibiting the goal of CIE.

40 National Council on Disability
Compliance and Roles and 

Responsibilities Within the 

AbilityOne Program

Compliance by the NPAs with the statutory 

requirements of JWOD is at the heart of 

ensuring fidelity of the 

program. Significant 

confusion abounds 

regarding compliance 

of the NPAs and who 

has responsibility for 

ensuring that compliance. 

Given the direct role the 

NPAs play in the current 

employment of 45,000 

people with significant 

disabilities and who are 

blind, the lack of clarity is 

concerning. For two years in a row, the OIG has 

identified the compliance program as a significant 

management challenge for the Commission.

The Commission established a Director 

of Compliance in 1973, and through the 

1990s issued compliance-related guidance 

documents. In 2005, 

the Commission staff 

published a compliance 

manual to improve the 

NPA’s understanding 

of the reviews 

and the Commission’s 

assessments. Based on this manual, the 

reviews should consist of assessing an NPA’s 

compliance with the direct labor hour ratios, the 

medical documentation requirements, and the 

“not competitively employable” assessments. 

The manual was last updated in 2007, but 

Commission staff stated they are in the process 

of completing an update to the manual and have 

removed the manual from the website to avoid 

inconsistencies. The current expectation is that 

a new compliance manual will be available in the 

second quarter of FY 2020.105

According to 

SourceAmerica, the 

Commission has 

the sole authority to 

determine AbilityOne 

NPA compliance. 

SourceAmerica 

believes they are to 

monitor and assist 

their NPAs to meet the 

statutory and regulatory 

requirements needed 

to fully participate in 

the AbilityOne Program. To achieve this goal, 

SourceAmerica conducts assistance and 

regulatory visits to their NPAs and provides 

feedback to the Commission, but they do 

not consider these to be qualified AbilityOne 

compliance visits.

The OIG has observed 

that the Office of 

Compliance for the 

AbilityOne Commission 

“delegates certain 

governmental compliance 

duties to the CNAs and 

has not performed a compliance visit to an NIBaffiliated NPA since 2011.”106 The Commission 

staff challenge the accuracy of the OIG’s findings. 

Furthermore, in the cooperative agreements, 

the Commission directly addresses the CNA’s 

“qualified NPA oversight protocols” in requiring 

NPAs to complete corrective action(s) if the 

Since NPAs must maintain the 

necessary ratio to remain in 

compliance, and a few reported 

a struggle to maintain the ratio, 

NPAs have no tangible reason to 

encourage advancement of people 

who are blind or have significant 

disabilities outside of the direct 

labor positions.

For 2 years in a row, the OIG has 

identified the compliance program 

as a significant management 

challenge for the Commission.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 41
NPA is not meeting program requirements. The 

Commission recognizes that as the government 

oversight agency, it may find an NPA is out of 

compliance with the program but nevertheless 

places much of the real responsibility on the 

CNAs to ensure that NPAs stay compliant. 

SourceAmerica reported that it performs a 

number of on-site regulatory reviews of member 

NPAs each year, and NIB stated it annually 

conducts on-site visits of all its member NPAs.

The Commission staff described a shared 

oversight responsibility between the Commission 

and the CNAs and indicated that the CNAs can 

use their assistance visits to regularly monitor 

NPA compliance. The 

Commission noted 

the large discrepancy 

between the resources 

available to the CNAs 

to work with the NPAs, 

as compared with the 

Commission, and seemed 

to imply that the CNAs 

are in a better position to 

provide direct, regulatory 

assistance to facilitate compliance given greater 

resources because of the program fee.

NIB conducts a yearly visit that includes a 

check on compliance with program requirements 

and to some degree with the Occupational 

Safety and Health Act to address safety 

concerns. NIB may also assist with reasonable 

accommodation issues. NIB will support the 

NPAs if the Commission requires the NPA 

have a corrective action plan and will provide 

an opinion if they believe the NPA has met 

the requirements within the corrective action 

plan. According to NIB, the Commission 

operates independently in terms of determining 

compliance and whether a corrective action plan 

was successful. SourceAmerica appears to agree 

with some shared responsibility on oversight 

with the Commission. SourceAmerica stated that 

it monitors and assists its NPAs with program 

requirements and, as necessary, provides the 

Commission the results of site visits. Ultimately 

for SourceAmerica, the NPAs are the ones 

expected to understand and perform as required.

At best, the CNAs and the Commission 

appear to have a muddled understanding of the 

lines of authority for monitoring compliance, 

which likely causes confusion for the NPAs about 

the role of each entity.

Most NPAs 

interviewed reported 

little to no interaction 

with the Commission, 

but one NPA did report 

having a relationship 

with Commission staff 

which they utilized to 

get direct answers to 

their questions. NPA 

interaction with the CNAs 

varied. Most SourceAmerica NPAs interviewed 

discussed the increases over the past two years 

in audits by SourceAmerica, as well as a focus 

on NPA internal compliance. NIB-affiliated NPAs 

reported that the CNA conducts both an annual 

audit and a qualification audit to determine the 

NPA’s suitability for new contract opportunities.

Complexities Surrounding 

Employee Eligibility Within the 

AbilityOne Program

The employment of people who are blind or 

who have a significant disability is the primary 

goal of the AbilityOne Program. Unfortunately, 

At best, the CNAs and the 

Commission appear to have a 

muddled understanding of the 

lines of authority for monitoring 

compliance, which likely causes 

confusion for the NPAs about the 

role of each entity.

42 National Council on Disability
eligibility for the Program is not a clear-cut 

process. Rather, it often pivots on the subjective 

interpretation of the person conducting the 

evaluation, referred to as an Individualized 

Employment Evaluation (IEE). What is classified 

as “severe,” to use the direct term from the 

JWOD Act, may differ from one evaluator to 

another. In order for the integrity of the program 

to be robust, the eligibility determinations must 

be completely transparent. Through research, 

site visits, and interviews, NCD has found 

this fundamental, integral cornerstone of the 

program to be opaque at best for people with 

significant disabilities.

People who are blind 

must expressly meet the 

Commission’s definition 

that “[b]lind means an 

individual or class of 

individuals whose central 

visual acuity does not 

exceed 20/200 in the 

better eye with correcting 

lenses or whose visual 

acuity, if better than 

20/200, is accompanied 

by a limit to the field of vision in the better eye to 

such a degree that its widest diameter subtends 

an angle no greater than 20 degrees.”107

For people considered to have a significant 

disability, however, the medical documentation 

must include “a written report signed by a 

licensed physician, psychiatrist, or qualified 

psychologist, reflecting the nature and extent 

of the disability or disabilities that cause such 

person to qualify as a person with a severe 

disability, or a certification of the disability or 

disabilities by a state or local governmental 

entity” and “[r]eports which state whether 

that individual is capable of engaging in normal 

competitive employment.”108 Although the reports 

must be signed by a person qualified by training 

and experience to evaluate work potential, the 

Commission does not list training requirements 

for the person conducting the assessments.

The 2007 Compliance Manual contains a 

section entitled “A Discussion of Disabilities 

Prevalent Among AbilityOne Employees” that 

provides some insight into which disabilities 

the Commission considers as significant. The 

manual lists common functional limitations 

related to a given disability as a way of analyzing 

whether an individual’s disability is significant. 

The manual lists various 

categories of disabilities. 

The list includes learning 

disabilities, mental 

illnesses (based on the 

Diagnostic and Statistical 

Manual of Mental 

Disorders [DSM] IV Axis I 

and Axis II), physical 

disabilities, as well as 

hypertension, obesity, 

low vision, alcohol/

drug addiction, and other substance abuse 

disorders.109

NCD spoke with a number of people with 

disabilities during visits of SourceAmerica 

NPAs job sites who did not present as having 

a significant disability. NCD, of course, did 

not have access to the relevant medical or 

psychological documentation and is aware of 

limitations of brief interactions. If the goal of the 

AbilityOne Program is to employ people with 

severe disabilities who have difficulty finding 

public or private employment, it was difficult 

to see how the people NCD spoke with had 

In order for the integrity of the 

program to be robust, the eligibility 

determinations must be completely 

transparent. . . . NCD has found this 

fundamental, integral cornerstone 

of the program to be opaque at 

best for people with significant 

disabilities.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 43
such difficulties. Many people NCD observed 

during site visits were actively participating in 

meaningful work without any direct supervision, 

and some with almost no supervision. In fact, 

some of the employees, who were determined 

to have a significant disability, were working 

on a different floor than their supervisor. If 

they needed any assistance, the person with a 

significant disability had to call the supervisor for 

assistance, although NPA supervisors indicated 

that most often the 

workers did not require 

assistance. NCD noted 

one instance in which 

a person considered 

to have a significant 

disability drives a truck, 

requiring a commercial 

license, with another 

person considered to 

have a significant disability. Their job involved 

navigating through a major city to deliver paper 

twice a week. Also, during these visits, a 

number of workers fully engaged with NCD in 

conversation. One employee spoke about his 

upcoming solo trip to Asia to visit family. Another 

employee oversaw the scheduling of and setting 

up for meetings for a conference space in a 

federal building. When asked if he sometimes 

provided meeting attendees with technical 

assistance with the technology, he answered 

affirmatively. NCD observations highlight the 

subjective nature of the IEE and that the program 

does not appear on the surface to be employing 

persons with significant disabilities.

NCD does not purport to have conducted 

medical evaluations or possess medical expertise 

of the persons interviewed. However, if an 

AbilityOne employee can work unsupervised, 

travel, and drive independently, the question 

that should be asked is this: why is the person 

not working in CIE? Members of an advisory 

group of disability advocates, former AbilityOne 

employees, and a former manager of an NPA also 

discussed how the NPAs only hire employees 

who marginally fall under the definition of 

significantly disabled. This practice is not unlike 

that of public/private employers except for the 

fact that NPAs are receiving federal set-aside 

contracts to ensure 

the employment of 

people with significant 

disabilities. The absence 

of strong oversight of 

the evaluation process 

as discussed later, gives 

NPAs less incentive to 

ensure persons with 

People considered to have ‘severe 

disabilities’ NCD observed during 

NPA site visits

■ One person drives a truck, requiring a 

commercial license, with another person 

considered to have a significant disability. 

Their job involved navigating through a 

major city to deliver paper twice a week.

■ One employee spoke about his upcoming 

solo trip to Asia to visit family.

■ One employee oversaw the scheduling 

of and setting up for meetings for a 

conference space in a federal building and 

provides meeting technical assistance with 

technology.

If the goal of the AbilityOne Program 

is to employ people with severe 

disabilities who have difficulty finding 

public or private employment, it was 

difficult to see how the people NCD 

spoke with had such difficulties.

44 National Council on Disability
significant disabilities are being employed under 

the program.

NCD also heard from congressional staffers 

and in other independent interviews that a 

real concern exists about the evaluation of 

significant disabilities, 

particularly when the 

NPA, the contract 

holder, is the entity 

responsible for 

evaluating an employee 

for the contract. NPAs 

employing people with 

significant disabilities 

have a vested interest 

in finding the person 

significantly disabled in 

order to fulfill program 

requirements. This concern is also echoed in 

a number of reports, including an 898 Panel 

report that recommends “stricter requirements 

on NPAs for documentation and disability 

determinations.”110

According to the most recent compliance 

manual available, the Commission further 

considers a person with a disability as capable 

of normal, competitive 

employment if the 

person can, with or 

without reasonable 

accommodations, 

work at least 40 hours 

per week, complete 

an application and 

participate in an interview independently, receive 

the same pay and benefits as any other worker 

performing comparable work, maintain a job 

for an extended period of time, and maintain 

a job without intervention or supports from 

outside sources. This understanding of what 

is competitive employment is problematic by 

setting a high bar. The Commission has excluded 

from competitive employment situations in 

which most employers will not provide the 

accommodation, are 

not normally provided 

in typical community 

employment, “or involve 

a third party in making 

the job placement 

successful.”111 These 

provisions conflict with 

the ADA that requires 

individual assessments 

by employers to 

determine what 

accommodations may 

be needed if a person is otherwise qualified for 

the job.112 The VR program further allows people 

with disabilities, including those with the most 

significant disabilities, to pursue high-quality CIE, 

when provided with the necessary services and 

supports.113

Additionally, the Commission fails to provide 

NPA evaluators with particular accommodations 

a “typical” community 

employer is unlikely 

to provide. Studies 

have shown that most 

accommodations are 

relatively inexpensive 

and easy to provide.114

The ADA also advances 

Congress’ belief that, with the appropriate 

accommodations, people with disabilities, even 

those with the most significant disabilities, can 

and should be working in the most integrated 

settings. Furthermore, in Lane v. Kitzhaber, a 

Many people NCD observed during 

site visits were actively participating 

in meaningful work without any 

direct supervision, and some with 

almost no supervision. In fact, 

some of the employees, who were 

determined to have a significant 

disability, were working on a 

different floor than their supervisor.

[I]f an AbilityOne employee can 

work unsupervised, travel, and drive 

independently, the question that 

should be asked is this: why is the 

person not working in CIE?

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 45
U.S. District Court specifically addressed the 

application of the ADA and the Olmstead v. 

L.C. decision to a public entity’s obligation to 

prevent unnecessary segregation for people 

with disabilities in employment services. The 

court held that the ADA’s integration mandate 

extends to employment services and prohibits 

the unnecessary segregation, and serious risk 

of unnecessary segregation, of people with 

disabilities, including adults and youth with 

disabilities.115 The case eventually settled.

Following this ruling, there were three 

landmark ADA settlement agreements entered 

within the span of three years that were brought 

by the Department of Justice (DOJ) or by the 

DOJ along with private 

plaintiffs. Each of these 

court-ordered settlement 

agreements provided a 

road map for how state 

and local governments 

can rebalance their 

systems to ensure that 

their employment services are provided in the 

most integrated setting appropriate. Definitions 

that seek to limit the purpose of the ADA restrict 

the goal of Congress to include people with 

disabilities fully into the community.116

Technology has become vital for increasing 

opportunities for people with significant 

disabilities as well as those who are blind 

to successfully work in the community. For 

example, a young man named Andy, who was 

paralyzed from the neck down and lost the ability 

to speak following a near-drowning accident as 

a toddler, worked successfully for 15 years at a 

local bookstore in Oregon. Andy communicated 

by using an iPad, and the only body part that he 

had voluntary control over was his head. Andy’s 

job responsibilities, with the help of an assistant, 

involved scanning/tracking books that were 

delivered to the store. He activated mechanical 

switches with his head in order to scan the bar 

codes and to review the lists of books. In one 

year, Andy scanned over 53,000 books and 

loved doing his community-based job.117

NCD heard stories about the importance 

of employment and opportunities under the 

AbilityOne Program from sites visited for this 

report. Several employees who acquired a 

disability later in life mentioned how AbilityOne 

employment was fundamental to helping them 

through the transition. Several other employees 

appreciated the 

understanding of the 

NPAs to disability-related 

concerns that directly 

affect their employment, 

and the services the 

NPA provides. NCD 

appreciates that these 

intangible benefits are important for many 

employees, but for true integration to occur, 

all employers covered by the ADA and the 

Rehabilitation Act must act like these NPAs 

and address the disability-related concerns of 

their employees. In addition, any programmatic 

changes to AbilityOne must ensure that current 

employment services rendered to people who 

are blind or have significant disabilities through 

an NPA or other service system remain intact.

Complexities Regarding Individual 

Eligibility by the Nonprofit Agencies

At present, the Commission requires the 

NPAs to make initial and annual IEEs for each 

NPAs employing people with 

significant disabilities have a vested 

interest in finding the person 

significantly disabled in order to 

fulfill program requirements.

46 National Council on Disability
employee who is blind or has a significant 

disability that will be counted in their direct 

labor hour ratio. The IEE documents the 

functional limitations related to the disability(ies) 

experienced by an individual and identifies 

the barriers for that individual, as well as the 

supports and services that individual requires, 

in order to participate 

in competitive 

employment. Several 

NPAs reported watching 

SourceAmerica webinars 

about how to conduct 

IEE evaluations, 

and several stated 

specifically that the trainings were more 

about filling out the required paperwork.

The IEE requires NPAs to evaluate people 

with disabilities who plan to participate in the 

AbilityOne Program and to make a determination 

of the severity of their disability. It is unclear, 

however, whether the NPAs have the capacity, 

skill, and knowledge to effectively evaluate the 

employment capabilities 

of their workers with 

disabilities.

NPAs reported a 

significant increase 

in the number of 

audits conducted due 

to the cooperative 

agreements implemented by SourceAmerica, 

especially in regard to the IEEs. NPAs reported 

that SourceAmerica now conducts annual 

audits of the IEEs. These are paper-only 

audits, however, and thus limited to ensure 

that the medical documentation is available 

to support the determination. NPAs informed 

NCD that SourceAmerica auditors do not 

speak to the employees or conduct other 

evaluations to check on the NPA’s determination. 

Further, it is completely up to the discretion 

of the NPA to determine if a person has a 

significant disability and cannot be successfully 

accommodated in CIE.

The JWOD Act 

requires that the 

Commission create 

specific criteria for 

the NPAs to follow to 

determine the severity 

of a person’s disability.118

The Commission has also 

defined the term “severely disabled” through 

regulation.119

The Commission created a broad evaluation 

process that gives NPAs the power to decide if a 

person has a significant disability. This approach is 

inherently problematic since the NPAs are making 

decisions about their own potential employees 

whom they will want as part of the program. The 

898 Panel recommended 

to Congress that all 

IEEs for new employees 

be conducted by 

evaluators who are 

independent from the 

NPA.120 This same 

recommendation had 

also been made by the Advisory Committee on 

Increasing Competitive Integrated Employment for 

Individuals with Disabilities.121 Program regulations 

appear to assign oversight of the employment 

determinations to the Commission, but in 

practice, the Commission is far removed from the 

determination process.

It is unclear . . . whether the NPAs 

have the capacity, skill, and 

knowledge to effectively evaluate 

the employment capabilities of their 

workers with disabilities.

NPAs informed NCD that 

SourceAmerica auditors do not 

speak to the employees or conduct 

other evaluations to check on the 

NPA’s determination.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 47
Degeneration of AbilityOne 

Program Integrity

The AbilityOne OIG and Commission staff have 

raised what they consider external threats to 

the continued viability 

of the program. One 

threat, which the 

Commission described 

as program “leakage,” 

is the failure of federal 

agencies to purchase 

from the AbilityOne 

Program as required by JWOD. NIB also 

discussed this problem to NCD and noted 

the need to market the program to ensure 

federal purchasing officers follow JWOD 

requirements. High turnover among federal 

procurement officers, lack of effective training 

to procurement officials about the program, 

and the use of purchase cards that allow for the 

purchase of goods from commercial vendors 

were mentioned as reasons for the leakage. 

The OIG reported as a management challenge 

the “Erosion of Statutory Authority,” a “[l]ack 

of enforcement capabilities for the [program] 

to assert its mandated source-priority when 

federal agencies fail to purchase AbilityOne 

products and services.”122

The Commission created a short-term 

pilot project between AbilityOne and Amazon 

designed to use the Amazon e-commerce portal 

for federal agency purchase. NCD was informed 

about significant concerns with the pilot and 

the lack of information about the outcome. 

Specifically, the pilot program did not lead to an 

increase in AbilityOne sales due to the fact that 

Amazon did not block its “essentially the same” 

(ETS) offerings. Despite the requirement that the 

federal agencies purchase an AbilityOne product, 

by using ETS, Amazon would list similar nonAbilityOne goods to the government purchaser 

at a cheaper price. In an interview with NCD, 

NIB expressed dissatisfaction and frustration 

with the pilot program 

citing lack of blocking 

ETS on Amazon as well 

as pricing procedures 

by Amazon that 

raised the price of the 

AbilityOne goods. The 

Commission reported 

to NCD that it believes the pilot provided 

information about the advantages and challenges 

of using an e-commerce platform, knowledge 

that was provided to the Government Services 

Administration. Nevertheless, the Commission 

has yet to provide a report or publicly give the 

results of the Amazon program, and during a 

Commission meeting no written materials or web 

materials were provided.

Another threat to the program is the so-called 

rule of two analysis used by the Department of 

Veteran Affairs (VA) to give veteran-owned small 

businesses procurement priority when there is 

a “reasonable expectation” that two or more 

Specifically, the pilot program did 

not lead to an increase in AbilityOne 

sales due to the fact that Amazon 

did not block its “essentially the 

same” (ETS) offerings.

NPA conflict of interest

The Commission created a broad evaluation 

process that gives NPAs the power to decide 

if a person has a significant disability. This 

approach is inherently problematic since the 

NPAs are making decisions about their own 

potential employees whom they will want as 

part of the program.

48 National Council on Disability
of those businesses will bid for the contract.123

Congress created the rule of two analysis in 2006 

under the Veterans Benefits, Health Care, and 

Information Technology Act (Veterans Benefits 

Act), which has been upheld by the U.S. Court 

of Appeals for the Federal Circuit as taking 

precedence over JWOD since the Veterans 

Benefits Act is a more recent and specific 

statute.124 This decision effectively creates 

an exemption from the AbilityOne Program’s 

procurement list priority for the VA. In their latest 

Top Management and Performance Challenges 

Report, the OIG provided the Commission with a 

detailed explanation on how the rule of two was 

applied in a recent court challenge where the 

decision by the court, in favor of a veteran-owned 

small business, potentially had negative impacts 

on the Program and the 

mandatory procurement 

sources in Part 8 of 

the Federal Acquisition 

Regulation. Moreover, 

according to the OIG, the 

“court challenges further 

demonstrate the confusion as to how AbilityOne 

Program rules should be interpreted and 

implemented.” In August 2020, Congress tried 

to reconcile these conflicting laws and passed 

the Department of Veterans Affairs Contracting 

Preference Consistency Act of 2020 (PL 116-

155), which creates an exception to the VA’s 

contracting requirements under the Rule of Two 

for certain AbilityOne products or services whose 

VA contract was in effect prior to December 22, 

2006 and in effect prior to the enactment of the 

law on August 8, 2020.

Despite the statutory erosion, discussed in 

detail in Chapter 3, AbilityOne Program sales 

have increased in most years since FY 2011. 

This trend might suggest that while erosion might 

affect specific NPAs and specific opportunities, 

leakage and erosion may not be impacting overall 

government sales under the program.

AbilityOne Commission’s Resources

The AbilityOne Commission has suggested 

that in comparison with the CNAs, the 

Commission lacks the resources for oversight. 

The Commission’s appropriations have increased 

slightly over the past several years, with much of 

the increase required to fund the new OIG. The 

Commission is currently funded at $10 million, 

of which $1.65 million funds the OIG.125 From 

FY 2011 though FY 2015, the Commission budget 

ranged between $5.09 million and $5.39 million, 

with steady increases starting in FY 2016 at 

$6.19 million to the 

current amount as the 

OIG began operations.126

The Commission 

currently employs 32 

full-time equivalent (FTE) 

staff, a slight increase 

from around 25 FTEs reported in FY 2016. The 

OIG has a separate staff that employs four FTEs.

Commission staff and the three Commission 

members interviewed stated that lack of 

resources is the most significant challenge 

facing the work of the Commission. The 

Commission further noted that NIB and 

SourceAmerica’s combined revenue and 

staff is 12 to 16 times larger than that of the 

Commission.127 The OIG also included lack of 

adequate resources, which impacts program 

effectiveness as a top management and 

performance challenge.128 This challenge was 

also reflected in the 898 Panel 2020 Report 

to Congress.129 The Financial Statement Audit 

Despite the statutory erosion, . . . 

AbilityOne Program sales have 

increased in most years since 

FY 2011.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 49
for FY 2019 of the Commission, however, 

reported financial management weaknesses 

and significant deviations from generally 

accepted accounting principles and federal 

reporting requirements. The auditors found the 

departures from the guidelines included material 

and pervasive misstatements and omissions 

in the Commission’s 

financial statements and 

footnotes. The financial 

statement auditors 

identified three findings 

of a potential violation of 

the Antideficiency Act 

by the Commission and 

issued an adverse opinion.130

While NCD is concerned, as detailed in 

Chapter 3, that CNA revenue from the program 

continues to rise without greater employment, 

NCD believes that the larger fundamental 

problems with the program cannot be 

resolved through greater appropriations to the 

Commission.

As discussed earlier, the AbilityOne Program 

is complex, composed of many interwoven and 

often overlapping segments. Through interviews, 

site visits, and a review of governmental 

and nongovernmental reports, NCD finds 

that the program is 

riddled by confusion 

of responsibilities, 

inconsistency, and a 

lack of transparency, 

and is fundamentally 

based on the outdated 

ideas about people with 

all types and severities of disabilities. Despite 

recent congressional attempts to remedy these 

problems, as detailed in Chapter 3, overall, 

the program has not improved or increased 

employment opportunities of people who are 

blind or have significant disabilities.

NCD believes that the larger 

fundamental problems with the 

program cannot be resolved 

through greater appropriations to 

the Commission.

50 National Council on Disability
Chapter 3: AbilityOne Sales, Revenue, and the 

Employment of People with Disabilities

Since the employment of people who 

have significant disabilities or who are 

blind is the primary goal of the JavitsWagner-O’Day (JWOD) Act, it is necessary to 

consider the employment outcomes of the 

AbilityOne Program. The JWOD Act does not 

require employment growth as an explicit goal 

of the program,131 but 

such growth is a key 

strategic goal set by the 

Commission.132 Sales to 

the Federal Government 

is also an important 

factor to consider, as 

increased sales should 

positively impact 

employment. Considering 

these factors, the NCD 

discovered that while 

overall AbilityOne 

Program sales have 

increased since FY 2011, 

the employment of people who are blind or have 

a significant disability, measured both by the 

number of employees and total direct labor hours 

worked, has decreased. Central nonprofit agency 

(CNA) revenue through the AbilityOne Program 

fee has also increased during this same period.

Employment Under the AbilityOne 

Program

The AbilityOne Program employed, on average, 

around 46,886 persons who are blind or have a 

significant disability per year between FY 2011 

and FY 2018, the years for which complete data is 

available (see Table 1).133

SourceAmerica nonprofit 

agencies (NPAs) account 

for the vast majority of 

employment under the 

program, both in terms 

of total employees with 

significant disabilities 

and hours worked. 

SourceAmerica NPAs 

employed on average 

42,470 people with 

significant disabilities per 

year, which represents 

90.57 percent of total 

annual employment 

under the program. NPAs affiliated with National 

Industries for the Blind (NIB) employed on 

average 4,416 persons who are blind, which 

represents 9.43 percent of total annual 

employment under the AbilityOne Program.

[W]hile overall AbilityOne Program 

sales have increased since FY 2011, 

the employment of people who are 

blind or have a significant disability, 

measured both by the number of 

employees and total direct labor 

hours worked, has decreased. 

Central nonprofit agency (CNA) 

revenue through the AbilityOne 

Program fee has also increased 

during this same period.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 51
In addition to the total number of employees 

who are blind or have a significant disability, 

the number of hours worked per year is an 

important factor to assess the program given 

the Commission’s stated goal of employment 

growth. Employees worked on average 

47.08 million direct labor hours a year between 

FY 2011 and FY 2018. This equated to, on 

average, about 19 hours a week per employee. 

SourceAmerica NPAs accounted for 41.2 million 

direct labor hours a year on average, or 

87.86 percent of the total direct labor hours. 

NIB participating NPAs accounted for 5.7 million 

direct labor hours on average each year, or 

12.14 percent. Based on the aggregate data, 

employees who are blind worked more direct 

labor hours under the program than those with a 

significant disability. Overall, the highest annual 

level of employment for this period occurred 

in FY 2011 in which 50,580 employees worked 

49.2 million direct labor hours through the 

AbilityOne Program.134

The total number of AbilityOne employees 

in a given year did not necessarily correspond 

with greater or fewer total direct labor 

hours worked in a given year. In FY 2018, 

for example, fewer employees worked more 

hours (44,006 employees worked 47.8 million 

hours) than a larger number of employee 

worked in FYs 2009 (45,936 employees worked 

45.7 million hours), 2012 (48,816 employees 

worked 47.7 million hours), and 2016 (46,161 

employees worked 46.9 million hours). As 

a further example, in FY 2014, the program 

employed 46,621 persons for 44.8 million 

direct hours, while in FY 2017, 43,831 

employees worked 2.1 million more direct 

hours for a total of 46.9 million hours.

Table 1: Employment of People 

Who Are Blind or Have a Significant 

Disability and Hours Worked Under 

the AbilityOne Program FY 2011 to 

FY 2018*

Fiscal Year Number of 

Employees

Direct Labor 

Hours Worked

2011 50,580 49,288,796

2012 48,816 47,714,261

2013 47,701 45,851,212

2014 46,621 44,855,247

2015 47,268 46,845,904

2016 46,161 47,352,402

2017 43,831 46,935,026

2018 44,006 47,840,847

Yearly

Average**

(n = 8)

46,886 47,085,462

*Data from AbilityOne Commission Annual 

Performance Reports during this period or provided 

by the Commission.

**Average calculations by the National Council on 

Disability.

CNA employment figures

■ SourceAmerica NPAs employed on average 

42,470 people with significant disabilities 

per year (90.57 percent of total annual 

employment under the program);

■ National Industries for the Blind (NIB) NPAs 

employed on average 4,416 persons who 

are blind per year (9.43 percent of total 

annual employment under the program).

52 National Council on Disability
A number of factors likely explain the lack 

of congruence between the total number of 

employees and the total number of hours 

worked, such as increases in government 

contract orders or service requests, or new 

procurement items produced, which did not 

require the hiring of additional employees. 

While NCD did not explore the various reasons 

behind these statistics, the lack of a relationship 

between a change in the total number of 

employees and the total hours worked raises 

questions about how the program should be 

evaluated. If the Commission’s goal is increased 

employment, is this accomplished best through 

increasing the numbers employed, the total 

number of hours worked, or both? Given the 

direction of federal disability policy toward CIE, 

are other metrics more important to measure the 

program, such as advancement in employment, 

wages, and other opportunities for people who 

are blind or have significant disabilities? The 

JWOD Act provides no clear guidance.

The employment of people who are blind 

declined under the program in fiscal years 

2012, 2013, and 2014, but in recent years, 

employment increased from a total of 4,249 

employees in FY 2015 to 4,467 employees in FY 

2018. These increases resulted in employees 

who are blind accounting for 10.5 percent of 

the total employees for the program in FY 2018 

compared with about 9.5 percent in FY 2011. 

The total number of direct labor hours worked 

by employees who are blind fluctuated from a 

high of 6.02 million direct labor hours worked 

in FY 2011 to a low of 5.22 million hours in FY 

2014. Direct hours worked by employees who 

are blind again topped 6 million hours in FY 

2018. Based on these numbers, between FY 

2011 and FY 2018, the employment of people 

who are blind under the AbilityOne Program 

can, at best, be described as static.

The employment of people with significant 

disabilities through the AbilityOne Program, 

on the other hand, dropped in every year but 

one between FY 2011 and FY 2018. Only in 

FY 2015 did more employees with significant 

disabilities work under the program than the 

prior year, and overall, 6,428 fewer employees 

with significant disabilities worked under the 

program comparing FY 2011 with FY 2018. 

The number of direct labor hours worked 

by people with disabilities also declined by 

1.43 million hours comparing FY 2011 and 

FY 2018. Direct labor hours worked by people 

with significant disabilities did, however, 

increase in fiscal years 2015, 2016, and 2018 

over the prior years. Nevertheless, the 

overall trend for the AbilityOne Program since 

FY 2011 has been fewer employees with 

significant disabilities generally working 

fewer hours.

Declining disability employment 

under the AbilityOne Program

Employment under the AbilityOne Program 

has declined since a peak in FY 2011 as 

measured by both the total number of 

employees in the program and by direct labor 

hours worked. The number of direct hours 

worked dropped significantly from FY 2011 

through FY 2014, and then began to rebound. 

In FY 2018, the program had 6,574 fewer 

employees who are blind or have a significant 

disability than in FY 2011, with 1.4 million 

fewer hours worked compared with FY 2011.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 53
In recent years, the Commission has 

tracked the movement of employees out of 

the program into competitive employment. 

NCD reported in 2019, 

based on Commission 

reports, that about 

4 percent of employees 

who are blind or 

have a significant 

disability annually 

exit the program for 

competitive integrated 

employment.135 The 

Commission also tracks 

promotions to higher 

wage grades, indirect 

labor positions, or 

management position 

within the program. 

From FY 2016 to FY 2018, between 1,310 and 

1,541 employees were promoted each year, 

representing about 3 percent of employees 

achieving a promotion in a given year.

Looking specifically 

at Commission-provided 

data on promotions 

out of direct labor, on 

average 395 persons 

exited direct labor 

positions per year from 

FY 2011 to FY 2018, 

or about 0.84 percent 

of all employees 

with significant 

disabilities or who 

are blind. SourceAmerica NPAs promoted 

about 0.87 percent of its employees per 

year out of direct labor, while NIB-affiliated 

NPAs promoted about 0.60 percent, with big 

increases in promotions in FY 2017 and 2018. 

Since the JWOD Act lacks a clear incentive 

or encouragement to 

promote, the number 

of promotions out of 

direct labor will likely 

remain limited. Based 

on NCD interviews, 

the NPA’s own mission 

may be a larger driver to 

encourage promotions 

than incentives from the 

AbilityOne Program.

The Commission 

also annually tracks the 

number of employees 

who are blind or have 

a significant disability 

who leave the AbilityOne Program and enter 

community-based employment. As part of 

this data, the Commission gathers information 

about whether the employee is placed into 

competitive employment, 

or employment with 

supports. Based on 

figures provided by 

the Commission, 

NCD calculated that 

between FY 2011 and 

FY 2018 on average 

4.3 percent of AbilityOne 

employees exited into 

community employment. 

About 4.71 percent of 

employees with a significant disability left for 

community employment per year on average, 

while around 0.67 percent of employees 

Given the direction of federal 

disability policy toward competitive 

integrated employment (CIE), 

are other metrics more important 

to measure the program, such 

as advancement in employment, 

wages, and other opportunities 

for people who are blind or 

have significant disabilities? 

The JWOD Act provides no 

clear guidance.

[O]verall, 6,428 fewer employees 

with significant disabilities worked 

under the program comparing FY 

2011 with FY 2018. The number of 

direct labor hours worked by people 

with disabilities also declined by 

1.43 million hours comparing FY 

2011 and FY 2018.

54 National Council on Disability
who are blind left 

AbilityOne employment 

for community 

employment. Since 

FY 2012, however, the 

vast majority of the 

20 to 30 employees who are blind who left 

the program each year entered competitive 

employment with no supports. The reverse was 

true for employees with significant disabilities. 

About two-thirds of the approximately 2,000 

employees with 

significant disabilities 

who left the AbilityOne 

Program for community 

employment per year 

required employment 

supports in their new 

placement from outside 

entities. The remaining 

one-third of people with significant disabilities 

entered competitive employment without the 

need for outside supports.

Sales, Wages, and Central Nonprofit 

Agency Revenue Under the 

AbilityOne Program

Despite the decrease in both employees and 

work hours since FY 2011, AbilityOne sales 

to the Federal Government kept growing. The 

AbilityOne Program generated $3.6 billion in 

sales in FY 2018, which is the highest sales 

level in both actual and constant dollars looking 

back to FY 2011.136 The program generated 

$626.1 million more sales in FY 2018 compared 

to FY 2011 ($250 million more in constant 2011 

dollars) despite having fewer employees who 

worked fewer hours. Of equal importance, in the 

aggregate, is that the percentage of AbilityOne 

Program sales devoted 

to wages for people with 

a significant disability 

or who are blind has 

declined in almost every 

year since FY 2011 

(see Table 2).

SourceAmerica NPAs accounted for on 

average 77.5 percent of AbilityOne sales from 

FY 2014 and FY 2018, and NIB-affiliated NPAs 

accounted for on average 22.4 percent of sales. 

Sales by NPAs under the NIB umbrella averaged 

about $700 million a 

year, with four of the 

eight years experiencing 

declines from the prior 

year. In comparison, 

sales from NPAs under 

SourceAmerica averaged 

$2.4 billion and were 

more stable with only one of the eight years 

resulting in a decline in sales from the prior 

year. Based on both sales and the number of 

AbilityOne exits for CIE and 

upward mobility

■ About 4 percent of employees who are 

blind or have a significant disability annually 

exit the program for CIE

■ About 3 percent of employees achieve a 

promotion (higher wage grades, indirect 

labor positions, or management positions) 

in a given year

● About 0.84 percent were promoted out 

of direct labor

Despite the decrease in both 

employees and work hours since FY 

2011, AbilityOne sales to the Federal 

Government kept growing.

[T]he percentage of AbilityOne 

Program sales devoted to wages for 

people with a significant disability 

or who are blind has declined in 

almost every year since FY 2011.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 55
employees, SourceAmerica is certainly the larger 

player in the AbilityOne Program.

In FY 2018, 18.19 percent of sales revenue 

paid for wages for people who are blind or have a 

significant disability compared with 20.09 percent 

in FY 2011, a decline of 1.9 percent. A wide 

variation will exist in the amount of revenue each 

individual NPA devotes to wages, especially if 

one were to compare manufacturing NPAs, which 

require equipment and materials supplies, with 

service-based NPAs, which have fewer material 

and supply requirements. In addition, several 

NPAs stated that income from the AbilityOne 

Program assists the NPA in providing other 

services.

Nevertheless, looking at the total amount 

paid in wages by AbilityOne is necessary for 

a proper assessment of the extent the federal 

procurement process directly impacts the 

economic situation of people with disabilities. 

Comparing the sales and wages paid since FY 

2011, NCD calculated that fewer federal dollars, 

as a percentage of total sales, were being 

used to pay wages for people who are blind 

or have a significant disability (see Table 2). 

A comparison of total wages and total sales 

between FY 2011 and FY 2018 further shows 

that total wages paid to employees who are 

blind or have a significant disability increased by 

$57.10 million between these years, while sales 

increased by $626.10 million. NCD compared 

the same time frame, FY 2011 to FY 2018, to 

account for inflation, and found that total wages 

paid decreased by $11.28 million using constant 

dollars ($599.1 million in FY 2011 compared 

with $587.82 million in FY 2018), while sales 

Table 2: AbilityOne Program Sales, Wages Paid, and Wages as Percentage of Sales

Fiscal Year

AbilityOne Program 

Contract Sales

(in millions)

Wages Paid

(to employees who are blind or 

have a significant disability)

(in millions)

Wages as a 

Percentage (%) 

of Sales**

2011 $2,981.60 $599.1 20.

2012 $2,860.70 $557.7 19.

2013 $2,833.00 $554.1 19.

2014 $2,881.50 $558.00 19.

2015 $3,153.90 $589.40 18.

2016 $3,333.50 $616.20 18.

2017 $3,345.30 $626.20 18.

2018 $3,607.70 $656.20 18.

Yearly Average**

(n = 8)

$3,124.65 $594.61 19.

*Data based on reports in AbilityOne Commission Annual Performance Reports. Contract Sales date broken 

down by National Industries for the Blind and SourceAmerica was obtained through request from the central 

nonprofit agencies and SourceAmerica.

**Wages as percent of sales and seven-year average calculation by the National Council on Disability.

56 National Council on Disability
increased by $250.14 million in constant dollars 

($2,981.60 billion in FY 2011 compared with 

$3,231.74 billion in FY 2018).137

The Commission reported that federal 

contracts under the program have shifted from 

manufacturing with higher labor requirements 

to those that require 

more cost associated 

with materials, especially 

specialized materials. 

Increased raw material 

costs and more complex 

services requiring less 

labor may also account 

for greater sales without 

a corresponding increase in employment or 

wages. The Commission further noted that 

federal procurement has trended toward 

consolidating services, such as Total Facilities 

Maintenance at military 

bases. NPAs under 

consolidated services 

may need to subcontract 

for certain specialty 

services, which would 

not be counted in the 

direct labor count. These 

factors could therefore 

increase the price of 

the contract while not 

necessarily increasing 

the employment of the 

targeted populations.

Nevertheless, more federal purchases and 

higher CNA revenue through the mandatory 

procurement list are not resulting in greater 

employment opportunities for people with 

disabilities. Furthermore, many AbilityOne 

contracts continue for years and sometimes 

decades, which means additional revenue for 

the CNAs for contracts that might not produce 

greater employment. Critically, therefore, the 

overall trend in the AbilityOne Program has 

been greater AbilityOne sales to the Federal 

Government and higher CNA revenue, but in 

the aggregate, fewer 

people with disabilities 

employed, generally 

fewer hours worked, and 

less program income 

applied to wages.

As AbilityOne 

Program sales increased, 

CNA revenue also 

increased. It should be pointed out that CNA 

program fee revenue is a factor of both the 

program fee percentage, which may be adjusted 

by the Commission, and sales under the various 

government contracts by 

the NPAs affiliated with 

the CNA. Increased sales 

do not necessarily result 

in an increase in CNA 

program fee, since the 

fee is also dependent on 

whether the percentage 

is raised or lowered by 

the Commission. The 

Commission took steps 

through the cooperative 

agreements to base 

the program fee on outcomes based on those 

agreements.

According to Commission figures, in 2000 the 

annual combined revenue of SourceAmerica and 

NIB was around $40 million, and these CNAs 

combined had just shy of 300 staff.138 According 

to data provided to NCD by SourceAmerica and 

Increased raw material costs 

and more complex services 

requiring less labor may also 

account for greater sales without 

a corresponding increase in 

employment or wages.

[T]he overall trend in the AbilityOne 

Program has been greater 

AbilityOne sales to the Federal 

Government and higher CNA 

revenue, but in the aggregate, fewer 

people with disabilities employed, 

generally fewer hours worked, and 

less program income applied to 

wages.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 57
NIB, combined CNA revenue rose from just 

around $101 million a year in FY 2011 to around 

$121.35 million a year (a $20.33 million increase 

in actual dollars and $7.6 million in constant 

dollars) in 2018. In 2018, the two long-standing 

CNAs had combined staffing around 600 

according to the Commission.139

NIB reported program fee revenue averaging 

$26.5 million a year from FY 2011 to FY 2018. 

The NIB program fee increased in real dollars 

in most years since FY 2011; however, the 

revenue declined precipitously between FY 

2012 and 2013 and then rebounded. Between 

FY 2015 and 2018, the 

fee generally exceeded 

inflation.140 Comparing 

the NIB program fee 

in FY 2011 to FY 2018, 

revenue increased by 

$3.9 million in real dollars 

and $843,000 in constant 

dollars. SourceAmerica 

reported program fee 

revenue averaging about 

$79.64 million in program 

fee revenue per year during the same time 

period. Similar to NIB, SourceAmerica revenue 

took a large drop between FY 2011 and 2013, 

but since that time has increased every year 

between FY 2014 and FY 2018 in real dollars, 

and increased every year in constant dollars 

for four of those five fiscal years.141 Comparing 

the SourceAmerica program fee in FY 2011 

to FY 2018, the CNA’s revenue increased by 

$16.41 million in real dollars and $6.844 million in 

constant dollars.

The AbilityOne Program’s purpose, since 

its inception, is to direct federal purchasing 

dollars toward the employment of people 

with disabilities. As the program is about 

employment, the increase in federal sales and 

CNA revenue is concerning when it does not 

result in increased employment opportunities for 

persons with significant disabilities or who are 

blind. Furthermore, despite the Commission’s 

strategic goal of increasing employment, NCD 

heard comments from NPAs that they felt the 

Commission and the CNAs view business 

ventures as more important than the role of 

providing employment opportunities for people 

with disabilities. If greater federal purchases from 

the program do not result in more employment 

opportunities, while the 

CNA revenue increases 

because of a program 

fee based in part on the 

contract price, then the 

nation needs to consider 

different models for 

how to improve the 

employment outlook 

for people who are 

blind or have significant 

disabilities.

Nonprofit Agency Production, 

Services, and Additional Funding

NPAs and their employees who are blind or 

have significant disabilities work on a variety 

of activities involving the production and 

manufacturing of goods and the provision of 

services for the Federal Government. NCD 

observed production activities that included 

packaging small tissue packs used for military 

Meals Ready to Eat (MREs), packing gloves for 

Transportation Security Administration workers, 

filling bottles and other containers with cleaning 

and other liquid products, producing pens and 

As the program is about 

employment, the increase in 

federal sales and CNA revenue 

is concerning when it does not 

result in increased employment 

opportunities for persons with 

significant disabilities or who 

are blind.

58 National Council on Disability
other office equipment under the SKILCRAFT 

and other labels, and making garments of 

different sorts for the military. Over 3,000 items 

are listed under the SKILCRAFT label alone.142

In some operations, people with disabilities are 

involved in complex production work. On the 

services side, NCD visited federal courthouses 

and buildings where custodial services were 

provided through an AbilityOne contract. NCD 

also visited or learned about several call centers 

and switchboard operations run by NPAs 

under contracts with the U.S. Department of 

Transportation and Department of Defense.

NPAs utilize a number 

of sources to fund their 

employment operations. 

Most NPAs reported 

that, in addition to the 

AbilityOne contract 

itself, other state 

contracts, public and 

private grants funds, fundraising activities, and 

private commercial contracts and sales, including 

subcontracts with other AbilityOne NPAs, are 

used to finance the NPAs’ work and services. In 

some cases, the AbilityOne contracts accounted 

for a third of an agency’s budget, but in other 

cases the NPAs had only a few contracts that 

either broke even or provided limited additional 

revenue for other services.

Wages and the Use of 14(c) 

Certificates by the AbilityOne 

Program

The payment of high wages is often mentioned 

as an important benefit of the AbilityOne 

Program, and wages paid under the program 

do, on average, exceed the federal minimum 

wage of $7.25 an hour. NCD calculated average 

wages for AbilityOne employment between FY 

2014 and FY 2018 as $13.10 an hour.143 Average 

wages also increased over that same time period, 

rising from $12.44 in FY 2014 to $13.72 in 2018. 

NCD calculated that wages have generally kept 

pace with inflation.144 Based on data provided 

by the CNAs, the annual average wage paid to 

employees who are blind during these periods 

was $11.25 an hour, while employees with 

significant disabilities earned on average $13.26 

an hour.145 Information on the range of wages is 

not easily available, and therefore, NCD cannot 

comment on whether outlier hourly wages might 

impact hourly wage 

averages. Based on the 

aggregate wage data, 

however, both employees 

who are blind and who 

have significant disability 

earn above the federal 

minimum wage.

The payment of subminimum wages to 

workers with disabilities has been a controversial 

issue in recent years. NCD addressed 

subminimum wages under the Fair Labor 

Standards Act (FLSA) Section 14(c) in the past, 

including its use by the AbilityOne Program.146

Subminimum wages paid to a worker with 

a disability under Section 14(c), known as 

commensurate wages, are based on the worker’s 

productivity in comparison to the productivity of 

experienced workers who do not have a disability 

performing essentially the same type, quality, and 

quantity of work.147

NPAs with Federal Government service 

contracts are mandated under Executive Order 

13658 to pay a minimum wage of $10.80 an hour 

as of January 1, 2020,148 regardless of whether 

the NPA has a 14(c) certificate. Many federal 

Based on the aggregate wage 

data, . . . both employees who are 

blind and who have significant 

disability earn above the federal 

minimum wage.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 59
contracts contain a prevailing wage requirement 

to reflect the local labor market, which requires 

that the contractor pay wages greater than the 

applicable minimum wage. An NPA can use a 

14(c) certificate, however, to pay less than the 

prevailing wage on a federal contract as long 

as they are not paying lower than the required 

minimum wage applicable to the contract. 

Under Section 14(c), the “prevailing wage” is the 

wage paid nondisabled, experienced workers 

performing essentially the same type of work in 

the same vicinity.149

In March 2016, the AbilityOne Commission 

issued a “Declaration in Support of Minimum 

Wage for All People Who Are Blind or Have 

Significant Disabilities,” which asked that all 

qualified NPAs “commit 

to, and begin (if not 

maintain), paying at least 

the federal minimum 

wage, or state minimum 

wage, if higher, to all 

employees who are 

blind or have significant 

disabilities working on AbilityOne contracts.”150

NIB made the decision in 2014 to eliminate the 

use of 14(c) certificates by their affiliated NPAs, 

and all but one NPA complied. SourceAmerica 

released a statement indicating they are “fully 

committed to maximum pay for people with 

disabilities and supports the elimination of 

Section 14(c);” and “will invest significant 

resources toward a transition support program” 

to accomplish this goal.151 NCD is pleased by 

the public statements from the AbilityOne 

Commission and SourceAmerica in regard to 

the elimination of Section 14(c) subminimum 

wages, and that NIB has eliminated the use 

of such certificates by all but one of its NPAs. 

NCD cautions, however, that use of the term 

“maximum pay” is ambiguous, which may 

lead to further confusion about the use of 

14(c) certificates among the general public. 

An employee with a disability could be paid 

a subminimum wage or a wage below the 

prevailing rate and be considered by the employer 

as receiving “maximum pay” if it determines the 

maximum productivity of the employee justifies a 

lower wage compared with other workers.

A number of the NPAs visited as part of this 

study indicated that their 14(c) certificate is not 

used to pay employees less than the federal 

minimum wage under the AbilityOne contract. 

Most NPAs interviewed tend to use the 14(c) 

certificates to pay workers with disabilities 

who do not work on an 

AbilityOne contract less 

than the minimum wage, 

or to pay employees with 

disabilities working on 

an AbilityOne contract 

at least the required 

minimum wage but less 

than the prevailing wage. Additionally, several 

NPAs interviewed noted that they needed 

14(c) certificates to qualify for their “state use” 

program. Forty-seven states have state use 

programs, further demonstrating the likely 

prevalence of this requirement.

Through interviews with NPAs, NCD heard 

a number of opinions regarding the use of 14(c) 

certificates. One NPA stated that although they 

have and use a 14(c) certificate for AbilityOne 

contracts, they are phasing out subminimum 

wage contracts and focusing on contracts where 

the salary is the prevailing wage. Another NPA 

noted that they kept their 14(c) certificate until 

2012, although they clarified, with pride, that 

In March 2016, the AbilityOne 

Commission issued a “Declaration 

in Support of Minimum Wage for 

All People Who Are Blind or Have 

Significant Disabilities” . . .

60 National Council on Disability
they had not actually used the certificate to 

pay subminimum wages since 2005. Examples 

therefore exist about how NPAs can transition to 

eliminate the need to pay subminimum wages.

During the NPA interviews, NCD learned that 

some of the AbilityOne jobs, especially those 

located in courthouses, that pay fair competitive 

wages also include substantial benefits packages, 

eliminating the dependency of those employees 

on public benefits. These jobs are understandably 

attractive to employees and, according to the 

NPAs, not surprisingly, have very little turnover.

Various Positions on Competitive 

Integrated Employment and 

Subminimum Wages

A significant area of 

discussion about the 

AbilityOne Program, 

as well as among 

people with disabilities, 

advocates, family 

members, and service 

providers, is what 

constitutes an integrated 

as opposed to a 

segregated setting. SourceAmerica, AbilityOne 

Commission staff, and a number of the NPAs 

interviewed believe that work performed in federal 

buildings, such as custodial work, mail delivery, or 

kitchen work, is integrated since the employees 

engage with persons without disabilities, even 

if coworkers are mainly other people with 

disabilities. Whether such jobs are considered 

integrated under the Workforce Innovation and 

Opportunity Act (WIOA) is also a much-debated 

point within the disability community. Many 

proponents of CIE believe that a typical AbilityOne 

work crew or enclave setting is not fully integrated 

since most of the coworker interaction is only with 

other coworkers with disabilities or a supervisor.

Based on site visits conducted for this study, 

a number of NPA work environments were 

segregated. NCD observed several NPA call 

centers and heard about others where the most 

direct interaction at the worksite was only between 

people with disabilities, or supervisors and 

managers without disabilities. In addition, during 

a visit to a mailroom run by an AbilityOne NPA, 

employees with significant disabilities worked 

in the basement of a hospital, away from other 

hospital employees and just down the hallway 

from the morgue. The NPA considered the site 

integrated because some employees delivered and 

picked up mail throughout the building. NCD also 

visited two work sites in 

which several custodial 

providers cleaned 

federal courthouses. 

On both visits, the NPA 

staff commented how 

much the workers with 

significant disabilities 

interacted with the 

federal judges.

In addition, under WIOA, an employee in 

CIE must be paid the state or local minimum 

wage rates and “not less than the customary 

rate paid by the employer for the same or 

similar work performed by other employees 

who are not individuals with disabilities, 

and who are similarly situated in similar 

occupations by the same employer and who 

have similar training, experience, and skills.”152

NPAs under the AbilityOne Program who 

pay the required minimum wage but not the 

prevailing wage are therefore in conflict with 

the definition of CIE.

NCD learned that some of the 

AbilityOne jobs, especially those 

located in courthouses, that pay 

fair competitive wages also include 

substantial benefits packages, 

eliminating the dependency of those 

employees on public benefits.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 61
During an NCD comment session, members 

of the disability community expressed conflicting 

views on the topic of subminimum wages. Some 

participants thought the need to pay below 

the prevailing wage was necessary and should 

be considered a “fair wage.” Similarly, some 

people believed that 

subminimum wages 

are—and should be—

part of a sustainable 

business model that 

allows organizations 

to continue to operate 

while simultaneously 

employing people with significant disabilities 

which might not be possible if the employer 

paid everyone a minimum wage. On the other 

hand, other participants of the comment session 

thought that subminimum wages should be 

eliminated, and people with disabilities should be 

paid fair wages at minimum wage or higher for 

their work.

WIOA extends the 

definition of CIE to 

include “supported 

employment,” which is 

“competitive integrated 

employment, including 

customized employment, 

or employment in an 

integrated work setting 

in which individuals are 

working on a short-term basis toward competitive 

integrated employment, that is individualized 

and customized consistent with the strengths, 

abilities, interests, and informed choice of the 

individuals involved, for individuals with the most 

significant disabilities for whom competitive 

integrated employment has not historically 

occurred or for whom competitive integrated 

employment has been interrupted or intermittent 

as a result of a significant disability; and who, 

because of the nature and severity of their 

disability, need intensive supported employment 

services and extended services after the 

transition . . . in order 

to perform the work 

involved.”153

The increased 

prevalence and 

availability of the 

customized employment 

approach allow people 

who were previously considered “unemployable” 

to successfully maintain employment in a 

competitive, integrated environment. The key 

to this approach is the use of flexible strategies. 

Rather than relying on open job postings, a job 

developer will work to determine the specific 

skills, assets, and interests of a person with a 

significant disability and how these skills can 

address an unmet need 

of an employer.154 For 

example, Sean, who 

is autistic, enjoyed 

organizing books and 

dusting. He was hired 

by Barnes & Noble 

bookstore to clean and 

organize the shelves 

prior to the opening 

of the store each morning. He loved his job, 

and the store was equally pleased because 

their other employees did not have the time to 

focus on such meticulous tasks.155 The advent 

of customized employment negates the need 

for people with significant disabilities to rely on 

AbilityOne for employment.

NPAs under the AbilityOne Program 

who pay the required minimum 

wage but not the prevailing wage 

are therefore in conflict with the 

definition of CIE.

The increased prevalence and 

availability of the customized 

employment approach allow people 

who were previously considered 

“unemployable” to successfully 

maintain employment in a 

competitive, integrated environment.

62 National Council on Disability
This study also revealed another critical, 

overarching issue that must be addressed. 

Obviously, not all people with disabilities are 

currently employed. The need for appropriate 

services for people with disabilities not 

participating in CIE positions became increasingly 

evident during NCD’s listening sessions. 

Multiple commenters held the strong belief 

that some people with disabilities are trapped in 

noncompetitive placements when they could, 

instead, be working in a competitive, integrated 

employment setting, if provided with the needed 

supports.

The disparity between the employment 

supports offered under the AbilityOne Program 

and current disability policy is evident to 

members of the disability community. Some 

commenters believed 

that while competitive 

integrated placements 

are not for everyone, we 

must also ensure that all 

people with disabilities 

engage in meaningful 

activities on a regular basis.

Participation in and the Cost of 

Segregated Employment

As NCD highlights in Chapter 2 of this report, 

the JWOD Act mandated 75 percent direct 

labor hour ratio encourages and, in many 

cases, results in the segregation of employees 

with significant disabilities and who are blind. 

To shed additional light on the overall cost of 

segregated employment, NCD analyzed data 

available from states on the amount of state 

funds spent on “facility-based” work for people 

with intellectual and developmental disabilities. 

Through the 2017 National Survey of State 

Intellectual and Developmental Disabilities 

Agencies Employment and Day Services, 30 

states reported the total number of people 

with intellectual and developmental disabilities 

served in facility-based work and data on the 

amount of funds spent in facility-based work.156

Nineteen states could not report on facilitybased work for the survey because of the 

service structure and state reporting capacity, 

and only one state, Vermont, does not fund 

facility-based or group-supported employment 

services.

Based on the 30 states for which data was 

reported, 90,974 persons with intellectual 

and developmental disabilities participated in 

facility-based work with state support. These 30 

states further spent $886.5 million to support 

facility-based work, 

or on average $9,746 

annually per person. 

A large variation existed 

across the 30 states, 

with Kansas spending 

on average $38,061 to 

support a person with a developmental disability 

in facility-based work and Virginia spending 

$1,148 on average (see Table 3). A majority of 

states spent between $6,000 and $11,000 per 

person for facility-based employment.

Using the same 2017 data set, NCD was 

able to estimate the total amount spent to 

provide services to people with intellectual 

and developmental disabilities in integrated 

employment. The majority of state intellectual / 

developmental disability agency funding 

provides ongoing supports to individuals once 

they acquire a job to support job maintenance 

and advancement. Initial job placement 

services are typically, but not always, funded 

The advent of customized 

employment negates the need for 

people with significant disabilities to 

rely on AbilityOne for employment.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 63
Table 3: State Costs of Facility-Based Work for People with Intellectual and 

Developmental Disabilities in Thirty States by Average Cost per Person

State Total Served

Total in 

Facility-Based 

Work

Total Spent on 

Facility-Based 

Work

Average Cost per 

Person in FacilityBased Work

Vermont 3,409 0 $0 $0

Virginia 15,477 1,054 $1,209,869 $1,148

Indiana 14,266 4,552 $17,778,195 $3,906

Oklahoma 3,885 2,133 $9,666,645 $4,532

South Dakota 2,476 1,476 $6,900,311 $4,675

Louisiana 4,951 969 $4,883,241 $5,039

Arizona 12,535 1,223 $6,321,775 $5,169

Oregon 7,906 1,785 $10,847,560 $6,077

Colorado 15,110 702 $4,295,754 $6,119

California 90,746 7,838 $48,783,122 $6,224

Kentucky 9,506 2,006 $12,982,799 $6,472

Ohio 32,976 17,998 $117,062,171 $6,504

Wisconsin 16,547 6,733 $44,051,379 $6,543

North Carolina 16,637 2,435 $15,979,861 $6,563

Georgia 15,842 2,389 $16,276,907 $6,813

Iowa 16,015 1,862 $12,879,814 $6,917

Washington 9,149 198 $1,372,392 $6,931

South Carolina 8,127 2,819 $25,631,619 $9,092

Illinois 24,325 172 $1,601,458 $9,311

Pennsylvania 30,461 8,163 $81,169,348 $9,944

Nevada 2,498 1,226 $12,695,759 $10,355

Montana 1,961 489 $5,101,199 $10,432

Alabama 5,270 454 $4,957,488 $10,920

Michigan 16,046 3,290 $37,185,858 $11,303

Nebraska 4,426 881 $10,267,519 $11,654

District of Columbia 1,303 186 $3,017,125 $16,221

Minnesota 30,396 14,533 $253,960,955 $17,475

Connecticut 10,751 190 $3,550,338 $18,686

Delaware 2,295 429 $9,976,735 $23,256

Kansas 7,477 2,789 $106,151,990 $38,061

64 National Council on Disability
by state VR agencies. While 45 states 

provided data on integrated employment, 

NCD calculated an estimate based only on 

the 30 states that provided facility-based 

data. These 30 states supported 115,926 

people with intellectual and developmental 

disabilities in integrated employment for an 

annual total cost of $909.6 million. These 

states thus provided services to support 

integrated employment to almost 25,000 more 

persons then in facility-based employment 

for only around $23.1 million more. More 

critically, the 30 states paid $7,847 per person 

on average in 2017 to support integrated 

employment, about $1,900 less per person 

on average than for facility-based work. There 

was also less variation among the 30 states, 

with Kansas paying $283 per person on 

average for integrated employment services, 

to Connecticut paying $16,850 on average 

per person (see Table 4). Every state except 

Connecticut paid less than $11,000 on average 

per person for integrated employment service 

in 2017, unlike facility-based employment where 

seven states averaged more than $11,000.

In addition to the estimated higher public 

cost to support people with intellectual and 

developmental disabilities in facility-based work, 

wages are also much lower. NCD utilized the 

2017–2018 National Core Indicator (NCI) data to 

estimate the number of people with intellectual 

disabilities working in individual community jobs, 

group community jobs, or facility-based jobs.157

Individual community jobs are those found in the 

typical labor market where the person with an 

intellectual disability works alongside peers who 

do not have a disability. Group community jobs 

are often referred to as work crews or enclaves, 

and include custodial, landscaping, mailroom, 

or similar work settings in which persons with 

disabilities work as a crew or team of not more 

than eight other persons with a disability in 

the community. Facility-based jobs are those 

segregated settings, commonly called sheltered 

workshops, where most workers in the location 

have a disability.

NCD’s analysis of the NCI data estimates 

that 33.8 percent of people with intellectual 

disabilities are in a job in some capacity, with 

just under 14 percent involved in an individual 

job, and just under 15 percent involved in 

facility-based jobs. Around 5 percent of persons 

with intellectual disabilities are in group 

community jobs. More significant, however, is 

the disparity in estimated wages. The mean 

wage for individual community work is $10.03 

an hour with an average of almost 29 hours over 

2 weeks. In comparison, people in facility-based 

work earn the estimated mean wage of only 

$3.34 an hour and work more hours, at almost 

32.5 hours over 2 weeks. The use of 14(c) 

certificates almost certainly accounts for the 

wage disparity. Group community work mean 

wages, at $8.78 per hour for around 27.5 hours 

Cost of segregated vs integrated 

employment

■ Average of $9,746 spent annually per 

person on facility-based work with state 

support

■ Average of $7,847 spent annually per 

person on integrated employment with 

state support and significantly more 

people served

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 65
Table 4: State Costs of Integrated Employment for People with Intellectual and 

Developmental Disabilities in Thirty States by Average Cost per Person

State

Total in 

Day and 

Employment 

Services

Total in 

Integrated 

Employment 

Services

Total Spent 

on Integrated 

Employment 

Services

Average Annual 

Cost per Person in 

Integrated Employment 

Services

Kansas 7,477 893 $252,611 $283

South Dakota 2,476 556 $747,183 $1,344

Indiana 14,266 1,529 $2,213,972 $1,448

Alabama 5,270 618 $927,418 $1,501

Nebraska 4,426 216 $630,232 $2,918

Virginia 15,477 3,806 $11,584,778 $3,044

Iowa 16,015 4,720 $19,168,820 $4,061

Kentucky 9,506 3,253 $13,336,505 $4,100

Montana 1,961 508 $2,216,146 $4,362

Georgia 15,842 2,153 $9,553,711 $4,437

Illinois 24,325 1,747 $7,976,437 $4,566

North Carolina 16,637 3,015 $19,469,121 $6,457

Michigan 16,046 4,379 $29,223,562 $6,674

Colorado 15,110 2,725 $18,663,581 $6,849

Washington 9,149 7,886 $56,675,968 $7,187

Louisiana 4,951 1,534 $11,179,547 $7,288

South Carolina 8,127 1,878 $13,698,891 $7,294

Wisconsin 16,547 3,388 $25,579,423 $7,550

Pennsylvania 30,461 5,584 $42,615,933 $7,632

Minnesota 30,396 3,188 $24,599,235 $7,716

Nevada 2,498 429 $3,413,939 $7,958

Ohio 32,976 9,222 $75,231,718 $8,158

Oklahoma 3,885 2,497 $20,762,029 $8,315

Delaware 2,295 731 $6,164,773 $8,433

District of Columbia 1,303 384 $3,286,662 $8,559

Oregon 7,906 4,542 $40,054,369 $8,819

Arizona 12,535 2,345 $24,550,418 $10,469

Vermont 3,409 1,256 $13,178,850 $10,493

California 90,746 10,903 $115,625,992 $10,605

Connecticut 10,751 4,477 $75,436,620 $16,850

66 National Council on Disability
over 2 weeks, are slightly higher than the 

current federal minimum wage.

A number of NPAs reported during the site 

visits that a common issue was the potential 

loss of Social Security 

Disability Insurance 

(SSDI) and Supplemental 

Security Income (SSI) 

cash benefits, and 

any associated health 

assistance benefits 

based on SSDI/SSI 

eligibility, the longstanding problem of the 

so-called benefits cliff. 

A benefits cliff is when 

a public benefit program 

lessens or stops when a 

person’s earnings increase. This reduction in or 

loss of benefits can be disruptive for people with 

disabilities who do not earn enough to maintain 

self-sufficiency but are considered to be working 

too much for public benefit program assistance. 

Several NPAs reported workers with disabilities 

who requested fewer hours or even sought to 

decline pay raises in order to prevent loss of 

SSDI/SSI benefits or associated public benefits. 

In cases of pay raises, NPA reported workers 

reducing their hours when informed they could 

not refuse a pay raise.

NPAs who offered supplemental insurance 

received fewer requests from employees to 

work less hours to maintain benefits. One NPA 

reported that none of their AbilityOne employees 

received public benefits because they were paid 

above the minimum wage and received employer 

provided benefits. Another NPA reported that 

some AbilityOne employees chose not to work a 

40-hour workweek for fear of losing their public 

benefits, unlike the assumption in the 2007 

AbilityOne Compliance Manual that assumes 

not working 40 hours a week is evidence of an 

inability to work normal competitive employment. 

The reduction or removal 

of benefits can, and 

does, create barriers to 

accessing health care, 

which could affect the 

health, housing, and 

overall participation in 

society of people with 

disabilities. This very 

real and imminent threat 

discourages people 

with disabilities from 

participating in full-time 

employment.

Comments from the community confirmed 

NPAs’ assertions that the raises in minimum 

wages, although extremely beneficial, have 

led to people with disabilities cutting hours in 

an effort to maintain public benefits like SSDI 

Another NPA reported that some 

AbilityOne employees chose not 

to work a 40-hour workweek for 

fear of losing their public benefits, 

unlike the assumption in the 2007 

AbilityOne Compliance Manual 

that assumes not working 40 hours 

a week is evidence of an inability 

to work normal competitive 

employment.

Wages for segregated vs 

integrated employment

■ Mean wage for individual community 

work is $10.03 an hour with an average of 

almost 29 hours over 2 weeks

■ Mean wage of facility-based work is 

only $3.34 an hour with an average of 

32.5 hours over 2 weeks

■ Mean wages for group community work is 

$8.78 per hour for around 27.5 hours over 

2 weeks

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 67
and Medicaid. Multiple people in the comment 

sessions cited the threat of losing benefits as a 

major problem for people with disabilities and 

that there needs to be a society-wide focus on 

assets and benefits of people with disabilities 

who are looking to partake in CIE. While the 

benefits cliff is not an AbilityOne Program 

problem, it highlights an important ancillary 

problem that limits the 

full employment of 

people with significant 

disabilities or who are 

blind, and can hinder CIE.

NCD sought to 

establish estimates 

for how an increase in 

CIE impacts the receipt 

of SSDI or the level 

of SSI cash benefits. There is ample evidence 

to demonstrate that increasing employment 

for people with disabilities will reduce poverty, 

improve health outcomes, and ultimately lead to 

lower public health care costs.158 Prior research 

by the University of New Hampshire indicates 

that the pace at which people exit the receipt 

of income-tested cash 

benefits is slow but is 

a possible long-term 

outcome of increasing 

employment for people 

with disabilities. Many 

studies overwhelmingly 

focus on the financial and psychological benefits 

of employment for people with disabilities and 

draw the conclusion that improved financial 

and psychological benefits lead to better health 

and therefore lower health care costs.159 These 

studies assume that the benefits of employment 

that have been documented in the general 

population through the U.S. Department of 

Health and Human Services’ Social Determinants 

of Health can also be applied to people with 

disabilities.160

Section 503 of the Rehabilitation Act

Besides the AbilityOne Program, the Federal 

Government has taken other steps to encourage 

the employment of 

persons with disabilities 

through use of federal 

funds. Most critical 

is Section 503 of the 

Rehabilitation Act. 

Section 503 “prohibits 

federal contractors 

and subcontractors 

from discrimination 

in the hiring and employment of persons with 

disabilities and requires these employers to take 

affirmative action to recruit, hire, promote, and 

retain employees with disabilities.”161

The U.S. Department of Labor, Office 

of Federal Contract Compliance Programs 

(OFCCP) is charged with the administration 

and enforcement of 

laws applicable to 

federal contractors and 

subcontractors that 

prohibit discrimination 

and promote equal 

employment opportunity 

of people with disabilities under Section 503.162

Section 503 also authorizes OFCCP to investigate 

complaints of disability discrimination.163

Any entity with a federal contract or 

subcontract of more than $15,000 is subject 

to the nondiscrimination provisions of 

Section 503.164 In an attempt to provide more 

While the benefits cliff is not an 

AbilityOne Program problem, it 

highlights an important ancillary 

problem that limits the full 

employment of people with 

significant disabilities or who are 

blind, and can hinder CIE.

Any entity with a federal contract or 

subcontract of more than $15,000 

is subject to the nondiscrimination 

provisions of Section 503.

68 National Council on Disability
employment opportunities for people with 

disabilities, an affirmative action program (AAP) 

is included as a part of Section 503. The AAP 

applies to entities with 50 or more employees 

and at least one federal contract or subcontract 

of $50,000 or more.165

Because AAP hiring efforts occurred more 

in theory than in practice, amendments to 

the Section 503 regulations were finalized in 

March 2014.166 Among other things, the revised 

regulations sought to increase the impact of 

the AAP by setting for federal contractors an 

“aspirational” 7 percent workforce utilization goal 

for people with disabilities.167 This new goal is not 

viewed by OFCCP as a quota or a requirement, 

but rather as a “management tool . . . designed 

to promote accountability.”168

OFCCP must take into account the potential 

burdens imposed by proposed federal regulations 

on federal contractors and subcontractors.169 As 

NCD found in 2018, these OFCCP concerns led 

to a diluted attempt to improve the AAP when 

the final regulations were implemented. For 

example, contractors are only required to invite 

employees to self-disclose their disabilities once 

every five years.170 This intermittent approach 

may do little to ensure that the 7 percent target 

is reached.

Additionally, issues surrounding OFCCP’s 

compliance review process became apparent. 

The number of reviews conducted each year is 

quite small.171 Moreover, contractors are given 

30 days advance notice if their AAP will be 

reviewed.172 In short, contractors are unlikely 

to undergo a review, and if a review occurs, 

the contractor may have an extended period of 

time to correct deficiencies in their plan prior to 

the review. The fact that contractors have very 

little incentive to meticulously comply with the 

current regulations is problematic. Nevertheless, 

Section 503 offers a possible mechanism 

to increase the employment of people with 

disabilities, including those who are blind or have 

a significant disability.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 69
70 National Council on Disability
Chapter 4: Recommendations

The National Council on Disability (NCD) recommends that Congress and the President take 

the following specific steps to phase out the AbilityOne Program:

Congress:

1. NCD recommends that Congress pass legislation to phase out the AbilityOne Program 

and amend Section 503 of the Rehabilitation Act.

2. NCD recommends the AbilityOne phaseout legislation provide for an 8-year period prior to 

the sunset of the AbilityOne Program.

3. NCD recommends the legislation for the phaseout plan of the AbilityOne Program include 

the following:

a. The formation of a study, of no more than two years, to determine the percentage 

required under federal contracts to ensure the integration of persons with significant 

disabilities and who are blind into new employment so as to avoid the loss of any of 

the 45,000 jobs currently under the AbilityOne Program.

b. The study should identify pathways and resource investments that are needed 

for current AbilityOne employees to move to a new employment relationship 

within competitive integrated employment (CIE) with federal contractors or other 

employers.

c. The study should address what funding would be required to offset any potential loss 

of employment services to people who are blind or have a significant disability.

d. A specific sunset provision should be made for the Javits-Wagner-O’Day (JWOD) Act, 

not to exceed six years after the date of completion of the study.

e. The AbilityOne Commission should wind down operations during years 3 through 5 of 

the phaseout (year 1 following the two-year study).

(continued)

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 71
f. The Office of Federal Contract Compliance Programs (OFCCP) should contract with the 

central nonprofit agencies (CNAs) starting on year 5 of the phaseout to provide training 

and technical assistance to all nonprofit agencies (NPAs) on competing for federal 

contracts, utilization of current NPA capital investments in competition, the availability 

of the Vocational Rehabilitation (VR) Program and other employment options to all NPA 

employees, and referrals to Social Security benefits planners.

g. The AbilityOne Commission should cease placing new products or services on the 

procurement list starting the third year of the phaseout.

h. Direct the AbilityOne Commission to notify NPAs of the phaseout of the program and 

assist NPAs through the termination of the program.

4. NCD recommends the formation of an advisory committee to promulgate the study to be 

composed of the following:

a. At least 50 percent of members who have a significant disability and who are blind.

b. An AbilityOne Commissioner.

c. A representative each from

i. National Industries for the Blind.

ii. SourceAmerica.

iii. American Foundation for the Blind.

d. An Executive Director from at least six AbilityOne nonprofit agencies, two of which 

should be from an NPA that employs people who are blind.

e. At least three covered federal contractors.

f. A representative from a state developmental disability agency.

g. A representative of a state VR agency.

h. A representative of a state Medicaid agency.

i. A representative from a state education agency.

5. NCD recommends Congress direct the U.S. Department of Education, Rehabilitation 

Services Administration (RSA) to require that state VR agencies conduct meaningful 

outreach to all NPA employees about available employment supports and options on 

either a one-on-one basis or in a group setting. Outreach should include, at a minimum:

a. A description of the overall purpose of the VR Program.

b. The eligibility requirements of the VR Program.

(continued)

72 National Council on Disability
c. The application procedures of the VR Program.

d. The scope of services that may be provided by the VR Program.

e. Other employment networks such as the American Job Centers.

6. NCD recommends Congress direct the AbilityOne Commission and OFCCP to contract 

with the current CNAs and other appropriate entities at a proper time before the end 

of the eight-year period, to utilize the expertise of these entities to provide training and 

technical assistance to all covered federal contractors to facilitate the employment of 

people who are blind or have significant disabilities. Such training and technical assistance 

should include how to recruit, support, and retain employees with significant disabilities 

and who are blind.

7. NCD recommends Congress ensure that federal appropriations currently covering wages 

and NPA services under the AbilityOne Program continue to support the employment 

of people who are blind or have significant disabilities after the sunset of the AbilityOne 

Program.

8. NCD recommends legislation for the amendment of Section 503 include:

a. That every federal contract valued at $200,000 or greater, including subcontracts, for 

which the contractor has at least 50 employees (“covered federal contractor”), hire a 

percentage of people who are blind or have a significant disability. (The percentage to 

be determined by the two-year study.)

b. That OFCCP oversight of the amended Section 503 requirement, and AbilityOne 

Commission appropriations and part of the current CNA program fee be made available 

to OFCCP to fund oversight and enforcement once the phaseout is complete.

c. That OFCCP coordinate with the AbilityOne Commission and the U.S. Department 

of Labor, Office of Disability Employment Policy (ODEP), during the phaseout, to 

develop and adopt a nonambiguous definition of significant disability to be used when 

assessing and calculating the labor ratio percentage for contractors.

d. A requirement that federal contractors obtain appropriate documentation to verify the 

employee with a disability meets the criteria adopted by OFCCP of an individual with a 

significant disability or who is blind. The documentation should be current (within the 

last 3 years) and be provided by a physician, psychologist, psychiatrist, or other relevant 

medical professionals.

e. A requirement that OFCCP review federal contracts and conduct random “audits” to 

ensure that covered contractors meet the required determined labor ratio percentage.

(continued)

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 73
f. That sufficient funds are appropriated to allow for an audit of at least 15 percent of 

covered contractors for each fiscal year.

g. That OFCCP design a system that allows complaints to be filed against covered 

contractors for failure to adhere to required percentages.

h. NCD recommends upon completion of the study that Congress mandate OFCCP to 

issue, by regulation, the required percentage of people with significant disabilities or 

who are blind that covered federal contractors must hire to comply with the amended 

Section 503.

Existing CNAs and NPAs:

9. NCD recommends that existing CNAs and NPAs be used as an integral tool during 

the transition. The CNAs should continue to represent and assist their affiliated NPAs 

and private nonprofit organizations with appropriate resources and training, NPAs can 

transition to competing for federal contracts, entering into subcontract arrangements, or 

supporting other federal contractors who would be required to employ people who are 

blind or have significant disabilities.

RSA and State VR Agencies:

10. NCD recommends that the RSA require state VR agencies to report relevant 

documentation about outreach activities on an annual basis. RSA will submit an annual 

report to Congress detailing all state VR agency outreach activities.

11. NCD recommends RSA direct state VR agencies to report the number of VR eligible 

persons who obtain or advance in employment by a covered federal contract.

12. NCD recommends that RSA facilitate the development of state-based memorandum of 

understandings between developmental disability services, Medicaid, education, VR, 

and other supports to ensure success for people with significant disabilities or individuals 

who are blind.

ODEP:

13. NCD recommends that ODEP facilitate a connection between NPAs and Employment 

First initiatives in states and a connection between covered federal contractors to the 

Job Accommodation Network (JAN) to learn about reasonable accommodations.

(continued)

74 National Council on Disability
Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 75

Federal Agencies:

14. NCD recommends that federal agencies not renew contracts with NPAs under the 

AbilityOne Program which expire during the phaseout period. Following the expiration 

of the contract, federal agencies would either have to compete the contract or justify 

continuing with the NPA as a sole-source contract under applicable federal law.

AbilityOne Commission:

15. NCD recommends that during the phaseout, the AbilityOne Commission should work 

with the Department of Defense, the General Services Administration, and other 

applicable federal agencies in winding down AbilityOne contracts with NPAs prior to the 

end of the eight-year phaseout in compliance with Title 41 of the United States Code 

and the Federal Acquisition Regulations.

16. NCD recommends that the AbilityOne Commission cease operation after all NPA 

contracts under the existing program expire.

Interim Recommendations

The phaseout of the AbilityOne Program will take multiple years to occur. In the meantime, 

NCD provides the following interim recommendations to improve the efficacy of the 

AbilityOne Program during the transition. The implementation of these recommendations 

does not require additional appropriations. These recommendations are in no way intended 

as a substitute for NCD’s recommendation to phase out the AbilityOne Program. Piecemeal 

changes will not address the structural problems and the incompatibility of the program 

with federal disability policy. NCD offers these interim recommendations to improve the 

function of the program toward the primary goal of the JWOD Act, to provide employment 

opportunities for people who have significant disabilities or who are blind.

AbilityOne Commission:

1. NCD recommends that the AbilityOne Commission make strong efforts to clarify and 

streamline the Individualized Employment Evaluation (IEE) process. Specific standardized 

criteria and methodology should be developed to determine if a person has a significant 

(continued)
Interim Recommendations: continued

disability. Eligibility for the AbilityOne Program (e.g., the documentation of a significant 

disability or documentation for someone who is blind) should not be determined by an 

NPA but by an independent party.

a. NCD recommends that such documentation issued by other federal and/or state 

agencies that provide official disability determinations be accepted as evidence of 

eligibility for the AbilityOne Program. The CNAs should provide training to the NPAs 

about how to conduct the IEEs.

2. NCD recommends that the AbilityOne Commission require and provide specific training 

about eligibility process requirements to the NPAs.

3. NCD recommends that the AbilityOne Commission should no longer allow NPAs 

that service people with significant disabilities to serve the dual roles of evaluator 

for participation in the AbilityOne Program and the employer. The Commission 

should consider entities, such as the state vocational rehabilitation program or other 

independent evaluators, to fulfill the evaluator role.

4. NCD recommends that the AbilityOne Commission explicitly clarify, through the 

cooperative agreements and policies, the CNA’s specific role in NPA compliance, 

especially regarding the IEEs.

5. NCD recommends that the AbilityOne Commission work with the CNAs to ensure the 

cooperative agreements clearly indicate how failure of the CNAs to comply with the 

Quality Assurance Surveillance Plan (QASP) will result in a reduction in the program fee or 

other steps to maintain compliance with the agreement. The QASPs should also place the 

greatest emphasis on both the employment of people who are blind or have a significant 

disability, especially encouraging promotions within NPAs, as well as movement of 

employees to CIE outside of the AbilityOne Program.

6. NCD recommends that the AbilityOne Commission amend the cooperative agreements, 

as necessary, to ensure that the program fee is set at a rate such that annual CNA revenue 

should provide only sufficient funds necessary to allow the CNA to offer training and technical 

assistance to the NPAs, distribute contracts among the NPAs, ensure the quality of NPA 

products and services to the Federal Government, submit new products and services to the 

procurement list, and create opportunities to advance the employment of people who are 

blind or have a significant disability into supervisory and management positions and into CIE.

7. NCD recommends the AbilityOne Commission restrict the use of executive sessions and 

nondisclosure agreements.

(continued)

76 National Council on Disability
Interim Recommendations: continued

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 77

Congress:

8. NCD recommends that Congress restrict the use of the CNA program fees for lobbying 

and executive salaries to the same extent as any entity that directly receives federally 

appropriated funds.

9. NCD recommends that Congress mandate that the CNAs report on the use of the 

program fee directly to AbilityOne on a quarterly basis and require AbilityOne to post the 

reports on its website.

10. NCD recommends that Congress amend the JWOD Act to eliminate the direct labor 

requirement and allow all jobs, both direct and indirect positions, to be counted toward 

the 75 percent ratio in order to improve the employment and promotion opportunities 

for people who are blind or have significant disabilities. NCD emphasizes that such an 

amendment be an interim step to the eventual phaseout of the JWOD Act.

U.S. Department of Labor:

11. NCD recommends that the U.S. Department of Labor restrict the issuance of Fair 

Labor Standards Act (FLSA) Section 14(c) certificates to NPAs that work on AbilityOne 

contracts.
78 National Council on Disability
Conclusion

Since the early twentieth century, the 

attitude in the United States toward 

people with disabilities—even those 

with the most significant disabilities—has 

undergone a monumental paradigm shift. The 

overall perception toward people with disabilities 

has evolved from one of pity and incapability 

under the medical and charity models, to one of 

awareness and inclusion under the social model. 

Since the mid-1970s, federal laws and policies 

have shown a clear and steady progression 

toward integration and equity.

The present day AbilityOne Program is 

beset by a number of systemic problems 

around transparency, compliance issues, and 

program erosion as highlighted in this report. 

These problems include criticism and opacity 

surrounding the use of program fees by the 

central nonprofit agencies (CNAs), and a lack 

of oversight of individualized employment 

evaluation procedures, issues around the 

Commission’s use of executive sessions and 

nondisclosure agreements, and financial audit 

concerns. The program is also bedeviled by 

the 75 percent direct labor ratio that inherently 

encourages various forms of segregation and 

restricts the ability of nonprofit agencies (NPAs) 

to encourage promotions out of direct labor 

positions. Congress has made several attempts 

to fix these problems, most notably through 

the mandate for the Commission to enter into 

cooperative agreements with the CNAs and 

establishment of the 898 Panel. These efforts, 

however, have simply plugged leaks to maintain 

a system at odds with the spirit, if not the letter 

of the Americans with Disabilities Act (ADA), the 

Rehabilitation Act, the Workforce Innovation and 

Opportunity Act (WIOA), and the other federal 

disability policies.

Furthermore, and as critical, data indicates that 

the ultimate purpose of the Javits-Wagner-O’Day 

(JWOD) Act, to use the Federal Government’s 

purchasing power to enhance employment 

opportunities for people who are blind or have 

significant disabilities, is not achieving the desired 

results. The AbilityOne Commission’s stated 

mission is “to enable all people who are blind or 

have other significant disabilities to achieve their 

maximum employment potential.”173 Promotions 

out of direct labor from the program appear to be 

minimal. In addition, despite a continued increase 

in AbilityOne Program sales, employment of 

persons who are blind has been generally flat 

since FY 2011, while employment of persons 

with significant disabilities has declined. The 

National Council on Disability (NCD) found that 

the overall trend since FY 2011 in the AbilityOne 

Program has been fewer people with disabilities 

employed for generally fewer hours, while 

AbilityOne sales to the Federal Government 

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 79
and CNA revenue have increased. There are 

certainly some differences between the National 

Industries for the Blind (NIB) and SourceAmerica 

in terms of sales, revenue, and employment 

outcome, but employment trends and numerous 

problems with the program point to the need for 

a change.

NCD appreciates the hard work of many 

NPAs under the AbilityOne Program to train, 

support, and provide various services to people 

with significant disabilities or who are blind. NCD 

learned about the support many of the NPAs 

provide to persons with disabilities in addition 

to providing employment. In some cases, NPA 

services are augmented or supported by revenue 

generated from AbilityOne Program contracts, 

while in other cases, AbilityOne contracts were 

simply part of a mix of employment provided 

by the NPA, which added little or nothing to the 

NPAs’ operating revenue.

NCD believes that for the nation to advance 

the full inclusion of people who are blind or 

have a significant disability that a paradigm 

shift in the approach to employment of people 

with disabilities must occur. It is time the 

nation moves past wholly separate programs 

or segregated settings for employees with 

disabilities, and from evaluating disability policies 

through the lens of whether the program 

is merely “good enough” for people with 

disabilities. The United States needs to have the 

fortitude and creativity to enact sensible policies 

to continue the country’s march toward equity 

and inclusion.

Congress already set the tone for encouraging 

greater employment of people with disabilities 

when it enacted Section 503 of the Rehabilitation 

Act. While the Affirmative Action Provision of 

Section 503 has been weak, even after the 

2014 regulatory changes, Section 503 presents 

a mechanism to increase the employment 

of people who are blind or have a significant 

disability throughout the federal contracting 

world, and thus expand the potential for full 

integration of all people with disabilities. 

Examples of how people with the most 

significant disabilities can be supported in full 

community integrated jobs have been included 

in this and other NCD reports, as have examples 

of how nonprofit agencies moved away from 

segregated employment. With these examples in 

mind, NCD offers the following recommendations 

to Congress and the President.

80 National Council on Disability
Appendix

Nonprofit Agency Phone Interview Selection Methodology

In order to further evaluate the nonprofit agencies (NPAs) and their use of the AbilityOne Program, the 

National Council on Disability (NCD) randomly selected 18 NPAs across the United States to participate 

in phone interviews. To select these NPAs, NCD divided the country into four sections—Northeast, 

Midwest, South, and West-Pacific—and pulled four or five agencies from each region. NCD used a 

formula that randomly assigned each NPA a number; once completed, the Excel program randomly 

selected four or five numbers. NCD chose the agencies that corresponded to the randomized numbers. 

To obtain pertinent information, NCD only ensured that at least one NPA from each region represented 

a blind organization. Otherwise, the process for selecting NPAs to interact with was randomized.

Once NCD began calls, there were some unforeseen challenges. While most NPAs knew who was 

best to talk with, a handful of NPAs either never responded or were unaware of the proper person to 

answer NCD’s questions. Surprisingly, the majority of these agencies were from the Midwest region. 

NCD surmised that the Midwest NPAs may have less contact with their AbilityOne-affiliated central 

nonprofit agency (CNA) because of their location. The only region that has easy access to the CNAs is 

the Northeast, which is close to the main CNA office in Washington, DC. The NPAs in the Midwest that 

NCD did hear from were smaller agencies that were often unable to afford the costs of travel and hotel 

for CNA or AbilityOne trainings. NCD heard from both larger and smaller agencies, and it is apparent 

that smaller agencies struggle to maintain as much involvement in the AbilityOne Program as larger 

agencies. This was a point of frustration with some agencies that felt that they were paying a large 

sum of money, through the program fee, and should be aided like larger NPAs.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 81
82 National Council on Disability
Endnotes

1 National Council on Disability, A Cursory Look at the AbilityOne Program (Washington, DC: National Council 

on Disability, 2019). https://ncd.gov/sites/default/files/Documents/A%20Cursory%20Look%20at%20

AbilityOne.pdf.

2 National Council on Disability, From the New Deal to the Real Deal: Joining Industries of the Future

(Washington, DC: National Council on Disability, 2018). https://ncd.gov/sites/default/files/New%20Deal%20

to%20Real%20Deal%20FINAL_508.PDF.

3 Committee of Purchase for People Who Are Blind or Have a Severe Disability, FY 2021 Congressional Budget 

Justification, accessed April 6, 2020, https://www.abilityone.gov/commission/documents/CPPBSD%20

AbilityOne%20FY2021%20CBJ%20Final%2020200208.pdf.

4 National Council on Disability, A Cursory Look at the AbilityOne Program. National Council on Disability, From 

the New Deal to the Real Deal.

5 Office of Inspector General, U.S. AbilityOne Commission, Top Performance and Management Challenges 

Report, December 2, 2019, https://www.abilityone.gov/commission/documents/TMC2019%20-%20

December%202,%202019.pdf.

6 The Javits-Wagner-O’Day Act 41 U.S.C. § 8501-8506, uses the term “severely disabled.” The AbilityOne 

Commission adopted the term “significant” in 2011. https://www.abilityone.gov/laws,_regulations_and_policy

/documents/51.102%20Definitions.pdf. Throughout this report, the National Council on Disability uses the 

term “significant” except when directly quoting sources.

7 National Council on Disability. A Cursory Look at the AbilityOne Program, 6.

8 University of Leicester, “The Social and Medical Model of Disability,” accessed April 6, 2020, https://

www2.le.ac.uk/offices/accessability/staff/accessabilitytutors/information-for-accessability-tutors/the-social

-and-medical-model-of-disability.

9 Stillmyrevolution, “The Charity Model,” accessed April 6, 2020, https://stillmyrevolution.org/2012/01/01/the

-charity-model/.

10 The Federal Government began to track the unemployment rate for persons with disabilities starting in 2008, 

and it is therefore not possible to determine how many people with disabilities were unemployed in 1938. 

Since 2009, based on National Council on Disability analysis of statistics from the U.S. Department of Labor, 

Bureau of Labor Statistics, the unemployment rate of persons with disabilities has been slightly more than 

two times the rate of persons without a disability.

11 Fair Labor Standards Act of 1938, Pub. L. No. 718, ch. 676, 52 Stat. 1060 (1938) (current version at 29 U.S.C. 

§ 8 [2006]). Wagner-O’Day Act, Pub. L. No. 75-739, 52 Stat. 1196 (1938).

12 Johnathan Grossman, “Fair Labor Standards Act: Maximum Struggle for a Minimum Wage,” accessed 

December 8, 2019, https://www.dol.gov/general/aboutdol/history/flsa1938.

13 Ibid.

14 29 U.S.C. § 214.

15 William Whittaker, Treatment of Workers with Disabilities Under Section 14(c) of the Fair Labor Standards Act

(Washington, DC: Congressional Research Service, 2005), accessed April 6, 2020, http://digitalcommons.ilr

.cornell.edu/key_workplace/209.

16 Mathew Crawford and Joshua Goodman, “Below the Minimum: A Critical Review of the 14(c) Minimum 

Wage Program for Workers with Disabilities,” Hofstra Labor and Employment Law Journal 30, no. 2 (2013): 

4–5, accessed April 6, 2020, https://scholarlycommons.law.hofstra.edu/cgi/viewcontent.cgi?article=1556

&context=hlelj.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 83
17 Ibid.

18 Mary Jane Surrago, “Empowering People, the Stories of National Industries for the Blind and Its Associated 

Industries,” National Industries for the Blind, accessed April 6, 2020, https://www.nib.org/sites/default/files

/FINAL_Empowering%20People_sliced%20cover_508v2.pdf.

19 41 U.S.C. § 46 et seq.

20 41 U.S.C. § 8504(a).

21 Ibid.

22 29 U.S.C. § 201.

23 Mathew Crawford and Joshua Goodman, “Below the Minimum: A Critical Review of the 14(c) Minimum 

Wage Program for Workers with Disabilities,” 4–5.

24 Amendments to the Wagner-O’Day Act: Before House of Representatives, Special Studies Subcommittee 

on Government Operations. United States Congress. Government Operations, 89, accessed April 6, 2020, 

https://books.google.com/books?id=M64DmmB969UC&pg=PP6&dq=1971+house+hearings+subcommittee

+on+special+studies+Wagner+o+day&hl=en&newbks=1&newbks_redir=0&sa=X#v=onepage&q=1971%20

house%20hearings%20subcommittee%20on%20special%20studies%20Wagner%20o%20day&f=false.

25 Ibid., 104.

26 Javits-Wagner-O’Day Act, Pub. L. No. 92-28, 85 Stat. 77 (1971), 41 U.S.C. §§ 8501– 8506.

27 Amendment to the Fair Labor Standards Act of 1938, Pub. L. No. 99-486, 100 Stat. 1229 (1986).

28 William Whittaker, Treatment of Workers with Disabilities Under Section 14(c), 25.

29 41 U.S.C. § 8501(2) & (5).

30 41 U.S.C. §§ 8501–8506.

31 National Council on Disability, A Cursory Look at the AbilityOne Program, 6. U.S. AbilityOne Commission. 

“History,” accessed April 7, 2020, https://www.abilityone.gov/abilityone_program/history.html.

32 National Industries for the Blind, “Our History,” accessed April 6, 2020, https://www.nib.org/about/nib-history/.

33 SourceAmerica. “History,” accessed April 6, 2020, https://www.sourceamerica.org/history.

34 Ibid.

35 American Foundation for the Blind. “AFB’s New Role in the AbilityOne Program,” accessed April 6, 2020, 

https://www.afb.org/research-and-initiatives/employment/ability-one.

36 U.S. AbilityOne Commission, “Key Points on Designation of American Foundation of the Blind as a New 

AbilityOne Central Nonprofit Agency” (July 26, 2018), accessed April 6, 2020, https://www.abilityone.gov

/media_room/documents/U.S.%20AbilityOne%20Commission%20Key%20Points%20on%20New%20

AbilityOne%20CNA%2020180726.pdf.

37 Sarah Goering, “Rethinking Disability: The Social Model of Disability and Chronic Disease,” Current Reviews 

in Musculoskeletal Medicine 8, no. 2: 134–138, accessed April 6, 2020, https://www.ncbi.nlm.nih.gov/pmc

/articles/PMC4596173/.

38 Rehabilitation Act of 1973, Pub. L. No. 93-112, 87 Stat. 355 (1973).

39 National Council on Disability, Rehabilitating Section 504 (Washington, DC: National Council on Disability, 

2003), accessed April 6, 2020, https://ncd.gov/publications/2003/Feb122003#ChapterI.

40 Ibid.

41 Education for All Handicapped Children Act, Pub. L. No. 94-142, 89 Stat. 773 (1975).

42 Americans with Disabilities Act of 1990, Pub. L. No. 101-336, § 2, 104 Stat. 327 (1990)., accessed April 7, 

2020, The original ADA is available at https://www.ada.gov/archive/adastat91.htm.

43 42 U.S.C. § 12101 et seq.

44 National Council on Disability, Has the Promise Been Kept? Federal Enforcement of Disability Rights Laws 

(Part 1). (Washington, DC: National Council on Disability, 2018), 101, accessed April 6, 2020, https://ncd.gov

/sites/default/files/Documents/NCD_Federal-Enforcement_508.pdf.

45 Olmstead v. L.C., 527 U.S. 581 (1999).

84 National Council on Disability
46 Workforce Innovation and Opportunity Act, Pub. L. No. 113-128, 128 Stat. 1425 (2014).

47 For a discussion of the history of sheltered workshops and the payment of subminimum wages, see William 

Whittaker, Treatment of Workers with Disabilities Under Section 14(c). 

48 34 C.F.R. Part 397.

49 Coalition to Advance Competitive Integrated Employment, “What Is the Workforce Innovation and Opportunity 

Act,” accessed April 7, 2020, https://integratedemploymentnow.org/learn-more/what-is-wioa/.

50 Congress has made repeated observations regarding challenges in transparency. During the amendments 

of the Wagner-O’Day Act in 1971, Congress stated: “The Committee’s procedures have not necessarily 

complied with due process of law, such as adequate notice, presentation of views prior to adding to or 

removing commodities at a fair market price.  . . .” See also GAO-13-457, “Employing People with Blindness or 

Severe Disabilities: Enhanced Oversight of the AbilityOne Program Needed” (May 2013). See also “Panel on 

Department of Defense and AbilityOne Contracting Oversight, Accountability, and Integrity,” 2018 First Annual 

Report to Congress (898 Panel Report [2018]).

51 Ibid.

52 41 U.S.C. § 8502(b)(1).

53 Ibid.

54 41 U.S.C. § 8502(b)(2), (3).

55 41 U.S.C. § 8503(a).

56 41 U.S.C. § 8503(b).

57 41 C.F.R § 51-2.2.

58 Office of Inspector General, U.S. AbilityOne Commission, Top Management and Performance Challenges 

Report (December 2, 2019), accessed April 6, 2020, https://www.oversight.gov/sites/default/files/oig-reports

/TMC2019%20-%20December%202%2C%202019.pdf.

59 Ibid., 4.

60 Ibid., 5.

61 Ibid.

62 National Federation of the Blind v. U.S. AbilityOne Commission, 421 F.Supp.3d. 102, 136 (Sept. 2019) appeal 

filed (4th Cir., Dec. 6, 2019).

63 41 C.F.R. § 51-3.

64 41 C.F.R. § 51-3.2(b).

65 41 C.F.R. § 51-3.2(b).

66 Based on interview with National Industries for the Blind staff.

67 Enhanced Oversight of the AbilityOne Program Needed (Washington, DC: U.S. Government Accountability 

Office, 2013), 4, accessed April 6, 2020, https://www.gao.gov/products/GAO-13-457.

68 Advisory Committee on Increasing Competitive Integrated Employment for Individuals with Disabilities, 

Final Report (September 15, 2016), 58, accessed April 6, 2020, https://www.dol.gov/odep/topics/pdf/ACICIEID

_Final_Report_9-8-16.pdf.

69 Panel on Department of Defense and AbilityOne Contracting, Oversight, Accountability, and Integrity, 2018 

First Annual Report to Congress (Washington, DC: Office of the Under Secretary of Defense for Acquisition 

and Sustainment, July 18, 2018), 17, accessed April 6, 2020, https://www.acq.osd.mil/dpap/cpic/cp/docs/First

_Annual_RTC_on_the_Panel_on_DoD_and_AbilityOne_Signed_18_July_18.pdf.

70 Office of Inspector General, U.S. AbilityOne Commission, Audit Plan for Fiscal Years 2018–2019 (August 9, 

2017), accessed April 6, 2020, https://www.abilityone.gov/commission/documents/Audit%20Plan%20for%20

FY2018-2019-final.pdf.

71 U.S. AbilityOne Commission. Fiscal Year 2019: Performance and Accountability Report, accessed April 6, 

2020, https://www.abilityone.gov/commission/documents/U.S.%20AbilityOne%20Commission%20PAR%20

FY%202019%20Post%20Final.pdf.

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 85
72 John Elkins, “Innovative Contract Approach Earns MICC Team Army Award,” Defense Visual Information 

Distribution Service, accessed March 23, 2020, https://www.dvidshub.net/news/357328/innovative-contract

-approach-earns-micc-team-army-award.

73 Panel on Department of Defense and AbilityOne Contracting, Oversight, Accountability, and Integrity, 2018 

First Annual Report to Congress (Washington, DC: Office of the Under Secretary of Defense for Acquisition 

and Sustainment, January 15, 2020), accessed April 6, 2020, https://www.acq.osd.mil/dpap/cpic/cp/docs

/Sec_898_Second_Annual_RTC_(with_Appendices)_signed_15_Jan_2020.pdf.

74 38 U.S.C. §8127(d).

75 Consolidated Appropriations Act, 2016, Pub. L. No. 114-113, Division H, Title IV, §§ 01-402, 129 Stat. 2242, 

2639 (2015).

76 Ibid.

77 Consolidated Appropriations Act, 2016, Pub. L. No. 114-113, Division H, Title IV, §§ 401-402, 129 Stat. 2242, 

2639 (2015); § 402, 129 Stat. 2242, 2639. Section 402 references section 4 of the CAA, 129 Stat 2242, 2244, 

which in turn references the Chairman of the Committee on Appropriations of the House December 17 

statement. The portion of the statement relevant to the Committee for Purchase that specifies the reports to 

be submitted may be found at 161 Cong. Rec. H10161-01, H10292 (December 17, 2015).

78 Cooperative Agreements (Agreements) between the U.S. AbilityOne Commission (Commission) and 

the central nonprofit agencies, https://www.abilityone.gov/commission/documents/Final%20Report%20

AbilityOne%20Cooperative%20Agreement_CLA.pdf.

79 Cooperative Agreement between the Committee for Purchase from People who are Blind or Severely Disabled 

and the National Industries for the Blind, June 14, 2019, https://www.abilityone.gov/laws,_regulations_and_policy

/documents/SourceAmerica%20Cooperative%20Agreement%2006.14.19.pdf.

80 Ibid.

81 Ibid., 41.

82 Ibid.

83 Consolidated Appropriations Act, 2016, Pub. L. No. 114-113, Division H, Title IV, §§ 401-402,129 Stat. 2242, 

2639 (2015).

84 Office of Inspector General, U.S. AbilityOne Commission, Performance Audit Report in the Cooperative 

Agreement (April 8, 2020), accessed June 3, 2020,

85 Panel on Department of Defense and AbilityOne Contracting, 2018 First Annual Report to Congress.

86 56 Fed. Reg. 187 (September 26, 1991) as amended in 71, Fed. Reg. 227 (November 27, 2006).

87 U.S. AbilityOne Commission, FY 2019 Performance and Accountability Report.

88 Ibid.

89 Government Accountability Office, Enhanced Oversight of the AbilityOne Program Needed (Washington, DC: 

U.S. Government Accountability Office, 2013), 10–11, accessed April 6, 2020, https://www.gao.gov/products

/GAO-13-457.

90 Ibid.

91 Ibid.

92 Panel on Department of Defense and AbilityOne Contracting, 2018 First Annual Report to Congress.

93 Office of Inspector General, U.S. AbilityOne Commission, Performance Audit Report on the AbilityOne 

Program Fee (December 20, 2019), accessed April 6, 2020 https://www.abilityone.gov/commission

/documents/Final%20Report%20-%20US%20AbilityOne%20Program%20Fee%20Audit_12-20-2019.pdf.

94 41 C.F.R. § 51-3.2(b).

95 41 C.F.R. § 51-3.2(j).

96 41 C.F.R. § 51-1.3.

97 41 C.F.R. § 51-1.3.

98 National Council on Disability, From the New Deal to the Real Deal, 125.

99 Rehabilitation Services Administration, “Regulations Implementing the Rehabilitation Act of 1973, as 

Amended by the Workforce Innovation and Opportunity Act, Regional Training Series,” slide 11, accessed 

86 National Council on Disability
January 3, 2019, https://www2.ed.gov/about/offices/list/osers/rsa/wioa/employment-outcomes-competitive

-integrated-employment.pdf.

100 Committee for Purchase, Fiscal Year 2019 Budget Justification, 5.

101 AbilityOne Commission staff written responses to the National Counsel on Disability research questions, 

2018.

102 Advisory Committee on Increasing Competitive Integrated Employment for Individuals with Disabilities, Final 

Report (September 15, 2016), 58–59, accessed April 6, 2020, https://www.dol.gov/odep/topics/pdf/ACICIEID

_Final_Report_9-8-16.pdf.

103 Ibid.

104 Mathematica, Designing a Reduced-Ratio Pilot for the AbilityOne Program, September 2019, accessed April 6, 

2020, https://www.sourceamerica.org/sites/default/files/report/files/dlr-reduction-pilot-final-report_2.pdf.

105 Panel on Department of Defense and AbilityOne Contracting, 2018 First Annual Report to Congress, 32.

106 Office of Inspector General, U.S. AbilityOne Commission, Top Management and Performance Challenges 

Report, 18.

107 Ibid.

108 Committee for Purchase from People Who Are Blind or Severely Disabled, “Committee Staff Nonprofit 

Agency Review Manual” (June 29, 2007), §§ 3.8.1, accessed April 7, 2020, https://www.abilityone.gov/laws,

_regulations_and_policy/documents/ComplianceManual.pdf.

109 Ibid.

110 Panel on Department of Defense and AbilityOne Contracting, Oversight, Accountability, and Integrity, 2018 

First Annual Report to Congress (Washington, DC: Office of the Under Secretary of Defense for Acquisition 

and Sustainment, July 18, 2018), 17, accessed July 23, 2020, https://www.acq.osd.mil/dpap/cpic/cp/docs

/First_Annual_RTC_on_the_Panel_on_DoD_and_AbilityOne_Signed_18_July_18.pdf.

111 Committee for Purchase, “Committee Staff Nonprofit Agency Review Manual,” 6 §§ 3.9.2, 3.9.3, and 

Competitive Employment Evaluation contained in the manual.

112 National Council on Disability, A Cursory Review of the AbilityOne Program, 14.

113 34 C.F.R. § 361.1.

114 According to the Job Accommodation Network (JAN), reasonable accommodations for employees with 

disabilities are rarely that expensive. JAN reports that 19 percent of reasonable accommodation requests cost 

nothing at all, 50 percent of the requests cost less than $500, and 80 percent of the requests cost less than 

$1,000, accessed April 7, 2020, https://askjan.org/topics/costs.cfm.

115 National Council on Disability, From the New Deal to the Real Deal, 40.

116 Ibid.

117 Rooted In Rights, “Bottom Dollars” (October 25, 2018), Video, 6:32, accessed April 6, 2020, https://www

.youtube.com/watch?v=O3yjHzMv_84&list=PLaYgKAZMUNMx9Ca-9Z4NdIIwLCuQ7FJcB&index=8&t=0s.

118 41 U.S.C. § 8501(5), (8).

119 41 C.F.R. 51-1.3 (definitions): Other severely disabled and severely disabled individuals (hereinafter persons with 

severe disabilities) mean a person other than a blind person who has a severe physical or mental impairment 

(a residual, limiting condition resulting from an injury, disease, or congenital defect) that so limits the person’s 

functional capabilities (mobility, communication, self-care, self-direction, work tolerance, or work skills) that the 

individual is unable to engage in normal competitive employment over an extended period of time.

120 Panel on Department of Defense and AbilityOne Contracting, 2018 First Annual Report to Congress.

121 Advisory Committee on Increasing Competitive Integrated Employment for Individuals with Disabilities, Final 

Report.

122 Office of Inspector General, U.S. AbilityOne Commission, Top Management and Performance Challenges 

Report, 11.

123 Ibid., 7.

124 Ibid., 8. See also PDS Consultants v. United States, 907 F.3d 1345 (Fed. Cir. 2018) cert. denied 2020 WL 

129560 (January 13, 2020).

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 87
125 Committee for Purchase, FY 2021 Congressional Budget Justification, 5.

126 Committee for Purchase, FY 2020 Congressional Budget Justification, 18. Committee for Purchase, FY 2021 

Congressional Budget Justification, 5.

127 Committee for Purchase, FY 2021 Congressional Budget Justification, 6.

128 Office of Inspector General, U.S. AbilityOne Commission, Top Management and Performance Challenges 

Report, 14.

129 Panel on Department of Defense and AbilityOne Contracting, 2018 First Annual Report to Congress.

130 Office of Inspector General, U.S. AbilityOne Commission, Audit of the U.S. AbilityOne Commission’s 

Financial Statements For Fiscal Year 2019, 2, https://www.abilityone.gov/commission/documents/FY%20

2019%20U.S.%20AbilityOne%20Commission%20Financial%20Statement%20Audit%20(Report%20

No.%2020-02).pdf.

131 National Council on Disability, A Cursory Review of the AbilityOne Program.

132 Committee for Purchase, 2020 Budget Justification, 27.

133 Commission reports include the number of employees worked back to FY 2008 and also includes direct labor 

hours worked back to FY 2008 but provides rounded figures for FY 2008 and FY 2010. Total wages paid to 

people who are blind or have significant disabilities is reported back to FY 2008, but the Commission began 

reporting AbilityOne Program sales to the government starting in FY 2011.

134 Data based on report in Annual Congressional Budget Justifications. Data is not available for FY 2013; for FY 

2008 and 2010, the Commission provided rounded figures for hours worked.

135 National Council on Disabilities, A Cursory Look at the AbilityOne Program, 15.

136 Using 2011 as the base year (Consumer Price Index of 224.939), the National Council on Disability calculated 

AbilityOne Program sales in constant 2011 dollars as follows: FY 2011, $2.982 billion; FY 2012, $2.803 billion; 

FY 2013, data not available; FY 2014, 2.738 billion; FY 2015, 2.993 billion; FY 2016, 3.124 billion; FY 2017, 

3.070 billion; FY 2018, 3.232 billion.

137 Using 2011 as the base year (Consumer Price Index of 224.939), the National Council on Disability calculated 

AbilityOne Program wages paid in constant 2011 dollars as follows: FY 2011, $599.1 million; FY 2012, 

$546.39 million; FY 2013, data not available; FY 2014, $530.19 million; FY 2015, $559.37 million; FY 2016, 

577.51 million; FY 2017, $574.64 million; FY 2018, $587.82 million.

138 Committee for Purchase, 2021 Congressional Budget Justification, 14–15 (figure 2).

139 Ibid.

140 The National Industries for the Blind (NIB) provide the National Council on Disability (NCD) with the 

NIB program fee revenue from FY 2011 to FY 2018. Using 2011 as the base year (Consumer Price 

Index of 224.939), NCD calculated the NIB program fee in constant 2011 dollars to adjust for inflation. 

The real dollar figure provided by NIB and the constant dollar figure calculated by NCD are as follows: 

FY 2011: $25,635,298 (real dollars), $25,635,398 (constant dollars); FY 2012: $26,055,151 (real dollars), 

$23,755,251.84 (constant dollars); FY 2013: $24,602,013 (real dollars), $23,489,832.97 (constant dollars); 

FY 2014: $24,721,765 (real dollars), $25,526,884.90 (constant dollars); FY 2015: $26,789,124 (real dollars), 

$25,423,993.91 (constant dollars); FY 2016: $26,942,848 (real dollars), $25,251,335.53 (constant dollars); 

FY 2017: $28,025,291 (real dollars), $25,717,937.88 (constant dollars); FY 2018: $29,558,807 (real dollars), 

$26,478,467.30 (constant dollars).

141 The National Council on Disability (NCD) calculated the SourceAmerica program fee in constant 2011 

dollars to adjust for inflation. The real dollar figure provided by SourceAmerica and the constant dollar figure 

calculated by NCD are as follows: FY 2011: $75,385,458 (real dollars), $75,385,458 (constant dollars); FY 2012: 

$75,001,132 (constant dollars), $73,480,490 (real dollars); FY 2013: $72,003,644 (real dollars), $69,525,396 

(constant dollars); FY 2014: $73,600,153 (real dollars), $69,932,518 (constant dollars); FY 2015: $80,630,773 

(real dollars), $76,521,960 (constant dollars); FY 2016: $83,937,505 (real dollars), $78,667,782 (constant 

dollars); FY 2017: $84,751,228 (real dollars), $77,773,565 (constant dollars); FY 2018: $91,796,485 (real 

dollars), $82,230,322 (constant dollars).

88 National Council on Disability
142 AbilityOne Commission, “Skilcraft Products,” accessed April 6, 2020, https://www.abilityone.gov

/procurement_list/product_skilcraft.html.

143 Committee for Purchase, FY 2017 Budget Justification, 26. Committee for Purchase, FY 2018 Budget 

Justification, 20. Committee for Purchase, FY 2020 Budget Justification, 30. Committee for Purchase, FY 2020 

Budget Justification, 30. Committee for Purchase, FY 2020 Budget Justification, 31.

144 Using 2014 as the base year (Consumer Price Index of 236.736), the National Council on Disability calculated 

wages in constant dollars as follows: FY 2014: $12.44 an hour (actual dollars), $12.44 an hour (constant 

dollars); FY 2015: $13.01 an hour (actual dollars), $12.99 an hour (constant dollars); FY 2016: $13.01 an hour 

(actual dollars), $12.83 an hour (constant dollars); FY 2017 $13.32 an hour (actual dollars), $12.86 an hour 

(constant dollars); FY 2018: $13.72 an hour (actual dollars), $12.93 an hour (constant dollars).

145 Data provide by the National Industries for the Blind (NIB) and SourceAmerica. In response to the inquiry by 

the National Council on Disability, NIB stated that “NIB has not historically tracked/reported out the ‘average 

annual wages’ of employees. NIB tracks average hourly wages which more accurately reflect wages paid 

to individuals who are blind, regardless of how many hours they worked, and is more easily comparable to 

wages paid outside of AbilityOne employment.”

146 National Council on Disability, The New Deal to the Real Deal. National Council on Disability, Subminimum 

Wage and Supported Employment (Washington, DC: National Council on Disability, 2012), accessed July 23, 

2020, https://ncd.gov/publications/2012/August232012.

147 U.S. Department of Labor, Wage and Hour Division, “Fact Sheet #39B: Prevailing Wages and Commensurate 

Wages Under Section 14(c) of the Fair Labor Standards Act (FLSA),” accessed April 7, 2020, https://www.dol

.gov/whd/regs/compliance/whdfs39b.pdf.

148 Executive Order 13658, accessed July 23, 2020, https://www.dol.gov/agencies/whd/government-contracts

/minimum-wage.

149 U.S. Department of Labor, Wage and Hour Division. “Fact Sheet #39B: Prevailing Wages and Commensurate 

Wages under Section 14(c).”

150 U.S. AbilityOne Commission, “Declaration in Support of Minimum Wage for All People Who Are Blind or Have 

Significant Disabilities” (March 18, 2016), accessed April 7, 2020, https://abilityone.gov/commission/documents

/US%20AbilityOne%20Commission%20Declaration%2018March2016%20Final.pdf.

151 SourceAmerica, “Letter to NPA Leaders,” accessed April 7, 2020, http://wintac-s3.s3-us-west-2.amazonaws

.com/topic-areas/ta_511/SourceAmerica-Letter.docx.

152 29 U.S.C. § 705(5).

153 29 U.S.C. § 705(38).

154 34 C.F.R § 361.5(c)(11).

155 Virginia Commonwealth University, Center on Transition Innovations, “Customized Employment” (December 19, 

2014), accessed April 7, 2020, https://youtu.be/_FPIeCubuPo.

156 Jean Winsor, Jaimie Timmons, John Butterworth, Alberto Migliore, Daria Domin, Agnes Zalewska, and John 

Shepard, StateData: The National Report on Employment Services and Outcomes Through 2019 (Boston, MA: 

University of Massachusetts Boston, Institute for Community Inclusion, 2019).

157 National Association of State Directors of Development Disabilities Services and Human Services Research 

Institute, National Core Indicator, https://www.nationalcoreindicators.org.

158 Melanie Bush, “Addressing the Root Cause: Rising Health Care Costs and Social Determinants of Health,” 

North Carolina Medical Journal 79, no. 1 (January 2015): 26–29. Philip W. Bush, Robert E. Drake, Haiyi Xie, 

Gregory J. McHugo, and William R. Haslett, “The Long-term Impact of Employment on Mental Health Service 

Use and Costs for Persons with Severe Mental Illness,” Psychiatric Services 60, no. 9 (August 2009): 1024–

1031. Jean P. Hall, Noelle K. Kurth, and Suzanne L. Hunt, “Employment as a Health Determinant for WorkingAge, Dually-Eligible People with Disabilities,” Disability Health Journal 6, no. 2 (April 2013): 100–106.

159 Evan E. Dean, Karrie A. Shogren, Mayumi Hagiwara, and Michael L. Wehmeyer, “How Does Employment 

Influence Health Outcomes? A Systematic Review of the Intellectual Disability Literature,” Journal of Vocational 

Policies from the Past in a Modern Era: The Unintended Consequences of AbilityOne 89
Rehabilitation 49, no. 1 (August 2018): 1–13. Nanette Goodman, Policy brief: The Impact of Employment 

on the Health Status and Health Care Costs of Working-Age People with Disabilities (Washington, DC: The 

National Center on Leadership for the Employment and Economic Advancement of People with Disabilities 

(LEAD Center), (November 2015), accessed July 23, 2020, http://www.leadcenter.org/system/files/resource

/downloadable_version/impact_of_employment_health_status_health_care_costs_0.pdf.

160 Bush, “Addressing the Root Cause.”

161 National Council on Disability, Has the Promise Been Kept? Federal Enforcement of Disability Rights Laws 

National Council on Disability (Part 1) (Washington, DC: National Council on Disability, 2018), 99, accessed 

July 23, 2020, https://ncd.gov/progressreport-publications/2018/has-promise-been-kept.

162 Ibid., 56.

163 Ibid.

164 Ibid., 57.

165 Ibid.

166 Ibid., 58.

167 Ibid.

168 Ibid.

169 Ibid.

170 Ibid.

171 Ibid., 61.

172 Ibid.

173 U.S. AbilityOne Commission, “Mission and Vision,” accessed April 7, 2020, https://www.abilityone.gov

/commission/mission.html.

90 National Council on Disability
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