Should grantees prove unable to meet performance expectations, their funding may be subject to competition. The Department of Labor will evaluate each grantee within 120 days after the end of the Program Year that ends June 30. It will provide technical assistance and require a corrective action plan for those grantees that are unable to meet their performance levels. Grantees that do not reach their performance levels after a second consecutive program year will have 25 percent of their funds awarded to another entity through competition. After a third consecutive year of underperformance the Department will oversee a competition for the grantee's entire grant award.
Governors are responsible for overseeing all aspects of performance in their State programs.
In addition, Governors may request the Department of Labor to review the performance of any national grantee in the State. Under the legislation, the Department will determine the initial eligibility of grantees through 14 responsibility tests. The OAA Amendments also establish uniform definitions of program and administrative costs and strengthen current Departmental regulations that stipulate that not less than 75 percent of Federal funds go directly to program participants in the form of wages and fringe benefits. Through the OAA Amendments, Congress sought to ensure that grantees and subgrantees received sufficient administrative resources to cover their costs. Therefore, the legislation requires grantees to pass through a sufficient amount of their administrative cost allocation to the subgrantee.