126
(2) MANDATORY
ACTIVITIES.—Such activities
shall include—
(A) rapid response activities; and
(B) additional assistance to areas that ex-
perience disasters, mass layoffs or plant clos-
ings, or other events which precipitate substan-
tial increases in the number of unemployed
workers, to be expended in accordance with the
local plan of the relevant workforce development
area.
(3) DISCRETIONARY ACTIVITIES.—
(A) IN GENERAL.—Such activities may in-
clude—
(i) subject to subparagraph (B), ad-
ministration by the State of programs
under this subtitle;
(ii) capacity building and technical as-
sistance to local workforce development
areas, integrated career center systems,
and service providers, including the devel-
opment and training of staff and the devel-
opment of exemplary program activities;
(iii) incentives for program coordina-
tion, performance awards, and research
and demonstrations;
127
(iv) implementation of innovative in-
cumbent worker training programs, which
may include the establishment and imple-
mentation of an employer loan program to
assist in skills upgrading (in accordance
with the requirements of section 324);
(v) 
implementation 
of 
experimen-
tation, model activities, pilot projects, and
demonstration projects which further the
goals and purposes of this Act;
(vi) additional assistance for the de-
velopment and implementation of the inte-
grated career center system of the State
established in accordance with title I;
(vii) support for a common manage-
ment information system as described in
section 109; and
(viii) implementation of innovative
programs to increase the number of indi-
viduals trained and placed in nontradi-
tional employment.
(B) LIMITATION.—Not more than 25 per-
cent of the amount reserved by the Governor
under paragraph (1) may be used for adminis-
128
tration by the State of programs under this
subtitle.
(b) WITHIN STATE ALLOCATION.—
(1) IN GENERAL.—The Governor of the State
shall allocate the remainder of the amount allotted
to the State under section 312(b) to workforce devel-
opment areas designated under title I of this Act, in
accordance with paragraphs (1) and (2) of such sec-
tion, for the purpose of providing employment, job
training, and related services for adults in accord-
ance with section 315.
(2) WITHIN STATE FORMULA.—
(A) 
ESTABLISHMENT.—The 
Governor,
through the collaborative process under section
103 of this Act, and after consultation with
local chief elected officials in the local workforce
development area, shall develop a formula for
the allocation of 90 percent of the remainder of
funds described in paragraph (1), to workforce
development areas, taking into account—
(i) poverty rates within each local
workforce development area, as determined
by the State;
(ii) unemployment rates within each
local workforce development area;
129
(iii) the proportion of the State’s
adult population residing within each local
workforce development area; and
(iv) such other factors as considered
appropriate.
(B) ADDITIONAL FACTORS.—In establish-
ing such formula, the Governor shall ensure
that funds are distributed equitably throughout
the State, and that the factors described in sub-
paragraph (A) do not receive disproportionate
weighting.
(3) WITHIN
STATE
DISCRETIONARY
ALLOCA-
TION.—In addition, the Governor is authorized to al-
locate 10 percent of the remainder of funds de-
scribed in paragraph (1) to workforce development
areas designated under title I of this Act. Amounts
may be allocated to such areas as determined by the
Governor.
SEC. 314. ADDITIONAL STATE PLAN REQUIREMENTS.
The State shall, as part of the State workforce devel-
opment and literacy plan under title I of this Act, submit
to the Secretary the following additional information:
(1) A description of how the State will serve the
employment and training needs of dislocated work-
ers, economically disadvantaged individuals, older
130
workers, individuals with disabilities, displaced
homemakers, veterans, and individuals with multiple
barriers to employment (as determined by the
State), including individuals who are basic skills de-
ficient and individuals seeking to enter nontradi-
tional employment.
(2) A description of how the State will provide
rapid response assistance to workers experiencing
dislocation as a result of mass layoffs and plant clos-
ings, either through the direct provision of services
or through the transfer of funds to local workforce
development areas for the provision of such services.
SEC. 315. USE OF AMOUNTS.
(a) CORE SERVICES.—Amounts allocated under sec-
tion 313(b) shall be used to provide core services to adults
through integrated career center systems in accordance
with title I of this Act.
(b) INTENSIVE SERVICES.—
(1) IN
GENERAL.—Amounts allocated under
section 313(b) shall be used to provide intensive
services to adults—
(A) who are unable to obtain employment
through core services under subsection (a); and
131
(B) who have been determined to be in
need of more intensive services in order to gain
employment.
(2) DELIVERY
OF
SERVICES.—Such intensive
services shall be provided—
(A) directly through integrated career cen-
ter systems in accordance with title I of this
Act; or
(B) through contracts through such sys-
tems with service providers approved by the
local workforce development board, which may
include private, for-profit providers.
(3) TYPES OF SERVICES.—Such intensive serv-
ices may include the following:
(A) Comprehensive and specialized assess-
ments of the skill levels and service needs of
adults, which may include—
(i) diagnostic testing and other assess-
ment tools; and
(ii) in-depth interviewing and evalua-
tion to identify employment barriers and
appropriate employment goals.
(B) Development of an individual employ-
ment plan, to identify the employment goals,
appropriate achievement objectives, and the ap-
132
propriate combination of services for the adult
to achieve the employment goal.
(C) Group counseling.
(D) Individual counseling and career plan-
ning.
(E) Case management for adults receiving
education and training services under sub-
section (c) or supportive services under sub-
section (d).
(F) Follow-up counseling for adults placed
in training or employment, for up to 1 year.
(c) EDUCATION AND TRAINING SERVICES.—
(1) IN
GENERAL.—Amounts allocated under
section 313(b) shall be used to provide education
and training services to adults—
(A) who are unable to obtain employment
through core services under subsection (a);
(B) who are in need of education and
training services in order to gain employment
as a result of determinations made through—
(i) preliminary assessments under sec-
tion 107(f)(1)(B) of this Act; or
(ii) comprehensive and specialized as-
sessments under subsection (b)(3)(A); and
133
(C) who are unable to obtain other grant
assistance for such services, such as through
Federal Pell Grants established under title IV
of the Higher Education Act of 1965.
(2) DELIVERY OF SERVICES.—Such education
and training services shall be provided through edu-
cation and training providers certified in accordance
with title I of this Act.
(3) TYPES OF SERVICES.—Such education and
training services may include the following:
(A) Basic skills training, including reme-
dial education, literacy training, and English
literacy program instruction.
(B) Occupational skills training, including
training for nontraditional employment.
(C) On-the-job training.
(D) Programs that combine workplace
training with related instruction.
(E) Training programs operated by the
private sector.
(F) Skill upgrading and retraining.
(G) Entrepreneurial training.
(H) Employability training to enhance
basic workplace competencies.
134
(I) Customized training conducted with a
commitment by an employer or group of em-
ployers to employ an individual upon successful
completion of the training.
(4) ADDITIONAL REQUIREMENTS.—
(A) USE OF CAREER GRANTS.—
(i) IN GENERAL.—Except as provided
in clause (ii) and clause (iii), education
and training services under this section
shall be provided through the use of career
grants in accordance with this subsection,
and shall be distributed to eligible individ-
uals through integrated career centers or
affiliated sites as described in section 107,
and in accordance with section 108 regard-
ing the identification of eligible education
and training providers.
(ii) 
EXCEPTIONS.—Education 
and
training services authorized under this title
may be provided pursuant to a contract for
services in lieu of a career grant if—
(I) such services are on-the-job
training provided by an employer;
(II) the local workforce develop-
ment board determines there are an
135
insufficient number of certified pro-
viders of education and training serv-
ices in the workforce development
area to accomplish the purposes of a
career grant system;
(III) the local workforce develop-
ment board determines that the cer-
tified providers of education and
training in the workforce development
area are unable to provide effective
services to special participant popu-
lations; or
(IV) the local workforce develop-
ment board decides to enter into a di-
rect training contract with a commu-
nity based organization serving special
participant populations.
(iii) TRANSITION.—States shall within
three years from the date of enactment of
this Act fully implement the requirements
of clause (i), but nothing shall prohibit
States from beginning such implementa-
tion at an earlier date.
(B) LINKAGE
TO
OCCUPATIONS
IN
DE-
MAND.—Education and training services under
136
this subsection shall be directly linked to occu-
pations for which there is a demand in the local
workforce development area, or in another area
to which an adult receiving such services is will-
ing to relocate.
(d) ADDITIONAL SERVICES.—
(1) SUPPORTIVE
SERVICES.—Supportive serv-
ices may be provided for individuals—
(A) who are receiving assistance under any
of subsections (a) through (c); and
(B) who are unable to receive such services
through other programs providing such services.
(2) NEEDS-RELATED PAYMENTS.—
(A) 
IN
GENERAL.—Amounts 
allocated
under section 313(b) may be used to provide
needs-related payments to adults who are un-
employed and do not qualify for (or have ceased
to qualify for) unemployment compensation for
the purpose of enabling such adults to partici-
pate in education and training programs under
subsection (c).
(B) ADDITIONAL
ELIGIBILITY
REQUIRE-
MENTS.—In addition to the requirements con-
tained in subparagraph (A), a dislocated worker
who has exhausted unemployment insurance
137
benefits may be eligible to receive needs-related
payments under this paragraph only if such
worker was enrolled in education or training by
the end of the 8th week of the worker’s initial
unemployment compensation benefit period, or,
if later, by the end of the 8th week after the
worker is informed that a short-term layoff will
in fact exceed 6 months.
(e) PRIORITY.—Local workforce development boards
shall establish a process through which priority is given
to dislocated workers and economically disadvantaged in-
dividuals, for receipt of services provided under sub-
sections (b) and (c), in the event that funds are limited
within the workforce development area.
(f) PROHIBITION ON PRIVATE RIGHT OF ACTION.—
Nothing in this section may be construed to establish a
right for a participant to bring an action to obtain services
under a program established under this section.
(g) LIMITATIONS ON USE OF FUNDS.—Not more
than 10 percent of the funds provided under this title to
a local workforce development board may be used for ad-
ministrative purposes.
Subtitle B—Federal Programs
SEC. 321. NATIONAL DISCRETIONARY GRANTS.
(a) GRANTS FOR DISLOCATED WORKERS.—
138
(1) IN
GENERAL.—From amounts reserved
under section 312(a)(2) for any fiscal year, the Sec-
retary is authorized to award national discretionary
grants to address major economic dislocations that
result from plant closures, base closures, or mass
layoffs.
(2) APPLICATION.—To receive a grant under
this section, an eligible entity shall submit an appli-
cation to the Secretary at such time, in such man-
ner, and accompanied by such information as the
Secretary determines is appropriate.
(3) ELIGIBLE
ENTITIES.—Grants under this
section may be awarded to—
(A) the State;
(B) a local workforce development board
administering assistance under this Act;
(C) employers and employer associations;
(D) worker-management transition assist-
ance committees and other employer-employee
entities;
(E) representatives of employees;
(F) community development corporations
and community-based organizations; and
(G) industry consortia.
139
(b) INCENTIVE GRANTS.—From amounts reserved
under section 312(a)(2) for any fiscal year, the Secretary
may provide awards to States—
(1) to assist in the implementation of exemplary
statewide workforce development system designs;
and
(2) for the achievement of exceptional perform-
ance in the statewide workforce development system.
SEC. 322. DISASTER RELIEF EMPLOYMENT ASSISTANCE.
(a) IN GENERAL.—From amounts reserved under
section 312(a)(2) for any fiscal year, the Secretary may
provide assistance to the Governor of any State within
which is located an area that has suffered an emergency
or a major disaster as defined in paragraphs (1) and (2),
respectively, of section 102 of the Robert T. Stafford Dis-
aster Relief and Emergency Assistance Act (referred to
in this section as the ‘‘disaster area’’).
(b) USE OF FUNDS.—
(1) 
PROJECTS
RESTRICTED
TO
DISASTER
AREAS.—Funds made available under this section—
(A) shall be used exclusively to provide em-
ployment on projects to provide food, clothing,
shelter, and other humanitarian assistance for
disaster victims and on projects regarding dem-
olition, cleanup, repair, renovation, and recon-
140
struction of damaged and destroyed structures,
facilities, and lands located within the disaster
area; and
(B) may be expended through public and
private agencies and organizations engaged in
such projects.
(2) ELIGIBILITY REQUIREMENTS.—An individ-
ual shall be eligible to be offered disaster employ-
ment under this section if such individual is a dis-
located worker or is temporarily or permanently laid
off as a consequence of the disaster.
(3) LIMITATIONS
ON
DISASTER
RELIEF
EM-
PLOYMENT.—No individual shall be employed under
this part for more than 6 months for work related
to recovery from a single natural disaster.
SEC. 323. RESEARCH, DEMONSTRATION, EVALUATION, AND
CAPACITY BUILDING.
(a) IN GENERAL.—From amounts reserved under
section 312(a)(2) for any fiscal year, the Secretary is au-
thorized to establish and carry out research, demonstra-
tion, and capacity building activities in accordance with
this section.
(b) ACTIVITIES.—The Secretary is authorized to
carry out the following activities under this section:
141
(1) RESEARCH.—The Secretary is authorized to
conduct continuing research, which may include
studies and other methods and techniques, that will
aid in the solution of the employment and training
problems of the United States. Such studies may in-
clude the extent to which individuals who participate
in programs established under this title achieve self-
sufficiency as a result of such participation, includ-
ing the identification by State and locality, to the ex-
tent practicable, of indicators measuring such self-
sufficiency.
(2) DEMONSTRATIONS.—The Secretary is au-
thorized to conduct pilot and demonstration projects
for the purpose of developing and improving meth-
ods and techniques for addressing employment and
training needs which may include—
(A) projects conducted jointly with the De-
partment of Defense to develop training pro-
grams utilizing computer-based and other inno-
vative learning technologies. The Secretary may
award grants and enter into contracts with ap-
propriate entities to carry out such projects;
and
(B) Projects which promote the use of dis-
tance learning, enabling students to take
142
courses through the use of media technology
such as videos, teleconferencing, computers, and
the Internet.
(3) EVALUATION.—
(A) ACTIVITIES.—
(i) JOB
TRAINING
ACTIVITIES.—The
Secretary shall provide for the continuing
evaluation of activities conducted under
this Act, including the use of controlled ex-
periments using experimental and control
groups chosen by scientific random assign-
ment, and at a minimum, determine
whether job training and job placement
programs effectively raise the hourly wage
rates of individuals receiving training
through such programs.
(ii) OTHER
PROGRAMS.—The Sec-
retary may conduct evaluations of other
federally funded employment-related activi-
ties 
including 
programs 
administered
under—
(I) the Wagner-Peyser Act (29
U.S.C. 49 et seq.);
(II) the National Apprenticeship
Act (29 U.S.C. 50 et seq.);
143
(III) the Older Americans Act of
1965 (42 U.S.C. 3001 et seq.); and
(IV) the Federal unemployment
insurance program under titles III,
IX, and XII of the Social Security Act
(42 U.S.C. 501 et seq., 1101 et seq.,
and 1321 et seq.).
(B) EFFECTIVENESS.—The Secretary shall
evaluate the effectiveness of programs author-
ized under this Act with respect to—
(i) the statutory goals; and
(ii) the extent to which such programs
enhance the employment and earnings of
participants, reduce income support costs,
improve the employment competencies of
participants in comparison to comparable
persons who did not participate in such
programs, and to the extent feasible, in-
crease the level of total employment over
the level that would have existed in the ab-
sence of such programs.
(4) NATIONAL
PARTNERSHIP
AND
SPECIAL
TRAINING.—The Secretary may award special grants
to eligible entities to carry out activities that are
144
most appropriately administered at the national
level. Such activities may include—
(A) partnerships with national organiza-
tions with special expertise in developing, orga-
nizing, and administering employment and
training services at the national, State, and
local levels, such as industry and labor associa-
tions, public interests groups, community-based
organizations representative of groups that en-
counter special difficulties in the labor market,
in education and training; and
(B) activities that—
(i) address industry-wide skill short-
ages;
(ii) meet training needs that are best
addressed on a multistate basis;
(iii) further the goals of increasing the
competitiveness of the United States labor
force;
(iv) require technical expertise avail-
able at the national level to serve the needs
of particular client groups that encounter
significant barriers to employment and who
the Secretary determines require special
assistance; and
145
(v) promote and experiment with
model activities, pilot projects, and dem-
onstration projects which further the goals
and purposes of this Act.
(5) CAPACITY BUILDING AND TECHNICAL AS-
SISTANCE.—
(A) IN
GENERAL.—The Secretary shall
provide, through grants, contracts, or other ar-
rangements, staff training and technical assist-
ance to States, local workforce development
boards, career centers, communities, business
and labor organizations, service providers, in-
dustry consortia, and other entities, to enhance
their capacity to develop and deliver effective
employment and training services.
(B) ACTIVITIES.—The staff training and
technical assistance authorized under subpara-
graph (A) may include—
(i) development of management infor-
mation systems;
(ii) development and maintenance of a
national capacity building, information and
dissemination network; and
146
(iii) grants for the replication of suc-
cessful employment and training models
and activities.
SEC. 324. WORKFORCE SKILLS AND DEVELOPMENT LOANS.
(a) AUTHORIZATION.—
(1) IN
GENERAL.—From amounts reserved
under section 312(a)(2) for any fiscal year, the Sec-
retary of Labor may use a portion of such amounts
to provide grants to States to provide loans to eligi-
ble entities described in paragraph (2) to assist such
entities in providing skills upgrading.
(2) ELIGIBLE ENTITIES.—An eligible entity de-
scribed in this paragraph is—
(A) an employer;
(B) a representative of employees;
(C) a business association;
(D) a trade organization; or
(E) a consortium consisting of—
(i) more than 1 of the entities de-
scribed in subparagraphs (A) through (D);
or
(ii) an institution of higher education
(as such term is defined in section 481 of
the Higher Education Act of 1965 (20
U.S.C. 1088) which continues to meet the
148
the program, including criteria that provides for the
following:
(A) A loan guarantee may be issued under
the program only if, at the time such guarantee
is issued the eligible entity agrees to pay as an
insurance premium an amount equal to 1 per-
cent of the principal received by such entity
under the loan to the State’s reserve fund.
(B)(i) Subject to clause (ii), the eligible en-
tity will use amounts received from the loan to
provide skills upgrading for mid- and lower-level
employees, which may include—
(I) training in total quality manage-
ment, statistical process control, produc-
tion techniques, office automation, mate-
rials resource planning; and
(II) training to improve basic skills,
including reading, writing, and arithmetic.
(ii) In providing such skills upgrading, the
eligible entity shall give priority to employees
who—
(I) directly produce or deliver goods
or services; or
(II) are in danger of being terminated
or laid off as a result of modernization in
149
the workplace, corporate downsizing, for-
eign or domestic competition, or Federal
policies adversely affecting 1 or more in-
dustries.
(C) Amounts from a loan shall not be used
to pay the wages or other benefits of any em-
ployee receiving assistance under the program.
(3) PAYMENT BY STATE TO FINANCIAL INSTI-
TUTIONS IN CASES OF DEFAULT.—
(A) IN GENERAL.—In accordance with cri-
teria developed by the Secretary, the State shall
make payments from the State’s reserve fund to
financial institutions that have provided loans
to eligible entities that have defaulted on such
loans for the purpose of reimbursing such insti-
tutions for the amount of principal and interest
remaining unpaid to the institutions by reason
of such default.
(B) NO FULL FAITH AND CREDIT OF THE
UNITED STATES.—Loans provided by financial
institutions to eligible entities under loan guar-
antee programs under this section shall not be
obligations of, or guaranteed in any respect by,
the United States.
150
(4) INTEREST
FROM
AMOUNTS
IN
RESERVE
FUND.—Any interest earned from amounts in the
State’s reserve fund shall be credited to such fund.
(d) FEDERAL AND STATE SHARE.—
(1) FEDERAL
SHARE.—The Federal share
under this section may not exceed 50 percent of the
total cost of the program established under sub-
section (c) for any fiscal year.
(2) STATE SHARE.—The State share shall be
provided from non-Federal sources and may be in
cash or in-kind, fairly evaluated.
SEC. 325. EMPLOYMENT, TRAINING, AND EDUCATION AS-
SISTANCE FOR NATIVE AMERICANS.
(a) AUTHORIZATION.—From amounts reserved under
section 4(a)(2) for any fiscal year, there shall be reserved
4 percent, or $85,000,000, whichever is less, to provide
grants to, or enter into contracts or cooperative agree-
ments with, Indian tribes and tribal organizations, trib-
ally-controlled colleges, tribally-controlled postsecondary
vocational institutions, Indian-controlled organizations
serving off-reservation areas, Alaska Native village and re-
gional entities serving areas as described in the Alaska
Native Claims Settlement Act and Hawaiian Native-con-
trolled organizations to provide employment, training, vo-
151
cational rehabilitation, library services, and education as-
sistance for Native Americans.
(b) TRANSFER
OF AUTHORITY
FOR VOCATIONAL
EDUCATION ACTIVITIES.—In carrying out subsection (a),
the Secretary of Labor may enter into an agreement with
the Secretary of Education to carry out any portion of
assistance under such subsection devoted to vocational
educational activities, including support for the United
Tribes Technical College and Crownpoint Institute of
Technology.
(c) CONSOLIDATION OF FUNDS.—Entities receiving
assistance under subsection (a) may consolidate such as-
sistance with assistance received from related programs in
accordance with the provisions of the Indian Employment,
Training and Related Services Demonstration Act (Public
Law 102–477).
(d) REGULATIONS.—The Secretary shall consult with
Indian, Alaska Native and Hawaiian Native groups in es-
tablishing regulations to carry out this section, including
performance standards for entities receiving assistance
under subsection (a), taking into account the economic cir-
cumstances of such groups.
152
SEC. 326. EMPLOYMENT, TRAINING, AND EDUCATION AS-
SISTANCE FOR MIGRANT AND SEASONAL
FARMWORKERS.
(a) AUTHORIZATION.—
(1) IN
GENERAL.—From amounts reserved
under section 4(a)(2) for any fiscal year, there shall
be reserved 4 percent, or $85,000,000, whichever is
less, to provide grants to, or enter into contracts or
cooperative agreements with, entities described in
paragraph (2) to provide employment, training, and
education assistance for migrant and seasonal farm-
workers.
(2) ENTITIES DESCRIBED.—An entity described
in this paragraph is an entity the Secretary deter-
mines to have the capacity to administer effectively
a diversified workforce development program for mi-
grant and seasonal farmworkers.
(b) USE OF AMOUNTS.—An entity shall use amounts
received under subsection (a) to provide employment,
training, educational development, high school equiva-
lency, postsecondary education assistance, vocational reha-
bilitation, literacy, English as a second language, work-
based education and development, worker safety training,
employability enhancements, emergency or other disaster
relief, housing, technical assistance, outreach, intake, as-
sessment, follow-up, stipend support, supportive services,
153
other needs-based assistance, self-employment and related
business enterprise development education, and the man-
agement of a database on participating migrant and sea-
sonal farmworkers.
(c) REGULATIONS.—The Secretary shall consult with
seasonal and migrant farmworker groups in establishing
regulations to carry out this section, including perform-
ance standards for entities receiving assistance under sub-
section (a)(2), taking into account the economic cir-
cumstances of such groups.
TITLE 
IV—ADULT 
EDUCATION
AND FAMILY LITERACY CON-
SOLIDATION GRANT AND LI-
BRARY SERVICES AND TECH-
NOLOGY 
CONSOLIDATION
GRANT
SEC. 401. FINDINGS.
The Congress finds as follows:
(1) According to the 1990 census, 21 percent of
our Nation’s adults (more than 38 million persons)
lack a high school credential or are limited English
proficient.
(2) The National Adult Literacy Survey, con-
ducted under the Adult Education Act, found that
20 percent of all adults in the United States, or
154
about 40 million people, have minimal levels of lit-
eracy skills and that the lack of such skills is related
to unemployment, low wages, and fewer weeks
worked.
(3) The success of State efforts to reform and
improve public education are dependent on the abil-
ity of the United States to break intergenerational
cycles of illiteracy and inadequate education by en-
suring that parents possess a strong educational
foundation and, as the first and most continuous
teachers of their children, model for, and instill in,
their children a commitment to family literacy and
life-long learning.
(4) Generations of immigrants have contributed
to our communities and our economy, but for them
to continue to do so given recent technologies and
the competitive global economy, they must master
English as rapidly as possible.
(5) Studies have found that incarcerated adults
are twice as likely as nonincarcerated adults to lack
a good education and that such lack is a significant
statistical indicator of recidivism.
(6) Certain short-term and long-term goals of
the Nation may not be met unless the United States
155
improves its current system of adult education and
life-long learning through Federal leadership.
SEC. 402. DEFINITIONS.
As used in this title:
(1) CORRECTIONAL EDUCATION AGENCY.—The
term ‘‘correctional education agency’’ means an en-
tity that provides programs for criminal offenders in
corrections institutions and for other institutional-
ized individuals which include academic programs
for basic education, special education, bilingual or
English language instruction, vocational training, li-
brary development, corrections education programs,
guidance and counseling, and other supportive serv-
ices for criminal offenders which may emphasize co-
ordination of educational services with educational
institutions, community-based organizations of de-
monstrative effectiveness, and the private sector, de-
signed to provide education and training.
(2) 
EDUCATIONALLY
DISADVANTAGED
ADULT.—The term ‘‘educationally disadvantaged
adult’’ means an adult who—
(A) demonstrates basic skills equivalent to
or below that of students at the fifth grade
level; or
156
(B) has been placed in the lowest or begin-
ning level of an adult education program when
that program does not use grade level equiva-
lencies as a measure of students’ basic skills.
(3) FAMILY
LITERACY
SERVICES.—The term
‘‘family literacy services’’ means services that are of
sufficient intensity in terms of hours, and of suffi-
cient duration, to make sustainable changes in a
family and that integrate all of the following activi-
ties:
(A) Interactive literacy activities between
parents and their children.
(B) Training for parents on how to be
their children’s primary teacher and full part-
ners in the education of their children.
(C) Parent literacy training.
(D) An age-appropriate education program
for children.
(4) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Education.
157
Subtitle A—Adult Education and
Family Literacy Consolidation
Grant
SEC. 411. PURPOSES.
The purposes of this subtitle are to assist States to
provide—
(1) to adults, the basic educational skills nec-
essary for employment and self-sufficiency;
(2) to adults who are parents, the educational
skills necessary to be full partners in the educational
development of their children;
(3) to adults, the basic English language skills
necessary to participate in the civic, social, and eco-
nomic life of the United States; and
(4) to adults, the opportunity to attain a high
school degree or its equivalent in order to permit
them to pursue further education and training or
improve their family and work situations.
CHAPTER 1—FUNDING
SEC. 421. RESERVATIONS FROM AMOUNTS APPROPRIATED.
(a) NATIONAL INSTITUTE FOR LITERACY.—For any
fiscal year, the Secretary shall reserve $4,500,000 of the
amount appropriated under section 4(a)(3) to carry out
the activities of the National Institute for Literacy de-
scribed in section 441.
158
(b) NATIONAL LEADERSHIP ACTIVITIES.—For any
fiscal year, the Secretary shall reserve $4,500,000 of the
amount appropriated under section 4(a)(3) to establish
and carry out the program of national leadership and eval-
uation activities described in section 442.
SEC. 422. ALLOTMENT.
(a) INITIAL ALLOTMENT.—From the sums available
for the purpose of making grants under chapter 2 for any
fiscal year, the Secretary shall allot—
(1) $100,000 each to Guam, American Samoa,
the Commonwealth of the Northern Mariana Is-
lands, and the Virgin Islands; and
(2) $250,000 to each of the other States.
(b) ADDITIONAL ALLOTMENT.—
(1) IN GENERAL.—From the remainder of the
sums described in subsection (a) after the applica-
tion of the subsection, the Secretary shall allot to
each State an amount which bears the same ratio to
such remainder as the number of qualifying adults
in the State bears to the number of such adults in
all States.
(2) QUALIFYING ADULT.—For purposes of this
subsection, the term ‘‘qualifying adult’’ means an
adult who—
159
(A) is at least 16 years of age, but less
than 61 years of age;
(B) is beyond the age of compulsory school
attendance under State law;
(C) does not have a certificate of gradua-
tion from a school providing secondary edu-
cation (or its equivalent); and
(D) is not currently enrolled in elementary
or secondary school.
CHAPTER 2—GRANTS TO STATES
SEC. 431. REQUIREMENT TO MAKE GRANTS.
For fiscal year 1997 and subsequent fiscal years, the
Secretary shall make a grant to a State in an amount
equal to the initial and additional allotments of the State
for the year if the State—
(1) has satisfied the requirements of title I and
section 433(a)(1);
(2) agrees not to expend the grant for any pur-
pose other than in accordance with section 432;
(3) agrees to satisfy the grant requirements in
section 433(a)(2) and 433(b); and
(4) agrees not to expend the grant for the pur-
pose of supporting or providing programs, services,
or activities for individuals who are not adults, ex-
160
cept if such programs, services, or activities are re-
lated to family literacy services.
SEC. 432. USES OF FUNDS.
(a) STATE USES OF FUNDS.—
(1) 
GRANTS
TO
SERVE
TARGET
POPU-
LATIONS.—
(A) IN GENERAL.—Of the funds paid to a
State under this title for fiscal year 1998 and
subsequent fiscal years, 3 percent shall be dis-
tributed as performance grants made by the
State on a competitive basis, and consistent
with subsection (b) and section 433(b)(2), to
local service providers that have provided, dur-
ing the immediately preceding fiscal year, adult
education or family literacy services to the tar-
get populations described in subparagraph (C).
(B) LOCAL
SERVICE
PROVIDERS.—The
local service providers referred to in subpara-
graph (A) may include the following:
(i) Local educational agencies.
(ii) Correctional educational agencies.
(iii) Community-based organizations.
(iv) Public or private nonprofit agen-
cies.
(v) Institutions of higher education.
161
(vi) Libraries.
(vii) Other institutions that the State
determines to have the ability to provide
literacy services to adults and families.
(C) TARGET
POPULATIONS.—The target
populations referred to in subparagraph (A) are
the following:
(i) Adults with more than one barrier
to self-sufficiency, such as being unem-
ployed or an educationally disadvantaged
adult.
(ii) Families on public assistance (as
determined by the State).
(iii) Parents who are educationally
disadvantaged adults and who have a child
who is less than 8 years of age.
(iv) Adults who are individuals with
disabilities or who have similar special
needs.
(2) GRANTS TO LOCAL SERVICE PROVIDERS.—
Of the funds paid to a State under this subtitle for
any fiscal year that remain after the application of
paragraph (1), at least 85 percent shall be distrib-
uted as grants made by the State on a competitive
basis, and consistent with subsection (b) and section
162
433(b)(2), to local service providers to establish,
conduct, or expand programs, services, or activities
to achieve a purpose of this subtitle. Such local serv-
ice providers may include the local service providers
described in paragraph (1)(B).
(3) OTHER STATE ACTIVITIES.—A State may
use not more than 12 percent of the funds paid to
the State under this subtitle for any fiscal year that
remain after the application of paragraph (1) for
one or more of the following purposes:
(A) The establishment or operation of pro-
fessional development programs to improve the
quality of instruction provided in local adult
education and literacy programs, including in-
struction provided by volunteers.
(B) The provision of technical assistance
to local service providers.
(C) The provision of technology assistance
to local service providers to enable them to im-
prove the quality of their programs, services,
and activities that achieve a purpose of this
subtitle, including—
(i) providing hardware and software;
163
(ii) paying for service connection fees
associated with gaining access to comput-
erized databases; and
(iii) upgrading the technological capa-
bilities of local service providers to improve
the quality of their services and to assist
them in providing services on a flexible
schedule that meets the needs of diverse
populations.
(D) The support of State or regional net-
works of literacy resource centers that—
(i) enhance the coordination of lit-
eracy services across public and private
programs and State agencies;
(ii) enhance the capacity of the State
and local service providers to provide lit-
eracy services through the diffusion and
adoption of state-of-the-art teaching meth-
ods and technologies;
(iii) provide linkages between the Na-
tional Institute for Literacy established
under section 441 and local service provid-
ers for the sharing of literacy information,
research, and resources;
164
(iv) encourage government and indus-
try partnerships; and
(v) provide training and technical as-
sistance to literacy instructors in reading
instruction, the use of state-of-the-art
methodologies, instructional materials, and
technologies, and professional development.
(E) Monitoring and evaluating the quality
of, and the improvement in, services and activi-
ties conducted with Federal financial assistance
under this subtitle, including carrying out sec-
tion 433(a)(2).
(F) The support of a common management
information system as described in section 109.
(G) Carrying out other activities of state-
wide significance that promote the purposes of
this Act.
(4) ADMINISTRATIVE EXPENSES.—For any fis-
cal year, a State may use not more than 3 percent
of the funds paid to the State under this subtitle
that remain after the application of paragraph (1) or
$50,000, whichever is greater, for—
(A) planning, administration, and inter-
agency coordination associated with a grant
under this subtitle; and
165
(B) support for integrated career center
systems described in section 107.
(b) LOCAL USES OF FUNDS.—A State shall require
that a local service provider that receives a grant from
the State under paragraph (1) or (2) of subsection (a)
use the grant to establish or operate one or more programs
that provide instruction or services within one or more of
the following categories:
(1) Adult basic education that is designed for
an adult who—
(A) has minimal competence in reading,
writing, or computation;
(B) is not sufficiently competent in read-
ing, writing, or computation to meet the re-
quirements of adult life in the United States; or
(C) is not sufficiently competent in speak-
ing, reading, or writing the English language to
obtain employment commensurate with the
adult’s intellectual abilities.
(2) Adult secondary education that is designed
for an adult who is literate and can function in ev-
eryday life, but who—
(A) has not acquired basic educational
skills, including reading, writing, and computa-
tion; or
166
(B) does not have a certificate of gradua-
tion from a school providing education to stu-
dents in grade 12, or its equivalent.
(3) English literacy instruction that is designed
for an adult—
(A) who—
(i) has limited ability in speaking,
reading, writing, or understanding the
English language and whose native lan-
guage is a language other than English; or
(ii) lives in a family or community en-
vironment where a language other than
English is the dominant language; and
(B) who, by reason of a condition de-
scribed in subparagraph (A), has sufficient dif-
ficulty reading, writing, or understanding the
English language that the adult is unable—
(i) to learn successfully in a classroom
where the language of instruction is Eng-
lish; or
(ii) to participate fully in the society
of the United States.
(4) Family literacy services.
(c) AUTHORIZATION TO RECEIVE PAYMENTS FROM
OTHER PROGRAMS.—A local service provider that receives
167
a grant from a State under paragraph (1) or (2) of sub-
section (a), and that provides adult education and literacy
services to an adult who was referred to the provider by
a program supported under title II or III, may receive pay-
ment for the services from the program, either in the form
of a career grant or by some other means.
SEC. 433. ADDITIONAL GRANT REQUIREMENTS.
(a) GOALS, PROGRESS INDICATORS, PERFORMANCE
MEASURES.—
(1) PLANNING REQUIREMENTS.—A State that
desires to receive a grant under this subtitle shall
accomplish the following:
(A) Establish, through the collaborative
process described in section 103, measurable
goals for improving literacy levels, retention in
literacy programs, and long-term learning gains
of individuals in the State.
(B) Based on such goals and the perform-
ance measures described in section 110(f), es-
tablish, through such collaborative process,
progress indicators to be used to evaluate the
performance of local service providers receiving
a grant under paragraph (1) or (2) of section
432(a).
168
(C) Describe such goals and progress indi-
cators in the State workforce development and
literacy plan submitted to the Secretary under
section 104.
(2) 
IMPLEMENTATION
REQUIREMENTS.—A
State that receives a grant under this subtitle shall
accomplish the following:
(A) With respect to each local service pro-
vider receiving a grant under paragraph (1) or
(2) of section 432(a), based on the goals and
progress indicators established under paragraph
(1), measure the performance measures de-
scribed in section 110(f) and use the data pro-
duced by such measurement to improve the
quality of services provided to program partici-
pants or service recipients.
(B) Beginning on the date that is 2 years
after the first date that a local service provider
receives a grant under paragraph (1) or (2) of
section 432(a), annually assess the degree to
which the provider is meeting or exceeding the
progress indicators applicable to the provider.
(C) Annually report to the Secretary on
the performance measures described in section
434 for each category described in such section.
169
(b) OTHER REQUIREMENTS.—A State that receives
a grant under this subtitle shall ensure the following:
(1) 
EXPENDITURES
OF
NON-FEDERAL
FUNDS.—For any fiscal year for which a grant is
made to the State under this subtitle, the State shall
expend, on programs and activities relating to adult
education and family literacy services, an amount,
derived from sources other than the Federal Govern-
ment, equal to 25 percent of the State’s initial and
additional allotments for the year.
(2) PRIORITY
FOR
PLANNING
WITH
BOARDS
AND SYSTEMS.—In awarding grants to local service
providers under paragraph (1) or (2) of section
432(a), the State shall give priority to providers that
demonstrate joint planning with local workforce de-
velopment boards and integrated career center sys-
tems.
(3) EQUITABLE
ACCESS.—Local educational
agencies, public or private nonprofit agencies, com-
munity-based organizations, correctional education
agencies, institutions of higher education, libraries,
and institutions which serve educationally disadvan-
taged adults shall be provided direct and equitable
access to Federal funds provided under this subtitle
in accordance with this subtitle.
170
(4) PAYMENTS BY LOCAL WORKFORCE DEVEL-
OPMENT BOARDS TO LOCAL SERVICE PROVIDERS.—
A local service provider that receives a grant from
a State under paragraph (1) or (2) of section 432(a)
may negotiate with a local workforce development
board with respect to receipt of payments for adult
education and literacy services provided by the pro-
vider to adults referred to the provider by a program
supported under title II or III.
CHAPTER 3—NATIONAL PROGRAMS
SEC. 441. NATIONAL INSTITUTE FOR LITERACY.
(a) ESTABLISHMENT.—
(1) IN GENERAL.—There shall be established a
National Institute for Literacy (in this section re-
ferred to as the ‘‘Institute’’). The Institute shall be
administered under the terms of an interagency
agreement entered into by the Secretary of Edu-
cation with the Secretary of Labor and the Secretary
of Health and Human Services (in this section re-
ferred to as the ‘‘Interagency Group’’). The Sec-
retary may include in the Institute any research and
development center, institute, or clearinghouse estab-
lished within the Department of Education whose
purpose is determined by the Secretary to be related
to the purpose of the Institute.
171
(2) BOARD
RECOMMENDATIONS.—The Inter-
agency Group shall consider the recommendations of
the National Institute for Literacy Advisory Board
(in this section referred to as the ‘‘Board’’) estab-
lished under subsection (d) in planning the goals of
the Institute and in the implementation of any pro-
grams to achieve such goals.
(3) DAILY OPERATIONS.—The daily operations
of the Institute shall be carried out by the Director
of the Institute appointed under subsection (g).
(b) DUTIES.—
(1) IN GENERAL.—The Institute shall—
(A) provide national leadership for the im-
provement and expansion of the system for de-
livery of literacy services;
(B) coordinate the delivery of such serv-
ices;
(C) support the creation of new methods of
offering improved services;
(D) serve as a national resource for adult
education and family literacy services by provid-
ing to the public the best and most current in-
formation available on the subjects; and
(E) assist States in developing levels of
performance.