In the Senate of the United States,
November 14 (legislative day, November 12), 2003.
Resolved, That the bill from the House of Representa-
tives (H.R. 1261) entitled ‘‘An Act to enhance the workforce
investment system of the Nation by strengthening one-stop
career centers, providing for more effective governance ar-
rangements, promoting access to a more comprehensive array
of employment, training, and related services, establishing a
targeted approach to serving youth, and improving perform-
ance accountability, and for other purposes.’’, do pass with
the following
AMENDMENT:
Strike out all after the enacting clause and insert:
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Workforce Investment
Act Amendments of 2003’’.
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SEC. 2. TABLE OF CONTENTS.
The table of contents of this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. References.
TITLE I—AMENDMENTS TO TITLE I OF THE WORKFORCE
INVESTMENT ACT OF 1998
Subtitle A—Definitions
Sec. 101. Definitions.
Subtitle B—Statewide and Local Workforce Investment Systems
Sec. 111. Purpose.
Sec. 112. State workforce investment boards.
Sec. 113. State plan.
Sec. 114. Local workforce investment areas.
Sec. 115. Local workforce investment boards.
Sec. 116. Local plan.
Sec. 117. Establishment of one-stop delivery systems.
Sec. 118. Eligible providers of training services.
Sec. 119. Eligible providers of youth activities.
Sec. 120. Youth activities.
Sec. 121. Adult and dislocated worker employment and training activities.
Sec. 122. Performance accountability system.
Sec. 123. Authorization of appropriations.
Subtitle C—Job Corps
Sec. 131. Job Corps.
Subtitle D—National Programs
Sec. 141. Native American programs.
Sec. 142. Migrant and seasonal farmworker programs.
Sec. 143. Veterans’ workforce investment programs.
Sec. 144. Youth challenge grants.
Sec. 145. Technical assistance.
Sec. 146. Demonstration, pilot, multiservice, research, and multistate projects.
Sec. 147. National dislocated worker grants.
Sec. 148. Authorization of appropriations for national activities.
Subtitle E—Administration
Sec. 151. Requirements and restrictions.
Sec. 152. Reports.
Sec. 153. Administrative provisions.
Sec. 154. Use of certain real property.
Sec. 155. Table of contents.
Subtitle F—Incentive Grants
Sec. 161. Incentive grants.
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TITLE II—AMENDMENTS TO THE ADULT EDUCATION AND FAMILY
LITERACY ACT
Sec. 201. Short title; purpose.
Sec. 202. Definitions.
Sec. 203. Authorization of appropriations.
Sec. 204. Home schools.
Sec. 205. Reservation of funds; grants to eligible agencies; allotments.
Sec. 206. Performance accountability system.
Sec. 207. State administration.
Sec. 208. State distribution of funds; matching requirement.
Sec. 209. State leadership activities.
Sec. 210. State plan.
Sec. 211. Programs for corrections education and other institutionalized individ-
uals.
Sec. 212. Grants and contracts for eligible providers.
Sec. 213. Local application.
Sec. 214. Local administrative cost limits.
Sec. 215. Administrative provisions.
Sec. 216. National Institute for Literacy.
Sec. 217. National leadership activities.
Sec. 218. Integrated English literacy and civics education.
Sec. 219. Transition.
TITLE III—AMENDMENTS TO OTHER PROVISIONS OF LAW
Sec. 301. Wagner-Peyser Act.
TITLE IV—REHABILITATION ACT AMENDMENTS
Sec. 401. Short title.
Sec. 402. Technical amendments to table of contents.
Sec. 403. Purpose.
Sec. 404. Definitions.
Sec. 405. Administration of the Act.
Sec. 406. Carryover.
Subtitle A—Vocational Rehabilitation Services
Sec. 411. Declaration of policy; authorization of appropriations.
Sec. 412. State plans.
Sec. 413. Eligibility and individualized plan for employment.
Sec. 414. Vocational rehabilitation services.
Sec. 415. State rehabilitation council.
Sec. 416. Evaluation standards and performance indicators.
Sec. 417. State allotments.
Sec. 418. Client assistance program.
Sec. 419. Incentive grants.
Sec. 420. Vocational rehabilitation services grants.
Sec. 421. GAO studies.
Subtitle B—Research and Training
Sec. 431. Authorization of appropriations.
Sec. 432. National Institute on Disability and Rehabilitation Research.
Sec. 433. Research and other covered activities.
Sec. 434. Rehabilitation research advisory council.
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Subtitle C—Professional Development and Special Projects and Demonstrations
Sec. 441. Training.
Sec. 442. Demonstration and training programs.
Sec. 443. Migrant and seasonal farmworkers.
Sec. 444. Recreational programs.
Subtitle D—National Council on Disability
Sec. 451. Authorization of appropriations.
Subtitle E—Rights and Advocacy
Sec. 461. Architectural and transportation barriers compliance board.
Sec. 462. Protection and advocacy of individual rights.
Subtitle F—Employment Opportunities for Individuals With Disabilities
Sec. 471. Projects with industry authorization of appropriations.
Sec. 472. Services for individuals with significant disabilities authorization of
appropriations.
Subtitle G—Independent Living Services and Centers for Independent Living
Sec. 481. State plan.
Sec. 482. Statewide independent living council.
Sec. 483. Independent living services authorization of appropriations.
Sec. 484. Program authorization.
Sec. 485. Grants to centers for independent living in States in which Federal
funding exceeds State funding.
Sec. 486. Grants to centers for independent living in States in which State fund-
ing equals or exceeds Federal funding.
Sec. 487. Standards and assurances for centers for independent living.
Sec. 488. Centers for independent living authorization of appropriations.
Sec. 489. Independent living services for older individuals who are blind.
Sec. 490. Program of grants.
Sec. 491. Independent living services for older individuals who are blind author-
ization of appropriations.
Subtitle H—Miscellaneous
Sec. 495. Helen Keller National Center Act.
TITLE V—TRANSITION AND EFFECTIVE DATE
Sec. 501. Transition provisions.
Sec. 502. Effective date.
SEC. 3. REFERENCES.
Except as otherwise expressly provided, wherever in
this Act an amendment or repeal is expressed in terms of
an amendment to, or repeal of, a section or other provision,
the reference shall be considered to be made to a section or
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other provision of the Workforce Investment Act of 1998 (29
U.S.C. 2801 et seq.).
TITLE 
I—AMENDMENTS 
TO
TITLE I OF THE WORKFORCE
INVESTMENT ACT OF 1998
Subtitle A—Definitions
SEC. 101. DEFINITIONS.
Section 101 (29 U.S.C. 2801) is amended—
(1) by redesignating paragraphs (1) through (4),
(5) through (16), (17), (18) through (41), and (42)
through (53) as paragraphs (2) through (5), (7)
through (18), (20), (23) through (46), and (48)
through (59), respectively;
(2) by inserting before paragraph (2) (as redesig-
nated by paragraph (1)) the following:
‘‘(1) ACCRUED EXPENDITURES.—The term ‘ac-
crued expenditures’ means charges incurred by recipi-
ents of funds under this title for a given period re-
quiring the provision of funds for—
‘‘(A) goods or other tangible property re-
ceived;
‘‘(B) services performed by employees, con-
tractors, subgrantees, subcontractors, and other
payees; and
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‘‘(C) other amounts becoming owed under
programs assisted under this title for which no
current services or performance is required, such
as annuities, insurance claims, and other benefit
payments.’’;
(3) in paragraph (2) (as redesignated by para-
graph (1)), by striking ‘‘Except in sections 127 and
132,’’ and inserting ‘‘Except in section 132,’’;
(4) by striking paragraph (5) (as redesignated
by paragraph (1)) and inserting the following:
‘‘(5) BASIC SKILLS DEFICIENT.—The term ‘basic
skills deficient’ means, with respect to an individual,
that the individual—
‘‘(A) has English reading, writing, or com-
puting skills at or below the 8th grade level on
a generally accepted standardized test or a com-
parable score on a criterion-referenced test; or
‘‘(B) is unable to compute or solve problems,
read, write, or speak English at a level necessary
to function on the job, in the individual’s family,
or in society.’’;
(5) by inserting after paragraph (5) (as redesig-
nated by paragraph (1)) the following:
‘‘(6) BUSINESS INTERMEDIARY.—The term ‘busi-
ness intermediary’ means an entity that brings to-
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gether various stakeholders with an expertise in an
industry or business sector.’’;
(6) in paragraph (9) (as redesignated by para-
graph (1)), by inserting ‘‘, including a faith-based or-
ganization,’’ after ‘‘nonprofit organization’’;
(7) in paragraph (10) (as redesignated by para-
graph (1))—
(A) in subparagraph (B), by striking ‘‘and’’
after the semicolon;
(B) in subparagraph (C)—
(i) by striking ‘‘for not less than 50
percent of the cost of the training.’’ and in-
serting ‘‘for—
‘‘(i) a significant portion of the cost of
training as determined by the local board,
taking into account the size of the employer
and such other factors as the local board de-
termines to be appropriate; and
‘‘(ii) for customized training (as de-
fined in subparagraphs (A) and (B)) with
an employer in multiple local areas in the
State, a significant portion of the cost of the
training, as determined by the Governor,
taking into account the size of the employer
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and such other factors as the Governor de-
termines to be appropriate.’’;
(8) in paragraph (11) (as redesignated by para-
graph (1))—
(A) in subparagraph (A)(ii)(II), by striking
‘‘section 134(c)’’ and inserting ‘‘section 121(e)’’;
(B) in subparagraph (C), by striking ‘‘or’’
after the semicolon;
(C) in subparagraph (D), by striking the
period and inserting ‘‘; or’’; and
(D) by adding at the end the following:
‘‘(E)(i) is the spouse of a member of the
Armed Forces on active duty for a period of
more than 30 days (as defined in section
101(d)(2) of title 10, United States Code) who
has experienced a loss of employment as a direct
result of relocation to accommodate a permanent
change in duty station of such member; or
‘‘(ii) is the spouse of a member of the
Armed Forces on active duty who meets the cri-
teria described in paragraph (12)(B).’’;
(9) in paragraph (12)(A) (as redesignated by
paragraph (1))—
(A) by striking ‘‘and’’ after the semicolon
and inserting ‘‘or’’;
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(B) by striking ‘‘(A)’’ and inserting
‘‘(A)(i)’’; and
(C) by adding at the end the following:
‘‘(ii) is the dependent spouse of a member of
the Armed Forces on active duty for a period of
more than 30 days (as defined in section
101(d)(2) of title 10, United States Code) whose
family income is significantly reduced because of
a deployment (as defined in section 991(b) of
title 10, United States Code, or pursuant to
paragraph (4) of such section), a call or order to
active duty pursuant to a provision of law re-
ferred to in section 101(a)(13)(B) of title 10,
United States Code, a permanent change of sta-
tion, or the service-connected (as defined in sec-
tion 101(16) of title 38, United States Code)
death or disability of the member; and’’;
(10) in paragraph (14)(A) (as redesignated by
paragraph (1)), by striking ‘‘section 122(e)(3)’’ and
inserting ‘‘section 122’’;
(11) by inserting after paragraph (18) (as redes-
ignated by paragraph (1)) the following:
‘‘(19) HARD-TO-SERVE POPULATIONS.—The term
‘hard-to-serve populations’ means populations of indi-
viduals who are hard to serve, including displaced
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homemakers, low-income individuals, Native Ameri-
cans, individuals with disabilities, older individuals,
ex-offenders, homeless individuals, individuals with
limited English proficiency, individuals who do not
meet the definition of literacy in section 203, individ-
uals facing substantial cultural barriers, migrant and
seasonal farmworkers, individuals within 2 years of
exhausting lifetime eligibility under part A of title IV
of the Social Security Act (42 U.S.C. 601 et seq.), and
such other groups as the Governor determines to be
hard to serve.’’;
(12) by inserting after paragraph (20) (as redes-
ignated by paragraph (1)) the following:
‘‘(21) INTEGRATED
TRAINING
PROGRAM.—The
term ‘integrated training program’ means a program
that combines occupational skills training with
English language acquisition.
‘‘(22) INSTITUTION
OF
HIGHER
EDUCATION.—
The term ‘institution of higher education’ has the
meaning given the term in section 101(a), and sub-
paragraphs (A) and (B) of section 102(a)(1), of the
Higher Education Act of 1965 (20 U.S.C. 1001(a),
1002(a)(1)).’’;
(13) in paragraph (30) (as redesignated by
paragraph (1))—
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(A) by redesignating subparagraphs (D)
through (F) as subparagraphs (E) through (G),
respectively; and
(B) by inserting after subparagraph (C) the
following:
‘‘(D) receives or is eligible to receive a free
or reduced price lunch under the Richard B.
Russell National School Lunch Act (42 U.S.C.
1751 et seq.);’’;
(14) in paragraph (35) (as redesignated by
paragraph (1)), by inserting ‘‘, subject to section
121(b)(1)(C)’’ after ‘‘121(b)(1)’’;
(15) by striking paragraph (38) (as redesignated
by paragraph (1)) and inserting the following:
‘‘(38) OUT-OF-SCHOOL YOUTH.—The term ‘out-
of-school youth’ means an out-of-school youth as de-
fined in section 129(a)(1)(B).’’;
(16) in paragraph (46) (as redesignated by
paragraph (1)), by striking ‘‘, and the term means
such Secretary for purposes of section 503’’;
(17) by inserting after paragraph (46) (as redes-
ignated by paragraph (1)) the following:
‘‘(47) SELF-SUFFICIENCY.—The term ‘self-suffi-
ciency’ means self-sufficiency within the meaning of
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subsections (a)(3)(A)(x) and (e)(1)(A)(xii) of section
134.’’;
(18) in paragraph (49) (as redesignated by
paragraph (1)), by striking ‘‘clause (iii) or (v) of sec-
tion 
136(b)(3)(A)’’ 
and 
inserting 
‘‘section
136(b)(3)(A)(iii)’’;
(19) in paragraph (58) (as redesignated by
paragraph (1)), by striking ‘‘(or as described in sec-
tion 129(c)(5))’’ and inserting ‘‘(or as described in
section 129(a)(2))’’; and
(20) in paragraph (59) (as redesignated by
paragraph (1)), by striking ‘‘established under section
117(h)’’ and inserting ‘‘that may be established under
section 117(h)(2)’’.
Subtitle B—Statewide and Local
Workforce Investment Systems
SEC. 111. PURPOSE.
Section 106 (29 U.S.C. 2811) is amended to read as
follows:
‘‘SEC. 106. PURPOSES.
‘‘The purposes of this subtitle are the following:
‘‘(1)(A) Primarily, to provide workforce invest-
ment activities, through statewide and local workforce
investment systems, that increase the employment, re-
tention, self-sufficiency, and earnings of participants,
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and increase occupational skill attainment by partici-
pants.
‘‘(B) As a result of the provision of the activities,
to improve the quality of the workforce, reduce welfare
dependency, increase self-sufficiency, and enhance the
productivity and competitiveness of the Nation.
‘‘(2) To enhance the workforce investment system
of the Nation by strengthening one-stop centers, pro-
viding for more effective governance arrangements,
promoting access to a more comprehensive array of
employment and training and related services, estab-
lishing a targeted approach to serving youth, improv-
ing performance accountability, and promoting State
and local flexibility.
‘‘(3) To provide workforce investment activities
in a manner that promotes the informed choice of
participants and actively involves participants in de-
cisions affecting their participation in such activities.
‘‘(4) To provide workforce investment systems
that are demand-driven and responsive to the needs
of all employers, including small employers.
‘‘(5) To provide workforce investment systems
that work in all areas of the Nation, including urban
and rural areas.
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‘‘(6) To allow flexibility to meet State, local, re-
gional, and individual workforce investment needs.
‘‘(7) To recognize and reinforce the vital link be-
tween economic development and workforce invest-
ment activities.
‘‘(8) To provide for accurate data collection, re-
porting, and performance measures that are not un-
duly burdensome.
‘‘(9) To address the ongoing shortage of essential
skills in the United States workforce related to both
manufacturing and knowledge-based economies to en-
sure that the United States remains competitive in
the global economy.
‘‘(10) To equip workers with higher skills and
contribute to lifelong education.
‘‘(11) To eliminate training disincentives for
hard-to-serve populations and minority workers, in-
cluding effectively utilizing community programs,
services, and agencies.
‘‘(12) To educate limited English proficient indi-
viduals about skills and language so the individuals
are employable.
‘‘(13) To increase the employment, retention and
earnings of individuals with disabilities.’’.
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SEC. 112. STATE WORKFORCE INVESTMENT BOARDS.
(a) MEMBERSHIP.—
(1) IN
GENERAL.—Section 111(b) (29 U.S.C.
2821(b)) is amended—
(A) in paragraph (1), by striking subpara-
graph (C) and inserting the following:
‘‘(C) representatives appointed by the Gov-
ernor, who—
‘‘(i) are the lead State agency officials
with responsibility for the programs and ac-
tivities that are described in section 121(b)
and carried out by one-stop partners, except
that—
‘‘(I) in any case in which no lead
State agency official has responsibility
for such a program or activity, the
representative shall be a representative
in the State with expertise relating to
such program or activity; and
‘‘(II) in the case of the programs
authorized under title I of the Reha-
bilitation Act of 1973, the representa-
tive shall be the director of the des-
ignated State unit, as defined in sec-
tion 7 of the Rehabilitation Act of
1973 (29 U.S.C. 705);
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‘‘(ii) are the State agency officials re-
sponsible for economic development;
‘‘(iii) are representatives of business in
the State, including small businesses, who—
‘‘(I) are owners of businesses, chief
executive or operating officers of busi-
nesses, or other business executives or
employers with optimum policymaking
or hiring authority;
‘‘(II) represent businesses with
employment opportunities that reflect
employment opportunities in the State;
and
‘‘(III) are appointed from among
individuals nominated by State busi-
ness organizations, business trade asso-
ciations, and local boards;
‘‘(iv) are chief elected officials (rep-
resenting cities and counties, where appro-
priate);
‘‘(v) are representatives of labor orga-
nizations, who have been nominated by
State labor federations; and
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‘‘(vi) are such other State agency offi-
cials and other representatives as the Gov-
ernor may designate.’’; and
(B) in paragraph (3), by striking ‘‘para-
graph (1)(C)(i)’’ and inserting ‘‘paragraph
(1)(C)(iii)’’.
(2) CONFORMING AMENDMENT.—Section 111(c)
(29 U.S.C. 2821(c)) is amended by striking ‘‘sub-
section 
(b)(1)(C)(i)’’ 
and 
inserting 
‘‘subsection
(b)(1)(C)(iii)’’.
(b) FUNCTIONS.—Section 111(d) (29 U.S.C. 2811(d))
is amended—
(1) in paragraph (1), by striking ‘‘development’’
and inserting ‘‘development, implementation, and re-
vision’’;
(2) in paragraph (2), by striking ‘‘section
134(c)’’ and inserting ‘‘section 121(e)’’;
(3) by striking paragraph (3) and inserting the
following:
‘‘(3) reviewing and providing comment on the
State plans of all one-stop partner programs, where
applicable, in order to provide effective strategic lead-
ership in the development of a high quality, com-
prehensive statewide workforce investment system, in-
cluding commenting at least once annually on the
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measures taken pursuant to section 113(b)(3) of the
Carl D. Perkins Vocational and Technical Education
Act of 1998 (20 U.S.C. 2323(b)(3)) and title II of this
Act;
(4) by redesignating paragraphs (4) through (9)
as paragraphs (5) through (10), respectively;
(5) by inserting after paragraph (3) the fol-
lowing:
‘‘(4) development and review of statewide policies
affecting the coordinated provision of services through
the one-stop delivery systems described in section
121(e) within the State, including—
‘‘(A) the development of objective criteria
and procedures for use by local boards in assess-
ing the effectiveness and continuous improvement
of one-stop centers under section 121(g);
‘‘(B) the development of guidance for the al-
location of one-stop center infrastructure funds
under section 121(h)(1)(B);
‘‘(C) the development of—
‘‘(i) statewide policies relating to the
appropriate roles and contributions of one-
stop partner programs within the one-stop
delivery system, including approaches to fa-
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cilitating equitable and efficient cost alloca-
tion in the one-stop delivery system;
‘‘(ii) statewide strategies for providing
effective outreach to individuals, including
hard-to-serve populations, and employers
who could benefit from services provided
through the one-stop delivery system; and
‘‘(iii) strategies for technology improve-
ments to facilitate access to services pro-
vided through the one-stop delivery system,
in remote areas, and for individuals with
disabilities, which may be utilized through-
out the State;
‘‘(D) identification and dissemination of in-
formation on best practices for effective operation
of one-stop centers, including use of innovative
business outreach, partnerships, and service de-
livery strategies, including for hard-to-serve pop-
ulations; and
‘‘(E) conduct of such other matters as may
promote statewide objectives for, and enhance the
performance of, the one-stop delivery systems;’’;
(6) in paragraph (5) (as redesignated by para-
graph (4)), by inserting ‘‘and the development of
statewide criteria to be used by chief elected officials
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for the appointment of local boards consistent with
section 117’’ after ‘‘section 116’’;
(7) in paragraph (6) (as redesignated by para-
graph (4)), by striking ‘‘sections 128(b)(3)(B) and
133(b)(3)(B)’’ and inserting ‘‘sections 128(b)(3) and
133(b)(3)(B)’’;
(8) in paragraph (9) (as redesignated by para-
graph (4)), by striking ‘‘and’’ after the semicolon;
(9) in paragraph (10) (as redesignated by para-
graph (4))—
(A) by striking ‘‘section 503’’ and inserting
‘‘section 136(i)(1)’’; and
(B) by striking the period and inserting ‘‘;
and’’; and
(10) by adding at the end the following:
‘‘(11) increasing the availability of skills train-
ing, employment opportunities, and career advance-
ment, for hard-to-serve populations.’’.
(c) ALTERNATIVE ENTITY.—Section 111(e) (29 U.S.C.
2811(e)) is amended—
(1) in paragraph (1), by striking ‘‘For’’ and in-
serting ‘‘Subject to paragraph (3), for’’; and
(2) by adding at the end the following:
‘‘(3) FAILURE
TO
MEET
PERFORMANCE
MEAS-
URES.—If a State fails to have performed successfully,
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as defined in section 116(a)(2), the Secretary may re-
quire the State to establish a State board in accord-
ance with subsections (a), (b), and (c) in lieu of the
alternative entity established under paragraph (1).’’.
(d) SUNSHINE PROVISION.—Section 111(g) (29 U.S.C.
2822(g)) is amended—
(1) by inserting ‘‘, and modifications to the
State plan,’’ before ‘‘prior’’; and
(2) by inserting ‘‘, and modifications to the
State plan’’ after ‘‘the plan’’.
(e) AUTHORITY TO HIRE STAFF.—Section 111 (29
U.S.C. 2811)) is amended by adding at the end the fol-
lowing:
‘‘(h) AUTHORITY TO HIRE STAFF.—The State board
may hire staff to assist in carrying out the functions de-
scribed in subsection (d) using funds allocated under sec-
tions 127(b)(1)(C) and 132(b).’’.
SEC. 113. STATE PLAN.
(a) PLANNING CYCLE.—Section 112(a) (29 U.S.C.
2822(a)) is amended—
(1) by striking ‘‘5-year strategy’’ and inserting
‘‘4-year strategy’’; and
(2) by adding at the end the following: ‘‘At the
end of the first 2-year period of the 4-year State plan,
the State board shall review and, as needed, amend
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the 4-year State plan to reflect labor market and eco-
nomic conditions. In addition, the State shall submit
a modification to the State plan at the end of the first
2-year period of the State plan, which may include
redesignation of local areas pursuant to section
116(a) and specification of the levels of performance
under sections 136 for the third and fourth years of
the plan.’’.
(b) CONTENTS.—Section 112(b) (29 U.S.C. 2822(b)) is
amended—
(1) in paragraph (8)(A)—
(A) in clause (ix), by striking ‘‘and’’ after
the semicolon; and
(B) by adding at the end the following:
‘‘(xi) programs authorized under title II of
the Social Security Act (42 U.S.C. 401 et seq.)
(relating to Federal old-age, survivors, and dis-
ability insurance benefits), title XVI of such Act
(42 U.S.C. 1381 et seq.) (relating to supple-
mental security income), title XIX of such Act
(42 U.S.C. 1396 et seq.) (relating to medicaid),
and title XX of such Act (relating to block grants
to States for social services), programs author-
ized under title VII of the Rehabilitation Act of
1973 (29 U.S.C. 796 et seq.), and programs car-
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ried out by State agencies relating to mental re-
tardation and developmental disabilities; and’’;
(2) by striking paragraph (10) and inserting the
following:
‘‘(10) a description of how the State will use
funds the State received under this subtitle to leverage
other Federal, State, local, and private resources, in
order to maximize the effectiveness of such resources,
expand resources for the provision of education and
training services, and expand the participation of
businesses, employees, and individuals in the state-
wide workforce investment system, including a de-
scription of incentives and technical assistance the
State will provide to local areas for such purposes;’’;
(3) in paragraph (12)(A), by striking ‘‘sections
128(b)(3)(B) and 133(b)(3)(B)’’ and inserting ‘‘sec-
tions 128(b)(3) and 133(b)(3)(B)’’;
(4) in paragraph (14), by striking ‘‘section
134(c)’’ and inserting ‘‘section 121(e)’’;
(5) in paragraph (17)—
(A) in subparagraph (A)—
(i) in clause (iii)—
(I) by inserting ‘‘local’’ before
‘‘customized training’’; and
(II) by striking ‘‘and’’ at the end;
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(ii) in clause (iv), by striking ‘‘(in-
cluding displaced homemakers),’’ and all
that follows through ‘‘disabilities)’’ and in-
serting ‘‘, hard-to-serve populations and in-
dividuals training for nontraditional em-
ployment’’; and
(iii) by adding after clause (iv) the fol-
lowing:
‘‘(v) how the State will serve the em-
ployment and training needs of individuals
with disabilities, consistent with section 188
and Executive Order 13217 (42 U.S.C.
12131 note; relating to community-based al-
ternatives for individuals with disabilities),
including the provision of outreach, intake,
the conduct of assessments, service delivery,
the development of adjustments to perform-
ance measures established under section
136, and the training of staff; and’’; and
(B) in subparagraph (B), by striking ‘‘and’’
at the end;
(6) in paragraph (18)(D)—
(A) by striking ‘‘youth opportunity grants’’
and inserting ‘‘youth challenge grants authorized
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under section 169 and other federally funded
youth programs’’; and
(B) by striking the period and inserting a
semicolon; and
(7) by adding at the end the following:
‘‘(19) a description of how the State will utilize
technology to facilitate access to services in remote
areas, which may be utilized throughout the State;
‘‘(20) a description of the State strategy for co-
ordinating workforce investment activities and eco-
nomic development activities;
‘‘(21) a description of the State strategy and as-
sistance to be provided for ensuring regional coopera-
tion within the State and across State borders as ap-
propriate;
‘‘(22) a description of how the State will use
funds the State receives under this subtitle to—
‘‘(A) implement innovative programs and
strategies designed to meet the needs of all busi-
nesses in the State, including small businesses,
which may include incumbent worker training
programs, sectoral and industry cluster strate-
gies, regional skills alliances, career ladder pro-
grams, utilization of effective business inter-
mediaries, and other business services and strate-
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gies that better engage employers in workforce
investment activities and make the statewide
workforce investment system more relevant to the
needs of State and local businesses, consistent
with the objectives of this title; and
‘‘(B) provide incentives and technical as-
sistance to assist local areas in more fully engag-
ing all employers, including small employers, in
local workforce investment activities, to make the
workforce investment system more relevant to the
needs of area businesses, and to better coordinate
workforce investment and economic development
efforts to contribute to the economic well-being of
the local area, as determined appropriate by the
local board;
‘‘(23) a description of the State strategy—
‘‘(A) for ensuring cooperation between
transportation providers, including public trans-
portation providers, and providers of workforce
investment activities; and
‘‘(B) for ensuring coordination among ap-
propriate State agencies and programs to make
available skills training, employment services
and opportunities, and career advancement ac-
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tivities, that will assist ex-offenders in reentering
the workforce;
‘‘(24) a description of how the State will assist
local areas in assuring physical and programmatic
accessibility for individuals with disabilities at one-
stop centers;
‘‘(25) a description of the process and method-
ology that will be used by the State board to—
‘‘(A) review statewide policies and provide
guidance on the coordinated provision of services
through the one-stop delivery system described in
section 121;
‘‘(B) establish, in consultation with chief
elected officials and local boards, objective cri-
teria and procedures for use by local boards in
periodically assessing the effectiveness, physical
and programmatic accessibility, and continuous
improvement of one-stop centers and one-stop de-
livery systems as described in section 121(g); and
‘‘(C) determine—
‘‘(i) one-stop partner program con-
tributions for the costs of the infrastructure
of one-stop centers under section 121(h)(2);
and
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‘‘(ii) the formula for allocating the
funds described in section 121(h)(2) to local
areas;
‘‘(26) a description of the State strategy for en-
suring that activities carried out under this title are
placing men and women in jobs, education, or train-
ing that lead to comparable pay; and
‘‘(27) a description of the technical assistance
available to one-stop operators and providers of train-
ing services for strategies to serve hard-to-serve popu-
lations and promote placement in nontraditional em-
ployment.’’.
(c) MODIFICATIONS
TO PLAN.—Section 112(d) (29
U.S.C. 2822(d)) is amended—
(1) by striking ‘‘5-year period’’ and inserting
‘‘4-year period’’; and
(2) by adding at the end the following: ‘‘In addi-
tion, the State shall submit the modifications to the
State plan required under subsection (a), under cir-
cumstances prescribed by the Secretary that are due
to changes in Federal law that significantly affect ele-
ments of the State plan.’’.
SEC. 114. LOCAL WORKFORCE INVESTMENT AREAS.
(a) DESIGNATION OF AREAS.—
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(1) CONSIDERATIONS.—Section 116(a)(1)(B) (29
U.S.C. 2831(a)(1)(B)) is amended by adding at the
end the following:
‘‘(vi) The extent to which such local
areas will promote maximum effectiveness
in the administration and provision of serv-
ices.’’.
(2) 
AUTOMATIC
DESIGNATION.—Section
116(a)(2) (29 U.S.C. 2831(a)(2)) is amended to read
as follows:
‘‘(2) AUTOMATIC DESIGNATION.—
‘‘(A) IN GENERAL.—The Governor shall ap-
prove a request for designation as a local area
that is submitted prior to the submission of the
State plan, or of a modification to the State
plan relating to area designation, from any area
that—
‘‘(i) is a unit of general local govern-
ment with a population of 500,000 or more,
except that after the initial 2-year period
following such designation pursuant to this
clause that occurs after the date of enact-
ment of the Workforce Investment Act
Amendments of 2003, the Governor shall
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only be required to approve a request for
designation from such area if such area—
‘‘(I) performed successfully; and
‘‘(II) sustained fiscal integrity;
‘‘(ii) was a local area under this title
for the preceding 2-year period, if such local
area—
‘‘(I) performed successfully; and
‘‘(II) sustained fiscal integrity;
‘‘(iii) is served by a rural concentrated
employment program grant recipient, ex-
cept that after the initial 2-year period fol-
lowing any such designation under the ini-
tial State plan submitted after the date of
enactment of the Workforce Investment Act
Amendments of 2003, the Governor shall
only be required to approve a request for
designation under this clause for such area
if such area—
‘‘(I) performed successfully; and
‘‘(II) sustained fiscal integrity; or
‘‘(iv) was a local area under section
116(a)(2)(C) (as in effect on the day before
the date of enactment of the Workforce In-
vestment Act Amendments of 2003), except
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that after the initial 2-year period following
such designation pursuant to this clause
that occurs after that date of enactment, the
Governor shall only be required to approve
a request for designation under this clause
for such area if such area—
‘‘(I) performed successfully; and
‘‘(II) sustained fiscal integrity.
‘‘(B) DEFINITIONS.—For purposes of this
paragraph:
‘‘(i) PERFORMED SUCCESSFULLY.—The
term ‘performed successfully’, when used
with respect to a local area, means the local
area performed at 80 percent or more of the
adjusted level of performance for core indi-
cators of performance described in section
136(b)(2)(A) for 2 consecutive years.
‘‘(ii) SUSTAINED FISCAL INTEGRITY.—
The term ‘sustained fiscal integrity’, used
with respect to an area, means that the Sec-
retary has not made a formal determination
during the preceding 2-year period that ei-
ther the grant recipient or the administra-
tive entity of the area misexpended funds
provided under this title due to willful dis-
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regard of the requirements of the Act in-
volved, gross negligence, or failure to comply
with accepted standards of administra-
tion.’’.
(3) CONFORMING AMENDMENTS.—Section 116(a)
(29 U.S.C. 2831(a)) is amended—
(A) by striking paragraph (3);
(B) by redesignating paragraphs (4) and
(5) as paragraph (3) and (4), respectively;
(C) in paragraph (3) (as redesignated by
subparagraph (B))—
(i) by striking ‘‘(including temporary
designation)’’; and
(ii) by striking ‘‘(v)’’ and inserting
‘‘(vi)’’; and
(D) in paragraph (4) (as redesignated by
subparagraph (B))—
(i) by striking ‘‘under paragraph (2)
or (3)’’ and inserting ‘‘under paragraph
(2)’’; and
(ii) by striking the second sentence.
(b) SINGLE LOCAL AREA STATES.—Section 116(b) (29
U.S.C. 2831(b)) is amended to read as follows:
‘‘(b) SINGLE LOCAL AREA STATES.—
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‘‘(1) CONTINUATION
OF
PREVIOUS
DESIGNA-
TION.—Notwithstanding subsection (a)(2), the Gov-
ernor of any State that was a single local area for
purposes of this title as of July 1, 2002, may continue
to designate the State as a single local area for pur-
poses of this title if the Governor identifies the State
as a local area in the State plan under section
112(b)(5).
‘‘(2) REDESIGNATION.—The Governor of a State
not described in paragraph (1) may designate the
State as a single local area if, prior to the submission
of the State plan or modification to such plan so des-
ignating the State, no local area meeting the require-
ments for automatic designation under subsection
(a)(2) requests such designation as a separate local
area.
‘‘(3) EFFECT ON LOCAL PLAN.—In any case in
which a State is designated as a local area pursuant
to this subsection, the local plan prepared under sec-
tion 118 for the area shall be submitted to the Sec-
retary for approval as part of the State plan under
section 112.’’.
(c) REGIONAL PLANNING.—Section 116(c) (29 U.S.C.
2831(c)) is amended—
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(1) by striking paragraph (1) and inserting the
following:
‘‘(1) PLANNING.—
‘‘(A) IN GENERAL.—As part of the process
for developing the State plan, a State may re-
quire regional planning by local boards for a
designated region in the State. The State may
require the local boards for a designated region
to participate in a regional planning process
that results in the establishment of regional per-
formance measures for workforce investment ac-
tivities authorized under this subtitle. The State,
after consultation with local boards and chief
elected officials, may require the local boards for
the designated region to prepare, submit, and ob-
tain approval of a single regional plan that in-
corporates local plans for each of the local areas
in the region, as required under section 118. The
State may award regional incentive grants to
the designated regions that meet or exceed the re-
gional performance measures pursuant to section
134(a)(2)(B)(iii).
‘‘(B) TECHNICAL ASSISTANCE.—If the State
requires regional planning as provided in sub-
paragraph (A), the State shall provide technical
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assistance and labor market information to such
local areas in the designated regions to assist
with such regional planning and subsequent
service delivery efforts.’’;
(2) in paragraph (2), by inserting ‘‘information
about the skill requirements of existing and emerging
industries and industry clusters,’’ after ‘‘information
about employment opportunities and trends,’’; and
(3) in paragraph (3), by adding at the end the
following: ‘‘Such services may be required to be co-
ordinated with regional economic development serv-
ices and strategies.’’.
SEC. 115. LOCAL WORKFORCE INVESTMENT BOARDS.
(a) 
COMPOSITION.—Section 
117(b) 
(29 
U.S.C.
2832(b)) is amended—
(1) in paragraph (2)(A)—
(A) in clause (i), by striking subclause (II)
and inserting the following:
‘‘(II) collectively, represent busi-
nesses with employment opportunities
that reflect the employment opportuni-
ties of the local area, and include rep-
resentatives of businesses that are in
high-growth and emerging industries,
and representatives of businesses, in-
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cluding small businesses, in the local
area; and’’;
(B) by striking clause (ii) and inserting the
following:
‘‘(ii)(I) a superintendent representing
the local school districts involved or another
high-level official from such districts;
‘‘(II) the president or highest ranking
official of an institution of higher education
serving the local area; and
‘‘(III) an administrator of local enti-
ties providing adult education and literacy
activities in the local area;’’;
(C) in clause (iv), by inserting ‘‘, hard-to-
serve populations,’’ after ‘‘disabilities’’; and
(D) by striking clause (vi) and inserting the
following:
‘‘(vi) if the local board does not estab-
lish or continue a youth council, representa-
tives with experience serving out-of-school
youth, particularly out-of-school youth fac-
ing barriers to employment; and’’; and
(2) by adding at the end the following:
‘‘(6) SPECIAL RULE.—In the case that there are
multiple school districts or institutions of higher edu-
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cation serving a local area, the representatives de-
scribed in subclause (I) or (II) of paragraph
(2)(A)(ii), respectively, shall be appointed from
among individuals nominated by regional or local
educational agencies, institutions, or organizations
representing such agencies or institutions.’’.
(b) AUTHORITY
OF
BOARD
MEMBERS.—Section
117(b)(3) (29 U.S.C. 2832(b)(3)) is amended—
(1) in the heading, by inserting ‘‘AND
REP-
RESENTATION’’ after ‘‘AUTHORITY’’; and
(2) by adding at the end the following: ‘‘The
members of the board shall represent diverse geo-
graphic sections within the local area.’’.
(c) CONFORMING AMENDMENT.—Section 117(c)(1)(C)
(29 U.S.C. 2832(c)(1)(C)) is amended by striking ‘‘section
116(a)(2)(B)’’ and inserting ‘‘section 116(a)(2)(A)(ii)’’.
(d) FUNCTIONS.—Section 117(d) (29 U.S.C. 2832(d))
is amended—
(1) in paragraph (2)—
(A) in subparagraph (B)—
(i) by inserting ‘‘(except as provided in
section 123(b))’’ after ‘‘basis’’; and
(ii) by inserting ‘‘(where appropriate)’’
after ‘‘youth council’’; and
(B) by adding at the end the following:
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‘‘(E) CONSUMER CHOICE REQUIREMENTS.—
Consistent with sections 122 and paragraphs (3)
and (4) of 134(d), the local board shall work to
ensure there are sufficient providers of intensive
services and training services serving the local
area in a manner that maximizes consumer
choice, including providers with expertise in as-
sisting individuals with disabilities.’’;
(2) in paragraph (4), by inserting ‘‘, and shall
ensure the appropriate use and management of the
funds provided under this subtitle for such programs,
activities, and system’’ after ‘‘area’’;
(3) in paragraph (8)—
(A) by inserting ‘‘, including small employ-
ers,’’ after ‘‘private sector employers’’; and
(B) by striking the period and inserting ‘‘,
taking into account the unique needs of small
businesses.’’; and
(4) by adding at the end the following:
‘‘(9) TECHNOLOGY
IMPROVEMENTS.—The local
board shall develop strategies for technology improve-
ments to facilitate access to services, in remote areas,
for services authorized under this subtitle and carried
out in the local area.’’.
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(e) CONFORMING AMENDMENT.—Section 117(f)(2) (29
U.S.C. 2832(f)(2)) is amended by striking ‘‘described in sec-
tion 134(c)’’.
(f) AUTHORITY TO ESTABLISH COUNCILS AND ELIMI-
NATION OF REQUIREMENT FOR YOUTH COUNCILS.—Section
117(h) (29 U.S.C. 2832(h)) is amended to read as follows:
‘‘(h) COUNCILS.—The local board may establish or
continue councils to provide information and advice to as-
sist the local board in carrying out activities under this
title. Such councils may include—
‘‘(1) a council composed of one-stop partners to
advise the local board on the operation of the one-stop
delivery system involved;
‘‘(2) a youth council composed of experts and
stakeholders in youth programs to advise the local
board on youth activities; and
‘‘(3) such other councils as the local board deter-
mines are appropriate.’’.
(g) 
ALTERNATIVE
ENTITY
PROVISION.—Section
117(i)(1) (29 U.S.C. 2832(i)(1)) is amended—
(1) by striking subparagraph (B) and inserting
the following:
‘‘(B) was in existence on August 7, 1998,
pursuant to State law; and’’;
(2) by striking subparagraph (C); and
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(3) by redesignating subparagraph (D) as sub-
paragraph (C).
SEC. 116. LOCAL PLAN.
(a) PLANNING CYCLE.—Section 118(a) (29 U.S.C.
2833(a)) is amended—
(1) by striking ‘‘5-year’’ and inserting ‘‘4-year’’;
and
(2) by adding at the end the following: ‘‘At the
end of the first 2-year period of the 4-year plan, the
local board shall review and, as needed, amend the 4-
year plan to reflect labor market and economic condi-
tions.’’.
(b) CONTENTS.—Section 118(b) (29 U.S.C. 2833(b)) is
amended—
(1) in paragraph (2)—
(A) in subparagraph (A), by striking ‘‘and’’
after the semicolon;
(B) by striking subparagraph (B) and in-
serting the following:
‘‘(B) a description of how the local board
will facilitate access to services provided through
the one-stop delivery system, in remote areas, in-
cluding facilitating access through the use of
technology; and’’; and
(C) by adding at the end the following:
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‘‘(C) a description of how the local board
will ensure physical and programmatic accessi-
bility for individuals with disabilities at one-
stop centers;’’;
(2) in paragraph (9), by striking ‘‘; and’’ and
inserting a semicolon;
(3) by redesignating paragraph (10) as para-
graph (14); and
(4) by inserting after paragraph (9) the fol-
lowing:
‘‘(10) a description of how the local board will
coordinate workforce investment activities carried out
in the local area with economic development activities
carried out in the local area;
‘‘(11) a description of the strategies and services
that will be initiated in the local area to more fully
engage all employers, including small employers, in
workforce investment activities, to make the workforce
investment system more relevant to the needs of area
businesses, and to better coordinate workforce invest-
ment and economic development efforts, which may
include the implementation of innovative initiatives
such as incumbent worker training programs, sectoral
and industry cluster strategies, regional skills alliance
initiatives, career ladder programs, utilization of ef-
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fective business intermediaries, and other business
services and strategies designed to meet the needs of
area employers and contribute to the economic well-
being of the local area, as determined appropriate by
the local board, consistent with the objectives of this
title;
‘‘(12) a description of how the local board will
expand access to education and training services for
eligible individuals who are in need of such services
through—
‘‘(A) the utilization of programs funded
under this title; and
‘‘(B) the increased leveraging of resources
other than those provided under this title, in-
cluding tax credits, private sector-provided
training, and other Federal, State, local, and
private funds that are brokered through the one-
stop centers for training services;
‘‘(13) a description of how the local board will
coordinate workforce investment activities carried out
in the local area with the provision of transportation,
including public transportation, in the local area;
and’’.
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SEC. 117. ESTABLISHMENT OF ONE-STOP DELIVERY SYS-
TEMS.
(a) ONE-STOP PARTNERS.—
(1) REQUIRED
PARTNERS.—Section 121(b)(1)
(29 U.S.C. 2841(b)(1)) is amended—
(A) by striking subparagraph (A) and in-
serting the following:
‘‘(A) ROLES
AND
RESPONSIBILITIES
OF
ONE-STOP PARTNERS.—Each entity that carries
out a program or activities described in subpara-
graph (B) shall—
‘‘(i) provide access through the one-stop
delivery system to the programs and activi-
ties carried out by the entity, including
making the core services described in section
134(d)(2) that are applicable to the pro-
gram of the entity available at the com-
prehensive one-stop centers (in addition to
any other appropriate locations);
‘‘(ii) use a portion of the funds avail-
able to the program of the entity to main-
tain the one-stop delivery system, including
payment of the infrastructure costs of one-
stop centers in accordance with subsection
(h);
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‘‘(iii) enter into a local memorandum
of understanding with the local board relat-
ing to the operation of the one-stop system
that meets the requirements of subsection
(c);
‘‘(iv) participate in the operation of
the one-stop system consistent with the
terms of the memorandum of under-
standing, the requirements of this title, and
the requirements of the Federal laws author-
izing the programs carried out by the enti-
ty; and
‘‘(v) provide representation on the
State board to the extent provided under
section 111.’’;
(B) in subparagraph (B)—
(i) by striking clause (v);
(ii) by redesignating clauses (vi)
through (xii) as clauses (v) through (xi), re-
spectively;
(iii) in clause (x) (as redesignated by
clause (ii)), by striking ‘‘and’’ at the end;
(iv) in clause (xi) (as redesignated by
clause (ii)), by striking the period and in-
serting ‘‘; and’’; and
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(v) by adding at the end the following:
‘‘(xii) programs authorized under part
A of title IV of the Social Security Act (42
U.S.C. 601 et seq.), subject to subparagraph
(C).’’; and
(C) by adding at the end the following:
‘‘(C) DETERMINATION BY THE GOVERNOR.—
‘‘(i) IN GENERAL.—An entity that car-
ries out programs referred to in subpara-
graph (B)(xii) shall be included in the one-
stop partners for the local area, as a re-
quired partner, for purposes of this title un-
less the Governor of the State provides the
notification described in clause (ii).
‘‘(ii) NOTIFICATION.—The notification
referred to in clause (i) is a notification
that—
‘‘(I) is made in writing of a deter-
mination by the Governor not to in-
clude such entity in the one-stop part-
ners described in clause (i); and
‘‘(II) is provided to the Secretary
and the Secretary of Health and
Human Services.’’.
(2) ADDITIONAL PARTNERS.—
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(A) IN GENERAL.—Section 121(b)(2)(A) (29
U.S.C. 2841(b)(2)(A)) is amended to read as fol-
lows:
‘‘(A) IN GENERAL.—With the approval of
the local board and chief elected official, in addi-
tion to the entities described in paragraph (1),
other entities that carry out human resource pro-
grams described in subparagraph (B) may be
one-stop partners and carry out the responsibil-
ities described in paragraph (1)(A).’’.
(B) 
ADDITIONAL
PARTNERS.—Section
121(b)(2)(B) 
(29 
U.S.C. 
2841(b)(2)(B)) 
is
amended by striking clauses (i) through (iii) and
inserting the following:
‘‘(i) employment and training pro-
grams administered by the Social Security
Administration, including the Ticket to
Work and Self-Sufficiency program estab-
lished under section 1148 of the Social Se-
curity Act (42 U.S.C. 1320b–19);
‘‘(ii) employment and training pro-
grams carried out by the Small Business
Administration;
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‘‘(iii) programs authorized under sec-
tion 6(d)(4) of the Food Stamp Act of 1977
(7 U.S.C. 2015(d)(4));’’.
(b) LOCAL MEMORANDUM OF UNDERSTANDING.—Sec-
tion 121(c)(2)(A) (29 U.S.C. 2841(c)(2)(A)) is amended to
read as follows:
‘‘(A) provisions describing—
‘‘(i) the services to be provided through
the one-stop delivery system consistent with
the requirements of this section, including
the manner in which the services will be co-
ordinated through such system;
‘‘(ii) how the costs of such services and
the operating costs of such system will be
funded to provide a stable and equitable
funding stream for ongoing one-stop system
operations, including the funding of the in-
frastructure costs of one-stop centers in ac-
cordance with subsection (h);
‘‘(iii) methods of referral of individuals
between the one-stop operator and the one-
stop partners for appropriate services and
activities;
‘‘(iv) methods to ensure the needs of
hard-to-serve populations are addressed in
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providing access to services through the one-
stop system; and
‘‘(v) the duration of the memorandum
of understanding and the procedures for
amending the memorandum during the
term of the memorandum, and assurances
that such memorandum shall be reviewed
not less than once every 2-year period to en-
sure appropriate funding and delivery of
services; and’’.
(c) CONFORMING AMENDMENT.—Section 121(d)(2) (29
U.S.C. 2841(d)(2)) is amended by striking ‘‘section 134(c)’’
and inserting ‘‘section 121(e)’’.
(d) PROVISION OF SERVICES.—
(1) ELIMINATION
OF
PROVISIONS
CONCERNING
ESTABLISHED
SYSTEMS.—Section 121 (29 U.S.C.
2841) is amended by striking subsection (e).
(2) REDESIGNATION.—Subtitle B of title I is
amended—
(A) in section 134 (29 U.S.C. 2864), by re-
designating subsection (c) as subsection (e); and
(B) by transferring that subsection (e) so
that the subsection appears after subsection (d)
of section 121.
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(3) ONE-STOP DELIVERY SYSTEMS.—Paragraph
(1) of section 121(e) (29 U.S.C. 2841(e)) (as redesig-
nated by paragraph (2)) is amended—
(A) in subparagraph (A), by striking ‘‘sub-
section 
(d)(2)’’ 
and 
inserting 
‘‘section
134(d)(2)’’;
(B) in subparagraph (B)—
(i) by striking ‘‘subsection (d)’’ and in-
serting ‘‘section 134(d)’’;
(ii) by striking ‘‘individual training
accounts’’ and inserting ‘‘career scholarship
accounts’’; and
(iii) by striking ‘‘subsection (d)(4)(G)’’
and inserting ‘‘section 134(d)(4)(G)’’;
(C) in subparagraph (C), by striking ‘‘sub-
section (e)’’ and inserting ‘‘section 134(e)’’;
(D) in subparagraph (D), by striking ‘‘sec-
tion 121(b)’’ and inserting ‘‘subsection (b)’’; and
(E) in subparagraph (E), by striking ‘‘in-
formation described in section 15’’ and inserting
‘‘data, information, and analysis described in
section 15(a)’’.
(e) CONTINUOUS IMPROVEMENT OF ONE-STOP CEN-
TERS.—Section 121 (29 U.S.C. 2841) is amended by add-
ing at the end the following:
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‘‘(g) CONTINUOUS IMPROVEMENT OF ONE-STOP CEN-
TERS.—
‘‘(1) IN
GENERAL.—The State board, in con-
sultation with chief local elected officials and local
boards, shall establish objective criteria and proce-
dures for use by local boards in periodically assessing
the effectiveness, physical and programmatic accessi-
bility, and continuous improvement of one-stop cen-
ters and one-stop delivery systems.
‘‘(2) CRITERIA.—The procedures and criteria de-
veloped under this subsection shall include minimum
standards relating to the scope and degree of service
coordination achieved by the one-stop delivery system
with respect to the programs administered by the one-
stop partners at the one-stop centers, consistent with
the guidelines and guidance provided by the Governor
and by the State board, in consultation with the chief
elected official and local boards, for such partners’
participation under subsections (h)(1)(B) and sub-
section (i), respectively, and such other factors relat-
ing to the quality, accessibility, and effectiveness of
the one-stop delivery system as the State board deter-
mines to be appropriate.
‘‘(3) LOCAL BOARDS.—Consistent with the cri-
teria developed by the State, the local board may de-
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velop additional criteria of higher standards to re-
spond to local labor market and demographic condi-
tions and trends.
‘‘(h) FUNDING OF ONE-STOP INFRASTRUCTURE.—
‘‘(1) IN GENERAL.—
‘‘(A) OPTIONS FOR INFRASTRUCTURE FUND-
ING.—
‘‘(i) LOCAL OPTIONS.—The local board,
chief elected officials, and one-stop partners
in a local area may choose to fund the costs
of the infrastructure of one-stop centers
through—
‘‘(I) methods described in the local
memorandum of understanding, if, the
local board, chief elected officials, and
one-stop partners agree to such meth-
ods; or
‘‘(II) 
the 
State 
infrastructure
funding mechanism described in para-
graph (2).
‘‘(ii) FAILURE TO REACH AGREEMENT
ON FUNDING METHODS.—If, as of July 1,
2004, the local board, chief elected officials,
and one-stop partners in a local area fail to
reach agreement on methods of sufficient
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funding of the infrastructure costs of one-
stop centers, as determined by the local
area, the State infrastructure funding mech-
anism described in paragraph (2) shall be
applicable to such local area.
‘‘(B) 
GUIDANCE
FOR
INFRASTRUCTURE
FUNDING.—In addition to carrying out the re-
quirements relating to the State mechanism for
one-stop center infrastructure funding described
in paragraph (2), the Governor, after consulta-
tion with chief local elected officials, local boards,
and the State board, and consistent with the
guidelines provided by the State board under
subsection (i), shall provide—
‘‘(i) guidelines for State administered
one-stop partner programs in determining
such programs’ contributions to and par-
ticipation in the one-stop delivery system,
including funding for the costs of infra-
structure as defined in paragraph (2)(D),
negotiated pursuant to the local memo-
randum of understanding under subsection
(c); and
‘‘(ii) guidance to assist local areas in
identifying equitable and stable alternative
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methods of funding of the costs of the infra-
structure of one-stop centers in local areas.
‘‘(2) STATE ONE-STOP INFRASTRUCTURE FUND-
ING.—
‘‘(A) PARTNER CONTRIBUTIONS.—
‘‘(i) IN
GENERAL.—Subject to clause
(iii), a portion determined under clause (ii)
of the Federal funds provided to the State
and areas within the State under the Fed-
eral laws authorizing the programs de-
scribed in subsection (b)(1) and adminis-
tered by one-stop partners for a fiscal year
shall be provided to the Governor from such
programs to assist in paying the costs of in-
frastructure of one-stop centers in those
local areas of the State not funded under
the 
option 
described 
in 
paragraph
(1)(A)(i)(I).
‘‘(ii) 
DETERMINATION
OF
GOV-
ERNOR.—
‘‘(I) IN
GENERAL.—Subject to
subclause (II) and clause (iii), the
Governor, after consultation with chief
local elected officials, local boards, and
the State board, shall determine the
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portion of funds to be provided under
clause (i) by each one-stop partner
from each program described in clause
(i). In making such determination, the
Governor shall calculate the propor-
tionate use of the one-stop centers for
the purpose of determining funding
contributions pursuant to clause (i)(II)
or (ii) of paragraph (1)(A) by each
partner, and the costs of administra-
tion for purposes not related to one-
stop centers for each partner. The Gov-
ernor shall exclude from such deter-
mination the portion of funds and use
of one-stop centers attributable to the
programs of one-stop partners for those
local areas of the State where the infra-
structure of one-stop centers is funded
under the option described in para-
graph (1)(A)(i)(I).
‘‘(II) SPECIAL RULE.—In a State
in which the State constitution places
policymaking authority that is inde-
pendent of the authority of the Gov-
ernor in an entity or official with re-
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spect to the funds provided for adult
education and literacy activities au-
thorized under title II and for postsec-
ondary vocational and technical edu-
cation activities authorized under the
Carl D. Perkins Vocational and Tech-
nical Education Act of 1998 (20
U.S.C. 2301 et seq.), or vocational re-
habilitation services offered under the
Rehabilitation Act of 1973 (29 U.S.C.
701 et seq.), the determination de-
scribed in subclause (I) with respect to
the programs authorized under that
title and those Acts shall be made by
the chief officer of the entity with such
authority in consultation with the
Governor.
‘‘(III) 
APPEAL
BY
ONE-STOP
PARTNERS.—The Governor shall estab-
lish a procedure for the one-stop part-
ner administering a program described
in subsection (b) to appeal a deter-
mination regarding the portion of
funds to be contributed under this
paragraph on the basis that such deter-
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mination is inconsistent with the cri-
teria described in the State plan or
with the requirements of this para-
graph. Such procedure shall ensure
prompt resolution of the appeal.
‘‘(iii) LIMITATIONS.—
‘‘(I) PROVISION
FROM
ADMINIS-
TRATIVE FUNDS.—The funds provided
under this paragraph by each one-stop
partner shall be provided only from
funds available for the costs of admin-
istration under the program adminis-
tered by such partner, and shall be
subject to the program limitations with
respect to the portion of funds under
such program that may be used for ad-
ministration.
‘‘(II) CAP
ON
REQUIRED
CON-
TRIBUTIONS.—
‘‘(aa) WIA FORMULA
PRO-
GRAMS
AND
EMPLOYMENT
SERV-
ICE.—The portion of funds re-
quired to be contributed under
clause (i)(II) or (ii) of paragraph
(1)(A) by the programs authorized
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under chapters 4 and 5 and under
the Wagner-Peyser Act shall not
be in excess of 3 percent of the
amount of Federal funds provided
to carry out each such program in
the State for a fiscal year.
‘‘(bb) 
OTHER
ONE-STOP
PARTNERS.—The portion of funds
required to be contributed under
clause (i)(II) or (ii) of paragraph
(1)(A) by a one-stop partner from
a program described in subsection
(b)(1) other than the programs de-
scribed under item (aa) shall not
be in excess of 11⁄2 percent of the
amount of Federal funds provided
to carry out such program in the
State for a fiscal year.
‘‘(cc) SPECIAL
RULE.—Not-
withstanding items (aa) and (bb),
an agreement, including a local
memorandum of understanding,
entered into prior to the date of
enactment of the Workforce Invest-
ment Act Amendments of 2003 by
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an entity regarding contributions
under this title that permits the
percentages 
described 
in 
such
items to be exceeded, may con-
tinue to be in effect until termi-
nated by the parties.
‘‘(dd) 
VOCATIONAL
REHA-
BILITATION.—Notwithstanding
items (aa) and (bb), an entity ad-
ministering a program under title
I of the Rehabilitation Act of 1973
(29 U.S.C. 720 et seq.) shall not
be required to provide, for the
purposes of this paragraph, an
amount in excess of—
‘‘(AA) 0.75 percent of
the amount provided for such
program in the State for the
second program year that be-
gins after the date of enact-
ment of the Workforce Invest-
ment Act Amendments of
2003;
‘‘(BB) 1.0 percent of the
amount provided for such
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program in the State for the
third program year that be-
gins after such date;
‘‘(CC) 1.25 percent of
the amount provided for such
program in the State for the
fourth program year that be-
gins after such date; and
‘‘(DD) 1.5 percent of the
amount provided for such
program in the State for the
fifth and each succeeding
program year that begins
after such date.
‘‘(III) FEDERAL
DIRECT
SPEND-
ING
PROGRAMS.—An entity admin-
istering a program funded with direct
spending 
as 
defined 
in 
section
250(c)(8) of the Balanced Budget and
Emergency Deficit Control Act of 1985
(2 U.S.C. 900(c)(8)) shall not be re-
quired to provide, for purposes of this
paragraph, an amount in excess of the
amount determined to be equivalent to
the cost of the proportionate use of the
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one-stop centers for such program in
the State.
‘‘(IV) NATIVE
AMERICAN
PRO-
GRAMS.—Native American programs
established under section 166 shall not
be subject to the provisions of this sub-
section or subsection (i). The method
for determining the appropriate por-
tion of funds to be provided by such
Native American programs to pay for
the costs of infrastructure of a one-stop
center shall be determined as part of
the development of the memorandum of
understanding under subsection (c) for
the one-stop center and shall be stated
in the memorandum.
‘‘(B) ALLOCATION
BY
GOVERNOR.—From
the funds provided under subparagraph (A), the
Governor shall allocate the funds to local areas
in accordance with the formula established under
subparagraph (C) for the purposes of assisting in
paying the costs of infrastructure of one-stop cen-
ters.
‘‘(C) ALLOCATION
FORMULA.—The State
board shall develop a formula to be used by the
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Governor to allocate the funds provided under
subparagraph (A) to local areas not funding in-
frastructure costs under the option described in
paragraph (1)(A)(i)(I). The formula shall be
based on factors including the number of one-
stop centers in a local area, the population
served by such centers, the services provided by
such centers, and other factors relating to the
performance of such centers that the State board
determines are appropriate.
‘‘(D) COSTS OF INFRASTRUCTURE.—In this
subsection, the term ‘costs of infrastructure’, used
with respect to a one-stop center, means the non-
personnel costs that are necessary for the general
operation of the one-stop center, including the
rental costs of the facilities, the costs of utilities
and maintenance, equipment (including adapt-
ive technology for individuals with disabilities),
and technology to facilitate remote access to the
one-stop center’s strategic planning activities,
and common outreach activities.
‘‘(i) OTHER FUNDS.—
‘‘(1) IN GENERAL.—Subject to the memorandum
of understanding described in subsection (c) for the
one-stop delivery system involved, in addition to the
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funds provided to carry out subsection (h), a portion
of funds made available under Federal law author-
izing the programs described in subsection (b) and
administered by one-stop partners, or the noncash re-
sources available under such programs, shall be used
to pay the additional costs relating to the operation
of the one-stop delivery system that are not paid from
the funds provided under subsection (h), as deter-
mined in accordance with paragraph (2), to the ex-
tent not inconsistent with the Federal law involved.
Such costs shall include the costs of the provision of
core services described in section 134(d)(2) applicable
to each program and may include common costs that
are not paid from the funds provided under sub-
section (h).
‘‘(2) 
DETERMINATION
AND
GUIDANCE.—The
method for determining the appropriate portion of
funds and noncash resources to be provided by each
program under paragraph (1) for a one-stop center
shall be determined as part of the development of the
memorandum of understanding under subsection (c)
for the one-stop center and shall be stated in the
memorandum. The State board shall provide guidance
to facilitate the determination of an appropriate allo-
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cation of the funds and noncash resources in local
areas.’’.
SEC. 118. ELIGIBLE PROVIDERS OF TRAINING SERVICES.
Section 122 (29 U.S.C. 2842) is amended to read as
follows:
‘‘SEC. 122. IDENTIFICATION OF ELIGIBLE PROVIDERS OF
TRAINING SERVICES.
‘‘(a) IN GENERAL.—The Governor, after consultation
with the State board, shall establish criteria and procedures
regarding the eligibility of providers of training services de-
scribed in section 134(d)(4) (referred to in this section as
‘training services’) to receive funds provided under section
133(b) for the provision of training services.
‘‘(b) CRITERIA.—
‘‘(1) IN GENERAL.—The criteria established by
the Governor pursuant to subsection (a) shall take
into account—
‘‘(A) the performance of providers of train-
ing services with respect to the performance
measures described in section 136 or other ap-
propriate measures of performance outcomes for
those individuals receiving training services
under this subtitle (taking into consideration the
characteristics of the population served and rel-
evant economic conditions);
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‘‘(B) the need to ensure access to training
services throughout the State, including any
rural areas;
‘‘(C) the information such providers are re-
quired to report to State agencies with respect to
Federal and State programs (other than the pro-
gram carried out under this subtitle), including
one-stop partner programs;
‘‘(D) the requirements for State licensing of
providers of training services, and the licensing
status of each provider of training services if ap-
plicable;
‘‘(E) to the extent practicable, encouraging
the use of industry-recognized standards and cer-
tification;
‘‘(F) the ability to provide training services
to hard-to-serve populations, including individ-
uals with disabilities; and
‘‘(G) such other factors as the Governor de-
termines are appropriate to ensure—
‘‘(i) the quality of services provided;
‘‘(ii) the accountability of the pro-
viders;
‘‘(iii) that the one-stop centers in the
State will ensure that such providers meet
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the needs of local employers and partici-
pants;
‘‘(iv) the informed choice of partici-
pants under chapter 5; and
‘‘(v) that the collection of information
required is not unduly burdensome or costly
to providers.
‘‘(2) INFORMATION AND RENEWAL.—The criteria
established by the Governor shall require that a pro-
vider of training services submit appropriate, accu-
rate, and timely information to the State for purposes
of carrying out subsection (d). The criteria shall also
provide for annual review and renewal of eligibility
under this section for providers of training services.
‘‘(3) LOCAL
CRITERIA.—A local board in the
State may establish criteria in addition to the cri-
teria established by the Governor, or may require
higher levels of performance than required under the
criteria established by the Governor, for purposes of
determining the eligibility of providers of training
services to receive funds described in subsection (a) to
provide the services in the local area involved.
‘‘(c) PROCEDURES.—The procedures established under
subsection (a) shall identify the application process for a
provider of training services to become eligible to receive
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funds provided under section 133(b) for the provision of
training services, and identify the respective roles of the
State and local areas in receiving and reviewing the appli-
cations and in making determinations of such eligibility
based on the criteria established under this section. The pro-
cedures shall also establish a process for a provider of train-
ing services to appeal a denial or termination of eligibility
under this section, that includes an opportunity for a hear-
ing and prescribes appropriate time limits to ensure
prompt resolution of the appeal.
‘‘(d) INFORMATION
TO
ASSIST
PARTICIPANTS
IN
CHOOSING PROVIDERS.—
‘‘(1) IN GENERAL.—In order to facilitate and as-
sist participants in choosing employment and train-
ing activities under chapter 5 and in choosing pro-
viders of training services, the Governor shall ensure
that an appropriate list of providers determined to be
eligible under this section in the State, accompanied
by appropriate information provided by providers of
training services in the State in accordance with sub-
section (b) and such other information as the Gov-
ernor determines is appropriate, including informa-
tion on program costs for participants in applicable
programs, is provided to the one-stop delivery system
in the State. The list and the information shall be
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made available to such participants and to members
of the public through the one-stop delivery system in
the State.
‘‘(2) SPECIAL RULE.—An entity that carries out
programs under the Act of August 16, 1937 (com-
monly known as the ‘National Apprenticeship Act’,
50 Stat. 664, chapter 663; 29 U.S.C. 50 et seq.) shall
be included on the list of eligible providers described
in paragraph (1) for so long as such entity remains
certified by the Department of Labor.
‘‘(e) ENFORCEMENT.—
‘‘(1) IN GENERAL.—The criteria and procedures
established under this section shall provide the fol-
lowing:
‘‘(A) 
INTENTIONALLY
SUPPLYING
INAC-
CURATE INFORMATION.—Upon a determination,
by an individual or entity specified in the cri-
teria or procedures, that a provider of training
services, or individual providing information on
behalf of the provider, intentionally supplied in-
accurate information under this section, the eli-
gibility of such provider to receive funds under
chapter 5 shall be terminated for a period of
time that is not less than 2 years.
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‘‘(B) SUBSTANTIAL
VIOLATIONS.—Upon a
determination, by an individual or entity speci-
fied in the criteria or procedures, that a provider
of training services substantially violated any re-
quirement under this title, the eligibility of such
provider to receive funds under the program in-
volved may be terminated, or other appropriate
action may be taken.
‘‘(C) REPAYMENT.—A provider of training
services whose eligibility is terminated under
subparagraph (A) or (B) shall be liable for the
repayment of funds received under chapter 5
during a period of noncompliance described in
such subparagraph.
‘‘(2) CONSTRUCTION.—Paragraph (1) shall be
construed to provide remedies and penalties that sup-
plement, but do not supplant, other civil and crimi-
nal remedies and penalties.
‘‘(f) AGREEMENTS WITH OTHER STATES.—States
may enter into agreements, on a reciprocal basis, to permit
eligible providers of training services to accept career schol-
arship accounts provided in another State.
‘‘(g) OPPORTUNITY TO SUBMIT COMMENTS.—In estab-
lishing criteria, procedures, and information required
under this section, the Governor shall provide an oppor-
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tunity for interested members of the public to make rec-
ommendations and submit comments regarding such cri-
teria, procedures, and information.
‘‘(h) TRANSITION PERIOD FOR IMPLEMENTATION.—
The requirements of this section shall be implemented not
later than December 31, 2004. In order to facilitate early
implementation of this section, the Governor may establish
transition procedures under which providers eligible to pro-
vide training services under chapter 5 as such chapter was
in effect on the day before the date of enactment of the Work-
force Investment Act Amendments of 2003 may continue to
be eligible to provide such services until December 31, 2004,
or until such earlier date as the Governor determines to be
appropriate.
‘‘(i) ON-THE-JOB TRAINING OR CUSTOMIZED TRAIN-
ING EXCEPTION.—
‘‘(1) IN GENERAL.—Providers of on-the-job train-
ing or customized training shall not be subject to the
requirements of subsections (a) through (h).
‘‘(2) COLLECTION AND DISSEMINATION OF INFOR-
MATION.—A one-stop operator in a local area shall
collect such performance information from on-the-job
training and customized training providers as the
Governor may require, determine whether the pro-
viders meet such performance criteria as the Governor
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may require, and disseminate information identifying
providers that meet the criteria as eligible providers,
and the performance information, through the one-
stop delivery system. Providers determined to meet the
criteria shall be considered to be identified as eligible
providers of training services.’’.
SEC. 119. ELIGIBLE PROVIDERS OF YOUTH ACTIVITIES.
Section 123 (29 U.S.C. 2843) is amended to read as
follows:
‘‘SEC. 123. ELIGIBLE PROVIDERS OF YOUTH ACTIVITIES.
‘‘(a) IN GENERAL.—From the funds allocated under
section 128(b) to a local area, the local board for such area
shall award grants or contracts on a competitive basis to
providers of youth activities identified based on the criteria
in the State plan described in section 112 and shall conduct
oversight with respect to such providers.
‘‘(b) EXCEPTIONS.—A local board may award grants
or contracts on a sole-source basis if such board determines
there is an insufficient number of eligible providers of youth
activities in the local area involved (such as a rural area)
for grants and contracts to be awarded on a competitive
basis under subsection (a).’’.
SEC. 120. YOUTH ACTIVITIES.
(a) STATE ALLOTMENTS.—Section 127 (29 U.S.C.
2852) is amended—
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(1) in subsection (a)(1), by striking ‘‘oppor-
tunity’’ and inserting ‘‘challenge’’; and
(2) by striking subsection (b) and inserting the
following:
‘‘(b) ALLOTMENT AMONG STATES.—
‘‘(1) YOUTH ACTIVITIES.—
‘‘(A) YOUTH CHALLENGE GRANTS.—
‘‘(i) IN
GENERAL.—For each fiscal
year in which the amount appropriated
under 
section 
137(a) 
exceeds
$1,000,000,000, the Secretary shall reserve a
portion of the amount to provide youth
challenge grants and other activities under
section 169 (relating to youth challenge
grants) and provide youth activities under
section 167 (relating to migrant and sea-
sonal farmworker programs).
‘‘(ii) PORTION.—The portion referred
to in clause (i) shall equal, for a fiscal
year—
‘‘(I) except as provided in sub-
clause (II), the difference obtained by
subtracting $1,000,000,000 from the
amount appropriated under section
137(a) for the fiscal year; or
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‘‘(II) for any fiscal year in which
the amount is $1,250,000,000 or great-
er, $250,000,000.
‘‘(iii) YOUTH
ACTIVITIES
FOR
FARM-
WORKERS.—The Secretary shall reserve the
greater of $10,000,000 or 4 percent of the
portion described in clause (i) for a fiscal
year to provide youth activities under sec-
tion 167.
‘‘(iv) NATIVE
AMERICANS.—From the
remainder of the amount appropriated
under section 137(a) for each fiscal year the
Secretary shall reserve not more than 11⁄2
percent of such amount to provide youth ac-
tivities under section 166 (relating to Na-
tive Americans).
‘‘(B) OUTLYING AREAS.—
‘‘(i) IN GENERAL.—From the amount
made available under subsection (a)(2) for
each fiscal year the Secretary shall reserve
not more than 1⁄4 of 1 percent of the amount
appropriated under section 137(a) for the
fiscal year to provide assistance to the out-
lying areas to carry out youth activities
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and statewide workforce investment activi-
ties.
‘‘(ii) LIMITATION FOR FREELY ASSOCI-
ATED STATES.—
‘‘(I) COMPETITIVE GRANTS.—The
Secretary shall use funds described in
clause (i) to award grants to Guam,
American Samoa, the Commonwealth
of the Northern Mariana Islands, and
the Freely Associated States to carry
out youth activities and statewide
workforce investment activities.
‘‘(II) AWARD
BASIS.—The Sec-
retary shall award grants pursuant to
subclause (I) on a competitive basis
and pursuant to the recommendations
of experts in the field of employment
and training, working through the Pa-
cific Region Educational Laboratory
in Honolulu, Hawaii.
‘‘(III) 
ASSISTANCE
REQUIRE-
MENTS.—Any Freely Associated State
that desires to receive assistance under
this subparagraph shall submit an ap-
plication to the Secretary and shall in-
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clude 
in 
the 
application 
for
assistance—
‘‘(aa) 
information 
dem-
onstrating that the Freely Associ-
ated State will meet all conditions
that apply to States under this
title;
‘‘(bb) an assurance that, not-
withstanding any other provision
of this title, the Freely Associated
State will use such assistance only
for the direct provision of services;
and
‘‘(cc) such other information
and assurances as the Secretary
may require.
‘‘(IV) ADMINISTRATIVE
COSTS.—
The Secretary may provide not more
than 5 percent of the funds made
available for grants under subclause (I)
to pay the administrative costs of the
Pacific Region Educational Labora-
tory in Honolulu, Hawaii, regarding
activities assisted under this clause.
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‘‘(iii) ADDITIONAL
REQUIREMENT.—
The provisions of Public Law 95–134, per-
mitting the consolidation of grants by the
outlying areas, shall not apply to assistance
provided to those areas, including the Free-
ly Associated States, under this subpara-
graph.
‘‘(C) STATES.—
‘‘(i) IN GENERAL.—From the remain-
der of the amount appropriated under sec-
tion 137(a) for a fiscal year that exists after
the Secretary determines the amounts to be
reserved under subparagraphs (A) and (B),
the Secretary shall allot to the States—
‘‘(I) an amount of the remainder
that is less than or equal to the total
amount that was allotted to States for
fiscal 
year 
2003 
under 
section
127(b)(1)(C) of this Act (as in effect on
the day before the date of enactment of
the Workforce Investment Act Amend-
ments of 2003), in accordance with the
requirements 
of 
such 
section
127(b)(1)(C); and
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‘‘(II) the amount of the remain-
der, if any, in excess of the amount re-
ferred to in subclause (I), in accord-
ance with clause (ii).
‘‘(ii) FORMULA.—Subject to clauses
(iii) and (iv), of the amount described in
clause (i)(II)—
‘‘(I) 331⁄3 percent shall be allotted
on the basis of the relative number of
individuals in the civilian labor force
who are ages 16 through 21 in each
State, compared to the total number of
individuals in the civilian labor force
who are ages 16 through 21 in all
States;
‘‘(II) 331⁄3 percent shall be allot-
ted on the basis of the relative number
of unemployed individuals in each
State, compared to the total number of
unemployed individuals in all States;
and
‘‘(III) 331⁄3 percent shall be allot-
ted on the basis of the relative number
of disadvantaged youth who are ages
16 through 21 in each State, compared
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to the total number of disadvantaged
youth who are ages 16 through 21 in
all States.
‘‘(iii) MINIMUM
AND
MAXIMUM
PER-
CENTAGES.—
‘‘(I) MINIMUM PERCENTAGE.—The
Secretary shall ensure that no State
shall receive an allotment percentage
under this subparagraph for a fiscal
year that is less than 90 percent of the
allotment percentage of the State for
the preceding fiscal year.
‘‘(II) MAXIMUM
PERCENTAGE.—
Subject to subclause (I), the Secretary
shall ensure that no State shall receive
an allotment percentage under this
subparagraph for a fiscal year that is
more than 130 percent of the allotment
percentage of the State for the pre-
ceding fiscal year.
‘‘(iv) SMALL STATE MINIMUM ALLOT-
MENT.—Subject to clause (iii), the Sec-
retary shall ensure that no State shall re-
ceive an allotment under this subparagraph
that is less than the total of—
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‘‘(I) 
3⁄10
of 
percent 
of
$1,000,000,000 of the remainder de-
scribed in clause (i) for the fiscal year;
and
‘‘(II) if the remainder described
in clause (i) for the fiscal year exceeds
$1,000,000,000, 2⁄5 of 1 percent of the
excess.
‘‘(2) DEFINITIONS.—For the purposes of para-
graph (1):
‘‘(A) ALLOTMENT PERCENTAGE.—The term
‘allotment percentage’, used with respect to fiscal
year 2004 or a subsequent fiscal year, means a
percentage of the remainder described in para-
graph (1)(C)(i) that is received by the State in-
volved through an allotment made under this
subsection for the fiscal year. The term, used
with respect to fiscal year 2003, means the per-
centage of the amounts allotted to States under
this chapter (as in effect on the day before the
date of enactment of the Workforce Investment
Act Amendments of 2003) that is received by the
State involved for fiscal year 2003.
‘‘(B) DISADVANTAGED YOUTH.—Subject to
paragraph (3), the term ‘disadvantaged youth’
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means an individual who is age 16 through 21
who received an income, or is a member of a
family that received a total family income, that,
in relation to family size, does not exceed the
higher of—
‘‘(i) the poverty line; or
‘‘(ii) 70 percent of the lower living
standard income level.
‘‘(C) FREELY
ASSOCIATED
STATE.—The
term ‘Freely Associated State’ means the Repub-
lic of the Marshall Islands, the Federated States
of Micronesia, and the Republic of Palau.
‘‘(3) SPECIAL RULE.—For purposes of the for-
mula specified in paragraph (1)(C), the Secretary
shall, as appropriate and to the extent practicable, ex-
clude college students and members of the Armed
Forces from the determination of the number of dis-
advantaged youth.’’.
(b) REALLOTMENT.—
(1) AMENDMENT.—Section 127(c) (29 U.S.C.
2852(c)) is amended—
(A) by striking paragraph (2) and inserting
the following:
‘‘(2) AMOUNT.—The amount available for real-
lotment for a program year is equal to the amount
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by which the unexpended balance at the end of the
program year prior to the program year for which the
determination is made exceeds 30 percent of the total
amount of funds available to the State under this sec-
tion during such prior program year (including
amounts allotted to the State in all prior program
years that remained available). For purposes of this
paragraph, the unexpended balance is the amount
that is the difference between—
‘‘(A) the total amount of funds available to
the State under this section during the program
year prior to the program year for which the de-
termination is made (including amounts allotted
to the State in all prior program years that re-
mained available); and
‘‘(B) the accrued expenditures during such
prior program year.’’;
(B) in paragraph (3)—
(i) by striking ‘‘for the prior program
year’’ and inserting ‘‘for the program year
for which the determination is made’’; and
(ii) by striking ‘‘such prior program
year’’ and inserting ‘‘such program year’’;
(C) by striking paragraph (4) and inserting
the following:
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‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible State means a State that does not
have an amount available for reallotment under para-
graph (2) for the program year for which the deter-
mination under paragraph (2) is made.’’; and
(D) in paragraph (5), by striking ‘‘obliga-
tion’’ and inserting ‘‘accrued expenditure’’.
(2) EFFECTIVE DATE.—The amendment made by
paragraph (1) shall take effect for the program year
that begins after the date of enactment of this Act.
(c) WITHIN STATE ALLOCATIONS.—
(1) RESERVATION FOR STATEWIDE ACTIVITIES.—
Section 128(a) (29 U.S.C. 2853(a)) is amended to
read as follows:
‘‘(a) RESERVATIONS FOR STATEWIDE ACTIVITIES.—
‘‘(1) IN
GENERAL.—The Governor of a State
shall reserve not more than 15 percent of each of the
amounts 
allotted 
to 
the 
State 
under 
section
127(b)(1)(C) and paragraphs (1)(B) and (2)(B) of
section 132(b) for a fiscal year for statewide workforce
investment activities.
‘‘(2) USE OF FUNDS.—Regardless of whether the
reserved 
amounts 
were 
allotted 
under 
section
127(b)(1)(C), or under paragraph (1)(B) or (2)(B) of
section 132(b), the Governor may use the reserved
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amounts to carry out statewide activities under sec-
tion 129(b) or statewide employment and training ac-
tivities, for adults or dislocated workers, under section
134(a).’’.
(2) WITHIN STATE ALLOCATION.—Section 128(b)
(29 U.S.C. 2853(b)) is amended to read as follows:
‘‘(b) WITHIN STATE ALLOCATIONS.—
‘‘(1) IN GENERAL.—Of the amount allotted to the
State under section 127(b)(1)(C) and not reserved
under subsection (a)(1)—
‘‘(A) a portion equal to not less than 80
percent of such amount shall be allocated by the
Governor to local areas in accordance with para-
graph (2); and
‘‘(B) a portion equal to not more than 20
percent of such amount may be allocated by the
Governor to local areas in accordance with para-
graph (3).
‘‘(2) ESTABLISHED FORMULA.—
‘‘(A) IN
GENERAL.—Of the portion de-
scribed in paragraph (1)(A), the Governor shall
allocate—
‘‘(i) 331⁄3 percent on the basis of the
relative number of individuals in the civil-
ian labor force who are ages 16 through 21
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in each local area, compared to the total
number of individuals in the civilian labor
force who are ages 16 through 21 in all
local areas in the State;
‘‘(ii) 331⁄3 percent on the basis of the
relative number of unemployed individuals
in each local area, compared to the total
number of unemployed individuals in all
local areas in the State; and
‘‘(iii) 331⁄3 percent on the basis of the
relative number of disadvantaged youth who
are ages 16 through 21 in each local area,
compared to the total number of disadvan-
taged youth who are ages 16 through 21 in
all local areas in the State.
‘‘(B) MINIMUM
AND
MAXIMUM
PERCENT-
AGES.—
‘‘(i) 
MINIMUM
PERCENTAGE.—The
Governor shall ensure that no local area
shall receive an allocation percentage under
this paragraph for a fiscal year that is less
than 90 percent of the allocation percentage
of the local area for the preceding fiscal
year.
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‘‘(ii) MAXIMUM PERCENTAGE.—Subject
to clause (i), the Governor shall ensure that
no local area shall receive an allocation per-
centage under this paragraph for a fiscal
year that is more than 130 percent of the
allocation percentage of the local area for
the preceding fiscal year.
‘‘(C) DEFINITIONS.—In this paragraph:
‘‘(i) ALLOCATION
PERCENTAGE.—The
term ‘allocation percentage’, used with re-
spect to fiscal year 2004 or a subsequent fis-
cal year, means a percentage of the portion
described in paragraph (1)(A) that is re-
ceived by the local area involved through an
allocation made under this paragraph for
the fiscal year. The term, used with respect
to fiscal year 2003, means the percentage of
the amounts allocated to local areas under
this chapter (as in effect on the day before
the date of enactment of the Workforce In-
vestment Act Amendments of 2003) that is
received by the local area involved for fiscal
year 2003.
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‘‘(ii) DISADVANTAGED
YOUTH.—The
term ‘disadvantaged youth’ means an indi-
vidual who—
‘‘(I) is age 16 through 21;
‘‘(II) is not a college student or
member of the Armed Forces; and
‘‘(III) received an income, or is a
member of a family that received a
total family income, that, in relation
to family size, does not exceed the high-
er of—
‘‘(aa) the poverty line; or
‘‘(bb) 70 percent of the lower
living standard income level.
‘‘(3) YOUTH DISCRETIONARY ALLOCATION.—The
Governor may allocate the portion described in para-
graph (1)(B) to local areas where there are a signifi-
cant number of eligible youth, after consultation with
the State board and local boards.
‘‘(4) LOCAL ADMINISTRATIVE COST LIMIT.—
‘‘(A) IN
GENERAL.—Of the amount allo-
cated to a local area under this subsection and
section 133(b) for a fiscal year, not more than 10
percent of the amount may be used by the local
board involved for the administrative costs of
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carrying out local workforce investment activities
under this chapter or chapter 5.
‘‘(B) USE OF FUNDS.—Funds made avail-
able for administrative costs under subparagraph
(A) may be used for the administrative costs of
any of the local workforce investment activities
described in this chapter or chapter 5, regardless
of whether the funds were allocated under this
subsection or section 133(b).’’.
(3) REALLOCATION.—
(A) 
AMENDMENT.—Section 
128(c) 
(29
U.S.C. 2853(c)) is amended—
(i) in paragraph (1), by striking
‘‘paragraph (2)(A) or (3) of’’;
(ii) by striking paragraph (2) and in-
serting the following:
‘‘(2) AMOUNT.—The amount available for re-
allocation for a program year is equal to the amount
by which the unexpended balance at the end of the
program year prior to the program year for which the
determination is made exceeds 30 percent of the total
amount of funds available to the local area under this
section during such prior program year (including
amounts allocated to the local area in all prior pro-
gram years that remained available). For purposes of
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this paragraph, the unexpended balance is the
amount that is the difference between—
‘‘(A) the total amount of funds available to
the local area under this section during the pro-
gram year prior to the program year for which
the determination is made (including amounts
allocated to the local area in all prior program
years that remained available); and
‘‘(B) the accrued expenditures during such
prior program year.’’;
(iii) by amending paragraph (3)—
(I) by striking ‘‘subsection (b)(3)’’
each place it appears and inserting
‘‘subsection (b)’’;
(II) by striking ‘‘for the prior
program year’’ the first place it ap-
pears and inserting ‘‘for the program
year for which the determination is
made’’;
(III) by striking ‘‘such prior pro-
gram year’’ and inserting ‘‘such pro-
gram year’’; and
(IV) by striking the last sentence;
and
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(iv) by striking paragraph (4) and in-
serting the following:
‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible local area means a local area that
does not have an amount available for reallocation
under paragraph (2) for the program year for which
the determination under paragraph (2) is made.’’.
(B) EFFECTIVE
DATE.—The amendments
made by subparagraph (A) shall take effect for
the later of—
(i) the program year that begins after
the date of enactment of this Act; or
(ii) program year 2004.
(d) 
YOUTH
PARTICIPANT
ELIGIBILITY.—Section
129(a) (29 U.S.C. 2854(a)) is amended to read as follows:
‘‘(a) YOUTH PARTICIPANT ELIGIBILITY.—
‘‘(1) ELIGIBILITY.—
‘‘(A) IN GENERAL.—To be eligible to par-
ticipate in activities carried out under this chap-
ter during any program year an individual
shall, at the time the eligibility determination is
made, be an out-of-school youth or an in-school
youth.
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‘‘(B) OUT-OF-SCHOOL YOUTH.—In this title
the term ‘out-of-school youth’ means an indi-
vidual who is—
‘‘(i) not younger than age 16 (subject
to paragraph (3)) nor older than age 21;
and
‘‘(ii) one of the following:
‘‘(I) A school dropout.
‘‘(II) A youth who is within the
age for compulsory school attendance,
but has not attended school for at least
1 school year calendar quarter.
‘‘(III) A recipient of a secondary
school diploma or its equivalent who
is—
‘‘(aa) deficient in basic skills,
including limited English pro-
ficiency;
‘‘(bb) a low-income indi-
vidual; and
‘‘(cc) 
not 
attending 
any
school.
‘‘(IV) Subject to the juvenile jus-
tice system or ordered by a court to an
alternative school.
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‘‘(V) A low-income individual who
is pregnant or parenting and not at-
tending any school.
‘‘(VI) A youth who is not attend-
ing school or a youth attending an al-
ternative school, who is homeless, a
runaway, a foster child, a child eligible
for assistance under section 477 of the
Social Security Act, or in an out-of-
home placement.
‘‘(VII) A low-income individual
who requires additional assistance to
complete an educational program or to
secure or hold employment.
‘‘(C) IN-SCHOOL
YOUTH.—In this section
the term ‘in-school youth’ means an individual
who is—
‘‘(i) not younger than age 14 nor older
than age 21;
‘‘(ii) a low-income individual; and
‘‘(iii) one or more of the following:
‘‘(I) Deficient in basic literacy
skills, including limited English pro-
ficiency.
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‘‘(II) Homeless, a runaway, a fos-
ter child, a child eligible for assistance
under section 477 of the Social Secu-
rity Act, or in an out-of-home place-
ment.
‘‘(III) Pregnant or parenting.
‘‘(IV) An offender (other than an
individual described in subparagraph
(B)(ii)(IV)).
‘‘(V) An individual who requires
additional assistance to complete an
educational program or to secure or
hold employment.
‘‘(2) EXCEPTION.—Not more than 5 percent of
the individuals assisted under this section in each
local area, in the case of individuals for whom low
income is a requirement for eligibility under this sec-
tion, may be individuals who are not low income.
‘‘(3) LIMITATIONS ON ACTIVITIES FOR IN-SCHOOL
YOUTH.—
‘‘(A) IN GENERAL.—For any program year,
not more than 60 percent of the funds available
for statewide activities under subsection (b), and
not more than 60 percent of funds available to
local areas under subsection (c), may be used to
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provide activities for in-school youth meeting the
requirements of paragraph (1)(B).
‘‘(B) EXCEPTION.—A State that receives a
minimum allotment under section 127(b)(1) in
accordance with section 127(b)(1)(C)(iv) or
under section 132(b)(1) in accordance with sec-
tion 132(b)(1)(B)(iv)(II) may increase the per-
centage described in subparagraph (A) for a
local area in the State, if—
‘‘(i) after an analysis of the eligible
youth population in the local area, the
State determines that the local area will be
unable to use at least 40 percent of the
funds available for activities under sub-
section (b) or (c) to serve out-of-school youth
due to a low number of out-of-school youth;
and
‘‘(ii)(I) the State submits to the Sec-
retary, for the local area, a request includ-
ing a proposed increased percentage for
purposes of subparagraph (A), and the sum-
mary of the eligible youth population anal-
ysis; and
‘‘(II) the request is approved by the
Secretary.
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‘‘(4) CONSISTENCY WITH COMPULSORY SCHOOL
ATTENDANCE LAWS.—In providing assistance under
this section to an individual who is required to attend
school under applicable State compulsory school at-
tendance laws, the priority in providing such assist-
ance shall be for the individual to attend school regu-
larly.’’.
(e) STATEWIDE
ACTIVITIES.—Section 129(b) (29
U.S.C. 2854(b)) is amended to read as follows:
‘‘(b) STATEWIDE ACTIVITIES.—
‘‘(1) IN GENERAL.—Funds reserved by a Gov-
ernor for a State as described in sections 128(a) and
133(a)(1) shall be used, regardless of whether the
funds were allotted to the State under section
127(b)(1)(C) or under paragraph (1)(B) or (2)(B) of
section 132(b) for statewide activities, which may
include—
‘‘(A) conducting—
‘‘(i) evaluations under section 136(e) of
activities authorized under this chapter and
chapter 5 in coordination with evaluations
carried out by the Secretary under section
172;
‘‘(ii) research; and
‘‘(iii) demonstration projects;
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‘‘(B) providing incentive grants to local
areas for regional cooperation among local
boards (including local boards in a designated
region as described in section 116(c)), for local
coordination of activities carried out under this
title, and for performance by local areas as de-
scribed in section 136(i)(2);
‘‘(C) providing technical assistance and ca-
pacity building activities to local areas, one-stop
operators, one-stop partners, and eligible pro-
viders, including the development and training
of staff, the development of exemplary program
activities, the provision of technical assistance to
local areas that fail to meet local performance
measures described in section 136(c), and the
provision of technology to facilitate remote access
to services provided through one-stop delivery
systems;
‘‘(D) operating a fiscal and management
accountability information system under section
136(f);
‘‘(E) carrying out monitoring and oversight
of activities carried out under this chapter and
chapter 5, which may include a review com-
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paring the services provided to male and female
youth;
‘‘(F) providing additional assistance to
local areas that have high concentrations of eligi-
ble youth;
‘‘(G) supporting the development of alter-
native programs and other activities that en-
hance the choices available to eligible youth and
encourage such youth to reenter secondary edu-
cation, enroll in postsecondary education and
advanced training, and obtain career path em-
ployment; and
‘‘(H) supporting the provision of core serv-
ices described in section 134(d)(2) in the one-
stop delivery system in the State.
‘‘(2) LIMITATION.—Not more than 5 percent of
the 
funds 
allotted 
to 
a 
State 
under 
section
127(b)(1)(C) shall be used by the State for adminis-
trative activities carried out under this subsection or
section 134(a).
‘‘(3) PROHIBITION.—No funds described in this
subsection may be used to develop or implement edu-
cation curricula for school systems in the State.’’.
(f) LOCAL ELEMENTS AND REQUIREMENTS.—
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(1) PROGRAM
DESIGN.—Section 129(c)(1) (29
U.S.C. 2854(c)(1)) is amended—
(A) in the matter that precedes subpara-
graph (A), by striking ‘‘paragraph (2)(A) or (3),
as appropriate, of’’;
(B) in subparagraph (B), by inserting ‘‘are
directly linked to 1 or more of the performance
measures relating to this chapter under section
136, and that’’ after ‘‘for each participant that’’;
and
(C) in subparagraph (C)—
(i) by redesignating clauses (i) through
(iv) as clauses (ii) through (v), respectively;
(ii) by inserting before clause (ii) (as
redesignated by clause (i)) the following:
‘‘(i) activities leading to the attain-
ment of a secondary school diploma or its
equivalent, or another recognized creden-
tial;’’;
(iii) in clause (ii) (as redesignated by
clause (i)), by inserting ‘‘and advanced
training’’ after ‘‘opportunities’’;
(iv) in clause (iii) (as redesignated by
clause (i))—
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(I) 
by 
inserting 
‘‘instruction
based on State academic content and
student academic achievement stand-
ards established under section 1111 of
the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 6311)’’
after ‘‘academic’’; and
(II) by inserting ‘‘that lead to the
attainment of recognized credentials’’
after ‘‘learning’’; and
(v) by striking clause (v) (as redesig-
nated by clause (i)) and inserting the fol-
lowing:
‘‘(v) effective connections to all employ-
ers, including small employers, in sectors of
the local and regional labor markets that
are experiencing high growth in employ-
ment opportunities.’’.
(2) PROGRAM ELEMENTS.—Section 129(c)(2) (29
U.S.C. 2854(c)(2)) is amended—
(A) in subparagraph (A), by striking ‘‘sec-
ondary school, including dropout prevention
strategies’’ and inserting ‘‘the requirements for a
secondary school diploma or its recognized equiv-
alent (including recognized alternative standards
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for individuals with disabilities) or for another
recognized credential, including dropout preven-
tion strategies’’;
(B) in subparagraph (B), by inserting ‘‘,
with a priority on exposing youth to technology
and nontraditional jobs’’ before the semicolon;
(C) in subparagraph (F), by striking ‘‘dur-
ing nonschool hours’’;
(D) in subparagraph (I), by striking ‘‘and’’
at the end;
(E) in subparagraph (J), by striking the
period at the end and inserting a semicolon; and
(F) by adding at the end the following:
‘‘(K) on-the-job training opportunities;
‘‘(L) opportunities to acquire financial lit-
eracy skills;
‘‘(M) entrepreneurial skills training and
microenterprise services; and
‘‘(N) information about average wages for a
range of jobs available in the local area, includ-
ing technology jobs.’’.
(3) 
ADDITIONAL
REQUIREMENTS.—Section
129(c)(3)(A) (29 U.S.C. 2854(c)(3)(A)) is amended in
the matter preceding clause (i) by striking ‘‘or appli-
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cant who meets the minimum income criteria to be
considered an eligible youth’’.
(4) PRIORITY AND EXCEPTIONS.—Section 129(c)
(29 U.S.C. 2854(c)) is amended by striking para-
graphs (4) and (5).
(5) 
PROHIBITIONS
AND
LINKAGES.—Section
129(c) (29 U.S.C. 2854(c)), as amended by paragraph
(4), is further amended—
(A) by redesignating paragraphs (6), (7),
and (8) as paragraphs (4), (5), and (6), respec-
tively;
(B) in paragraph (4) (as redesignated by
subparagraph (A))—
(i) by striking subparagraph (B); and
(ii) by redesignating subparagraph (C)
as subparagraph (B); and
(C) in paragraph (5) (as redesignated by
subparagraph (A)), by striking ‘‘youth councils’’
and inserting ‘‘local boards’’.
SEC. 121. ADULT AND DISLOCATED WORKER EMPLOYMENT
AND TRAINING ACTIVITIES.
(a) STATE ALLOTMENTS.—
(1) RESERVATIONS.—Section 132(a)(2)(A) is
amended by striking ‘‘national emergency grants’’
and inserting ‘‘national dislocated worker grants’’.
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(2) ALLOTMENT AMONG STATES.—Section 132(b)
(29 U.S.C. 2862(b)) is amended—
(A) in paragraph (1)(A)(ii), by striking
‘‘section 127(b)(1)(B)’’ and all that follows and
inserting ‘‘section 127(b)(1)(B).’’;
(B) by striking paragraph (1)(B)(ii) and
inserting the following:
‘‘(ii) FORMULA.—Subject to clauses
(iii) and (iv), of the remainder—
‘‘(I) 40 percent shall be allotted
on the basis of the relative number of
unemployed individuals in areas of
substantial unemployment in each
State, compared to the total number of
unemployed individuals in areas of
substantial 
unemployment 
in 
all
States;
‘‘(II) 25 percent shall be allotted
on the basis of the relative number of
individuals in the civilian labor force
in each State, compared to the total
number of such individuals in all
States; and
‘‘(III) 35 percent shall be allotted
on the basis of the relative number of
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disadvantaged adults in each State,
compared to the total number of dis-
advantaged adults in all States, except
as described in clause (iii).’’;
(C) in paragraph (1)(B)—
(i) in clause (iii), by striking ‘‘section
116(a)(2)(B)’’ 
and 
inserting 
‘‘section
116(a)(2)(A)(iii)’’; and
(ii) in clause (iv)—
(I) in subclause (II), by striking
‘‘subclauses (I), (III), and (IV)’’ and
inserting ‘‘subclauses (I) and (III)’’;
and
(II) by striking subclause (IV);
and
(D) in paragraph (2)(A)(ii), by striking
‘‘section 127(b)(1)(B)’’ and all that follows and
inserting ‘‘section 127(b)(1)(B).’’.
(3) REALLOTMENT.—Section 132(c) (29 U.S.C.
2862(c)) is amended—
(A) by striking paragraph (2) and inserting
the following:
‘‘(2) AMOUNT.—The amount available for real-
lotment for a program year for programs funded
under subsection (b)(1)(B) (relating to adult employ-
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ment and training) and subsection (b)(2)(B) (relating
to dislocated worker employment and training), re-
spectively, is equal to the amount by which the unex-
pended balance at the end of the program year prior
to the program year for which the determination is
made exceeds 30 percent of the total amount of funds
available to the State under subsection (b)(1)(B) or
(b)(2)(B), respectively, during such prior program
year (including amounts allotted to the State in all
prior program years under such provisions that re-
mained available). For purposes of this paragraph,
the unexpended balance is the amount that is the dif-
ference between—
‘‘(A) the total amount of funds available to
the State under subsection (b)(1)(B) or (b)(2)(B),
respectively, during the program year prior to
the program year for which the determination is
made (including amounts allotted to the State in
all prior program years under such provisions
that remained available); and
‘‘(B) the accrued expenditures from such
total amount of funds available under subsection
(b)(1)(B) or (b)(2)(B), respectively, during such
prior program year.’’;
(B) in paragraph (3)—
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(i) by striking ‘‘under this section for
such activities for the prior program year’’
and inserting ‘‘under subsection (b)(1)(B)
or (b)(2)(B), as appropriate, for the pro-
gram year for which the determination is
made’’; and
(ii) by striking ‘‘under this subsection
for such activities for such prior program
year’’ and inserting ‘‘under subsection
(b)(1)(B) or (b)(2)(B), as appropriate, for
such program year’’;
(C) by striking paragraph (4) and inserting
the following:
‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible State means—
‘‘(A) with respect to funds allotted under
subsection (b)(1)(B), a State that does not have
an amount of such funds available for reallot-
ment under paragraph (2) for the program year
for which the determination under paragraph (2)
is made; and
‘‘(B) with respect to funds allotted under
subsection (b)(2)(B), a State that does not have
an amount of such funds available for reallot-
ment under paragraph (2) for the program year
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for which the determination under paragraph (2)
is made.’’; and
(D) in paragraph (5), by striking ‘‘obliga-
tion’’ and inserting ‘‘accrued expenditure’’.
(4) EFFECTIVE DATE.—The amendments made
by paragraph (3) shall take effect for the later of—
(A) the program year that begins after the
date of enactment of this Act; or
(B) program year 2004.
(b) WITHIN STATE ALLOCATIONS.—
(1) ALLOCATION.—Section 133(b)(5)(B)(ii) (29
U.S.C. 2863(b)(5)(B)(ii)) is amended by striking
‘‘section 134(c)’’ and inserting ‘‘section 121(e)’’.
(2) REALLOCATION.—Section 133(c) (29 U.S.C.
2863(c)) is amended—
(A) in paragraph (1), by inserting ‘‘, and
under subsection (b)(2)(B) for dislocated worker
employment and training activities,’’ after ‘‘ac-
tivities’’;
(B) by striking paragraph (2) and inserting
the following:
‘‘(2) AMOUNT.—The amount available for re-
allocation for a program year for programs funded
under paragraphs (2)(A) and (3) of subsection (b)
(relating to adult employment and training) and sub-
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section (b)(2)(B) (relating to dislocated worker em-
ployment and training), respectively, is equal to the
amount by which the unexpended balance at the end
of the program year prior to the program year for
which the determination is made exceeds 30 percent
of the total amount of funds available to the local
area under paragraphs (2)(A) and (3) of subsection
(b), or subsection (b)(2)(B), respectively, during such
prior program year (including amounts allocated to
the local area in all prior program years under such
provisions that remained available). For purposes of
this paragraph, the unexpended balance is the
amount that is the difference between—
‘‘(A) the total amount of funds available to
the local area under paragraphs (2)(A) and (3)
of subsection (b), or subsection (b)(2)(B), respec-
tively, during the program year prior to the pro-
gram year for which the determination is made
(including amounts allotted to the local area in
all prior program years under such provisions
that remained available); and
‘‘(B) the accrued expenditures from such
total amount of funds available under para-
graphs (2)(A) and (3) of subsection (b), or sub-
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section (b)(2)(B), respectively, during such prior
program year.’’;
(C) by striking paragraph (3) and inserting
the following:
‘‘(3) REALLOCATION.—In making reallocations
to eligible local areas of amounts available pursuant
to paragraph (2) for a program year, the Governor
shall allocate to each eligible local area within the
State—
‘‘(A) with respect to amounts that are avail-
able for reallocation under paragraph (2) that
were allocated under paragraphs (2)(A) or (3) of
subsection (b), an amount based on the relative
amount allocated to such local area under para-
graphs (2)(A) or (3) of subsection (b), as appro-
priate, for the program year for which the deter-
mination is made, as compared to the total
amount allocated to all eligible local areas under
paragraphs (2)(A) or (3) of subsection (b), as ap-
propriate, of such program year; and
‘‘(B) with respect to amounts that are
available for reallocation under paragraph (2)
that were allocated under subsection (b)(2)(B),
an amount based on the relative amount allo-
cated to such local area under subsection
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(b)(2)(B) for the program year for which the de-
termination is made, as compared to the total
amount allocated to all eligible local areas under
subsection (b)(2)(B) for such program year.’’;
and
(D) by striking paragraph (4) and insert-
ing the following:
‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible local area means—
‘‘(A) with respect to funds allocated under
paragraphs (2)(A) or (3) of subsection (b), a
local area that does not have an amount of such
funds available for reallocation under paragraph
(2) for the program year for which the deter-
mination under paragraph (2) is made; and
‘‘(B) with respect to funds allocated under
subsection (b)(2)(B), a local area that does not
have an amount of such funds available for re-
allocation under paragraph (2) for the program
year for which the determination under para-
graph (2) is made.’’.
(3) EFFECTIVE DATE.—The amendments made
by paragraph (2) shall take effect for the later of—
(A) the program year that begins after the
date of enactment of this Act; or
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(B) program year 2004.
(c) USE OF FUNDS FOR EMPLOYMENT AND TRAINING
ACTIVITIES.—
(1) STATEWIDE EMPLOYMENT AND TRAINING AC-
TIVITIES.—
(A) STATEWIDE RAPID RESPONSE ACTIVI-
TIES.—Section 
134(a)(2)(A) 
(29 
U.S.C.
2864(a)(2)(A)) is amended to read as follows:
‘‘(A) STATEWIDE RAPID RESPONSE ACTIVI-
TIES.—
‘‘(i) IN GENERAL.—A State shall carry
out statewide rapid response activities using
funds reserved by a Governor for a State
under section 133(a)(2). Such activities
shall include—
‘‘(I) provision of rapid response
activities, carried out in local areas by
the State or by an entity designated by
the State, working in conjunction with
the local boards and the chief elected
officials for the local areas; and
‘‘(II) provision of additional as-
sistance to local areas that experience
disasters, mass layoffs, or plant clos-
ings, or other events that precipitate
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substantial increases in the number of
unemployed individuals, carried out in
local areas by the State, working in
conjunction with the local boards and
the chief elected officials for the local
areas.
‘‘(ii) USE OF UNEXPENDED FUNDS.—
Funds reserved under section 133(a)(2) to
carry out this subparagraph that remain
unexpended after the first program year for
which such funds were allotted may be used
by the Governor to carry out statewide ac-
tivities authorized under subparagraph (B)
and paragraph (3)(A) in addition to activi-
ties under this subparagraph.’’.
(B) STATEWIDE EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—Section 134(a)(2) (29 U.S.C.
2864(a)(2)) is amended by striking subpara-
graph (B) and inserting the following:
‘‘(B) STATEWIDE EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—Funds reserved by a Governor
for a State under sections 128(a)(1) and
133(a)(1) and not used under paragraph (1)(A)
(regardless of whether the funds were allotted to
the States under section 127(b)(1)(C) or para-
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graphs (1)(B) or (2)(B) of section 132(b)) shall
be used for statewide employment and training
activities, including—
‘‘(i) disseminating—
‘‘(I) the State list of eligible pro-
viders of training services, including
eligible providers of nontraditional
training services;
‘‘(II) information identifying eli-
gible providers of on-the-job training
and customized training;
‘‘(III) performance information
and program cost information, as de-
scribed in subsections (d) and (i) of
section 122; and
‘‘(IV) information on physical
and programmatic accessibility for in-
dividuals with disabilities;
‘‘(ii) conducting evaluations under sec-
tion 136(e) of activities authorized under
this chapter and chapter 5 in coordination
with evaluations carried out by the Sec-
retary under section 172;
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‘‘(iii) providing incentive grants to
local areas in recognition of exceptional
achievement relating to—
‘‘(I) regional cooperation among
local boards (including local boards in
a designated region as described in sec-
tion 116(c));
‘‘(II) expanded local coordination
of programs and activities carried out
as part of a comprehensive workforce
investment system, including—
‘‘(aa) employment services
under the Wagner-Peyser Act and
core activities under this title;
and
‘‘(bb) one-stop partner pro-
grams described in section 121;
‘‘(III) performance by local areas
as described in section 136(i)(2); and
‘‘(IV) providing expanded access
to education and training services, es-
pecially through increased leveraging
of resources other than those provided
through programs under this title;
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‘‘(iv) developing strategies for ensuring
that activities carried out under this section
are placing men and women in jobs, edu-
cation, and training that lead to com-
parable pay;
‘‘(v) providing technical assistance and
capacity building to local areas, one-stop
operators, one-stop partners, and eligible
providers, including the development and
training of staff, the development of exem-
plary program activities, and the provision
of technical assistance to local areas that
fail to meet local performance measures de-
scribed in section 136(c), which may in-
clude the development and training of staff
to provide opportunities for hard-to-serve
populations to enter high-wage, high-skilled,
and nontraditional occupations;
‘‘(vi) operating a fiscal and manage-
ment accountability system under section
136(f); and
‘‘(vii) carrying out monitoring and
oversight of activities carried out under this
chapter and chapter 4.’’.
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(C) ALLOWABLE STATEWIDE EMPLOYMENT
AND
TRAINING
ACTIVITIES.—Section
134(a)(3)(A) (29 U.S.C. 2864(a)(3)(A) is amend-
ed to read as follows:
‘‘(A) IN
GENERAL.—Funds reserved by a
Governor for a State under sections 128(a)(1)
and 133(a)(1) and not used under paragraph
(1)(A) or (2)(B) (regardless of whether the funds
were allotted to the State under section
127(b)(1)(C) or paragraph (1)(B) or (2)(B) of
section 132(b)) may be used to carry out addi-
tional statewide employment and training ac-
tivities, which may include—
‘‘(i) implementing innovative pro-
grams and strategies designed to meet the
needs of all businesses in the State, includ-
ing small businesses, which may include in-
cumbent worker training programs, sectoral
and industry cluster strategies and partner-
ships, including regional skills alliances, ca-
reer ladder programs, micro-enterprise and
entrepreneurial training and support pro-
grams, utilization of effective business inter-
mediaries, activities to improve linkages be-
tween the one-stop delivery systems in the
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State and all employers (including small
employers) in the State, and other business
services and strategies that better engage
employers in workforce investment activities
and make the workforce investment system
more relevant to the needs of State and local
businesses, consistent with the objectives of
this title;
‘‘(ii) developing strategies for effec-
tively serving hard-to-serve populations and
for coordinating programs and services
among one-stop partners;
‘‘(iii) implementing innovative pro-
grams for displaced homemakers, which for
purposes of this clause may include an in-
dividual who is receiving public assistance
and is within 2 years of exhausting lifetime
eligibility under part A of title IV of the
Social Security Act (42 U.S.C. 601 et seq.);
‘‘(iv) implementing programs to in-
crease the number of individuals training
for and placed in nontraditional employ-
ment;
‘‘(v) carrying out activities to facilitate
remote access to services, including training
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services described in subsection (d)(4), pro-
vided through a one-stop delivery system,
including facilitating access through the use
of technology;
‘‘(vi) supporting the provision of core
services described in subsection (d)(2) in the
one-stop delivery system in the State;
‘‘(vii) coordinating with the child wel-
fare system to facilitate services for children
in foster care and those who are eligible for
assistance under section 477 of the Social
Security Act;
‘‘(viii) activities—
‘‘(I) to improve coordination be-
tween workforce investment activities
carried out within the State involved
and economic development activities;
‘‘(II) to improve coordination be-
tween employment and training assist-
ance, child support services, and assist-
ance provided by State and local agen-
cies carrying out part D of title IV of
the Social Security Act (42 U.S.C. 651
et seq.);
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‘‘(III) to improve coordination be-
tween employment and training assist-
ance and cooperative extension pro-
grams carried out by the Department
of Agriculture;
‘‘(IV) to improve coordination be-
tween employment and training assist-
ance and programs carried out in the
local area for individuals with disabil-
ities, including programs carried out
by State agencies relating to mental re-
tardation and developmental disabil-
ities, Statewide Independent Living
Councils established under section 705
of the Rehabilitation Act of 1973 (29
U.S.C. 796d), and centers for inde-
pendent living defined in section 702
of the Rehabilitation Act of 1973 (29
U.S.C. 796a);
‘‘(V) to develop and disseminate
workforce and labor market informa-
tion; and
‘‘(VI) to improve coordination
with the corrections system to facilitate
provision of training services and em-
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ployment opportunities that will assist
ex-offenders in reentering the work-
force;
‘‘(ix) conducting—
‘‘(I) research; and
‘‘(II) demonstration projects; and
‘‘(x) adopting, calculating, or commis-
sioning a minimum self-sufficiency stand-
ard that specifies the income needs of fami-
lies, by family size, the number and ages of
children in the family, and sub-State geo-
graphical considerations.’’.
(2) REQUIRED LOCAL EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—
(A) 
ALLOCATED
FUNDS.—Section
134(d)(1)(A) 
(29 
U.S.C. 
2864(d)(1)(A)) 
is
amended—
(i) in clause (i), by striking ‘‘described
in subsection (c)’’;
(ii) in clause (iii), by striking ‘‘and’’
at the end;
(iii) in clause (iv), by striking the pe-
riod and inserting a semicolon; and
(iv) by adding at the end the following:
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‘‘(v) to designate a dedicated business
liaison in the local area who may be funded
with funds provided under this title or from
other sources to establish and develop rela-
tionships and networks with large and
small employers and their intermediaries;
and
‘‘(vi) in order to avoid duplication of
services and enhance coordination of serv-
ices, to require the colocation of employment
services provided under the Wagner-Peyser
Act at the comprehensive one-stop centers.’’.
(B) CORE
SERVICES.—Section 134(d)(2)
(29 U.S.C. 2864(d)(2)) is amended—
(i) in the matter preceding subpara-
graph (A), by striking ‘‘paragraph (1)(A)’’
and inserting ‘‘paragraph (1)’’;
(ii) by striking subparagraph (D) and
inserting the following:
‘‘(D) labor exchange services, including—
‘‘(i) job search and placement assist-
ance and, in appropriate cases, career coun-
seling, including—
‘‘(I) exposure to high wage, high
skill jobs; and
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‘‘(II) nontraditional employment;
and
‘‘(ii) 
appropriate 
recruitment 
and
other business services for all employers, in-
cluding small employers, in the local area,
which may include services described in this
subsection, including information and refer-
ral to specialized business services not tra-
ditionally offered through the one-stop deliv-
ery system;’’;
(iii) in subparagraph (E)(iii)—
(I) by inserting ‘‘, career ladders,’’
after ‘‘earnings’’; and
(II) by striking ‘‘and’’ at the end;
(iv) in subparagraph (F)—
(I) by striking ‘‘and program cost
information’’; and
(II) by striking ‘‘described in sec-
tion 123’’;
(v) by striking subparagraph (H) and
inserting the following:
‘‘(H) provision of accurate information, in
formats that are usable and understandable to
all one-stop center customers, relating to the
availability of supportive services or assistance,
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including child care, child support, medical or
child health assistance under title XIX or XXI of
the Social Security Act, benefits under the Food
Stamp Act of 1977, the earned income tax credit
under section 32 of the Internal Revenue Code of
1986, and assistance under a State program
funded under part A of title IV of the Social Se-
curity Act and other supportive services and
transportation provided through funds made
available under such part, available in the local
area, and referral to such services or assistance
as appropriate;’’; and
(vi) in subparagraph (J), by striking
‘‘for—’’ and all that follows through ‘‘(ii)
programs’’ and inserting ‘‘for programs’’.
(C) 
INTENSIVE
SERVICES.—Section
134(d)(3) (29 U.S.C. 2864(d)(3)) is amended—
(i) by striking subparagraph (A) and
inserting the following:
‘‘(A) IN GENERAL.—
‘‘(i) ELIGIBILITY.—Except as provided
in clause (ii), funds allocated to a local
area for adults under paragraph (2)(A) or
(3), as appropriate, of section 133(b), and
funds allocated to the local area for dis-
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located workers under section 133(b)(2)(B),
shall be used to provide intensive services to
adults 
and 
dislocated 
workers,
respectively—
‘‘(I) who are unemployed and
who, after an interview, evaluation, or
assessment, have been determined by a
one-stop operator or one-stop partner
to be—
‘‘(aa) unlikely or unable to
obtain employment, that leads to
self-sufficiency 
or 
wages 
com-
parable to or higher than previous
employment, through core services
described in paragraph (2); and
‘‘(bb) in need of intensive
services to obtain employment
that leads to self-sufficiency or
wages comparable to or higher
than previous employment; or
‘‘(II) who are employed, but who,
after an interview, evaluation, or as-
sessment are determined by a one-stop
operator or one-stop partner to be in
need of intensive services to obtain or
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retain employment that leads to self-
sufficiency.
‘‘(ii) SPECIAL
RULE.—A new inter-
view, evaluation, or assessment of a partici-
pant is not required under clause (i) if the
one-stop operator or one-stop partner deter-
mines that it is appropriate to use a recent
assessment of the participant conducted
pursuant to another education or training
program.’’; and
(ii) in subparagraph (C)—
(I) in clause (v), by striking ‘‘for
participants seeking training services
under paragraph (4)’’; and
(II) by adding at the end the fol-
lowing:
‘‘(vii) Internships and work experience.
‘‘(viii) Literacy activities relating to
basic work readiness, and financial literacy
activities.
‘‘(ix) Out-of-area job search assistance
and relocation assistance.
‘‘(x) English language acquisition and
integrated training programs.’’.
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(D) 
TRAINING
SERVICES.—Section
134(d)(4) (29 U.S.C. 2864(d)(4)) is amended—
(i) by striking subparagraph (A) and
inserting the following:
‘‘(A) IN GENERAL.—
‘‘(i) ELIGIBILITY.—Except as provided
in clause (ii), funds allocated to a local
area for adults under paragraph (2)(A) or
(3), as appropriate, of section 133(b), and
funds allocated to the local area for dis-
located workers under section 133(b)(2)(B),
shall be used to provide training services to
adults 
and 
dislocated 
workers,
respectively—
‘‘(I) who, after an interview, eval-
uation, or assessment, and case man-
agement, have been determined by a
one-stop operator or one-stop partner,
as appropriate, to—
‘‘(aa) be unlikely or unable
to obtain or retain employment,
that leads to self-sufficiency or
wages comparable to or higher
than 
previous 
employment,
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through the intensive services de-
scribed in paragraph (3);
‘‘(bb) be in need of training
services to obtain or retain em-
ployment that leads to self-suffi-
ciency or wages comparable to or
higher than previous employment;
and
‘‘(cc) have the skills and
qualifications to successfully par-
ticipate in the selected program of
training services;
‘‘(II) who select programs of
training services that are directly
linked to the employment opportunities
in the local area or region involved or
in another area to which the adults or
dislocated workers are willing to com-
mute or relocate;
‘‘(III) who meet the requirements
of subparagraph (B); and
‘‘(IV) who are determined to be el-
igible in accordance with the priority
system in effect under subparagraph
(E).
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‘‘(ii) SPECIAL
RULE.—A new inter-
view, evaluation, or assessment of a partici-
pant is not required under clause (i) if the
one-stop operator or one-stop partner deter-
mines that it is appropriate to use a recent
assessment of the participant conducted
pursuant to another education or training
program.’’;
(ii) in subparagraph (B)(i), by strik-
ing ‘‘Except’’ and inserting ‘‘Notwith-
standing section 479B of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1087uu) and
except’’;
(iii) in subparagraph (D)—
(I) in clause (viii), by striking
‘‘and’’ after the semicolon;
(II) in clause (ix), by striking the
period and inserting ‘‘; and’’; and
(III) by adding at the end the fol-
lowing:
‘‘(x) English language acquisition and
integrated training programs.’’;
(iv) in subparagraph (F)—
(I) in clause (ii), by striking ‘‘re-
ferred to in subsection (c), shall make
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available—’’ and all that follows and
inserting ‘‘shall make available a list
of eligible providers of training serv-
ices, and accompanying information,
in accordance with section 122(d).’’;
(II) in the heading of clause (iii),
by striking ‘‘INDIVIDUAL TRAINING AC-
COUNTS’’ 
and 
inserting 
‘‘CAREER
SCHOLARSHIP ACCOUNTS’’;
(III) in clause (iii)—
(aa) by striking ‘‘identifying
information’’ and inserting ‘‘ac-
companying information’’;
(bb) 
by 
striking 
‘‘clause
(ii)(I)’’ and inserting ‘‘clause
(ii)’’; and
(cc) by striking ‘‘individual
training account’’ and inserting
‘‘career scholarship account’’; and
(IV) by adding at the end the fol-
lowing:
‘‘(iv) 
COORDINATION.—Each 
local
board may, through one-stop centers, coordi-
nate career scholarship accounts with other
Federal, State, local, or private job training
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programs or sources to assist the individual
in obtaining training services.’’; and
(v) in subparagraph (G)—
(I) in the subparagraph heading,
by striking ‘‘INDIVIDUAL TRAINING AC-
COUNTS’’ 
and 
inserting 
‘‘CAREER
SCHOLARSHIP ACCOUNTS’’;
(II) in clause (i), by striking ‘‘in-
dividual training accounts’’ and in-
serting ‘‘career scholarship accounts’’;
(III) in clause (ii)—
(aa) by striking ‘‘individual
training account’’ and inserting
‘‘career scholarship account’’;
(bb) in subclause (II), by
striking ‘‘individual training ac-
counts’’ and inserting ‘‘career
scholarship accounts’’;
(cc) in subclause (II) by
striking ‘‘or’’ after the semicolon;
(dd) in subclause (III), by
striking ‘‘special participant pop-
ulations that face multiple bar-
riers to employment’’ and insert-
ing ‘‘hard-to-serve populations’’;
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(ee) in subclause (III), by
striking the period and inserting
’‘‘; or’’; and
(ff) by adding at the end the
following:
‘‘(IV) the local board determines
that it would be most appropriate to
award a contract to an institution of
higher education in order to facilitate
the training of multiple individuals in
high-demand occupations, if such con-
tract does not limit customer choice.’’;
and
(IV) in clause (iv)—
(aa) by redesignating sub-
clause (IV) as subclause (V); and
(bb) by inserting after sub-
clause (III) the following:
‘‘(IV) Individuals with disabil-
ities.’’.
(3) PERMISSIBLE
ACTIVITIES.—Section 134(e)
(29 U.S.C. 2864(e)) is amended—
(A) by striking the matter preceding para-
graph (2) and inserting the following:
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‘‘(e) PERMISSIBLE LOCAL EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—
‘‘(1) IN GENERAL.—
‘‘(A) ACTIVITIES.—Funds allocated to a
local area for adults under paragraph (2)(A) or
(3), as appropriate, of section 133(b), and funds
allocated to the local area for dislocated workers
under section 133(b)(2)(B), may be used to pro-
vide, through the one-stop delivery system
involved—
‘‘(i) customized screening and referral
of qualified participants in training serv-
ices described in subsection (d)(4) to em-
ployment;
‘‘(ii) customized employment-related
services to employers on a fee-for-service
basis;
‘‘(iii) customer support to enable mem-
bers of hard-to-serve populations, including
individuals with disabilities, to navigate
among multiple services and activities for
such populations;
‘‘(iv) technical assistance and capacity
building for serving individuals with dis-
abilities in local areas, for one-stop opera-
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tors, one-stop partners, and eligible pro-
viders, including the development and
training of staff, the provision of outreach,
intake, assessments, and service delivery,
and the development of performance meas-
ures;
‘‘(v) employment and training assist-
ance provided in coordination with child
support enforcement activities of the State
and local agencies carrying out part D of
title IV of the Social Security Act (42
U.S.C. 601 et seq.);
‘‘(vi) activities to improve coordination
between employment and training assist-
ance, child support services, and assistance
provided by State and local agencies car-
rying out part D of title IV of the Social
Security Act (42 U.S.C. 651 et seq.);
‘‘(vii) activities to improve coordina-
tion between employment and training as-
sistance and cooperative extension programs
carried out by the Department of Agri-
culture;
‘‘(viii) activities to facilitate remote
access to services provided through a one-
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stop delivery system, including facilitating
access through the use of technology;
‘‘(ix) activities—
‘‘(I) to improve coordination be-
tween workforce investment activities
carried out within the local area in-
volved and economic development ac-
tivities; and
‘‘(II) to improve services and
linkages between the local workforce in-
vestment system including the local
one-stop delivery system, and all em-
ployers, including small employers in
the local area, through services de-
scribed in this section, including sub-
paragraph (B);
‘‘(x) training programs for displaced
homemakers and for individuals training
for nontraditional occupations, in conjunc-
tion with programs operated in the local
area;
‘‘(xi) using a portion of the funds allo-
cated under section 133(b), activities to
carry out business services and strategies
that meet the workforce investment needs of
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local area employers, as determined by the
local board, consistent with the local plan
under section 118, which services—
‘‘(I) may be provided through ef-
fective business intermediaries working
in conjunction with the local board,
and may also be provided on a fee-for-
service basis or through the leveraging
of economic development and other re-
sources as determined appropriate by
the local board; and
‘‘(II) may include—
‘‘(aa) identifying and dis-
seminating to business, educators,
and job seekers, information re-
lated to the workforce, economic
and 
community 
development
needs, and opportunities of the
local economy;
‘‘(bb) development and deliv-
ery of innovative workforce invest-
ment services and strategies for
area businesses, which may in-
clude sectoral, industry cluster, re-
gional skills alliances, career lad-
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der, skills upgrading, skill stand-
ard development and certification,
apprenticeship, and other effective
initiatives for meeting the work-
force investment needs of area em-
ployers and workers;
‘‘(cc) participation in semi-
nars and classes offered in part-
nership with relevant organiza-
tions focusing on the workforce-re-
lated needs of area employers and
job seekers;
‘‘(dd) 
training 
consulting,
needs analysis, and brokering
services for area businesses, in-
cluding the organization and ag-
gregation of training (which may
be paid for with funds other than
those provided under this title),
for individual employers and coa-
litions of employers with similar
interests, products, or workforce
needs;
‘‘(ee) assistance to area em-
ployers in the aversion of layoffs
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and in managing reductions in
force in coordination with rapid
response activities;
‘‘(ff) the marketing of busi-
ness services offered under this
title, to appropriate area employ-
ers, including small and mid-
sized employers;
‘‘(gg) information referral on
concerns affecting local employers;
and
‘‘(hh) other business services
and strategies designed to better
engage employers in workforce in-
vestment activities and to make
the workforce investment system
more relevant to the workforce in-
vestment needs of area businesses,
as determined by the local board
to be consistent with the objectives
of this title;
‘‘(xii) activities to adjust the self-suffi-
ciency standards for local factors, or activi-
ties to adopt, calculate, or commission a
self-sufficiency standard that specifies the
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income needs of families, by family size, the
number and ages of children in the family,
and sub-State geographical considerations;
and
‘‘(xiii) improved coordination between
employment and training assistance and
programs carried out in the local area for
individuals with disabilities, including pro-
grams carried out by State agencies relating
to mental retardation and developmental
disabilities, Statewide Independent Living
Councils established under section 705 of the
Rehabilitation Act of 1973 (29 U.S.C.
796d), and centers for independent living
defined in section 702 of the Rehabilitation
Act of 1973 (29 U.S.C. 796a).
‘‘(B) WORK SUPPORT ACTIVITIES FOR LOW-
WAGE WORKERS.—
‘‘(i) IN GENERAL.—Funds allocated to
a local area for adults under paragraph
(2)(A) or (3), as appropriate, of section
133(b), and funds allocated to the local area
for 
dislocated 
workers 
under 
section
133(b)(2)(B), may be used to provide,
through the one-stop delivery system in-
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volved, work support activities designed to
assist low-wage workers in retaining and
enhancing employment. The one-stop part-
ners shall coordinate the appropriate pro-
grams and resources of the partners with
the activities and resources provided under
this subparagraph.
‘‘(ii) ACTIVITIES.—The activities de-
scribed in clause (i) may include the provi-
sion of activities described in this section
through the one-stop delivery system in a
manner that enhances the opportunities of
such workers to participate in the activities,
such as the provision of activities described
in this section during nontraditional hours
and the provision of onsite child care while
such activities are being provided.’’;
(B) in paragraph (2), by striking the mat-
ter preceding subparagraph (A) and inserting
the following:
‘‘(2) SUPPORTIVE SERVICES.—Funds allocated to
a local area for adults under paragraph (2)(A) or (3),
as appropriate, of section 133(b), and funds allocated
to the local area for dislocated workers under section
133(b)(2)(B), may be used to provide supportive serv-
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ices to adults and dislocated workers, respectively—’’;
and
(C) by adding at the end the following:
‘‘(4) 
INCUMBENT
WORKER
TRAINING
PRO-
GRAMS.—
‘‘(A) IN GENERAL.—The local board may
use up to 10 percent of the funds allocated to the
local area involved under section 133(b) to pay
for the Federal share of the cost of providing
training through an incumbent worker training
program carried out in accordance with this
paragraph. The Governor or State board may
make recommendations to the local board regard-
ing incumbent worker training with statewide
impact.
‘‘(B) TRAINING ACTIVITIES.—The training
program for incumbent workers carried out
under this paragraph shall be carried out by the
local board in conjunction with the employers or
groups of employers of such workers for the pur-
pose of assisting such workers in obtaining the
skills necessary to retain employment or avert
layoffs.
‘‘(C) EMPLOYER SHARE REQUIRED.—
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‘‘(i) IN GENERAL.—Employers partici-
pating in the program carried out under
this paragraph shall be required to pay the
non-Federal share of the costs of providing
the training to incumbent workers of the
employers. The local board shall establish
the non-Federal share of such costs, which
may include in-kind contributions. The
non-Federal share shall not be less than—
‘‘(I) 10 percent of the costs, for
employers with 50 or fewer employees;
‘‘(II) 25 percent of the costs, for
employers with more than 50 employ-
ees but fewer than 100 employees; and
‘‘(III) 50 percent of the costs, for
employers with 100 or more employees.
‘‘(ii) 
CALCULATION
OF
EMPLOYER
SHARE.—The non-Federal share paid by
such an employer may include the amount
of the wages paid by the employer to a
worker while the worker is attending a
training program under this paragraph.’’.
SEC. 122. PERFORMANCE ACCOUNTABILITY SYSTEM.
(a) STATE PERFORMANCE MEASURES.—
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(1) INDICATORS
OF
PERFORMANCE.—Section
136(b)(2)(A) (29 U.S.C. 2871(b)(2)(A)) is amended—
(A) in clause (i)—
(i) in the matter preceding subclause
(I), by striking ‘‘and (for participants who
are eligible youth age 19 through 21) for
youth activities authorized under section
129’’;
(ii) by striking subclause (III) and in-
serting the following:
‘‘(III) increases in earnings from
unsubsidized employment; and’’; and
(iii) in subclause (IV), by striking ‘‘,
or by participants’’ and all that follows
through ‘‘unsubsidized employment’’; and
(B) by striking clause (ii) and inserting the
following:
‘‘(ii) CORE INDICATORS FOR ELIGIBLE
YOUTH.—The core indicators of performance
for youth activities authorized under section
129 shall consist of—
‘‘(I) entry into employment, edu-
cation or advanced training, or mili-
tary service;
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‘‘(II) attainment of secondary
school diplomas or their recognized
equivalents, and postsecondary certifi-
cates; and
‘‘(III) 
literacy 
or 
numeracy
gains.’’.
(2) 
ADDITIONAL
INDICATORS.—Section
136(b)(2)(C) (29 U.S.C. 2871(b)(2)(C)) is amended to
read as follows:
‘‘(C) ADDITIONAL
INDICATORS.—A State
may identify in the State plan additional indi-
cators for workforce investment activities under
this subtitle, including indicators identified in
collaboration with State business and industry
associations, with employee representatives where
applicable, and with local boards, to measure the
performance of the workforce investment system
in serving the workforce needs of business and
industry in the State.’’.
(3) 
LEVELS
OF
PERFORMANCE.—Section
136(b)(3)(A) (29 U.S.C. 2871(b)(3)(A)) is amended—
(A) in clause (iii)—
(i) in the heading, by striking ‘‘FOR
FIRST 3 YEARS’’;
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(ii) by striking ‘‘and the customer sat-
isfaction indicator of performance, for the
first 3’’ and inserting ‘‘described in clauses
(i) and (ii) of paragraph (2)(A) and the
customer satisfaction indicator of perform-
ance, for the first 2’’; and
(iii) by inserting at the end the fol-
lowing: ‘‘Agreements on levels of perform-
ance for each of the core indicators of per-
formance for the third and fourth program
years covered by the State plan shall be
reached prior to the beginning of the third
program year covered by the State plan,
and incorporated as a modification to the
State plan.’’;
(B) in clause (iv)—
(i) in subclause (II)—
(I) by striking ‘‘taking into ac-
count’’ and inserting ‘‘and shall ensure
that the levels involved are adjusted,
using objective statistical methods,
based on’’;
(II) by inserting ‘‘(such as dif-
ferences in unemployment rates and
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job losses or gains in particular indus-
tries)’’ after ‘‘economic conditions’’;
(III) by inserting ‘‘(such as indi-
cators of poor work history, lack of
work experience, lack of educational or
occupational skills attainment, disloca-
tion from high-wage and benefit em-
ployment, low levels of literacy or
English proficiency, disability status,
homelessness, and welfare dependency)’’
after ‘‘program’’; and
(IV) by striking ‘‘and’’ at the end;
(ii) in subclause (III), by striking the
period and inserting ‘‘; and’’; and
(iii) by adding at the end the fol-
lowing:
‘‘(IV) the extent to which the levels
involved will assist the State in meet-
ing the national goals described in
clause (v).’’;
(C) by striking clause (v) and inserting the
following:
‘‘(v) ESTABLISHMENT
OF
NATIONAL
GOALS.—In order to promote enhanced per-
formance outcomes on the performance
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measures and to facilitate the process of
reaching agreements with the States under
clause (iii) and to measure systemwide per-
formance for the one-stop delivery systems
of the States, the Secretary shall establish
long-term national goals for the adjusted
levels of performance for that systemwide
performance to be achieved by the programs
assisted under chapters 4 and 5 on the core
indicators of performance described in sub-
paragraphs (A) and (B) of subsection
(b)(2). Such goals shall be established in ac-
cordance with the Government Performance
and Results Act of 1993 in consultation
with the States and other appropriate par-
ties.’’; and
(D) in clause (vi)—
(i) by striking ‘‘or (v)’’; and
(ii) by striking ‘‘with the representa-
tives described in subsection (i)’’ and insert-
ing ‘‘with the States and other interested
parties’’.
(b) 
LOCAL
PERFORMANCE
MEASURES.—Section
136(c)(3) (29 U.S.C. 2871(c)(3))—
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(1) by striking ‘‘shall take into account’’ and in-
serting ‘‘shall ensure that the levels involved are ad-
justed, using objective statistical methods, based on’’;
(2) by inserting ‘‘(characteristics such as unem-
ployment rates and job losses or gains in particular
industries)’’ after ‘‘economic’’; and
(3) by inserting ‘‘(characteristics such as indica-
tors of poor work history, lack of work experience,
lack of educational and occupational skills attain-
ment, dislocation from high-wage and benefit employ-
ment, low levels of literacy or English proficiency,
disability status, homelessness, and welfare depend-
ency)’’ after ‘‘demographic’’.
(c) REPORT.—Section 136(d) (29 U.S.C. 2871(d)) is
amended—
(1) in paragraph (1), by adding at the end the
following: ‘‘In the case of a State or local area that
chooses to expend funds for activities under subsection
(a)(3)(A)(i) or (e)(1)(A)(xi), respectively, of section
134, the report also shall include the amount of such
funds so expended and the percentage that such funds
are of the funds available for activities under section
134.’’;
(2) in paragraph (2)—
(A) in subparagraph (E)—
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(i) by striking ‘‘(excluding partici-
pants who received only self-service and in-
formational activities)’’; and
(ii) by striking ‘‘and’’ after the semi-
colon;
(B) in subparagraph (F)—
(i) by inserting ‘‘noncustodial parents
with child support obligations, homeless in-
dividuals,’’ after ‘‘displaced homemakers,’’;
and
(ii) by striking the period and insert-
ing a semicolon; and
(C) by adding at the end the following:
‘‘(G) the number of participants served and
the cost per participant; and
‘‘(H) the amount of adult and dislocated
worker funds spent on—
‘‘(i) core, intensive, and training serv-
ices, respectively; and
‘‘(ii) services provided under subsection
(a)(3)(A)(i) or (e)(1)(A)(xi) of section 134,
if applicable.’’; and
(3) by adding at the end the following:
‘‘(4) DATA VALIDATION.—In preparing the re-
ports described in this subsection, the States shall es-
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tablish procedures, consistent with guidelines issued
by the Secretary, to ensure that the information con-
tained in the reports is valid and reliable.’’.
(d) EVALUATION
OF
STATE
PROGRAMS.—Section
136(e)(3) is amended by inserting ‘‘, including information
on promoting self-sufficiency and comparable pay between
men and women’’ after ‘‘employers’’.
(e) SANCTIONS
FOR
STATE.—Section 136(g) is
amended—
(1) in paragraph (1)(B), by striking ‘‘If such
failure continues for a second consecutive year’’ and
inserting ‘‘If a State performs at less than 80 percent
of the adjusted level of performance for core indicators
of performance described in subsection (b)(2)(A) for 2
consecutive years’’; and
(2) in paragraph (2), by striking ‘‘section 503’’
and inserting ‘‘subsection (i)(1)’’.
(f) 
SANCTIONS
FOR
LOCAL
AREA.—Section
136(h)(2)(A) (29 U.S.C. 2871(h)(2)(A)) is amended—
(1) in the matter preceding clause (i), by strik-
ing ‘‘If such failure continues for a second consecutive
year’’ and inserting ‘‘If a local area performs at less
than 80 percent of the adjusted level of performance
for core indicators of performance described in sub-
section (b)(2)(A) for 2 consecutive years’’;
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(2) in clause (ii), by striking ‘‘or’’ after the semi-
colon;
(3) by redesignating clause (iii) as clause (iv);
and
(4) by inserting after clause (ii) the following:
‘‘(iii) redesignate the local area in ac-
cordance with section 116(b)(2); or’’.
(g) INCENTIVE GRANTS.—Section 136(i) (29 U.S.C.
2871(i)) is amended to read as follows:
‘‘(i) INCENTIVE GRANTS FOR LOCAL AREAS.—
‘‘(1) IN GENERAL.—From funds reserved under
sections 128(a) and 133(a)(1), the Governor involved
shall award incentive grants to local areas for per-
formance described in paragraph (2) in carrying out
programs under chapters 4 and 5.
‘‘(2) BASIS.—The Governor shall award the
grants on the basis—
‘‘(A) that the local areas met or exceeded the
performance measures established under sub-
section (c)(2) relating to indicators described in
subsection (b)(3)(A)(iii);
‘‘(B) of exemplary performance of the local
areas in serving hard-to-serve populations; or
‘‘(C) that the local areas are effectively—
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‘‘(i) coordinating multiple systems into
a comprehensive workforce investment sys-
tem, including coordination of employment
services under the Wagner-Peyser Act and
core activities under this title as well as
one-stop partner programs described in sec-
tion 121;
‘‘(ii) expanding access to training, in-
cluding through increased leveraging of re-
sources other than those funded through pro-
grams under this title; or
‘‘(iii) implementing innovative busi-
ness and economic development initiatives.
‘‘(3) USE OF FUNDS.—The funds awarded to a
local area under this paragraph may be used to carry
out activities authorized for local areas under chap-
ters 4 and 5, and such demonstration projects or in-
novative programs for hard-to-serve populations as
may be approved by the Governor.’’.
(g) USE OF CORE MEASURES IN OTHER DEPARTMENT
OF LABOR PROGRAMS.—Section 136 (29 U.S.C. 2871) is
amended by adding at the end the following:
‘‘(j) USE OF CORE INDICATORS FOR OTHER PRO-
GRAMS.—In addition to the programs carried out under
chapters 4 and 5, and consistent with the requirements of
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the applicable authorizing laws, the Secretary shall use the
indicators of performance described in subparagraphs (A)
and (B) of subsection (b)(2) to assess the effectiveness of the
programs described in clauses (i), (ii), and (vi) of section
121(b)(1)(B) that are carried out by the Secretary.’’.
(h) PREVIOUS DEFINITIONS OF CORE INDICATORS.—
Section 502 (29 U.S.C. 9272) is repealed.
SEC. 123. AUTHORIZATION OF APPROPRIATIONS.
(a) YOUTH ACTIVITIES.—Section 137(a) (29 U.S.C.
2872(a)) is amended by striking ‘‘such sums as may be nec-
essary for each of fiscal years 1999 through 2003’’ and in-
serting ‘‘such sums as may be necessary for each of fiscal
years 2004 through 2009’’.
(b) ADULT
EMPLOYMENT
AND
TRAINING
ACTIVI-
TIES.—Section 137(b) (29 U.S.C. 2872(b)) is amended by
striking ‘‘such sums as may be necessary for each of fiscal
years 1999 through 2003’’ and inserting ‘‘such sums as may
be necessary for each of fiscal years 2004 through 2009’’.
(c) DISLOCATED WORKER EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—Section 137(c) (29 U.S.C. 2872(c)) is
amended by striking ‘‘such sums as may be necessary for
each of fiscal years 1999 through 2003’’ and inserting ‘‘such
sums as may be necessary for each of fiscal years 2004
through 2009’’.
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Subtitle C—Job Corps
SEC. 131. JOB CORPS.
(a) ELIGIBILITY.—Section 144(3) (29 U.S.C. 2884(3))
is amended by adding at the end the following:
‘‘(F) A child eligible for assistance under
section 477 of the Social Security Act.’’.
(b) IMPLEMENTATION
OF STANDARDS
AND PROCE-
DURES.—Section 145(a)(3) (29 U.S.C. 2885(a)(3)) is
amended—
(1) in subparagraph (B), by striking ‘‘and’’ after
the semicolon;
(2) in subparagraph (C), by striking the period
and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(D) child welfare agencies that are respon-
sible for children in foster care and children eli-
gible for assistance under section 477 of the So-
cial Security Act.’’.
(c) INDUSTRY COUNCILS.—Section 154(b) (29 U.S.C.
2894(b)) is amended—
(1) in paragraph (1)(A), by striking ‘‘local and
distant’’; and
(2) by adding at the end the following:
‘‘(3) EMPLOYERS OUTSIDE OF LOCAL AREA.—
The industry council may include, or otherwise pro-
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vide for consultation with, employers from outside the
local area who are likely to hire a significant number
of enrollees from the Job Corps center.
‘‘(4) SPECIAL RULE FOR SINGLE LOCAL AREA
STATES.—In the case of a single local area State des-
ignated under section 116(b), the industry council
shall include a representative of the State Board.’’.
(d) INDICATORS OF PERFORMANCE.—Section 159 (29
U.S.C. 2899) is amended—
(1) in subsection (c)—
(A) by striking paragraph (1) and inserting
the following:
‘‘(1) PERFORMANCE INDICATORS.—The Secretary
shall annually establish expected levels of performance
for Job Corps centers and the Job Corps program re-
lating to each of the core indicators of performance
for 
youth 
activities 
identified 
in 
section
136(b)(2)(A)(ii).’’;
(B) in paragraph (2), by striking ‘‘meas-
ures’’ each place it appears and inserting ‘‘indi-
cators’’; and
(C) in paragraph (3)—
(i) in the first sentence, by striking
‘‘core performance measures, as compared to
the expected performance level for each per-
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formance measure’’ and inserting ‘‘perform-
ance indicators described in paragraph (1),
as compared to the expected level of per-
formance established under paragraph (1)
for each performance measure’’; and
(ii) in the second sentence, by striking
‘‘measures’’ each place it appears and in-
serting ‘‘indicators’’; and
(2) in subsection (f)(2), in the first sentence, by
striking ‘‘core performance measures’’ and inserting
‘‘indicators of performance’’.
(e) AUTHORIZATION
OF APPROPRIATIONS.—Section
161 (29 U.S.C. 2901) is amended by striking ‘‘1999 through
2003’’ and inserting ‘‘2004 through 2009’’.
Subtitle D—National Programs
SEC. 141. NATIVE AMERICAN PROGRAMS.
(a) ADVISORY COUNCIL.—Section 166(h)(4)(C) (29
U.S.C. 2911(h)(4)(C)) is amended to read as follows:
‘‘(C) DUTIES.—The Council shall advise the
Secretary on the operation and administration
of the programs assisted under this section, in-
cluding the selection of the individual appointed
as head of the unit established under paragraph
(1).’’.
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(b) ASSISTANCE TO UNIQUE POPULATIONS IN ALASKA
AND
HAWAII.—Section 166(j) (29 U.S.C. 2911(j)) is
amended to read as follows:
‘‘(j) ASSISTANCE TO UNIQUE POPULATIONS IN ALASKA
AND HAWAII.—
‘‘(1) IN GENERAL.—Notwithstanding any other
provision of law, the Secretary is authorized to pro-
vide assistance to unique populations who reside in
Alaska or Hawaii to improve job training and work-
force investment activities.
‘‘(2) AUTHORIZATION
OF
APPROPRIATIONS.—
There are authorized to be appropriated to carry out
this subsection such sums as may be necessary for fis-
cal year 2004.’’.
(c) PERFORMANCE INDICATORS.—Section 166 (29
U.S.C. 2911) is amended by adding at the end the fol-
lowing’:
‘‘(k) PERFORMANCE INDICATORS.—
‘‘(1) DEVELOPMENT OF INDICATORS.—The Sec-
retary, in consultation with the Native American
Employment and Training Council, shall develop a
set of performance indicators and standards which
shall be applicable to programs under this section.
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‘‘(2) SPECIAL CONSIDERATIONS.—Such perform-
ance indicators and standards shall take into
account—
‘‘(A) the purposes of the programs under
this section as described in paragraph (a)(1);
‘‘(B) the needs of the groups served by this
section, including the differences in needs among
such groups in various geographic service areas;
and
‘‘(C) the economic circumstances of the com-
munities served, including differences in cir-
cumstances among various geographic service
areas.’’.
SEC. 142. MIGRANT AND SEASONAL FARMWORKER PRO-
GRAMS.
Section 167(d) (29 U.S.C. 2912(d)) is amended by in-
serting ‘‘(including permanent housing)’’ after ‘‘housing’’.
SEC. 
143. 
VETERANS’ 
WORKFORCE 
INVESTMENT 
PRO-
GRAMS.
Section 168(a)(3)(C) (29 U.S.C. 2913(a)(3)(C)) is
amended by striking ‘‘section 134(c)’’ and inserting ‘‘sec-
tion 121(e)’’.
SEC. 144. YOUTH CHALLENGE GRANTS.
Section 169 (29 U.S.C. 2914) is amended to read as
follows:
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‘‘SEC. 169. YOUTH CHALLENGE GRANTS.
‘‘(a) IN GENERAL.—Of the amounts reserved by the
Secretary under section 127(b)(1)(A) for a fiscal year—
‘‘(1) the Secretary shall use not less than 80 per-
cent to award competitive grants under subsection
(b); and
‘‘(2) the Secretary may use not more than 20
percent to award discretionary grants under sub-
section (c).
‘‘(b) COMPETITIVE GRANTS TO STATES AND LOCAL
AREAS.—
‘‘(1) ESTABLISHMENT.—From the funds de-
scribed in subsection (a)(1), the Secretary shall award
competitive grants to eligible entities to carry out ac-
tivities authorized under this subsection to assist eli-
gible youth in acquiring the skills, credentials, and
employment experience necessary to achieve the per-
formance outcomes for youth described in section 136
‘‘(2) ELIGIBLE ENTITY.—In this subsection, the
term ‘eligible entity’ means—
‘‘(A) a State or consortium of States;
‘‘(B) a local board or consortium of local
boards;
‘‘(C) a recipient of a grant under section
166 (relating to Native American programs); or
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‘‘(D) a public or private entity (including
a consortium of such entities) with expertise in
the provision of youth activities, applying in
partnership with a local board or consortium of
local boards.
‘‘(3) APPLICATIONS.—To be eligible to receive a
grant under this subsection, an eligible entity shall
submit an application to the Secretary at such time,
in such manner, and containing such information as
the Secretary may require, including—
‘‘(A) a description of the activities the eligi-
ble entity will provide to eligible youth under
this subsection, and how the eligible entity will
collaborate with State and local workforce invest-
ment systems established under this title in the
provision of such activities;
‘‘(B) a description of the programs of dem-
onstrated effectiveness on which the provision of
the activities under subparagraph (A) are based,
and a description of how such activities will ex-
pand the base of knowledge relating to the provi-
sion of activities for youth;
‘‘(C) a description of the State, local, and
private resources that will be leveraged to pro-
vide the activities described under subparagraph
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(A) in addition to funds provided under this
subsection, and a description of the extent of the
involvement of employers in the activities;
‘‘(D) the levels of performance the eligible
entity expects to achieve with respect to the indi-
cators of performance for youth specified in sec-
tion 136(b)(2)(A)(ii); and
‘‘(E) an assurance that the State board of
each State in which the proposed activities are
to be carried out had the opportunity to review
the application, and including the comments, if
any, of the affected State boards on the applica-
tion, except that this subparagraph shall not
apply to an eligible entity described in para-
graph (2)(C).
‘‘(4) FACTORS FOR AWARD.—
‘‘(A) IN
GENERAL.—In awarding grants
under 
this 
subsection 
the 
Secretary 
shall
consider—
‘‘(i) the quality of the proposed activi-
ties;
‘‘(ii) the goals to be achieved;
‘‘(iii) the likelihood of successful imple-
mentation;
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‘‘(iv) the extent to which the proposed
activities are based on proven strategies or
the extent to which the proposed activities
will expand the base of knowledge relating
to the provision of activities for youth;
‘‘(v) the extent of collaboration with the
State and local workforce investment sys-
tems in carrying out the proposed activities;
‘‘(vi) the extent of employer involve-
ment in the proposed activities;
‘‘(vii) whether there are other Federal
and non-Federal funds available for similar
activities to the proposed activities, and the
additional State, local, and private re-
sources that will be provided to carry out
the proposed activities; and
‘‘(viii) the quality of proposed activi-
ties in meeting the needs of the youth to be
served.
‘‘(B) EQUITABLE
GEOGRAPHIC
DISTRIBU-
TION.—In awarding grants under this subsection
the Secretary shall ensure an equitable distribu-
tion of such grants across geographically diverse
areas.
‘‘(5) USE OF FUNDS.—
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‘‘(A) IN GENERAL.—An eligible entity that
receives a grant under this subsection shall use
the grant funds to carry out activities that are
designed to assist youth in acquiring the skills,
credentials, and employment experience that are
necessary to succeed in the labor market, includ-
ing the activities identified in section 129.
‘‘(B) ACTIVITIES.—The activities carried
out pursuant to subparagraph (A) may include
the following:
‘‘(i) Training and internships for out-
of-school youth in sectors of the economy ex-
periencing, or projected to experience, high
growth.
‘‘(ii) Dropout prevention activities for
in-school youth.
‘‘(iii) Activities designed to assist spe-
cial youth populations, such as court-in-
volved youth and youth with disabilities.
‘‘(iv) Activities combining remediation
of academic skills, work readiness training,
and work experience, and including link-
ages to postsecondary education, apprentice-
ships, and career-ladder employment.
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‘‘(v) Activities, including work experi-
ence, paid internships, and entrepreneurial
training, in areas where there is a migra-
tion of youth out of the areas.
‘‘(C) 
PARTICIPANT
ELIGIBILITY.—Youth
who are 14 years of age through 21 years of age,
as of the time the eligibility determination is
made, may be eligible to participate in activities
carried out under this subsection.
‘‘(6) GRANT PERIOD.—The Secretary shall make
a grant under this subsection for a period of 2 years
and may renew the grant, if the eligible entity has
performed successfully, for a period of not more than
3 succeeding years.
‘‘(7) MATCHING
FUNDS
REQUIRED.—The Sec-
retary shall require that an eligible entity that re-
ceives a grant under this subsection provide non-Fed-
eral matching funds in an amount to be determined
by the Secretary that is not less than 10 percent of
the cost of activities carried out under the grant. The
Secretary may require that such non-Federal match-
ing funds be provided in cash resources, noncash re-
sources, or a combination of cash and noncash re-
sources.
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‘‘(8) EVALUATION.—The Secretary shall reserve
not more than 3 percent of the funds described in sub-
section (a)(1) to provide technical assistance to, and
conduct evaluations of (using appropriate techniques
as described in section 172(c)), the projects funded
under this subsection.
‘‘(c) DISCRETIONARY GRANTS
FOR YOUTH ACTIVI-
TIES.—
‘‘(1) IN GENERAL.—From the funds described in
subsection (a)(2), the Secretary may award grants to
eligible entities to provide activities that will assist
youth in preparing for, and entering and retaining,
employment.
‘‘(2) ELIGIBLE ENTITY.—In this subsection, the
term ‘eligible entity’ means a public or private entity
that the Secretary determines would effectively carry
out activities relating to youth under this subsection.
‘‘(3) 
EQUITABLE
DISTRIBUTION
TO
RURAL
AREAS.—In awarding grants under this subsection
the Secretary shall ensure an equitable distribution of
such grants to rural areas.
‘‘(4) APPLICATIONS.—To be eligible to receive a
grant under this subsection, an eligible entity shall
submit an application to the Secretary at such time,
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in such manner, and containing such information as
the Secretary may require.
‘‘(5) USE OF FUNDS.—
‘‘(A) IN GENERAL.—An eligible entity that
receives a grant under this subsection shall use
the grant funds to carry out—
‘‘(i) activities that will assist youth in
preparing for, and entering and retaining,
employment, including the activities de-
scribed in section 129 for out-of-school
youth;
‘‘(ii) activities designed to assist in-
school youth to stay in school and gain
work experience;
‘‘(iii) activities designed to assist youth
in economically distressed areas; and
‘‘(iv) such other activities that the Sec-
retary determines are appropriate to ensure
that youth entering the workforce have the
skills needed by employers.
‘‘(B) 
PARTICIPANT
ELIGIBILITY.—Youth
who are 14 years of age through 21 years of age,
as of the time the eligibility determination is
made, may be eligible to participate in activities
carried out under this subsection.
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‘‘(6) MATCHING
FUNDS
REQUIRED.—The Sec-
retary shall require that an eligible entity that re-
ceives a grant under this subsection provide non-Fed-
eral matching funds in an amount to be determined
by the Secretary that is not less than 10 percent of
the cost of activities carried out under the grant. The
Secretary may require that such non-Federal match-
ing funds be provided in cash resources, noncash re-
sources, or a combination of cash and noncash re-
sources.
‘‘(7) EVALUATIONS.—The Secretary may require
that an eligible entity that receives a grant under this
subsection participate in an evaluation of activities
carried out under this subsection, including an eval-
uation using the techniques described in section
172(c).’’.
SEC. 145. TECHNICAL ASSISTANCE.
Section 170 (29 U.S.C. 2915) is amended—
(1) in subsection (a)(1), by—
(A) inserting ‘‘the training of staff pro-
viding rapid response services, the training of
other staff of recipients of funds under this title,
the training of members of State boards and
local boards, peer review activities under this
title,’’ after ‘‘localities,’’; and
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(B) striking ‘‘from carrying out activities’’
and all that follows through the period and in-
serting ‘‘to implement the amendments made by
the Workforce Investment Act Amendments of
2003.’’;
(2) in subsection (a)(2), by adding at the end the
following: ‘‘The Secretary shall also hire staff quali-
fied to provide the assistance described in paragraph
(1).’’;
(3) in subsection (b)(2), by striking the last sen-
tence and inserting ‘‘Such projects shall be adminis-
tered by the Employment and Training Administra-
tion.’’; and
(4) by adding at the end the following:
‘‘(c) BEST PRACTICES COORDINATION.—The Secretary
shall—
‘‘(1) establish a system through which States
may share information regarding best practices with
regard to the operation of workforce investment ac-
tivities under this Act;
‘‘(2) evaluate and disseminate information re-
garding best practices and identify knowledge gaps;
and
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‘‘(3) commission research under section 172 to
address knowledge gaps identified under paragraph
(2).’’.
SEC. 146. DEMONSTRATION, PILOT, MULTISERVICE, RE-
SEARCH, AND MULTISTATE PROJECTS.
(a) DEMONSTRATION AND PILOT PROJECTS.—Section
171(b) (29 U.S.C. 2916(b)) is amended—
(1) in paragraph (1)—
(A) by striking ‘‘Under a’’ and inserting
‘‘Consistent with the priorities specified in the’’;
(B) by striking subparagraphs (A) through
(E) and inserting the following:
‘‘(A) projects that assist national employers
in connecting with the workforce investment sys-
tem established under this title in order to facili-
tate the recruitment and employment of needed
workers for career ladder jobs and to provide in-
formation to such system on skills and occupa-
tions in demand;
‘‘(B) projects that promote the development
of systems that will improve the maximum effec-
tiveness of programs carried out under this title;
‘‘(C) projects that focus on opportunities for
employment in industries and sectors of indus-
tries that are experiencing, or are likely to expe-
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rience, high rates of growth and jobs with wages
leading to self-sufficiency;
‘‘(D) computerized, individualized, self-
paced training projects targeted to dislocated,
disadvantaged, or incumbent workers utilizing
equipment and curriculum designed in partner-
ship with industries for employment in the oper-
ations, repair, and maintenance of high-tech
equipment that is used in integrated systems
technology;
‘‘(E) projects carried out by States and
local areas to test innovative approaches to deliv-
ering employment-related services;’’;
(C) in subparagraph (G), by striking ‘‘and’’
after the semicolon; and
(D) by striking subparagraph (H) and in-
serting the following:
‘‘(H) projects that provide retention grants,
which shall—
‘‘(i) be made to qualified job training
programs offering instruction, assessment,
or professional coaching, upon placement of
a low-income individual trained by the pro-
gram involved in employment with an em-
ployer and retention of the low-income indi-
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vidual in that employment with that em-
ployer for a period of 1 year, if that em-
ployment provides the low-income indi-
vidual with an annual salary—
‘‘(I) that is at least $10,000 more
than the individual’s federally adjusted
income for the previous year; and
‘‘(II) that is not less than twice
the poverty line applicable to the indi-
vidual; and
‘‘(ii) be made taking into account the
economic benefit received by the Federal
Government from the employment and re-
tention of the individual, including the eco-
nomic benefit from tax revenue and de-
creased public subsidies;
‘‘(I) targeted innovation projects that im-
prove access to and delivery of employment and
training services, with emphasis given to projects
that incorporate advanced technologies to facili-
tate the connection of individuals to the informa-
tion and tools they need to upgrade skills;
‘‘(J) projects that promote the use of dis-
tance learning, enabling students to take courses
through the use of media technology such as vid-
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eos, teleconferencing computers, and the Internet;
and
‘‘(K) projects that provide comprehensive
education and training services, and support
services, in coordination with local boards, for
populations in targeted high poverty areas where
the greatest barriers to employment exist, includ-
ing ex-offenders, out-of-school youth, and public
assistance recipient populations.’’; and
(2) in paragraph (2)—
(A) by striking subparagraph (B); and
(B) by redesignating subparagraph (C) as
subparagraph (B).
(b) MULTISERVICE PROJECTS.—Section 171(c)(2)(B)
(29 U.S.C. 2916(c)(2)(B)) is amended to read as follows:
‘‘(B) STUDIES AND REPORTS.—
‘‘(i) NET
IMPACT
STUDIES
AND
RE-
PORTS.—
‘‘(I) IN GENERAL.—The Secretary,
in coordination with the Secretary of
Education, shall conduct studies to de-
termine the net impacts of programs,
services, and activities carried out
under this title.
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‘‘(II) REPORTS.—The Secretary
shall prepare and disseminate to the
public reports containing the results of
the studies conducted under subclause
(I).
‘‘(ii) STUDY ON RESOURCES AVAILABLE
TO
ASSIST
OUT-OF-SCHOOL
YOUTH.—The
Secretary, in coordination with the Sec-
retary of Education, may conduct a study
examining the resources available at the
Federal, State, and local levels to assist out-
of-school youth in obtaining the skills, cre-
dentials, and work experience necessary to
become successfully employed, including the
availability of funds provided through aver-
age daily attendance and other methodolo-
gies used by States and local areas to dis-
tribute funds.
‘‘(iii) STUDY OF INDUSTRY-BASED CER-
TIFICATION AND CREDENTIALS.—
‘‘(I) IN GENERAL.—The Secretary
shall conduct a study concerning the
role and benefits of credentialing and
certification to businesses and workers
in the economy and the implications of
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certification to the services provided
through the workforce investment sys-
tem. The study may examine issues
such as—
‘‘(aa) the characteristics of
successful credentialing and cer-
tification systems that serve busi-
ness and individual needs;
‘‘(bb) the relative proportions
of certificates and credentials at-
tained with assistance from the
public sector, with private-sector
training of new hires or incum-
bent workers, and by individuals
on their own initiative without
other assistance, respectively;
‘‘(cc) the return on human
capital investments from occupa-
tional credentials and industry-
based skill certifications, includ-
ing the extent to which acquisi-
tion of such credentials or certifi-
cates enhances outcomes such as
entry into employment, retention,
earnings (including the number
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and amount of wage increases),
career advancement, and layoff
aversion;
‘‘(dd) the implications of the
effects of skill certifications and
credentials to the types and deliv-
ery of services provided through
the workforce investment system;
‘‘(ee) the role that Federal
and State governments play in
fostering the development of and
disseminating 
credentials 
and
skill standards; and
‘‘(ff) the use of credentials by
businesses to achieve goals for
workforce skill upgrading and
greater operating efficiency.
‘‘(II) REPORT
TO
CONGRESS.—
The Secretary shall prepare and sub-
mit to Congress a report containing
the results of the study conducted pur-
suant to subclause (I). Such report
may include any recommendations
that the Secretary determines are ap-
propriate to include in such report re-
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lating to promoting the acquisition of
industry-based certification and cre-
dentials, and the appropriate role of
the Department of Labor and the work-
force investment system in supporting
the needs of business and individuals
with respect to such certification and
credentials.
‘‘(iv) STUDY
OF
EFFECTIVENESS
OF
WORKFORCE INVESTMENT SYSTEM IN MEET-
ING BUSINESS NEEDS.—
‘‘(I) IN
GENERAL.—Using funds
available to carry out this section
jointly with funds available to the Sec-
retary of Commerce and Administrator
of the Small Business Administration,
the Secretary, in coordination with the
Secretary of Commerce and the Ad-
ministrator of the Small Business Ad-
ministration, may conduct a study of
the effectiveness of the workforce invest-
ment system in meeting the needs of
business, with particular attention to
the needs of small business, including
in assisting workers to obtain the skills
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needed to utilize emerging technologies.
In conducting the study, the Secretary,
in coordination with the Secretary of
Commerce and the Administrator of
the Small Business Administration,
may examine issues such as—
‘‘(aa) methods for identifying
the workforce needs of businesses
and how the requirements of small
businesses may differ from larger
establishments;
‘‘(bb) 
business 
satisfaction
with the workforce investment sys-
tem, with particular emphasis on
the satisfaction of small busi-
nesses;
‘‘(cc) the extent to which
business is engaged as a collabo-
rative partner in the workforce
investment system, including the
extent of business involvement as
members of State boards and local
boards, and the extent to which
such boards and one-stop centers
effectively collaborate with busi-
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ness and industry leaders in de-
veloping 
workforce 
investment
strategies, including strategies to
identify high growth opportuni-
ties;
‘‘(dd) ways in which the
workforce investment system ad-
dresses changing skill needs of
business that result from changes
in technology and work processes;
‘‘(ee) promising practices for
serving small businesses;
‘‘(ff) the extent and manner
in which the workforce investment
system uses technology to serve
business and individual needs,
and how uses of technology could
enhance efficiency and effective-
ness in providing services; and
‘‘(gg) the extent to which var-
ious segments of the labor force
have access to and utilize tech-
nology to locate job openings and
apply for jobs, and characteristics
of individuals utilizing such tech-
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nology (such as age, gender, race
or ethnicity, industry sector, and
occupational groups).
‘‘(II) REPORT
TO
CONGRESS.—
The Secretary shall prepare and sub-
mit to Congress a report containing
the results of the study described in
clause (I). Such report may include
any recommendations the Secretary de-
termines are appropriate to include in
such report, including ways to enhance
the effectiveness of the workforce invest-
ment system in meeting the needs of
business for skilled workers.’’.
(c) NEXT GENERATION TECHNOLOGIES.—Section 171
(29 U.S.C. 2916) is amended by adding at the end the fol-
lowing:
‘‘(e) SKILL CERTIFICATION PILOT PROJECTS.—
‘‘(1) PILOT PROJECTS.—In accordance with sub-
section (b) and from funds appropriated pursuant to
paragraph (10), the Secretary shall establish and
carry out not more than 10 pilot projects to establish
a system of industry-validated national certifications
of skills, including—
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‘‘(A) not more than 8 national certifications
of skills in high-technology industries, including
biotechnology, telecommunications, highly auto-
mated manufacturing (including semiconduc-
tors), nanotechnology, and energy technology;
and
‘‘(B) not more than 2 cross-disciplinary na-
tional certifications of skills in homeland secu-
rity technology.
‘‘(2) GRANTS TO ELIGIBLE ENTITIES.—In car-
rying out the pilot projects, the Secretary shall make
grants to eligible entities, for periods of not less than
36 months and not more than 48 months, to carry out
the authorized activities described in paragraph (7)
with respect to the certifications described in para-
graph (1). In awarding grants under this subsection
the Secretary shall take into consideration awarding
grants to eligible entities from diverse geographic
areas, including rural areas.
‘‘(3) ELIGIBLE ENTITIES.—
‘‘(A) DEFINITION OF ELIGIBLE ENTITY.—In
this subsection the term ‘eligible entity’ means
an entity that shall work in conjunction with a
local board and shall include as a principal par-
ticipant one or more of the following:
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‘‘(i) An educational institution, in-
cluding a 2- or 4-year college, or a technical
or vocational school.
‘‘(ii) An advanced technology edu-
cation center.
‘‘(iii) A local board.
‘‘(iv) A representative of a business in
a target industry for the certification in-
volved.
‘‘(v) A representative of an industry
association, labor organization, or commu-
nity development organization.
‘‘(B) HISTORY
OF
DEMONSTRATED
CAPA-
BILITY REQUIRED.—To be eligible to receive a
grant under this subsection, an eligible entity
shall have a history of demonstrated capability
for effective collaboration with industry on work-
force investment activities that is consistent with
the objectives of this title.
‘‘(4) APPLICATIONS.—To be eligible to receive a
grant under this subsection, an eligible entity shall
submit an application to the Secretary at such time,
in such manner, and containing such information as
the Secretary may require.
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‘‘(5) CRITERIA.—The Secretary shall establish
criteria, consistent with paragraph (6), for awarding
grants under this subsection.
‘‘(6) PRIORITY.—In selecting eligible entities to
receive grants under this subsection, the Secretary
shall give priority to eligible entities that demonstrate
the availability of and ability to provide matching
funds from industry or nonprofit sources. Such
matching funds may be provided in cash or in kind.
‘‘(7) AUTHORIZED ACTIVITIES.—
‘‘(A) IN GENERAL.—An eligible entity that
receives a grant under this subsection shall use
the funds made available through the grant—
‘‘(i) to facilitate the establishment of
certification requirements for a certification
described in paragraph (1) for an industry;
‘‘(ii) to develop and initiate a certifi-
cation program that includes preparatory
courses, course materials, procedures, and
examinations, for the certification; and
‘‘(iii) to collect and analyze data re-
lated to the program at the program’s com-
pletion, and to identify best practices (con-
sistent with paragraph (8)) that may be
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used by local and State workforce invest-
ment boards in the future.
‘‘(B) BASIS FOR REQUIREMENTS.—The cer-
tification requirements established under the
grant shall be based on applicable skill standards
for the industry involved that have been devel-
oped by or linked to national centers of excellence
under the National Science Foundation’s Ad-
vanced Technological Education Program. The
requirements shall require an individual to dem-
onstrate an identifiable set of competencies rel-
evant to the industry in order to receive certifi-
cation. The requirements shall be designed to
provide evidence of a transferable skill set that
allows flexibility and mobility of workers within
a high technology industry.
‘‘(C) RELATIONSHIP TO TRAINING AND EDU-
CATION PROGRAMS.—The eligible entity shall en-
sure that—
‘‘(i) a training and education program
related to competencies for the industry in-
volved, that is flexible in mode and time-
frame for delivery and that meets the needs
of those seeking the certification, is offered;
and
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under title III of the Social Security Act (42 U.S.C. 501
et seq.) or under the Wagner-Peyser Act is transferred to
the States that used the grants for the acquisition of such
equity. The portion of any real property that is attributable
to the Federal equity transferred under this section shall
be used to carry out activities authorized under title III
of the Social Security Act or the Wagner-Peyser Act. Any
disposition of such real property shall be carried out in ac-
cordance with the procedures prescribed by the Secretary
and the portion of the proceeds from the disposition of such
real property that is attributable to the Federal equity
transferred under this section shall be used to carry out ac-
tivities authorized under title III of the Social Security Act
or the Wagner-Peyser Act.
‘‘(b) LIMITATION ON USE.—A State shall not use funds
awarded under title III of the Social Security Act or the
Wagner-Peyser Act to amortize the costs of real property
that is purchased by any State on or after the effective date
of this provision.’’.
SEC. 155. TABLE OF CONTENTS.
Section 1(b) (29 U.S.C. 9201 note) is amended—
(1) by striking the item relating to section 106
and inserting the following:
‘‘Sec. 106. Purposes.’’;
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‘‘(A) how the eligible agency will evaluate
and measure annually such effectiveness on a
grant-by-grant basis; and
‘‘(B) how the eligible agency—
‘‘(i) will hold eligible providers ac-
countable regarding the progress of such
providers 
in 
improving 
the 
academic
achievement of participants in adult edu-
cation programs under this subtitle and re-
garding the core indicators of performance
described in section 212(b)(2)(A); and
‘‘(ii) will use technical assistance,
sanctions, and rewards (including alloca-
tion of grant funds based on performance
and termination of grant funds based on
performance)’’;
(D) in paragraph (4), by striking ‘‘will en-
sure the improvement of’’ and inserting ‘‘im-
proved’’;
(E) 
by 
redesignating 
paragraphs 
(5)
through (12) as paragraphs (6) through (13), re-
spectively;
(F) by inserting after paragraph (4) the fol-
lowing: