ignated local areas in consultation with local 
boards. 
‘‘(B) METHOD OF DISTRIBUTING FUNDS.—
The method of distributing funds under this 
paragraph shall be developed in consultation 
with the State board and local boards. Such 
method of distribution, which may include the 
formula established under section 121(h)(3), shall 
be objective and geographically equitable, and 
may include factors such as the number of cen-
ters in the local area that have been certified, the 
population served by such centers, and the per-
formance of such centers. 
‘‘(C) OTHER
USE
OF
FUNDS.—Funds re-
served by a Governor for a State—
‘‘(i) under section 133(a) and not used 
under subparagraph (A), may be used for 
statewide activities described in paragraph 
(2); and 
‘‘(ii) under section 133(a) and not 
used under subparagraph (A), and under 
section 128(a) may be used to carry out any 
of the statewide employment and training 
activities described in paragraph (3).’’.
(B) STATEWIDE RAPID RESPONSE ACTIVI-
TIES.—Section 134(a)(2) (29 U.S.C. 2864(a)(2)) 
is amended to read as follows: 
‘‘(2) STATEWIDE RAPID RESPONSE ACTIVITIES.—
A State shall carry out statewide rapid response ac-
tivities using funds reserved as described in section 
133(a). Such activities shall include—
‘‘(A) provision of rapid response activities, 
carried out in local areas by the State or by an 
entity designated by the State, working in con-
junction with the local boards and the chief elect-
ed officials in the local areas; and 
‘‘(B) provision of additional assistance to 
local areas that experience disasters, mass layoffs 
or plant closings, or other events that precipitate 
substantial increases in the number of unem-
ployed individuals, carried out in local areas by 
the State, working in conjunction with the local 
boards and the chief elected officials in the local 
areas.’’. 
(C) STATEWIDE EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—Section 134(a)(3) (29 U.S.C. 
2864(a)(3)) is amended to read as follows: 
‘‘(3) STATEWIDE ACTIVITIES.—Funds reserved by 
a Governor for a State as described in sections 133(a)
and 128(a) may be used for statewide activities in-
cluding—
‘‘(A) supporting the provision of core serv-
ices described in section 134(c)(2) in the one-stop 
delivery system; 
‘‘(B) conducting evaluations under section 
136(e) of activities authorized under this chapter 
and chapter 4 in coordination with evaluations 
carried out by the Secretary under section 172, 
research, and demonstration projects; 
‘‘(C) 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 
Act, and for exemplary performance by local 
areas on the local performance measures; 
‘‘(D) providing technical assistance and ca-
pacity building to local areas, one-stop opera-
tors, one-stop partners, and eligible providers, 
including the development and training of staff, 
the development of exemplary program activities, 
and the provision of technical assistance to local 
areas that fail to meet local performance meas-
ures;
‘‘(E) operating a fiscal and management 
accountability system under section 136(f); 
‘‘(F) carrying out monitoring and oversight 
of activities carried out under this chapter and 
chapter 4; 
‘‘(G) implementing innovative programs, 
such as incumbent worker training programs, 
programs and strategies designed to meet the 
needs of businesses in the State, including small 
businesses, and engage employers in workforce 
activities, and programs serving individuals 
with disabilities consistent with section 188; 
‘‘(H) developing strategies for effectively 
serving hard-to-serve populations and for inte-
grating programs and services among one-stop 
partners; 
‘‘(I) implementing innovative programs for 
displaced homemakers, which for purposes of this 
subparagraph may include an individual 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.);
‘‘(J) implementing programs to increase the 
number of individuals training for and placed 
in nontraditional employment; and 
‘‘(K) carrying out activities to facilitate re-
mote access to services provided through a one-
stop delivery system, including facilitating access 
through the use of technology.’’. 
(D) LIMITATION ON STATE ADMINISTRATIVE 
EXPENDITURES.—Section 
134(a) 
is 
further 
amended by adding the following new para-
graph: 
‘‘(4) LIMITATION.—Not more than 5 percent of 
the funds allotted under section 132(b) shall be used 
by the State for administrative activities carried out 
under this subsection and section 128(a).’’. 
(2) LOCAL EMPLOYMENT AND TRAINING ACTIVI-
TIES.—Section 134(b) (29 U.S.C. 2864(b)) is amend-
ed—
(A) by striking ‘‘under paragraph (2)(A)’’ 
and 
all 
that 
follows 
through 
‘‘section 
133(b)(2)(B)’’ and inserting ‘‘under section 
133(b)’’; and 
(B) in paragraphs (1) and (2), by striking 
‘‘or dislocated workers, respectively’’ .
(3) TECHNICAL
AMENDMENT.—Section 134 is 
further amended by redesignating subsections (d) and 
(e) as subsections (c) and (d), respectively. 
(4) REQUIRED LOCAL EMPLOYMENT AND TRAIN-
ING ACTIVITIES.—
(A) ALLOCATED FUNDS.—Section 134(c)(1) 
(29 U.S.C. 2864(c)(1)) (as redesignated by para-
graph (3)) is amended to read as follows: 
‘‘(1) IN GENERAL.—Funds allocated to a local 
area for adults under section 133(b) shall be used—
‘‘(A) to establish a one-stop delivery system 
as described in section 121(e); 
‘‘(B) to provide the core services described 
in paragraph (2) through the one-stop delivery 
system in accordance with such paragraph; 
‘‘(C) to provide the intensive services de-
scribed in paragraph (3) to adults described in 
such paragraph; and 
‘‘(D) to provide training services described 
in paragraph (4) to adults described in such 
paragraph.’’. 
(B) CORE SERVICES.—Section 134(c)(2) (29 
U.S.C. 2864(c)(2)) (as redesignated by para-
graph (3)) is amended—
(i) by striking ‘‘who are adults or dis-
located workers’’; 
(ii) in subparagraph (A), by striking 
‘‘under this subtitle’’ and inserting ‘‘under 
the one-stop partner programs described in 
section 121(b)’’; 
(iii) by amending subparagraph (D) to 
read as follows: 
‘‘(D) labor exchange services, including—
‘‘(i) job search and placement assist-
ance, and where appropriate career coun-
seling; 
‘‘(ii) appropriate recruitment services 
for employers; and 
‘‘(iii) reemployment services provided 
to unemployment claimants.’’; 
(iv) in subparagraph (I), by inserting 
‘‘and the administration of the work test for 
the unemployment compensation system’’ 
after ‘‘compensation’’; and 
(v) by amending subparagraph (J) to 
read as follows: 
‘‘(J) assistance in establishing eligibility for 
programs of financial aid assistance for training 
and education programs that are not funded
under this Act and are available in the local 
area; and’’. 
(C) 
INTENSIVE
SERVICES.—Section 
134(c)(3) (29 U.S.C. 2864(c)(3) (as redesignated 
by paragraph (3) of this subsection) is amend-
ed—
(i) by amending subparagraph (A) to 
read as follows: 
‘‘(A) IN GENERAL.—
‘‘(i) ELIGIBILITY.—Funds allocated to 
a local area under section 133(b) shall be 
used to provide intensive services for adults 
who—
‘‘(I) are unemployed and who 
have been determined by the one-stop 
operator to be—
‘‘(aa) unlikely or unable to 
obtain 
suitable 
employment 
through core services; and 
‘‘(bb) in need of intensive 
services in order to obtain suitable 
employment; or 
‘‘(II) are employed, but who are 
determined by a one-stop operator to
be in need of intensive services to ob-
tain or retain suitable employment. 
‘‘(ii) DEFINITION.—The Governor shall 
define the term ‘suitable employment’ for 
purposes of this subparagraph.’’; and 
(ii) in subparagraph (C)—
(I) in clause (v), by striking ‘‘for 
participants seeking training services 
under paragraph (4)’’; and 
(II) by adding the following 
clauses after clause (vi): 
‘‘(vii) Internships and work experience. 
‘‘(viii) Literacy activities relating to 
basic work readiness, information and com-
munication technology literacy activities, 
and financial literacy activities. 
‘‘(ix) Out-of-area job search assistance 
and relocation assistance.’’. 
(D) 
TRAINING
SERVICES.—Section 
134(c)(4) (as redesignated by paragraph (3) of 
this subsection) is amended—
(i) by amending subparagraph (A) to 
read as follows: 
‘‘(A) IN GENERAL.—
‘‘(i) ELIGIBILITY.—Funds allocated to 
a local area under section 133(b) shall be 
used to provide training services to adults 
who—
‘‘(I) after an interview, evalua-
tion, or assessment, and case manage-
ment, have been determined by a one-
stop operator or one-stop partner, as 
appropriate, to—
‘‘(aa) be unlikely or unable 
to obtain or retain suitable em-
ployment through intensive serv-
ices under paragraph (3)(A); 
‘‘(bb) be in need of training 
services to obtain or retain suit-
able employment; and 
‘‘(cc) have the skills and 
qualifications to successfully par-
ticipate in the selected program of 
training services; 
‘‘(II) select programs of training 
services that are directly linked to the 
employment opportunities in the local 
area involved or in another area in
which the adults receiving such services 
are willing to commute or relocate; 
‘‘(III) who meet the requirements 
of subparagraph (B); and 
‘‘(IV) who are determined eligible 
in accordance with the priority system 
in effect under subparagraph (E). 
‘‘(ii) DEFINITION.—The Governor shall 
define the term ‘suitable employment’ for 
purposes of this subparagraph.’’; 
(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) by amending clause (iv) to 
read as follows: 
‘‘(iv) entrepreneurial training, includ-
ing providing information about obtaining 
microcredit loans for the purpose of starting 
a business, including contact information of 
microcredit lenders operating within the 
local area;’’;
(II) in clause (viii) by inserting 
‘‘(including English as a Second Lan-
guage)’’ after ‘‘activities’’; and 
(III) by redesignating clause (ix) 
as clause (x) and inserting after clause 
(viii) the following: 
‘‘(ix) training that integrates occupa-
tional skills training and English language 
acquisition;’’; 
(iv) by amending subparagraph (E) to 
read as follows: 
‘‘(E) PRIORITY.—
‘‘(i) IN GENERAL.—A priority shall be 
given to unemployed individuals for the 
provision of intensive and training services 
under this subsection. 
‘‘(ii) ADDITIONAL
PRIORITY.—If the 
funds in the local area, including the funds 
allocated under section 133(b), for serving 
recipients of public assistance and other 
low-income individuals, including single 
parents, displaced homemakers, and preg-
nant single women, is limited, the priority 
for the provision of intensive and training
services under this subsection shall include 
such recipients and individuals. 
‘‘(iii) 
DETERMINATIONS.—The 
Gov-
ernor and the appropriate local board shall 
direct the one-stop operators in the local 
area with regard to making determinations 
with respect to the priority of service under 
this subparagraph.’’; 
(v) in subparagraph (F), by adding the 
following clause after clause (iii): 
‘‘(iv) ENHANCED INDIVIDUAL TRAINING 
ACCOUNTS.—Each local board may, through 
one-stop centers, assist individuals receiving 
individual training accounts through the es-
tablishment of such accounts that include, 
in addition to the funds provided under this 
paragraph, funds from other programs and 
sources that will assist the individual in ob-
taining training services.’’; 
(vi) in subparagraph (G)(iv), by redes-
ignating subclause (IV) as subclause (V) 
and inserting after subclause (III) the fol-
lowing: 
‘‘(IV) Individuals with disabil-
ities.’’; and
(vii) by adding at the end the fol-
lowing: 
‘‘(H) COMPUTER
TECHNOLOGY.—In pro-
viding training services under subparagraph 
(G), funds allocated to a local area under this 
title may be used to purchase computer tech-
nology for use by an individual who is eligible 
pursuant to subsection (A), only if—
‘‘(i) such purchase is part of an ongo-
ing training program; and 
‘‘(ii) such purchase is necessary to en-
sure the individual can participate in such 
training program. 
Any purchase of computer technology under this 
subparagraph shall remain the property of the 
one-stop operator.’’. 
(5) PERMISSIBLE
ACTIVITIES.—Section 134(d) 
(as redesignated by paragraph (3)) is amended—
(A) by amending paragraph (1) to read as 
follows: 
‘‘(1) DISCRETIONARY
ONE-STOP
DELIVERY
AC-
TIVITIES.—
‘‘(A) IN GENERAL.—Funds allocated to a 
local area under section 133(b) may be used to 
provide, through the one-stop delivery system—
‘‘(i) customized screening and referral 
of qualified participants in training serv-
ices to employers; 
‘‘(ii) customized employment-related 
services to employers on a fee-for-service 
basis; 
‘‘(iii) customer support to navigate 
among multiple services and activities for 
special participant populations that face 
multiple barriers to employment, including 
individuals with disabilities; 
‘‘(iv) employment and training assist-
ance provided in coordination with child 
support enforcement activities of the State 
agency carrying out subtitle D of title IV of 
the Social Security Act; 
‘‘(v) activities to improve services to 
local employers, including small employers 
in the local area, and increase linkages be-
tween the local workforce investment system 
and employers; and 
‘‘(vi) activities to facilitate remote ac-
cess to services provided through a one-stop 
delivery system, including facilitating ac-
cess through the use of technology.
‘‘(B) WORK SUPPORT ACTIVITIES FOR LOW-
WAGE WORKERS.—
‘‘(i) IN GENERAL.—Funds allocated to 
a local area under 133(b) may be used to 
provide, through the one-stop delivery sys-
tem and in collaboration with the appro-
priate programs and resources of the one-
stop partners, work support activities de-
signed to assist low-wage workers in retain-
ing and enhancing employment. 
‘‘(ii) ACTIVITIES.—The activities de-
scribed in clause (i) may include assistance 
in accessing financial supports for which 
such workers may be eligible and the provi-
sion of activities available through the one-
stop delivery system in a manner that en-
hances the opportunities of such workers to 
participate, such as the provision of em-
ployment and training activities during 
nontraditional hours and the provision of 
on-site child care while such activities are 
being provided.’’; and 
(B) by adding after paragraph (3) the fol-
lowing new paragraph:
‘‘(4) 
INCUMBENT
WORKER
TRAINING
PRO-
GRAMS.—
‘‘(A) IN GENERAL.—The local board may 
use up to 10 percent of the funds allocated to a 
local area under section 133(b) to carry out in-
cumbent worker training programs in accord-
ance with this paragraph. 
‘‘(B) TRAINING ACTIVITIES.—The training 
programs for incumbent workers under this 
paragraph shall be carried out by the local area 
in conjunction with the employers of such work-
ers for the purpose of assisting such workers in 
obtaining the skills necessary to retain employ-
ment and avert layoffs. 
‘‘(C) EMPLOYER MATCH REQUIRED.—
‘‘(i) IN GENERAL.—Employers partici-
pating in programs under this paragraph 
shall be required to pay a proportion of the 
costs of providing the training to the in-
cumbent workers. The Governor shall estab-
lish, or may authorize the local board to es-
tablish, the required portion of such costs, 
which 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
MATCH.—The 
wages paid by an employer to a worker 
while they are attending training may be 
included as part of the requirement pay-
ment of the employer.’’. 
SEC. 113. PERFORMANCE ACCOUNTABILITY SYSTEM. 
(a) STATE PERFORMANCE MEASURES.—
(1) IN GENERAL.—Section 136(b)(1) (29 U.S.C. 
2871(b)(1)) is amended—
(A) in subparagraph (A)(i), by striking 
‘‘and the customer satisfaction indicator of per-
formance described in paragraph (2)(B)’’; and 
(B) in subparagraph (A)(ii), by striking 
‘‘paragraph (2)(C)’’ and inserting ‘‘paragraph 
(2)(B)’’. 
(2) INDICATORS
OF
PERFORMANCE.—Section 
136(b)(2) (29 U.S.C. 2871(b)(2)) is amended—
(A) in subparagraph (A)(i), by striking 
‘‘(except for self-service and information activi-
ties) and (for participants who are eligible youth
age 19 through 21) for youth activities author-
ized under section 129’’; 
(B) in subparagraph (A)(i)(II), by insert-
ing ‘‘and’’ after the semicolon; 
(C) in subparagraph (A)(i)(III), by striking 
‘‘; and’’ and inserting a period; 
(D) by striking subparagraph (A)(i)(IV); 
(E) by amending subparagraph (A)(ii) to 
read as follows: 
‘‘(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; 
‘‘(II) attainment of secondary 
school diploma, General Educational 
Development 
credential 
(GED), 
or 
other State-recognized equivalent (in-
cluding recognized alternative stand-
ards for individuals with disabilities); 
and 
‘‘(III) 
literacy 
or 
numeracy 
gains.’’;
(F) by striking subparagraph (B); and 
(G) by redesignating subparagraph (C) as 
subparagraph (B), and by adding at the end of 
such subparagraph (as so redesignated) the fol-
lowing new sentence: ‘‘Such indicators may in-
clude customer satisfaction of employers and 
participants with services received from the 
workforce investment activities authorized under 
this subtitle.’’. 
(3) 
LEVELS
OF
PERFORMANCE.—Section 
136(b)(3)(A) (29 U.S.C. 2871(b)(3)(A)) is amended—
(A) in clause (i), by striking ‘‘and the cus-
tomer satisfaction indicator described in para-
graph (2)(B)’’; 
(B) in clause (ii), by striking ‘‘and the cus-
tomer satisfaction indicator of performance, for 
the first 3’’ and inserting ‘‘for the 2’’; 
(C) in clause (iii)—
(i) in the heading, by striking ‘‘FOR 
FIRST 3 YEARS’’; and 
(ii) by striking ‘‘and the customer sat-
isfaction indicator of performance, for the 
first 3’’ and inserting ‘‘for the 2’’; 
(D) in clause (iv)—
(i) by striking subclause (I);
(ii) by redesignating subclauses (II) 
and (III) as subclauses (I) and (II), respec-
tively; and 
(iii) in subclause (I) (as so redesig-
nated)—
(I) by striking ‘‘taking into ac-
count’’ and inserting ‘‘which shall be 
adjusted based on’’; 
(II) by inserting ‘‘, such as unem-
ployment rates and job losses or gains 
in particular industries’’ after ‘‘eco-
nomic conditions’’; and 
(III) by inserting ‘‘, such as indi-
cators of poor work history, lack of 
work experience, low levels of literacy 
or English proficiency, disability sta-
tus, including the number of veterans 
with disabilities, and welfare depend-
ency’’ after ‘‘program’’; 
(E) by striking clause (v); and 
(F) by redesignating clause (vi) as clause 
(v). 
(4) 
ADDITIONAL
INDICATORS.—Section 
136(b)(3)(B) is amended by striking ‘‘paragraph 
(2)(C)’’ and inserting ‘‘paragraph (2)(B)’’.
(b) 
LOCAL
PERFORMANCE
MEASURES.—Section 
136(c) (29 U.S.C 2871(c)) is amended—
(1) in paragraph (1)(A)(i), by striking ‘‘, and 
the customer satisfaction indicator of performance de-
scribed in subsection (b)(2)(B),’’; 
(2) in paragraph (1)(A)(ii), by striking ‘‘sub-
section 
(b)(2)(C)’’ 
and 
inserting 
‘‘subsection 
(b)(2)(B)’’; and 
(3) by amending paragraph (3) to read as fol-
lows: 
‘‘(3) DETERMINATIONS.—In determining such 
local levels of performance, the local board, the chief 
elected official, and the Governor shall ensure such 
levels are adjusted based on the specific economic 
characteristics (such as unemployment rates and job 
losses or gains in particular industries), demographic 
characteristics, or other characteristics of the popu-
lation to be served in the local area, such as poor 
work history, lack of work experience, low levels of lit-
eracy or English proficiency, disability status, includ-
ing the number of veterans with disabilities, and wel-
fare dependency.’’. 
(c) REPORT.—Section 136(d) (29 U.S.C. 2871(d)) is 
amended—
(1) in paragraph (1), by striking ‘‘and the cus-
tomer satisfaction indicator’’ in both places that it 
appears; 
(2) in paragraph (2)—
(A) in subparagraph (E), by striking ‘‘(ex-
cluding participants who received only self-serv-
ice and informational activities); and’’ and in-
serting a semicolon; 
(B) in subparagraph (F), by striking the 
period and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(G) the number of participants served and 
the cost per participant.’’; 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-
tablish procedures, consistent with guidelines issued 
by the Secretary, to ensure the information contained 
in the report is valid and reliable.’’. 
(d) SANCTIONS
FOR
STATE.—Section 136(g) (29 
U.S.C. 2871(g)) is amended—
(1) in paragraph (1)(A), by striking ‘‘or (B)’’; 
and 
(2) in paragraph (2), by striking ‘‘section 503’’ 
and inserting ‘‘section 136(i)’’.
(e) SANCTIONS FOR LOCAL AREAS.—Section 136(h) 
(29 U.S.C. 2871(h)) is amended—
(1) in paragraph (1), by striking ‘‘or (B)’’; and 
(2) by amending paragraph (2)(B) to read as 
follows: 
‘‘(B) APPEAL TO GOVERNOR.—A local area 
that is subject to a reorganization plan under 
subparagraph (A) may, not later than 30 days 
after receiving notice of the reorganization plan, 
appeal to the Governor to rescind or revise such 
plan. In such case, the Governor shall make a 
final decision not later than 30 days after the re-
ceipt of the appeal.’’. 
(f) INCENTIVE GRANTS.—Section 136(i) (29 U.S.C. 
2871(i)) is amended to read as follows: 
‘‘(i) INCENTIVE GRANTS
FOR STATES
AND LOCAL 
AREAS.—
‘‘(1) INCENTIVE GRANTS FOR STATES.—
‘‘(A) IN
GENERAL.—From funds appro-
priated under section 174, the Secretary may 
award grants to States for exemplary perform-
ance in carrying programs under chapters 4 and 
5 of this title. Such awards may be based on 
States meeting or exceeding the performance 
measures established under this section, on the