IB 
Union Calendar No. 46
108TH CONGRESS 
1ST SESSION H. R. 1261
[Report No. 108–82] 
To enhance the workforce investment system of the Nation by strengthening 
one-stop career centers, providing for more effective governance arrange-
ments, promoting access to a more comprehensive array of employment, 
training, and related services, establishing a targeted approach to serving 
youth, and improving performance accountability, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 13, 2003
Mr. MCKEON (for himself and Mr. BOEHNER) introduced the following bill; 
which was referred to the Committee on Education and the Workforce 
MAY 1, 2003
Additional sponsors: Mr. BALLENGER, Mr. COLE, Mr. TIBERI, Mr. ISAKSON, 
Mr. NORWOOD, and Mr. BEREUTER 
MAY 1, 2003
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on March 13, 2003] 
A BILL 
To enhance the workforce investment system of the Nation 
by strengthening one-stop career centers, providing for 
more effective governance arrangements, promoting ac-
cess to a more comprehensive array of employment,
training, and related services, establishing a targeted ap-
proach to serving youth, and improving performance ac-
countability, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Workforce Reinvestment 
and Adult Education Act of 2003’’. 
SEC. 2. TABLE OF CONTENTS. 
The table of contents for 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
Sec. 101. Definitions. 
Sec. 102. Purpose. 
Sec. 103. State workforce investment boards. 
Sec. 104. State plan. 
Sec. 105. Local workforce investment areas. 
Sec. 106. Local workforce investment boards. 
Sec. 107. Local plan. 
Sec. 108. Establishment of one-stop delivery systems. 
Sec. 109. Eligible providers of training services. 
Sec. 110. Eligible providers of youth activities. 
Sec. 111. Youth activities. 
Sec. 112. Comprehensive program for adults. 
Sec. 113. Performance accountability system. 
Sec. 114. Authorization of appropriations. 
Sec. 115. Job Corps. 
Sec. 116. Native American programs. 
Sec. 117. Youth challenge grants. 
Sec. 118. Technical assistance. 
Sec. 119. Demonstration, pilot, multiservice, research and multistate projects. 
Sec. 120. Evaluations. 
Sec. 121. Authorization of appropriations for national activities. 
Sec. 122. Requirements and restrictions. 
Sec. 123. Nondiscrimination. 
Sec. 124. Administrative provisions. 
Sec. 125. General program requirements.
TITLE II—ADULT EDUCATION 
PART A—ADULT BASIC SKILLS AND FAMILY LITERACY EDUCATION 
Sec. 201. Table of contents. 
Sec. 202. Amendment. 
PART B—NATIONAL INSTITUTE FOR LITERACY 
Sec. 211. Short title; purpose. 
Sec. 212. Establishment. 
Sec. 213. Administration. 
Sec. 214. Duties. 
Sec. 215. Leadership in scientifically based reading instruction. 
Sec. 216. National Institute for Literacy Advisory Board. 
Sec. 217. Gifts, bequests, and devises. 
Sec. 218. Mails. 
Sec. 219. Applicability of certain civil service laws. 
Sec. 220. Experts and consultants. 
Sec. 221. Report. 
Sec. 222. Definitions. 
Sec. 223. Authorization of appropriations. 
Sec. 224. Reservation. 
Sec. 225. Authority to publish. 
TITLE III—AMENDMENTS TO THE WAGNER-PEYSER ACT 
Sec. 301. Amendments to the Wagner-Peyser Act. 
TITLE IV—AMENDMENTS TO THE REHABILITATION ACT OF 1973
Sec. 401. Chairperson. 
Sec. 402. Rehabilitation Services Administration. 
Sec. 403. Director. 
Sec. 404. State goals. 
Sec. 405. Authorizations of appropriations. 
Sec. 406. 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 amendment or repeal shall be considered to be made 
to a section or other provision of the Workforce Investment 
Act of 1998 (20 U.S.C. 9201 et seq.).
TITLE 
I—AMENDMENTS 
TO 
TITLE I OF THE WORKFORCE 
INVESTMENT ACT OF 1998
SEC. 101. DEFINITIONS. 
Section 101 (29 U.S.C. 2801) is amended—
(1) in paragraph (8)(C), by striking ‘‘not less 
than 50 percent of the cost of the training’’ and in-
serting ‘‘a significant portion of the cost of training, 
as determined by the local board’’; 
(2) by striking paragraph (13) and redesig-
nating paragraphs (1) through (12) as paragraphs 
(2) through (13) respectively; 
(3) by inserting the following new paragraph 
after ‘‘In this title:’’: 
‘‘(1) ACCRUED EXPENDITURES.—The term ‘ac-
crued expenditures’ includes the sum of actual cash 
disbursements for direct charges for goods and serv-
ices, the net increase or decrease in the amounts owed 
by recipients, goods and other property received for 
services performed by employees, contractors, sub-
grantees, or other payees, and other amounts becom-
ing owned for which no current service or perform-
ance is required.’’;
(4) by striking paragraph (24) and redesig-
nating paragraphs (25) through (32) as paragraphs 
(24) through (31), respectively; 
(5) in paragraph (24) (as so redesignated)—
(A) in subparagraph (B), by striking ‘‘high-
er of—’’ and all that follows through such sub-
paragraph and inserting ‘‘poverty line for an 
equivalent period;’’; and 
(B) by redesignating subparagraphs (D) 
through (F) as subparagraph (E) through (G), 
respectively, and inserting after subparagraph 
(C) the following: 
‘‘(D) receives or is eligible to receive free or 
reduced price lunch;’’; and 
(6) by striking paragraph (33) and redesig-
nating paragraphs (34) through (53) as paragraphs 
(32) through (51), respectively. 
SEC. 102. PURPOSE. 
Section 106 (29 U.S.C. 2811) is amended by inserting 
at the end the following: ‘‘It is also the purpose of this sub-
title to provide workforce investment activities in a manner 
that promotes the informed choice of participants and ac-
tively involves participants in decisions affecting their par-
ticipation in such activities.’’.
SEC. 103. STATE WORKFORCE INVESTMENT BOARDS. 
(a) MEMBERSHIP.—
(1) IN
GENERAL.—Section 111(b) (29 U.S.C. 
2821(b)) is amended—
(A) by amending paragraph (1)(C) to read 
as follows: 
‘‘(C) representatives appointed by the Gov-
ernor, who are—
‘‘(i)(I) 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; 
‘‘(II) in any case in which no lead 
State agency official has responsibility for 
such a program or activity, a representative 
in the State with expertise relating to such 
program or activity; and 
‘‘(III) if not included under subclause 
(I), the director of the designated State enti-
ty responsible for carrying out title I of the 
Rehabilitation Act (29 U.S.C. 701 et seq.); 
‘‘(ii) the State agency officials respon-
sible for economic development; 
‘‘(iii) representatives of business in the 
State who—
‘‘(I) are owners of businesses, chief 
executive or operating officers of busi-
nesses, and other business executives or 
employers with optimum policy mak-
ing or hiring authority, including 
members of local boards described in 
section 117(b)(2)(A)(i); 
‘‘(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 and business trade 
associations; 
‘‘(iv) 
chief 
elected 
officials 
(rep-
resenting both cities and counties, where ap-
propriate); 
‘‘(v) representatives of labor organiza-
tions, who have been nominated by State 
labor federations; and 
‘‘(vi) such other representatives and 
State agency officials as the Governor 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 2811(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) by amending paragraph (3) to read as fol-
lows: 
‘‘(3) development and review of statewide policies 
affecting the integrated provision of services through 
the one-stop delivery system described in section 121, 
including—
‘‘(A) the development of criteria for, and the 
issuance of, certifications of one-stop centers; 
‘‘(B) the criteria for the allocation of one-
stop center infrastructure funding under section 
121(h), and oversight of the use of such funds; 
‘‘(C) approaches to facilitating equitable 
and efficient cost allocation in one-stop delivery 
systems; and 
‘‘(D) such other matters that may promote 
statewide objectives for, and enhance the per-
formance of, one-stop delivery systems within the 
State;’’; 
(2) in paragraph (4), by inserting ‘‘and the de-
velopment of State criteria relating to the appoint-
ment and certification of local boards under section 
117’’ after ‘‘section 116’’; 
(3) in paragraph (5), by striking ‘‘sections 
128(b)(3)(B) and 133(b)(3)(B)’’ and inserting ‘‘sec-
tions 128(b)(3) and 133(b)(3)’’; and 
(4) in paragraph (9), by striking ‘‘section 503’’ 
and inserting ‘‘section 136(i)’’. 
(c) ELIMINATION OF ALTERNATIVE ENTITY AND PRO-
VISION OF AUTHORITY TO HIRE STAFF.—Section 111(e) 
(29 U.S.C. 2821(e)) is amended to read as follows: 
‘‘(e) AUTHORITY TO HIRE STAFF.—The State board 
may hire staff to assist in carrying out the functions de-
scribed in subsection (d).’’. 
SEC. 104. STATE PLAN. 
(a) PLANNING CYCLE.—Section 112(a) (29 U.S.C. 
2822(a)) is amended by striking ‘‘5-year strategy’’ and in-
serting ‘‘2-year strategy’’. 
(b) CONTENTS.—Section 112(b)(17)(A) (29 U.S.C. 
2822(b)(17)(A)) is amended— 
(1) in clause (iii) by striking ‘‘and’’; 
(2) by amending clause (iv) to read as follows:
‘‘(iv) how the State will serve the em-
ployment and training needs of dislocated 
workers (including displaced homemakers 
and 
formerly 
self-employed 
and 
transitioning farmers, ranchers, and fisher-
man) low income individuals (including re-
cipients of public assistance), homeless indi-
viduals, ex-offenders, individuals training 
for nontraditional employment, and other 
individuals with multiple barriers to em-
ployment (including older individuals);’’; 
and 
(3) by adding the following new clause after 
clause (iv): 
‘‘(v) how the State will serve the em-
ployment and training needs of individuals 
with disabilities, consistent with section 188 
and Executive Order 13217 (relating to 
community-based alternatives for individ-
uals with disabilities) including the provi-
sion of outreach, intake, assessments, and 
service delivery, the development of perform-
ance measures, and the training of staff; 
and’’.
(c) MODIFICATION
TO PLAN.—Section 112(d) (29 
U.S.C. 2822(d)) is amended by striking ‘‘5-year period’’ 
and inserting ‘‘2-year period’’. 
SEC. 105. LOCAL WORKFORCE INVESTMENT AREAS. 
(a) DESIGNATION OF AREAS.—
(1) CONSIDERATIONS.—Section 116(a)(1)(B) (29 
U.S.C. 2831(a)(1)(B)) is amended by adding at the 
end the following clause: 
‘‘(vi) The extent to which such local 
areas will promote efficiency in the admin-
istration and provision of services.’’. 
(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.—Except as provided in 
subparagraph (B) of this paragraph and sub-
section (b), the Governor shall approve a request 
for designation as a local area from—
‘‘(i) any unit of general local govern-
ment with a population of 500,000 or more; 
and 
‘‘(ii) an area served by a rural con-
centrated employment program grant re-
cipient that served as a service delivery
area or substate area under the Job train-
ing Partnership Act (29 U.S.C. 1501 et 
seq.), 
for the 2-year period covered by a State plan 
under section 112 if such request is made not 
later than the date of the submission of the State 
plan. 
‘‘(B) CONTINUED DESIGNATION BASED ON 
PERFORMANCE.—The Governor may deny a re-
quest for designation submitted pursuant to sub-
paragraph (A) if such unit of government was 
designated as a local area for the preceding 2-
year period covered by a State plan and the 
Governor determines that such local area did not 
perform successfully during such period.’’. 
(b) REGIONAL
PLANNING.—Section 116(c)(1) (29 
U.S.C. 2831(c)(1)) is amended by adding at the end the 
following: ‘‘The State may require the local boards for the 
designated region to prepare a single regional plan that in-
corporates the elements of the local plan under section 118 
and that is submitted and approved in lieu of separate local 
plans under such section.’’. 
SEC. 106. LOCAL WORKFORCE INVESTMENT BOARDS. 
(a) COMPOSITION.—Section 117(b)(2)(A) (29 U.S.C. 
2832(b)(2)(A)) is amended—
(1) in clause (i)(II), by inserting ‘‘, businesses 
that are in the leading industries in the local area, 
and large and small businesses in the local area’’ 
after ‘‘local area’’; 
(2) by amending clause (ii) to read as follows: 
‘‘(ii) superintendents of the local sec-
ondary school systems and the presidents or 
chief executive officers of postsecondary edu-
cational institutions (including community 
colleges, where such entities exist);’’; 
(3) in clause (iv), by striking the semicolon and 
inserting ‘‘and faith-based organizations; and’’; and 
(4) by striking clause (vi). 
(b) AUTHORITY
OF
BOARD
MEMBERS.—Section 
117(b)(3) (29 U.S.C. 2832(b) is amended— 
(1) in the heading, by inserting ‘‘AND
REP-
RESENTATION’’ after ‘‘MEMBERS’’; 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) FUNCTIONS.—Section 117(d) (29 U.S.C. 2832(d)) 
is amended— 
(1) in paragraph (2)(B), by striking ‘‘local 
area’’ and all that follows and inserting ‘‘local area.’’; 
and
(2) in paragraph (4) by inserting ‘‘and ensure 
the appropriate use and management of the funds 
provided under this title for such programs, activities, 
and system’’ after ‘‘area’’. 
(d) 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) ESTABLISHMENT OF COUNCILS.—The local board 
may establish councils to provide information and advice 
to assist the local board in carrying out activities under 
this title. Such councils may include a council composed 
of one-stop partners to advise the local board on the oper-
ation of the one-stop delivery system, a youth council com-
posed of experts and stakeholders in youth programs to ad-
vise the local board on activities for youth, and such other 
councils as the local board determines are appropriate.’’. 
(e) REPEAL OF ALTERNATIVE ENTITY PROVISION.—
Section 117 (29 U.S.C. 2832) is further amended by strik-
ing subsection (i). 
SEC. 107. LOCAL PLAN. 
(a) PLANNING CYCLE.—Section 118(a) (29 U.S.C. 
2833(a)) is amended by striking ‘‘5-year’’ and inserting ‘‘2-
year’’. 
(b) CONTENTS.—Section 118(b) (29 U.S.C. 2833(b)) is 
amended—
(1) by amending paragraph (2) to read as fol-
lows: 
‘‘(2) a description of the one-stop delivery system 
to be established or designated in the local area, in-
cluding a description of how the local board will en-
sure the continuous improvement of eligible providers 
of services through the system and ensure that such 
providers meets the employment needs of local em-
ployers and participants.’’; and 
(2) in paragraph (4), by striking ‘‘and dis-
located worker’’. 
SEC. 108. ESTABLISHMENT OF ONE-STOP DELIVERY SYS-
TEMS. 
(a) ONE-STOP PARTNERS.—Section 121(b)(2)(B) (29 
U.S.C. 2841(b)(2)(B)) is amended—
(1) in clause (iv) by striking ‘‘and’’ at the end; 
(2) in clause (v) by striking the period and in-
serting a semicolon; and 
(3) by adding at the end the following new 
clauses: 
‘‘(vi) employment and training pro-
grams administered by the Social Security 
Administration, including the Ticket to 
Work program (established by Public Law 
106–170);
‘‘(vii) programs under part D of title 
IV of the Social Security Act (42 U.S.C. 
451 et seq.) (relating to child support en-
forcement); and 
‘‘(viii) programs carried out in the 
local area for individuals with disabilities, 
including programs carried out by State 
agencies relating to mental health, mental 
retardation, and developmental disabilities, 
State Medicaid agencies, State Independent 
Living Councils, and Independent Living 
Centers.’’. 
(b) PROVISION OF SERVICES.—Subtitle B of title I is 
amended—
(1) by striking subsection (e) of section 121; 
(2) by moving subsection (c) of section 134 from 
section 134, redesignating such subsection as sub-
section (e), and inserting such subsection (as so redes-
ignated) after subsection (d) of section 121; and 
(3) by amending subsection (e) (as moved and 
redesignated by paragraph (2))—
(A) in paragraph (1)(A), by striking ‘‘sub-
section (d)(2)’’ and inserting ‘‘section 134(c)(2)’’; 
(B) in paragraph (1)(B)—
(i) by striking ‘‘subsection (d)’’ and in-
serting ‘‘section 134(c)’’; and 
(ii) by striking ‘‘subsection (d)(4)(G)’’ 
and inserting ‘‘section 134(c)(4)(G)’’; 
(C) in paragraph (1)(C), by striking ‘‘sub-
section (e)’’ and inserting ‘‘section 134(d)’’; 
(D) in paragraph (1)(D)—
(i) by striking ‘‘section 121(b)’’ and 
inserting ‘‘subsection (b)’’; and 
(ii) by striking ‘‘and’’ at the end; and 
(E) by amending paragraph (1)(E) to read 
as follows: 
‘‘(E) shall provide access to the information 
described in section 15(e) of the Wagner-Peyser 
Act (29 U.S.C. 49l–2(e)).’’. 
(c) CERTIFICATION AND FUNDING OF ONE-STOP CEN-
TERS.—Section 121 (as amended by subsection (b)) is fur-
ther amended by adding at the end the following new sub-
sections: 
‘‘(g) CERTIFICATION OF ONE-STOP CENTERS.—
‘‘(1) IN GENERAL.—The State board shall estab-
lish procedures and criteria for periodically certifying 
one-stop center for the purpose of awarding the one-
stop infrastructure funding described in subsection 
(h).
‘‘(2) CRITERIA.—The criteria for certification 
under this subsection shall include minimum stand-
ards relating to the scope and degree of service inte-
gration achieved by the centers involving the pro-
grams provided by the one-stop partners. 
‘‘(3) EFFECT OF CERTIFICATION.—One-stop cen-
ters certified under this subsection shall be eligible to 
receive the infrastructure grants authorized under 
subsection (h). 
‘‘(h) ONE-STOP INFRASTRUCTURE FUNDING.—
‘‘(1) PARTNER CONTRIBUTIONS.—
‘‘(A) 
PROVISION
OF
FUNDS.—Notwith-
standing any other provision of law, as deter-
mined under subparagraph (B), a portion of the 
Federal funds provided to the State and areas 
within the State under the Federal laws author-
izing the one-stop partner programs described in 
subsection (b) for a fiscal year shall be provided 
to the Governor by such programs to carry out 
this subsection. 
‘‘(B) DETERMINATION.—The portion of 
funds to be provided under subparagraph (A) by 
each one-stop partner shall be determined by the 
Governor, after consultation with the State 
board.
‘‘(2) ALLOCATION
BY
GOVERNOR.—From the 
funds provided under paragraph (1), the Governor 
shall allocate funds to local areas for the purposes of 
assisting in paying the costs of the infrastructure of 
One-Stop centers certified under subsection (g). 
‘‘(3) ALLOCATION FORMULA.—The State board 
shall develop a formula to be used by the Governor to 
allocate the funds described in paragraph (1). The 
formula shall include such factors as the State board 
determines are appropriate, which may include fac-
tors such as the number of centers in the local area 
that have been certified, the population served by such 
centers, and the performance of such centers. 
‘‘(4) COSTS OF INFRASTRUCTURE.—For purposes 
of this subsection, the term ‘costs of infrastructure’ 
means the nonpersonnel costs that are necessary for 
the general operation of a one-stop center, including 
the rental costs of the facilities, the costs of utilities 
and maintenance, equipment (including adaptive 
technology for individuals with disabilities), strategic 
planning activities for the center, and common out-
reach activities. 
‘‘(i) OTHER FUNDS.—
‘‘(1) IN GENERAL.—In addition to the funds pro-
vided to carry out subsection (h), a portion of funds
made available under Federal law authorizing the 
one-stop partner programs described in subsection (b) 
shall be used to pay the costs relating to the operation 
of the one-stop delivery system that are not paid for 
from the funds provided under subsection (h), to the 
extent not inconsistent with the Federal law involved 
including—
‘‘(A) infrastructure costs that are in excess 
of the funds provided under subsection (h); 
‘‘(B) common costs that are in addition to 
the costs of infrastructure; and 
‘‘(C) the costs of the provision of core serv-
ices applicable to each program. 
‘‘(2) 
DETERMINATION
AND
GUIDANCE.—The 
method for determining the appropriate portion of 
funds to be provided by each program under para-
graph (1) shall be determined as part of the memo-
randum of understanding under subsection (c). The 
State board shall provide guidance to facilitate the 
determination of appropriate funding allocation in 
local areas.’’. 
SEC. 109. 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 shall establish cri-
teria and procedures regarding the eligibility of providers 
of training services described in section 134(c)(4) to receive 
funds provided under section 133(b) for the provision of 
such training services. 
‘‘(b) CRITERIA.—
‘‘(1) IN GENERAL.—The criteria established pur-
suant to subsection (a) shall take into account the 
performance of providers of training services with re-
spect to the indicators described in section 136 or 
other appropriate indicators (taking into consider-
ation the characteristics of the population served and 
relevant economic conditions), and such other factors 
as the Governor determines are appropriate to ensure 
the quality of services, the accountability of providers, 
and the informed choice of participants under chapter 
5. Such criteria shall require that the provider submit 
appropriate, accurate and timely information to the 
State for purposes of carrying out subsection (d). The 
criteria shall also provide for periodic review and re-
newal of eligibility under this section for providers of 
training services. The Governor may authorize local 
areas in the State to establish additional criteria or 
to modify the criteria established by the Governor
under this section for purposes of determining the eli-
gibility of providers of training services to provide 
such services in the local area. 
‘‘(2) LIMITATION.—In carrying out the require-
ments of this subsection, no personally identifiable in-
formation regarding a student, including Social Secu-
rity number, student identification number, or other 
identifier, may be disclosed without the prior written 
consent of the parent or eligible student in compliance 
with section 444 of the General Education Provisions 
Act (20 U.S.C. 1232g). 
‘‘(c) PROCEDURES.—The procedures established under 
subsection (a) shall identify the application process for a 
provider of training services to become eligible to receive 
funds under section 133(b), and identify the respective roles 
of the State and local areas in receiving and reviewing ap-
plications and in making determinations of 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.—In order to facilitate and assist
participants under chapter 5 in choosing providers of train-
ing services, the Governor shall ensure that an appropriate 
list or lists of providers determined eligible under this sec-
tion in the State, accompanied by such information as the 
Governor determines is appropriate, is provided to the local 
boards in the State to be made available to such partici-
pants and to members of the public through the one-stop 
delivery system in the State. 
‘‘(e) AGREEMENTS WITH OTHER STATES.—States 
may enter into agreements, on a reciprocal basis, to permit 
eligible providers of training services to accept individual 
training accounts provided in another State. 
‘‘(f) RECOMMENDATIONS.—In developing the criteria, 
procedures, and information required under this section, the 
Governor shall solicit and take into consideration the rec-
ommendations of local boards and providers of training 
services within the State. 
‘‘(g) OPPORTUNITY TO SUBMIT COMMENTS.—During 
the development of the criteria, procedures, and information 
required under this section, the Governor shall provide an 
opportunity for interested members of the public, including 
representatives of business and labor organizations, to sub-
mit comments regarding such criteria, procedures, and in-
formation.’’.
SEC. 110. ELIGIBLE PROVIDERS OF YOUTH ACTIVITIES. 
Section 123 (29 U.S.C. 2843) and the item relating 
to such section in the table of contents are repealed. 
SEC. 111. YOUTH ACTIVITIES. 
(a) STATE ALLOTMENTS.—
(1) IN
GENERAL.—Section 127(a) (29 U.S.C. 
2852(a)) is amended to read as follows: 
‘‘(a) ALLOTMENT AMONG STATES.—
‘‘(1) YOUTH ACTIVITIES.—
‘‘(A) YOUTH CHALLENGE GRANTS.—
‘‘(i) RESERVATION OF FUNDS.—Of the 
amount appropriated under section 137(a) 
for each fiscal year, the Secretary shall re-
serve 25 percent to provide youth challenge 
grants under section 169. 
‘‘(ii) 
LIMITATION.—Notwithstanding 
clause (i), if the amount appropriated 
under section 137(a) for a fiscal year ex-
ceeds $1,000,000,000, the Secretary shall re-
serve $250,000,000 to provide youth chal-
lenge grants under section 169. 
‘‘(B) OUTLYING AREAS AND NATIVE AMERI-
CANS.—After determining the amount to be re-
served under subparagraph (A), of the remainder 
of the amount appropriated under section 137(a) 
for each fiscal year the Secretary shall—
‘‘(i) reserve not more than 1⁄4 of one 
percent of such amount to provide assist-
ance to the outlying areas to carry out 
youth activities and statewide workforce in-
vestment activities; and 
‘‘(ii) reserve not more than 1 and 1⁄2 
percent of such amount to provide youth ac-
tivities under section 166 (relating to Na-
tive Americans). 
‘‘(C) STATES.—
‘‘(i) IN GENERAL.—After determining 
the amounts to be reserved under subpara-
graphs (A) and (B), the Secretary shall 
allot the remainder of the amount appro-
priated under section 137(a) for each fiscal 
year to the States pursuant to clause (ii) for 
youth activities and statewide workforce in-
vestment activities. 
‘‘(ii) FORMULA.—Subject to clauses 
(iii) and (iv), of the remainder—
‘‘(I) 33 and 1⁄3 percent shall be al-
lotted on the basis of the relative num-
ber of high school dropouts who are 
ages 16 through 21 in the State, com-
pared to the total number of high
school dropouts who are ages 16 
through 21 in all States; 
‘‘(II) 33 and 1⁄3 percent shall be 
allotted on the basis of the relative 
number of jobless out-of-school youth 
who are ages 16 through 21 in the 
State, compared to the total number of 
jobless out-of-school youth who are ages 
16 through 21 in all States; and 
‘‘(III) 33 and 1⁄3 percent shall be 
allotted on the basis of the relative 
number of disadvantaged youth who 
are ages 16 through 21 in the State, 
compared to the total number of dis-
advantaged youth who are ages 16 
through 21 in all States. 
‘‘(iii) MINIMUM
AND
MAXIMUM
PER-
CENTAGES.—The Secretary shall ensure that 
no State shall receive an allotment for a fis-
cal year that is less than 90 percent or 
greater than 130 percent of the allotment 
percentage of that State for the preceding 
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 paragraph 
that is less than 3⁄10 of 1 percent of the 
amount available under subparagraph (A). 
‘‘(2) DEFINITIONS.—For the purposes of para-
graph (1), the following definitions apply: 
‘‘(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 through an allot-
ment made under this subsection for the fiscal 
year. The term, with respect to fiscal year 2003, 
means the percentage of the amounts allotted to 
States under this chapter (as in effect on the day 
before the date of enactment of the Workforce Re-
investment and Adult Education Act of 2003) 
that is received by the State involved for fiscal 
year 2003. 
‘‘(B) DISADVANTAGED
YOUTH.—The term 
‘disadvantaged youth’ 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 poverty line.
‘‘(C) NUMBER
OF
HIGH
SCHOOL
DROP-
OUTS.—The term ‘number of high school drop-
outs’ means the number of high school dropouts 
as is determined by the Secretary based on the 
Current Population Survey. 
‘‘(D) NUMBER OF JOBLESS OUT-OF-SCHOOL 
YOUTH.—The term ‘number of jobless out-of-
school youth’ means the number of jobless out-of-
school youth as is determined by the Secretary 
based on the Current Population Survey. 
‘‘(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. 
‘‘(4) MINIMUM
ALLOTMENT.—Notwithstanding 
any other provision of this section, no State shall re-
ceive an allotment under this section that is less than 
the amount received by such State for fiscal year 
2003.’’. 
(2) REALLOTMENT.—Section 127 (29 U.S.C. 
2552) is further amended—
(A) by striking subsection (b);
(B) by redesignating subsection (c) as sub-
section (b); 
(C) in subsection (b) (as so redesignated) 
(i) by amending paragraph (2) to read 
as follows: 
‘‘(2) AMOUNT.—The amount available for real-
lotment for a program year is equal to the amount 
by which the unexpended balance, excluding accrued 
expenditures, at the end of such program year of the 
total amount of funds available to the State under 
this section during such program year (including 
amounts allotted to the State in prior program years 
that remain available during the program year for 
which the determination is made) exceeds 30 percent 
of such total amount.’’; 
(ii) in paragraph (3)—
(I) by striking ‘‘for the prior pro-
gram year’’ and inserting ‘‘for the pro-
gram year in which the determination 
is made’’; and 
(II) by striking ‘‘such prior pro-
gram year’’ and inserting ‘‘such pro-
gram year’’; 
(iii) by amending paragraph (4) to 
read as follows:
‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible State means a State which does 
not have an amount available for reallotment under 
paragraph (2) for the program year for which the de-
termination under paragraph (2) is made.’’. 
(b) WITHIN STATE ALLOCATIONS.—
(1) RESERVATION FOR STATEWIDE ACTIVITIES.—
Section 128(a) is amended to read as follows: 
‘‘(a) RESERVATION FOR STATEWIDE ACTIVITIES.—
‘‘(1) IN
GENERAL.—The Governor of a State 
shall reserve not more than 10 percent of the amount 
allotted to the State under section 127(a)(1)(C) for a 
fiscal year for statewide activities. 
‘‘(2) USE OF FUNDS.—Regardless of whether the 
amounts are allotted under section 127(a)(1)(C) and 
reserved under paragraph (1) or allotted under sec-
tion 132 and reserved under section 133(a), the Gov-
ernor may use the reserved amounts to carry out 
statewide youth activities under section 129(b) or 
statewide employment and training activities under 
section 133.’’. 
(2) WITHIN STATE ALLOCATION.—Section 128(b) 
is amended to read as follows: 
‘‘(b) WITHIN STATE ALLOCATION.—
‘‘(1) IN GENERAL.—Of the amounts allotted to 
the State under section 127(a)(1)(C) and not reserved 
under subsection (a)(1)—
‘‘(A) 80 percent of such amounts shall be al-
located by the Governor to local areas in accord-
ance with paragraph (2); and 
‘‘(B) 20 percent of such amounts shall be al-
located by the Governor to local areas in accord-
ance with paragraph (3). 
‘‘(2) ESTABLISHED FORMULA.—
‘‘(A) IN
GENERAL.—Of the amounts de-
scribed in paragraph (1)(A), the Governor shall 
allocate—
‘‘(i) 33 and 1⁄3 percent on the basis of 
the relative number of high school dropouts 
who are ages 16 through 21 in each local 
area, compared to the total number of high 
school dropouts who are ages 16 through 21 
in all local areas in the State; 
‘‘(ii) 33 and 1⁄3 percent on the basis of 
the relative number of jobless out-of-school 
youth who are ages 16 through 21 in each 
local area, compared to the total number of 
jobless out-of-school youth who are ages 16
through 21 in all local areas in the State; 
and 
‘‘(iii) 33 and 1⁄3 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 dis-
advantaged youth who are ages 16 through 
21 in all local areas in the State. 
‘‘(B) MINIMUM
AND
MAXIMUM
PERCENT-
AGES.—The Governor shall ensure that no local 
area shall receive an allocation for a fiscal year 
under this paragraph that is less than 90 percent 
or greater than 130 percent of the allocation per-
centage of the local area for the preceding fiscal 
year. 
‘‘(C) DEFINITIONS.—
‘‘(i) ALLOCATION
PERCENTAGE.—For 
purposes of this paragraph, the term ‘allo-
cation percentage’, used with respect to fis-
cal year 2004 or a subsequent fiscal year, 
means a percentage of amount described in 
paragraph(1)(A) that is received through an 
allocation made under this paragraph for 
the fiscal year. The term, with respect to fis-
cal 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 Invest-
ment Act Amendments of 2003) that is re-
ceived by the local area involved for fiscal 
year 2003. 
‘‘(ii) OTHER TERMS.—For purposes of 
this paragraph, all other terms shall have 
the meaning given such terms in section 
127(a)(2). 
‘‘(3) YOUTH DISCRETIONARY ALLOCATION.—The 
Governor shall allocate to local areas the amounts de-
scribed in paragraph (1)(B) in accordance with such 
demographic and economic factors as the Governor, 
after consultation with the State board and local 
boards, determines are appropriate. 
‘‘(4) LOCAL ADMINISTRATIVE COST LIMIT.—
‘‘(A) IN GENERAL.—Of the amounts 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 
boards for the administrative costs of 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.—Section 128(c) (29 U.S.C. 
2853(c)) is amended—
(A) in paragraph (1), by striking ‘‘para-
graph (2)(A) or (3) of’’; 
(B) by amending paragraph (2) to read as 
follows: 
‘‘(2) AMOUNT.—The amount available for re-
allocation for a program year is equal to the amount 
by which the unexpended balance, excluding accrued 
expenditures, at the end of such program year of the 
total amount of funds available to the local area 
under this section during such program year (includ-
ing amounts allotted to the local area in prior pro-
gram years that remain available during the program 
year for which the determination is made) exceeds 30 
percent of such total amount.’’; 
(C) by amending paragraph (3)—
(i) by striking ‘‘subsection (b)(3)’’ each 
place it appears and inserting ‘‘subsection 
(b)’’; 
(ii) by striking ‘‘the prior program 
year’’ and inserting ‘‘the program year in 
which the determination is made’’; 
(iii) by striking ‘‘such prior program 
year’’ and inserting ‘‘such program year’’; 
and 
(iv) by striking the last sentence; and 
(D) by amending paragraph (4) to read as 
follows: 
‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible local area means a local area 
which does not have an amount available for realloca-
tion under paragraph (2) for the program year for 
which the determination under paragraph (2) is 
made.’’. 
(c) 
YOUTH
PARTICIPANT
ELIGIBILITY.—Section 
129(a) (29 U.S.C. 2854(a)) is amended to read as follows: 
‘‘(a) YOUTH PARTICIPANT ELIGIBILITY.—
‘‘(1) IN
GENERAL.—The individuals partici-
pating in activities carried out under this chapter by 
a local area during any program year shall be indi-
viduals who, at the time the eligibility determination 
is made, are—
‘‘(A) not younger than age 16 or older than 
age 21; and 
‘‘(B) one or more of the following: 
‘‘(i) school dropouts; 
‘‘(ii) recipients of a secondary school 
diploma or the General Equivalency Di-
ploma (GED) (including recognized alter-
native standards for individuals with dis-
abilities); 
‘‘(iii) court-involved youth attending 
an alternative school; 
‘‘(iv) youth in foster care or who have 
been in foster care; or 
‘‘(v) in school youth who are low-in-
come individuals and one or more of the fol-
lowing: 
‘‘(I) Deficient in literacy skills. 
‘‘(II) Homeless, runaway, or fos-
ter children. 
‘‘(III) Pregnant or parents. 
‘‘(IV) Offenders. 
‘‘(V) Individuals who require ad-
ditional assistance to complete an edu-
cational program, or to secure and 
hold employment. 
‘‘(2) PRIORITY FOR SCHOOL DROPOUTS.—A pri-
ority in the provision of services under this chapter 
shall be given to individuals who are school dropouts. 
‘‘(3) LIMITATIONS ON ACTIVITIES FOR IN-SCHOOL 
YOUTH.—
‘‘(A) PERCENTAGE
OF
FUNDS.—For any 
program year, not more than 30 percent of the 
funds available for statewide activities under 
subsection (b), and not more than 30 percent of 
funds available to local areas under subsection 
(c), may be used to provide activities for in-
school youth meeting the requirements of para-
graph (1)(B)(v). 
‘‘(B) NON-SCHOOL HOURS REQUIRED.—Ac-
tivities carried out under this chapter for in-
school youth meeting the requirements of para-
graph (1)(B)(v) shall only be carried out in non-
school hours or periods when school is not in ses-
sion (such as before and after school or during 
summer recess.’’. 
(d) STATEWIDE YOUTH 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) may be used for statewide activities includ-
ing—
‘‘(A) additional assistance to local areas 
that have high concentrations of eligible youth; 
‘‘(B) supporting the provision of core serv-
ices described in section 134(c)(2) in the one-stop 
delivery system; 
‘‘(C) conducting 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, 
research, and demonstration projects; 
‘‘(D) 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; 
‘‘(E) 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; 
‘‘(F) operating a fiscal and management 
accountability system under section 136(f); and 
‘‘(G) carrying out monitoring and oversight 
of activities under this chapter and chapter 5. 
‘‘(2) LIMITATION.—Not more than 5 percent of 
the funds allotted under section 127(b) shall be used 
by the State for administrative activities carried out 
under this subsection and section 133(a). 
‘‘(3) PROHIBITION.—No funds described in this 
subsection or in section 134(a) may be used to develop 
or implement education curricula for school systems 
in the State.’’. 
(e) LOCAL ELEMENTS AND REQUIREMENTS.——
(1) PROGRAM
DESIGN.—Section 129(c)(1) (29 
U.S.C. 2854(c) (1)) is amended—
(A) in the matter preceding subparagraph 
(A), by striking ‘‘paragraph (2)(A) or (3), as ap-
propriate, of’’; 
(B) in subparagraph (B), by inserting ‘‘are 
directly linked to one or more of the performance 
outcomes 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 
so redesignated) the following: 
‘‘(i) activities leading to the attain-
ment of a secondary school diploma or the 
General Equivalency Diploma (GED) (in-
cluding recognized alternative standards for 
individuals with disabilities);’’; 
(iii) in clause (ii) (as redesignated by 
this subparagraph), by inserting ‘‘and ad-
vanced training’’ after ‘‘opportunities’’; 
(iv) in clause (iii) (as redesignated by 
this subparagraph), by inserting ‘‘that lead 
to the attainment of recognized credentials’’ 
after ‘‘learning’’; and 
(v) by amending clause (v) (as redesig-
nated by this subparagraph) to read as fol-
lows: 
‘‘(v) effective connections to employers 
in sectors of the local labor market experi-
encing high growth in employment opportu-
nities.’’. 
(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 ‘‘secondary school di-
ploma or the General Equivalency Diploma 
(GED) (including recognized alternative stand-
ards for individuals with disabilities), including 
dropout prevention strategies’’; 
(B) in subparagraph (I), by striking ‘‘and’’ 
at the end; 
(C) in subparagraph (J), by striking the pe-
riod at the end and inserting a semicolon; and 
(D) by adding at the end the following: 
‘‘(K) on-the-job training opportunities; and 
‘‘(L) financial literacy skills.’’. 
(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-
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 further amended—
(A) by striking paragraphs (4) and (5); 
(B) by redesignating paragraph (6) as 
paragraph (4); 
(C) by redesignating paragraph (7) as 
paragraph (5), and in such redesignated para-
graph (5) by striking ‘‘youth councils’’ and in-
serting ‘‘local boards’’; and 
(D) by redesignating paragraph (8) as 
paragraph (6). 
SEC. 112. COMPREHENSIVE PROGRAM FOR ADULTS. 
(a) TITLE OF CHAPTER 5.—
(1) The title heading of chapter 5 is amended to 
read as follows: 
‘‘CHAPTER 5—COMPREHENSIVE EMPLOY-
MENT AND TRAINING ACTIVITIES FOR 
ADULTS’’. 
(2) CONFORMING
AMENDMENT.—Table of con-
tents in section 1(b) is amended by amending the 
item related to the heading for chapter 5 to read as 
follows:
‘‘CHAPTER 5—COMPREHENSIVE EMPLOYMENT AND TRAINING ACTIVITIES FOR 
ADULTS’’.
(b) GENERAL
AUTHORIZATION.—Section 131 (29 
U.S.C. 2861) is amended—
(1) by striking ‘‘paragraphs (1)(B) and (2)(B)
of’’; and 
(2) by striking ‘‘, and dislocated workers,’’. 
(c) STATE ALLOTMENTS.—
(1) IN
GENERAL.—Section 132(a) (29 U.S.C. 
2862(a)) is amended to read as follows: 
‘‘(a) IN GENERAL.—The Secretary shall—
‘‘(1) reserve 10 percent of the amount appro-
priated under section 137(b) for a fiscal year, of 
which—
‘‘(A) not less than 75 percent shall be used 
for national dislocated worker grants under sec-
tion 173; 
‘‘(B) not more than 20 percent may be used 
for demonstration projects under section 171; 
and 
‘‘(C) not more than 5 percent may be used 
to provide technical assistance under section 170; 
and 
‘‘(2) make allotments from 90 percent of the 
amount appropriated under section 137(b) for a fiscal 
year in accordance with subsection (b).’’. 
(2) ALLOTMENT AMONG STATES.—Section 132(b) 
(29 U.S.C. 2862(b)) is amended to read as follows:
‘‘(b) ALLOTMENT AMONG STATES FOR ADULT EM-
PLOYMENT AND TRAINING ACTIVITIES.—
‘‘(1) RESERVATION
FOR
OUTLYING
AREAS.—
From the amount made available under subsection 
(a)(2) for a fiscal year, the Secretary shall reserve not 
more than 1⁄4 of 1 percent to provide assistance to 
outlying areas to carry out employment and training 
activities for adults and statewide workforce invest-
ment activities. 
‘‘(2) STATES.—
‘‘(A) IN GENERAL.—After determining the 
amount to be reserved under paragraph (1), the 
Secretary shall allot the remainder of the 
amount referred to under subsection (a)(2) for a 
fiscal year to the States pursuant to subpara-
graph (B) for employment and training activi-
ties for adults and statewide workforce invest-
ment activities. 
‘‘(B) FORMULA.—Subject to subparagraphs 
(C) and (D), of the remainder— 
‘‘(i) 60 percent shall be allotted on the 
basis of the relative number of unemployed 
individuals in each State, compared to the 
total number of unemployed individuals in 
all States;
‘‘(ii) 15 percent shall be allotted on the 
basis of the relative excess number of unem-
ployed individuals in each State, compared 
to the total excess number of unemployed 
individuals in all States; 
‘‘(iii) 15 percent shall be allotted on 
the basis of the relative number of individ-
uals in the civilian labor force in each 
State, compared to the total number of indi-
viduals in the civilian labor force in all 
States; and 
‘‘(iv) 10 percent shall be allotted on the 
basis of the relative number of disadvan-
taged adults in each State, compared to the 
total number of disadvantaged adults in all 
States. 
‘‘(C) MINIMUM
AND
MAXIMUM
PERCENT-
AGES.—The Secretary shall ensure that no State 
shall receive an allotment for a fiscal year that 
is less than 90 percent or greater than 130 per-
cent of the allotment percentage of the State for 
the preceding fiscal year. 
‘‘(D) 
MINIMUM
ALLOTMENT.—Notwith-
standing any other provision of this section, no 
State shall receive an allotment under this sec-
tion that is less than the amount received by 
such State for fiscal year 2003. 
‘‘(E) 
SMALL
STATE
MINIMUM
ALLOT-
MENT.—Subject to subparagraph (C), the Sec-
retary shall ensure that no State shall receive an 
allotment under this paragraph that is less than 
3⁄10 of 1 percent of the amount available under 
subparagraph (A). 
‘‘(F) DEFINITIONS.—For the purposes of 
this paragraph, the following definitions apply: 
‘‘(i) ALLOTMENT
PERCENTAGE.—The 
term ‘allotment percentage’, used with re-
spect to fiscal year 2004 or a subsequent fis-
cal year, means a percentage of the remain-
der described in subparagraph (A) that is 
received through an allotment made under 
this paragraph for the fiscal year. The term, 
with respect to fiscal year 2003, means the 
percentage of the amounts allotted to States 
under this chapter (as in effect on the day 
before the date of enactment of the Work-
force Reinvestment and Adult Education 
Act of 2003) and under section 6 of the 
Wagner-Peyser Act that is received by the 
State involved for fiscal year 2003.
‘‘(ii) 
DISADVANTAGED
ADULT.—The 
term ‘disadvantaged adult’ means an indi-
vidual who is age 22 through 72 who re-
ceived an income, or is a member of a fam-
ily that received a total family income, 
that, in relation to family size, does not ex-
ceed the poverty line. 
‘‘(iii) EXCESS NUMBER.—The term ‘ex-
cess number’ means, used with respect to the 
excess number of unemployed individuals 
within a State, the number that represents 
the number of unemployed individuals in 
excess of 4.5 percent of the civilian labor 
force in the State.’’. 
(3) REALLOTMENT.—Section 132(c) (29 U.S.C. 
2862(c)) is amended—
(A) by amending paragraph (2) to read as 
follows: 
‘‘(2) AMOUNT.—The amount available for real-
lotment for a program year is equal to the amount 
by which the unexpended balance, excluding accrued 
expenditures, at the end of such program year of the 
total amount of funds available to the State under 
this section during such program year (including 
amounts allotted to the State in prior program years
that remain available during the program year for 
which the determination is made) exceeds 30 percent 
of such total amount.’’; 
(B) in paragraph (3)—
(i) by striking ‘‘for the prior program 
year’’ and inserting ‘‘for the program year 
in which the determination is made’’; and 
(ii) by striking ‘‘such prior program 
year’’ and inserting ‘‘such program year’’; 
and 
(C) by amending paragraph (4) to read as 
follows: 
‘‘(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.’’. 
(d) WITHIN STATE ALLOCATIONS.—
(1) RESERVATION FOR STATE ACTIVITIES.—Sec-
tion 133(a) (29 U.S.C. 2863(a)) is amended to read 
as follows: 
‘‘(a) RESERVATION FOR STATEWIDE ACTIVITIES.—The 
Governor of a State may reserve up to 50 percent of the 
total amount allotted to the State under section 132 for a
fiscal year to carry out the statewide activities described 
in section 134(a).’’. 
(2) ALLOCATIONS
TO
LOCAL
AREAS.—Section 
133(b) (29 U.S.C. 2863(b)) is amended to read as fol-
lows: 
‘‘(b) ALLOCATIONS TO LOCAL AREAS.—
‘‘(1) IN GENERAL.—Of the amounts allotted to 
the State under section 132(b)(2) and not reserved 
under subsection (a)— 
‘‘(A) 80 percent of such amounts shall be al-
located by the Governor to local areas in accord-
ance with paragraph (2); and 
‘‘(B) 20 percent of such amounts shall be al-
located by the Governor to local areas in accord-
ance with paragraph (3). 
‘‘(2) ESTABLISHED FORMULA.—
‘‘(A) IN
GENERAL.—Of the amounts de-
scribed in paragraph (1)(A), the Governor shall 
allocate—
‘‘(i) 60 percent on the basis of the rel-
ative number of unemployed individuals in 
each local area, compared to the total num-
ber of unemployed individuals in all local 
areas in the State;
‘‘(ii) 15 percent on the basis of the rel-
ative excess number of unemployed individ-
uals in each local area, compared to the 
total excess number of unemployed individ-
uals in all local areas in the State; 
‘‘(iii) 15 percent on the basis of the rel-
ative number of individuals in the civilian 
labor force in each local area, compared to 
the total number of individuals in the civil-
ian labor force in all local areas in the 
State; and 
‘‘(iv) 10 percent shall be allotted on the 
basis of the relative number of disadvan-
taged adults in each local area, compared to 
the total number of disadvantaged adults in 
all local areas in the State. 
‘‘(B) MINIMUM
AND
MAXIMUM
PERCENT-
AGES.—The Governor shall ensure that no local 
area shall receive an allocation for a fiscal year 
under this paragraph that is less than 90 percent 
or greater than 130 percent of the allocation per-
centage of the local area for the preceding fiscal 
year. 
‘‘(C) DEFINITIONS.—
‘‘(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 amount de-
scribed in paragraph (1)(A) that is received 
through an allocation made under this 
paragraph for the fiscal year. The term, 
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 Reinvestment and Adult Edu-
cation Act of 2003) that is received by the 
local area involved for fiscal year 2003. 
‘‘(ii) 
DISADVANTAGED
ADULT.—The 
term ‘disadvantaged adult’ means an indi-
vidual who is age 22 through 72 who re-
ceived an income, or is a member of a fam-
ily that received a total family income, 
that, in relation to family size, does not ex-
ceed the poverty line. 
‘‘(iii) EXCESS NUMBER.—The term ‘ex-
cess number’ means, used with respect to the 
excess number of unemployed individuals 
within a local area, the number that rep-
resents the number of unemployed individ-
uals in excess of 4.5 percent of the civilian 
labor force in the local area. 
‘‘(3) DISCRETIONARY
ALLOCATION.—The Gov-
ernor shall allocate to local areas the amounts de-
scribed in paragraph (1)(B) based on a formula de-
veloped in consultation with the State board and local 
boards. Such formula shall be objective and geo-
graphically equitable and may include such demo-
graphic and economic factors as the Governor, after 
consultation with the State board and local boards, 
determines are appropriate. 
‘‘(4) LOCAL ADMINISTRATIVE COST LIMIT.—
‘‘(A) IN GENERAL.—Of the amounts allo-
cated to a local area under this subsection and 
section 128(b) for a fiscal year, not more than 10 
percent of the amount may be used by the local 
boards for the administrative costs of carrying 
out local workforce investment activities under 
this chapter or chapter 4. 
‘‘(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 4, regardless
of whether the funds were allocated under this 
subsection or section 128(b).’’. 
(3) REALLOCATION AMONG LOCAL AREAS.—Sec-
tion 133(c) (29 U.S.C. 2863(c)) is amended—
(A) in paragraph (1), by striking ‘‘para-
graph (2)(A) or (3) of’’; 
(B) by amending paragraph (2) to read as 
follows: 
‘‘(2) AMOUNT.—The amount available for re-
allocation for a program year is equal to the amount 
by which the unexpended balance, excluding accrued 
expenditures, at the end of such program year of the 
total amount of funds available to the local area 
under this section during such program year (includ-
ing amounts allotted to the local area in prior pro-
gram years that remain available during the program 
year for which the determination is made) exceeds 30 
percent of such total amount.’’; 
(C) by amending paragraph (3)—
(i) by striking ‘‘subsection (b)(3)’’ each 
place it appears and inserting ‘‘subsection 
(b)’’; 
(ii) by striking ‘‘the prior program 
year’’ and inserting ‘‘the program year in 
which the determination is made’’;
(iii) by striking ‘‘such prior program 
year’’ and inserting ‘‘such program year’’; 
and 
(iv) by striking the last sentence; and 
(D) by amending paragraph (4) to read as 
follows: 
‘‘(4) ELIGIBILITY.—For purposes of this sub-
section, an eligible local area means a local area 
which does not have an amount available for realloca-
tion under paragraph (2) for the program year for 
which the determination under paragraph (2) is 
made.’’. 
(e) USE OF FUNDS FOR EMPLOYMENT AND TRAINING 
ACTIVITIES.—
(1) STATEWIDE EMPLOYMENT AND TRAINING AC-
TIVITIES.—
(A) IN
GENERAL.—Section 134(a)(1) (29 
U.S.C. 2864(a)(1) is amended to read as follows: 
‘‘(1) IN GENERAL.—
‘‘(A) REQUIRED USE OF FUNDS.—Not less 
than 50 percent of the funds reserved by a Gov-
ernor under section 133(a) shall be used to sup-
port the provision of core services in local areas, 
consistent with the local plan, through one-stop 
delivery systems by distributing funds to local
areas in accordance with subparagraph (B). 
Such funds may be used by States to employ 
State personnel to provide such services in des-
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 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.); and 
‘‘(J) implementing programs to increase the 
number of individuals training for and placed 
in nontraditional employment.’’.
(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)’’; 
(B) in paragraphs (1) and (2), by striking 
‘‘or dislocated workers, respectively’’ both places 
it appears; and 
(C) by redesignating subsections (d) and (e) 
as subsections (c) and (d), respectively. 
(3) 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 (2)) 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 (2)) 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; and 
‘‘(ii) appropriate recruitment services 
for employers;’’; 
(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 (2) 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, 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 (2) 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) 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) 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 is limited, the pri-
ority 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.’’; 
(iv) 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.’’; and 
(v) 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.’’. 
(4) PERMISSIBLE
ACTIVITIES.—Section 134(d) 
(as redesignated by paragraph (2)) 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; and 
‘‘(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. 
‘‘(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) by amending subparagraph (A)(i)(IV) 
to read as follows: 
‘‘(IV) the efficiency of the pro-
gram in obtaining the outcomes de-
scribed 
in 
subclauses 
(I) 
through 
(III).’’;
(C) 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 diplomas or the General Equiva-
lency Diploma (GED) (including rec-
ognized alternative standards for indi-
viduals with disabilities); 
‘‘(III) attainment of literacy or 
numeracy skills; and 
‘‘(IV) the efficiency of the pro-
gram in obtaining the outcomes de-
scribed 
in 
subclauses 
(I) 
through 
(III).’’; 
(D) by striking subparagraph (B); 
(E) 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 indica-
tors of poor work history, lack of work 
experience, low levels of literacy or 
English proficiency, disability status, 
and welfare dependency’’ after ‘‘pro-
gram’’; 
(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, and 
welfare 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)(E), by striking ‘‘(excluding 
participants who received only self-service and infor-
mational activities)’’; 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 this 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 
performance of the State in serving special popu-
lations, including the levels of service provided 
and the performance outcomes, and such other 
factors relating to the performance of the State 
under this title as the Secretary determines is 
appropriate. 
‘‘(B) USE OF FUNDS.—The funds awarded 
to a State under this paragraph may be used to 
carry out any activities authorized under chap-
ters 4 and 5 of this title, including demonstra-
tions and innovative programs for special popu-
lations. 
‘‘(2) INCENTIVE GRANTS FOR LOCAL AREAS.—
‘‘(A) IN
GENERAL.—From funds reserved 
under sections 128(a) and 133(a), the Governor 
may award incentive grants to local areas for 
exemplary performance with respect to the meas-
ures established under this section and with the 
performance of the local area in serving special 
populations, including the levels of service and 
the performance outcomes. 
‘‘(B) USE OF FUNDS.—The funds awarded 
to a local area may be used to carry out activi-
ties authorized for local areas under chapters 4 
and 5 of this title, and such demonstration or 
other innovative programs to serve special popu-
lations as may be approved by the Governor.’’. 
(g) REPEAL OF DEFINITIONS.—Sections 502 and 503 
(and the items related to such sections in the table of con-
tents) are repealed. 
SEC. 114. 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 ‘‘$1,001,000,000 for fiscal year 2004 and such sums 
as may be necessary for each of fiscal years 2005 through 
2009’’.
out by each Job Corps center under this section’’; 
and 
(3) in subsection (c), by striking ‘‘The Liaison 
for’’ and inserting ‘‘The director of’’. 
(b) 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 after paragraph (2) the following: 
‘‘(3) EMPLOYERS OUTSIDE OF LOCAL AREAS.—
The industry council may include, or otherwise pro-
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.’’. 
(c) INDICATORS OF PERFORMANCE AND ADDITIONAL 
INFORMATION.—Section 159(c) (29 U.S.C. 2893(c)) is 
amended—
(1) by amending paragraph (1) to read as fol-
lows: 
‘‘(1) CORE
INDICATORS.—The Secretary shall 
annually establish expected levels of performance for 
Job Corps centers and the Job Corps program relat-
ing to each of the core indicators for youth identified 
in section 136(b)(2)(A)(ii).’’; and
(2) in paragraph (2), by striking ‘‘measures’’ 
each place it appears and inserting ‘‘indicators’’. 
SEC. 116. NATIVE AMERICAN PROGRAMS. 
(a) AUTHORIZED ACTIVITIES.—Section 166(d)(2) (29 
U.S.C. 2911(d)(2)) is amended to read as follows: 
‘‘(2) WORKFORCE INVESTMENT ACTIVITIES AND 
SUPPLEMENTAL
SERVICES.—Funds made available 
under subsection (c) shall be used for—
‘‘(A) comprehensive workforce investment 
activities for Indians or Native Hawaiians; or 
‘‘(B) supplemental services for Indian or 
Native Hawaiian youth on or near Indian res-
ervations and in Oklahoma, Alaska, or Ha-
waii.’’. 
(b) 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.’’. 
(c) ASSISTANCE TO AMERICAN SAMOANS IN HAWAII.—
Section 166 (29 U.S.C. 2911) is further amended by strik-
ing subsection (j). 
SEC. 117. YOUTH CHALLENGE GRANTS. 
Section 169 (29 U.S.C. 2914) is amended to read as 
follows:
‘‘SEC. 169. YOUTH CHALLENGE GRANTS. 
‘‘(a) IN GENERAL.—Of the amounts reserved by the 
Secretary under section 127(a)(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 section to assist eligible 
youth in acquiring the skills, credentials and employ-
ment experience necessary to succeed in the labor 
market. 
‘‘(2) ELIGIBLE
ENTITIES.—Grants under this 
subsection may be awarded to States, local boards, re-
cipients of grants under section 166 (relating to Na-
tive American programs), and public or private enti-
ties (including consortia of such entities) applying in 
conjunction with local boards. 
‘‘(3) GRANT PERIOD.—The Secretary may make 
a grant under this section for a period of 1 year and
may renew the grants for each of the 4 succeeding 
years. 
‘‘(4) AUTHORITY TO REQUIRE MATCH.—The Sec-
retary may require that grantees under this sub-
section provide a non-Federal share of the cost of ac-
tivities carried out under a grant awarded under this 
subsection. 
‘‘(5) PARTICIPANT ELIGIBILITY.—Youth ages 14 
through 19 as of the time the eligibility determination 
is made may be eligible to participate in activities 
provided under this subsection. 
‘‘(6) USE OF FUNDS.—Funds under this sub-
section may be used for activities that are designed to 
assist youth in acquiring the skills, credentials and 
employment experience that are necessary to succeed 
in the labor market, including the activities identified 
in section 129. The activities may include activities 
such as—
‘‘(A) training and internships for out-of-
school youth in sectors of economy experiencing 
or projected to experience high growth; 
‘‘(B) after-school dropout prevention activi-
ties for in-school youth;
‘‘(C) activities designed to assist special 
youth populations, such as court-involved youth 
and youth with disabilities; and 
‘‘(D) activities combining remediation of 
academic skills, work readiness training, and 
work experience, and including linkages to post-
secondary education, apprenticeships, and ca-
reer-ladder employment. 
‘‘(7) 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; 
‘‘(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 private and pub-
lic, and local and State resources that will be le-
veraged to provide the activities described under
subparagraph (A) in addition the funds provided 
under this subsection; and 
‘‘(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). 
‘‘(8) FACTORS FOR AWARD.—In awarding grants 
under this subsection the Secretary may consider the 
quality of the proposed project, the goals to be 
achieved, the likelihood of successful implementation, 
the extent to which the project is based on proven 
strategies or the extent to which the project will ex-
pand the knowledge base on activities for youth, and 
the additional State, local or private resources that 
will be provided. 
‘‘(9) EVALUATION.—The Secretary may reserve 
up to 5 percent of the funds described in sub-
section(a)(1) to provide technical assistance to, and 
conduct evaluations of the projects funded under this 
subsection (using appropriate techniques as described 
in section 172(c)). 
‘‘(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
ENTITIES.—Grants under this 
subsection may be awarded to public or private enti-
ties that the Secretary determines would effectively 
carry out activities relating to youth under this sub-
section. 
‘‘(3) PARTICIPANT ELIGIBILITY.—Youth ages 14 
through 19 at the time the eligibility determination is 
made may be eligible to participate in activities 
under this subsection. 
‘‘(4) USE
OF
FUNDS.—Funds provided under 
this subsection may be used for activities that will as-
sist youth in preparing for, and entering and retain-
ing, employment, including the activities described in 
section 129 for out-of-school youth, activities designed 
to assist in-school youth to stay in school and gain 
work experience, and such other activities that the 
Secretary determines are appropriate. 
‘‘(5) 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.
‘‘(6) ADDITIONAL
REQUIREMENTS.—The Sec-
retary may require the provision of a non-Federal 
share for projects funded under this subsection and 
may require participation of grantees in evaluations 
of such projects, including evaluations using the tech-
niques as described in section 172(c).’’. 
SEC. 118. TECHNICAL ASSISTANCE. 
Section 170 (29 U.S.C. 2915) is amended—
(1) by striking subsection (b); 
(2) by striking ‘‘(a) GENERAL TECHNICAL AS-
SISTANCE.—’’; 
(3) by redesignating paragraphs (1), (2), and (3) 
as subsections (a), (b), and (c) respectively, and mov-
ing such subsections 2 ems to the left; and 
(4) in subsection (a) (as redesignated by para-
graph (3))—
(A) by inserting ‘‘the training of staff pro-
viding rapid response services, the training of 
other staff of recipients of funds under this title, 
peer review activities under this title,’’ after ‘‘lo-
calities,’’; and 
(B) by striking ‘‘from carrying out activi-
ties’’ and all that follows up to the period and 
inserting ‘‘to implement the amendments made
by the Workforce Reinvestment and Adult Edu-
cation Act of 2003’’. 
SEC. 119. 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 
amending 
subparagraphs 
(A) 
through (D) to read as follows: 
‘‘(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 and to provide information to such sys-
tem on skills and occupations in demand; 
‘‘(B) projects that promote the development 
of systems that will improve the effectiveness and 
efficiency 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-
rience high rates of growth;
‘‘(D) projects carried out by States and 
local areas to test innovative approaches to deliv-
ering employment-related services;’’; 
(C) by striking subparagraph (E); 
(D) by redesignating subparagraphs (F) 
and (G) as subparagraphs (E) and (F), respec-
tively; 
(E) by inserting after subparagraph (F) (as 
so redesignated) the following: 
‘‘(G) projects that provide retention grants 
to qualified job training programs upon place-
ment or retention of a low-income individual 
trained by that program in employment with a 
single employer for a period of 1 year, provided 
that such employment is providing to the low-in-
come individual an income not less than twice 
the poverty line for that individual.’’; and 
(F) by striking subparagraph (H); 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) NET
IMPACT
STUDIES
AND
RE-
PORTS.—The Secretary shall conduct studies to 
determine the net impacts of programs, services, 
and activities carried out under this title. The 
Secretary shall prepare and disseminate to the 
public reports containing the results of such 
studies.’’. 
(c) WAIVER AUTHORITY TO CARRY OUT DEMONSTRA-
TIONS
AND
EVALUATIONS.—Section 171 (29 U.S.C. 
2916(d)) is further amended by striking subsection (d). 
SEC. 120. EVALUATIONS. 
(a) IN GENERAL.—Section 173 (29 U.S.C. 2916) is 
amended—
(1) by amending the designation and heading to 
read as follows:
‘‘SEC. 173. NATIONAL DISLOCATED WORKER GRANTS.’’; 
and 
(2) in subsection (a)—
(A) 
by 
striking 
‘‘national 
emergency 
grants’’ in the matter preceding paragraph (1) 
and 
inserting 
‘‘national 
dislocated 
worker 
grants’’; and 
(B) in paragraph (1), by striking ‘‘sub-
section (c)’’ and inserting ‘‘subsection (b)’’.
(b) ADMINISTRATION.—Section 173 (29 U.S.C. 2918) 
is further amended—
(1) by striking subsection (b) and redesignating 
subsections (c) and (d) as subsections (b) and (c), re-
spectively; and 
(2) by striking subsection (e) and redesignating 
subsections (f) and (g) as subsection (d) and (e), re-
spectively. 
(c) ELIGIBLE ENTITIES.—Section 173(b)(1)(B) (29 
U.S.C.2918(b)(1)(B)) (as redesignated by subsection (b) of 
this section) is amended by striking ‘‘, and other entities’’ 
and all that follows and inserting a period. 
(d) CONFORMING AMENDMENT.—The table of contents 
in section 1(b) is amended by amending the item related 
to section 173 to read as follows:
‘‘Sec. 173. National dislocated worker grants.’’.
SEC. 121. AUTHORIZATION OF APPROPRIATIONS FOR NA-
TIONAL ACTIVITIES. 
(a) IN
GENERAL.—Section 174(a)(1) (29 U.S.C. 
2919(a)(1)) is amended by striking ‘‘1999 through 2003’’ 
and inserting ‘‘2004 through 2009’’. 
(b) RESERVATIONS.—Section 174(b) is amended to 
read as follows: 
‘‘(b) TECHNICAL ASSISTANCE; DEMONSTRATION AND 
PILOT PROJECTS; EVALUATIONS; INCENTIVE GRANTS.—
There are authorized to be appropriated to carry out sec-
tions 170 through 172 and section 136 such sums as may 
be necessary for each of fiscal years 2004 through 2009.’’. 
SEC. 122. REQUIREMENTS AND RESTRICTIONS. 
(a) IN GENERAL.—Section 181(c)(2)(A) (29 U.S.C. 
2931(c)(2)(A)) is amended in the matter preceding clause 
(i) by striking ‘‘shall’’ and inserting ‘‘may’’. 
(b) LIMITATIONS.—Section 181(e) is amended by strik-
ing the first sentence. 
SEC. 123. NONDISCRIMINATION. 
Section 188(a)(2) (29 U.S.C. 2931(a)(2)) is amend-
ed—
(1) by striking ‘‘EMPLOYMENT.—No’’ and insert-
ing ‘‘EMPLOYMENT.—
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), no’’; and 
(2) by adding at the end the following subpara-
graph: 
‘‘(B) EXEMPTION FOR RELIGIOUS ORGANI-
ZATIONS.—Subparagraph (A) shall not apply to 
recipients of financial assistance under this title 
that is a religious corporation, association, edu-
cational institution, or society, with respect to 
the employment of individuals of a particular 
religion to perform work connected with the car-
rying on by such corporation, association, edu-
cational institution, or society of its activities 
Such recipients shall comply with the other re-
quirements contained in subparagraph (A).’’. 
SEC. 124. ADMINISTRATIVE PROVISIONS. 
(a) PROGRAM YEAR.—Section 189(g)(1) (29 U.S.C. 
2939(g)(1)) is amended to read as follows: 
‘‘(1) IN GENERAL.—Appropriations for any fis-
cal year for programs and activities carried out 
under this title shall be available for obligation only 
on the basis of a program year. The program year 
shall begin on July 1 in the fiscal year for which the 
appropriation is made.’’. 
(b) AVAILABILITY.—Section 189(g)(2) (29 U.S.C. 
2939(g)(2)) is amended by striking ‘‘each State’’ and insert-
ing ‘‘each recipient’’. 
(c) GENERAL WAIVERS.—Section 189(i)(4) (29 U.S.C. 
2939(i)(4)) is amended—
(1) in subparagraph (A), in the matter preceding 
clause (i), by inserting ‘‘, or in accordance with sub-
paragraph (D),’’ after ‘‘subparagraph (B)’’; and 
(2) by adding the following subparagraph: 
‘‘(D) EXPEDITED PROCESS FOR EXTENDING 
APPROVED WAIVERS TO ADDITIONAL STATES.—
In lieu of the requirements of subparagraphs (B) 
and (C), the Secretary may establish an expe-
dited procedure for the purpose of extending to 
additional States the waiver of statutory or regu-
latory requirements that have been approved for 
a State pursuant to a request under subpara-
graph (B). Such procedure shall ensure that the 
extension of such waivers to additional States 
are accompanied by appropriate conditions re-
lating the implementation of such waivers.’’. 
SEC. 125. GENERAL PROGRAM REQUIREMENTS. 
Section 195 (29 U.S.C. 2945) is amended by adding 
at the end the following new paragraph: 
‘‘(14) Funds provided under this title shall not 
be used to establish or operate stand-alone fee-for-serv-
ice enterprises that compete with private sector em-
ployment agencies within the meaning of section 
701(c) of the Civil Rights Act of 1964 (42 U.S.C. 
2000e(c)). For purposes of this paragraph, such an 
enterprise does not include one-stop centers.’’. 
TITLE II—ADULT EDUCATION 
PART A—ADULT BASIC SKILLS AND FAMILY 
LITERACY EDUCATION 
SEC. 201. TABLE OF CONTENTS. 
The table of contents in section 1(b) is amended by 
amending the items relating to title II to read as follows:
‘‘TITLE II—ADULT BASIC SKILLS AND FAMILY LITERACY 
EDUCATION 
‘‘Sec. 201. Short title. 
‘‘Sec. 202. Purpose. 
‘‘Sec. 203. Definitions. 
‘‘Sec. 204. Home schools. 
‘‘Sec. 205. Authorization of appropriations. 
‘‘CHAPTER 1—FEDERAL PROVISIONS 
‘‘Sec. 211. Reservation of funds; grants to eligible agencies; allotments. 
‘‘Sec. 212. Performance accountability system. 
‘‘Sec. 213. Incentive grants for states. 
‘‘CHAPTER 2—STATE PROVISIONS 
‘‘Sec. 221. State administration. 
‘‘Sec. 222. State distribution of funds; matching requirement. 
‘‘Sec. 223. State leadership activities. 
‘‘Sec. 224. State plan. 
‘‘Sec. 225. Programs for corrections education and other institutionalized individ-
uals. 
‘‘CHAPTER 3—LOCAL PROVISIONS 
‘‘Sec. 231. Grants and contracts for eligible providers. 
‘‘Sec. 232. Local application. 
‘‘Sec. 233. Local administrative cost limits. 
‘‘CHAPTER 4—GENERAL PROVISIONS 
‘‘Sec. 241. Administrative provisions. 
‘‘Sec. 242. National leadership activities.’’.
SEC. 202. AMENDMENT. 
Title II is amended to read as follows: 
‘‘TITLE II—ADULT BASIC SKILLS 
AND FAMILY LITERACY EDU-
CATION 
‘‘SEC. 201. SHORT TITLE. 
‘‘This title may be cited as the ‘Adult Basic Skills and 
Family Literacy Education Act’.
‘‘SEC. 202. PURPOSE. 
‘‘It is the purpose of this title to provide instructional 
opportunities for adults seeking to improve their basic read-
ing, writing, speaking, and math skills, and support States 
and local communities in providing, on a voluntary basis, 
adult basic skills and family literacy programs, in order 
to—
‘‘(1) increase the basic reading, writing, speak-
ing, and math skills necessary for adults to obtain 
employment and self-sufficiency and to successfully 
advance in the workforce; 
‘‘(2) assist adults in the completion of a sec-
ondary school education (or its equivalent) and the 
transition to a postsecondary educational institution; 
‘‘(3) increase the basic reading, writing, speak-
ing, and math skills of parents to enable them to sup-
port the educational development of their children 
and make informed choices regarding their children’s 
education; and 
‘‘(4) assist immigrants who are not proficient in 
English in improving their reading, writing, speak-
ing, and math skills and acquiring an understanding 
of the American free enterprise system, individual 
freedom, and the responsibilities of citizenship. 
‘‘SEC. 203. DEFINITIONS. 
‘‘In this title:
‘‘(1) ADULT BASIC SKILLS AND FAMILY LITERACY 
EDUCATION PROGRAMS.—The term ‘adult basic skills 
and family literacy education programs’ means a se-
quence of academic instruction and educational serv-
ices below the postsecondary level that increase an in-
dividual’s ability to read, write, and speak in English 
and perform mathematical computations leading to a 
level of proficiency equivalent to secondary school 
completion that is provided for individuals—
‘‘(A) who are at least 16 years of age; 
‘‘(B) who are not enrolled or required to be 
enrolled in secondary school under State law; 
and 
‘‘(C) who—
‘‘(i) lack sufficient mastery of basic 
reading, writing, speaking, and math skills 
to enable the individuals to function effec-
tively in society; 
‘‘(ii) do not have a secondary school 
diploma or the General Equivalency Di-
ploma (GED) (including recognized alter-
native standards for individuals with dis-
abilities), and have not achieved an equiva-
lent level of education; or
‘‘(iii) are unable to read, write, or 
speak the English language. 
‘‘(2) ELIGIBLE
AGENCY.—The term ‘eligible 
agency’—
‘‘(A) means the sole entity or agency in a 
State or an outlying area responsible for admin-
istering or supervising policy for adult basic 
skills and family literacy education programs in 
the State or outlying area, respectively, con-
sistent with the law of the State or outlying 
area, respectively; and 
‘‘(B) may be the State educational agency, 
the State agency responsible for administering 
workforce investment activities, or the State 
agency responsible for administering community 
or technical colleges. 
‘‘(3) ELIGIBLE
PROVIDER.—The term ‘eligible 
provider’ means—
‘‘(A) a local educational agency; 
‘‘(B) a community-based or faith-based or-
ganization of demonstrated effectiveness; 
‘‘(C) a volunteer literacy organization of 
demonstrated effectiveness; 
‘‘(D) an institution of higher education;
‘‘(E) a public or private educational agen-
cy; 
‘‘(F) a library; 
‘‘(G) a public housing authority; 
‘‘(H) an institution that is not described in 
any of subparagraphs (A) through (G) and has 
the ability to provide adult basic skills and fam-
ily literacy education programs to adults and 
families; or 
‘‘(I) a consortium of the agencies, organiza-
tions, institutions, libraries, or authorities de-
scribed in any of subparagraphs (A) through 
(H). 
‘‘(4) ENGLISH
LANGUAGE
ACQUISITION
PRO-
GRAM.—The term ‘English language acquisition pro-
gram’ means a program of instruction designed to 
help individuals with limited English proficiency 
achieve competence in reading, writing, and speaking 
the English language. 
‘‘(5) ESSENTIAL COMPONENTS OF READING IN-
STRUCTION.—The term ‘essential components of read-
ing instruction’ has the meaning given to that term 
in section 1208 of the Elementary and Secondary 
Education Act of 1965 (20 U.S.C. 6368).
‘‘(6) FAMILY LITERACY EDUCATION PROGRAMS.—
The term ‘family literacy education programs’ means 
educational programs that—
‘‘(A) assist parents and students, on a vol-
untary basis, in achieving the purposes of this 
title as described in section 202; and 
‘‘(B) are of sufficient intensity in terms of 
hours and of sufficient duration to make sustain-
able changes in a family, are based upon sci-
entific research-based principles, and for the pur-
pose of substantially increasing the ability of 
parents and children to read, write, and speak 
English integrate—
‘‘(i) interactive literacy activities be-
tween parents and their children; 
‘‘(ii) training for parents regarding 
how to be the primary teacher for their chil-
dren and full partners in the education of 
their children; 
‘‘(iii) parent literacy training that 
leads to economic self-sufficiency; and 
‘‘(iv) an age-appropriate education to 
prepare children for success in school and 
life experiences.
100
‘‘(7) GOVERNOR.—The term ‘Governor’ means 
the chief executive officer of a State or outlying area. 
‘‘(8) INDIVIDUAL WITH A DISABILITY.—
‘‘(A) IN
GENERAL.—The term ‘individual 
with a disability’ means an individual with any 
disability (as defined in section 3 of the Ameri-
cans with Disabilities Act of 1990 (42 U.S.C. 
12102)). 
‘‘(B) INDIVIDUALS
WITH
DISABILITIES.—
The term ‘individuals with disabilities’ means 
more than one individual with a disability. 
‘‘(9) INDIVIDUAL WITH LIMITED ENGLISH PRO-
FICIENCY.—The 
term 
‘individual 
with 
limited 
English proficiency’ means an adult or out-of-school 
youth who has limited ability in reading, writing, 
speaking, or understanding the English language, 
and—
‘‘(A) whose native language is a language 
other than English; or 
‘‘(B) who lives in a family or community 
environment where a language other than 
English is the dominant language. 
‘‘(10) INSTITUTION
OF
HIGHER
EDUCATION.—
The term ‘institution of higher education’ has the
101
meaning given to that term in section 101 of the 
Higher Education Act of 1965 (20 U.S.C. 1001). 
‘‘(11) LITERACY.—The term ‘literacy’ means the 
ability to read, write, and speak the English language 
with competence, knowledge, and comprehension. 
‘‘(12) LOCAL EDUCATIONAL AGENCY.—The term 
‘local educational agency’ has the meaning given to 
that term in section 9101 of the Elementary and Sec-
ondary Education Act of 1965 (20 U.S.C. 7801). 
‘‘(13) OUTLYING
AREA.—The term ‘outlying 
area’ has the meaning given to that term in section 
101 of this Act. 
‘‘(14) POSTSECONDARY
EDUCATIONAL
INSTITU-
TION.—The term ‘postsecondary educational institu-
tion’ means—
‘‘(A) an institution of higher education that 
provides not less than a 2-year program of in-
struction that is acceptable for credit toward a 
bachelor’s degree; 
‘‘(B) a tribally controlled community col-
lege; or 
‘‘(C) a nonprofit educational institution of-
fering certificate or apprenticeship programs at 
the postsecondary level.
102
‘‘(15) READING.—The term ‘reading’ has the 
meaning given to that term in section 1208 of the El-
ementary and Secondary Education Act of 1965 (20 
U.S.C. 6368). 
‘‘(16) SCIENTIFICALLY
BASED
READING
RE-
SEARCH.—The term ‘scientifically based reading re-
search’ has the meaning given to that term in section 
1208 of the Elementary and Secondary Education 
Act of 1965 (20 U.S.C. 6368). 
‘‘(17) SECRETARY.—The term ‘Secretary’ means 
the Secretary of Education. 
‘‘(18) STATE.—The term ‘State’ means each of 
the several States of the United States, the District of 
Columbia, and the Commonwealth of Puerto Rico. 
‘‘(19) STATE EDUCATIONAL AGENCY.—The term 
‘State educational agency’ has the meaning given to 
that term in section 9101 of the Elementary and Sec-
ondary Education Act of 1965 (20 U.S.C. 7801). 
‘‘(20) WORKPLACE
LITERACY
PROGRAM.—The 
term ‘workplace literacy program’ means an edu-
cational program that is offered in collaboration be-
tween eligible providers and employers or employee 
organizations for the purpose of improving the pro-
ductivity of the workforce through the improvement of 
reading, writing, speaking, and math skills.
103
‘‘SEC. 204. HOME SCHOOLS. 
‘‘Nothing in this title shall be construed to affect home 
schools, whether or not a home school is treated as a home 
school or a private school under State law, or to compel 
a parent engaged in home schooling to participate in an 
English language acquisition program, a family literacy 
education program, or an adult basic skills and family lit-
eracy education program. 
‘‘SEC. 205. AUTHORIZATION OF APPROPRIATIONS. 
‘‘There are authorized to be appropriated to carry out 
this title $584,300,000 for fiscal year 2004 and such sums 
as may be necessary for fiscal years 2005 through 2009. 
‘‘CHAPTER 1—FEDERAL PROVISIONS 
‘‘SEC. 211. RESERVATION OF FUNDS; GRANTS TO ELIGIBLE 
AGENCIES; ALLOTMENTS. 
‘‘(a) RESERVATION OF FUNDS.—From the sums ap-
propriated under section 205 for a fiscal year, the Sec-
retary—
‘‘(1) shall reserve 1.75 percent to carry out the 
National Institute for Literacy Establishment Act; 
‘‘(2) shall reserve up to 1.72 percent for incentive 
grants under section 213; and 
‘‘(3) shall reserve up to 1.55 percent to carry out 
section 242. 
‘‘(b) GRANTS TO ELIGIBLE AGENCIES.—
104
‘‘(1) IN GENERAL.—From the sums appropriated 
under section 205 and not reserved under subsection 
(a) for a fiscal year, the Secretary shall award a 
grant to each eligible agency having a State plan ap-
proved under section 224 in an amount equal to the 
sum of the initial allotment under subsection (c)(1) 
and the additional allotment under subsection (c)(2) 
for the eligible agency for the fiscal year, subject to 
subsections (f) and (g). 
‘‘(2) PURPOSE OF GRANTS.—The Secretary may 
award a grant under paragraph (1) only if the eligi-
ble agency involved agrees to expend the grant in ac-
cordance with the provisions of this title. 
‘‘(c) ALLOTMENTS.—
‘‘(1) INITIAL ALLOTMENTS.—From the sums ap-
propriated under section 205 and not reserved under 
subsection (a) for a fiscal year, the Secretary shall 
allot to each eligible agency having a State plan ap-
proved under section 224—
‘‘(A) $100,000, in the case of an eligible 
agency serving an outlying area; and 
‘‘(B) $250,000, in the case of any other eli-
gible agency. 
‘‘(2) ADDITIONAL ALLOTMENTS.—From the sums 
appropriated under section 205, not reserved under
105
subsection (a), and not allotted under paragraph (1), 
for a fiscal year, the Secretary shall allot to each eli-
gible agency that receives an initial allotment under 
paragraph (1) an additional amount that bears the 
same relationship to such sums as the number of 
qualifying adults in the State or outlying area served 
by the eligible agency bears to the number of such 
adults in all States and outlying areas. 
‘‘(d) QUALIFYING ADULT.—For the purpose of sub-
section (c)(2), the term ‘qualifying adult’ means an adult 
who—
‘‘(1) is at least 16 years of age; 
‘‘(2) is beyond the age of compulsory school at-
tendance under the law of the State or outlying area; 
‘‘(3) does not have a secondary school diploma or 
the General Equivalency Diploma (GED) (including 
recognized alternative standards for individuals with 
disabilities); and 
‘‘(4) is not enrolled in secondary school. 
‘‘(e) SPECIAL RULE.—
‘‘(1) IN GENERAL.—From amounts made avail-
able under subsection (c) for the Republic of the Mar-
shall Islands, the Federated States of Micronesia, and 
the Republic of Palau, the Secretary shall award 
grants to Guam, American Samoa, the Common-
106
wealth of the Northern Mariana Islands, the Republic 
of the Marshall Islands, the Federated States of Mi-
cronesia, or the Republic of Palau to carry out activi-
ties described in this title in accordance with the pro-
visions of this title as determined by the Secretary. 
‘‘(2) TERMINATION
OF
ELIGIBILITY.—Notwith-
standing any other provision of law, the Republic of 
the Marshall Islands, the Federated States of Micro-
nesia, and the Republic of Palau shall be eligible to 
receive a grant under this title until an agreement for 
the extension of United States education assistance 
under the Compact of Free Association for each of the 
Freely Associated States becomes effective. 
‘‘(3) ADMINISTRATIVE
COSTS.—The Secretary 
may provide not more than 5 percent of the funds 
made available for grants under this subsection to 
pay the administrative costs of the Pacific Region 
Educational Laboratory regarding activities assisted 
under this subsection. 
‘‘(f) HOLD-HARMLESS PROVISIONS.—
‘‘(1) IN GENERAL.—Notwithstanding subsection 
(c), and subject to paragraphs (2) and (3), for fiscal 
year 2004 and each succeeding fiscal year, no eligible 
agency shall receive an allotment under this title that 
is less than 90 percent of the allotment the eligible
107
agency received for the preceding fiscal year under 
this title. 
‘‘(2) EXCEPTION.—An eligible agency that re-
ceives for the preceding fiscal year only an initial al-
lotment under subsection 211(c)(1) (and no addi-
tional allotment under 211(c)(2)) shall receive an al-
lotment equal to 100 percent of the initial allotment. 
‘‘(3) RATABLE
REDUCTION.—If for any fiscal 
year the amount available for allotment under this 
title is insufficient to satisfy the provisions of para-
graph (1), the Secretary shall ratably reduce the pay-
ments to all eligible agencies, as necessary. 
‘‘(g) REALLOTMENT.—The portion of any eligible 
agency’s allotment under this title for a fiscal year that the 
Secretary determines will not be required for the period 
such allotment is available for carrying out activities under 
this title, shall be available for reallotment from time to 
time, on such dates during such period as the Secretary 
shall fix, to other eligible agencies in proportion to the origi-
nal allotments to such agencies under this title for such 
year. 
‘‘SEC. 212. PERFORMANCE ACCOUNTABILITY SYSTEM. 
‘‘(a) PURPOSE.—The purpose of this section is to es-
tablish a comprehensive performance accountability system, 
composed of the activities described in this section, to assess
108
the effectiveness of eligible agencies in achieving continuous 
improvement of adult basic skills and family literacy edu-
cation programs funded under this title, in order to opti-
mize the return on investment of Federal funds in adult 
basic skills and family literacy education programs. 
‘‘(b) ELIGIBLE AGENCY PERFORMANCE MEASURES.—
‘‘(1) IN GENERAL.—For each eligible agency, the 
eligible agency performance measures shall consist 
of—
‘‘(A)(i) the core indicators of performance 
described in paragraph (2)(A); and 
‘‘(ii) employment performance indicators 
identified by the eligible agency under para-
graph (2)(B); and 
‘‘(B) an eligible agency adjusted level of 
performance for each indicator described in sub-
paragraph (A). 
‘‘(2) INDICATORS OF PERFORMANCE.—
‘‘(A) CORE
INDICATORS
OF
PERFORM-
ANCE.—The core indicators of performance shall 
include the following: 
‘‘(i) Measurable improvements in basic 
skill levels in reading, writing, and speak-
ing the English language and math, and
109
English language acquisition leading to 
proficiency in each skill. 
‘‘(ii) Receipt of a secondary school di-
ploma or the General Equivalency Diploma 
(GED) (including recognized alternative 
standards for individuals with disabilities). 
‘‘(iii) Placement in postsecondary edu-
cation or other training programs. 
‘‘(B) EMPLOYMENT PERFORMANCE INDICA-
TORS.—Consistent with applicable Federal and 
State privacy laws, an eligible agency shall iden-
tify in the State plan the following individual 
participant employment performance indica-
tors—
‘‘(i) entry into employment; 
‘‘(ii) retention in employment; and 
‘‘(iii) increase in earnings. 
‘‘(3) LEVELS OF PERFORMANCE.—
‘‘(A) ELIGIBLE AGENCY ADJUSTED LEVELS 
OF PERFORMANCE FOR CORE INDICATORS.—
‘‘(i) IN
GENERAL.—For each eligible 
agency submitting a State plan, there shall 
be established, in accordance with this sub-
paragraph, levels of performance for each of 
the core indicators of performance described
110
in paragraph (2)(A) for adult basic skills 
and family literacy education programs au-
thorized under this title. The levels of per-
formance established under this subpara-
graph shall, at a minimum—
‘‘(I) be expressed in an objective, 
quantifiable, and measurable form; 
and 
‘‘(II) show the progress of the eli-
gible agency toward continuously and 
significantly improving the agency’s 
performance outcomes in an objective, 
quantifiable, and measurable form. 
‘‘(ii) 
IDENTIFICATION
IN
STATE 
PLAN.—Each eligible agency shall identify, 
in the State plan submitted under section 
224, expected levels of performance for each 
of the core indicators of performance for the 
first 3 program years covered by the State 
plan. 
‘‘(iii) AGREEMENT ON ELIGIBLE AGEN-
CY
ADJUSTED
LEVELS
OF
PERFORMANCE 
FOR FIRST 3 YEARS.—In order to ensure an 
optimal return on the investment of Federal 
funds in adult basic skills and family lit-
111
eracy education programs authorized under 
this title, the Secretary and each eligible 
agency shall reach agreement on levels of 
student proficiency for each of the core indi-
cators of performance, for the first 3 pro-
gram years covered by the State plan, tak-
ing into account the levels identified in the 
State plan under clause (ii) and the factors 
described in clause (iv). The levels agreed to 
under this clause shall be considered to be 
the eligible agency adjusted levels of per-
formance for the eligible agency for such 
years and shall be incorporated into the 
State plan prior to the approval of such 
plan. 
‘‘(iv) FACTORS.—The agreement de-
scribed in clause (iii) or (v) shall take into 
account—
‘‘(I) how the levels involved com-
pare with the eligible agency’s adjusted 
levels of performance, taking into ac-
count factors including the characteris-
tics of participants when the partici-
pants entered the program; and
112
‘‘(II) the extent to which such lev-
els promote continuous and significant 
improvement in performance on the 
student proficiency measures used by 
such eligible agency and ensure opti-
mal return on the investment of Fed-
eral funds. 
‘‘(v) AGREEMENT ON ELIGIBLE AGENCY 
ADJUSTED LEVELS OF PERFORMANCE FOR 
SECOND 3 YEARS.—Prior to the fourth pro-
gram year covered by the State plan, the 
Secretary and each eligible agency shall 
reach agreement on levels of student pro-
ficiency for each of the core indicators of 
performance for the fourth, fifth, and sixth 
program years covered by the State plan, 
taking into account the factors described in 
clause (iv). The levels agreed to under this 
clause shall be considered to be the eligible 
agency adjusted levels of performance for the 
eligible agency for such years and shall be 
incorporated into the State plan. 
‘‘(vi) 
REVISIONS.—If 
unanticipated 
circumstances arise in a State resulting in 
a significant change in the factors described
113
in clause (iv)(I), the eligible agency may re-
quest that the eligible agency adjusted levels 
of performance agreed to under clause (iii) 
or (v) be revised. 
‘‘(B) LEVELS OF EMPLOYMENT PERFORM-
ANCE.—The eligible agency shall identify, in the 
State plan, eligible agency levels of performance 
for each of the employment performance indica-
tors described in paragraph (2)(B). Such levels 
shall be considered to be eligible agency adjusted 
levels of performance for purposes of this title. 
‘‘(c) REPORT.—
‘‘(1) IN GENERAL.—Each eligible agency that re-
ceives a grant under section 211(b) shall annually 
prepare and submit to the Secretary, the Governor, 
the State legislature, eligible providers, and the gen-
eral public within the State, a report on the progress 
of the eligible agency in achieving eligible agency per-
formance measures, including the following: 
‘‘(A) Information on the levels of perform-
ance achieved by the eligible agency with respect 
to the core indicators of performance and em-
ployment performance indicators. 
‘‘(B) The number and type of each eligible 
provider that receives funding under such grant.
114
‘‘(2) INFORMATION
DISSEMINATION.—The Sec-
retary—
‘‘(A) shall make the information contained 
in such reports available to the general public 
through publication and other appropriate meth-
ods; 
‘‘(B) shall disseminate State-by-State com-
parisons of the information; and 
‘‘(C) shall provide the appropriate commit-
tees of the Congress with copies of such reports. 
‘‘SEC. 213. INCENTIVE GRANTS FOR STATES. 
‘‘(a) IN GENERAL.—From funds appropriated under 
section 211(a)(2), the Secretary may award grants to States 
for exemplary performance in carrying out programs under 
this title. Such awards shall be based on States meeting or 
exceeding the core indicators of performance established 
under section 212(b)(2)(A) and may be based on the per-
formance of the State in serving populations, such as those 
described in section 224(b)(10), including the levels of serv-
ice provided and the performance outcomes, and such other 
factors relating to the performance of the State under this 
title as the Secretary determines appropriate. 
‘‘(b) USE OF FUNDS.—The funds awarded to a State 
under this paragraph may be used to carry out any activi-
115
ties authorized under this title, including demonstrations 
and innovative programs for hard-to-serve populations. 
‘‘CHAPTER 2—STATE PROVISIONS 
‘‘SEC. 221. STATE ADMINISTRATION. 
‘‘Each eligible agency shall be responsible for the fol-
lowing activities under this title: 
‘‘(1) The development, submission, implementa-
tion, and monitoring of the State plan. 
‘‘(2) Consultation with other appropriate agen-
cies, groups, and individuals that are involved in, or 
interested in, the development and implementation of 
activities assisted under this title. 
‘‘(3) Coordination and avoidance of duplication 
with other Federal and State education, training, cor-
rections, public housing, and social service programs. 
‘‘SEC. 222. STATE DISTRIBUTION OF FUNDS; MATCHING RE-
QUIREMENT. 
‘‘(a) STATE DISTRIBUTION OF FUNDS.—Each eligible 
agency receiving a grant under this title for a fiscal year—
‘‘(1) shall use an amount not less than 82.5 per-
cent of the grant funds to award grants and contracts 
under section 231 and to carry out section 225, of 
which not more than 10 percent of such amount shall 
be available to carry out section 225;
116
‘‘(2) shall use not more than 12.5 percent of the 
grant funds to carry out State leadership activities 
under section 223; and 
‘‘(3) shall use not more than 5 percent of the 
grant funds, or $75,000, whichever is greater, for the 
administrative expenses of the eligible agency. 
‘‘(b) MATCHING REQUIREMENT.—
‘‘(1) IN GENERAL.—In order to receive a grant 
from the Secretary under section 211(b), each eligible 
agency shall provide, for the costs to be incurred by 
the eligible agency in carrying out the adult basic 
skills and family literacy education programs for 
which the grant is awarded, a non-Federal contribu-
tion in an amount at least equal to— 
‘‘(A) in the case of an eligible agency serv-
ing an outlying area, 12 percent of the total 
amount of funds expended for adult basic skills 
and family literacy education programs in the 
outlying area, except that the Secretary may de-
crease the amount of funds required under this 
subparagraph for an eligible agency; and 
‘‘(B) in the case of an eligible agency serv-
ing a State, 25 percent of the total amount of 
funds expended for adult basic skills and family 
literacy education programs in the State.
117
‘‘(2) NON-FEDERAL CONTRIBUTION.—An eligible 
agency’s non-Federal contribution required under 
paragraph (1) may be provided in cash or in kind, 
fairly evaluated, and shall include only non-Federal 
funds that are used for adult basic skills and family 
literacy education programs in a manner that is con-
sistent with the purpose of this title. 
‘‘SEC. 223. STATE LEADERSHIP ACTIVITIES. 
‘‘(a) IN GENERAL.—Each eligible agency may use 
funds made available under section 222(a)(2) for any of 
the following adult basic skills and family literacy edu-
cation programs: 
‘‘(1) The establishment or operation of profes-
sional development programs to improve the quality 
of instruction provided pursuant to local activities re-
quired under section 231(b), including instruction in-
corporating the essential components of reading in-
struction and instruction provided by volunteers or 
by personnel of a State or outlying area. 
‘‘(2) The provision of technical assistance to eli-
gible providers of adult basic skills and family lit-
eracy education programs for development and dis-
semination of scientific research-based instructional 
practices in reading, writing, speaking, math, and 
English language acquisition programs.
118
‘‘(3) The provision of assistance to eligible pro-
viders in developing, implementing, and reporting 
measurable progress in achieving the objectives of this 
title. 
‘‘(4) The provision of technology assistance, in-
cluding staff training, to eligible providers of adult 
basic skills and family literacy education programs, 
including distance learning activities, to enable the 
eligible providers to improve the quality of such ac-
tivities. 
‘‘(5) The development and implementation of 
technology applications or distance learning, includ-
ing professional development to support the use of in-
structional technology. 
‘‘(6) Coordination with other public programs, 
including welfare-to-work, workforce development, and 
job training programs. 
‘‘(7) Coordination with existing support services, 
such as transportation, child care, and other assist-
ance designed to increase rates of enrollment in, and 
successful completion of, adult basic skills and family 
literacy education programs, for adults enrolled in 
such activities.
119
‘‘(8) The development and implementation of a 
system to assist in the transition from adult basic 
education to postsecondary education. 
‘‘(9) Activities to promote workplace literacy 
programs. 
‘‘(10) Activities to promote and complement local 
outreach initiatives described in section 242(7). 
‘‘(11) Other activities of statewide significance, 
including assisting eligible agencies in achieving 
progress in improving the skill levels of adults who 
participate in programs under this title. 
‘‘(b) COORDINATION.—In carrying out this section, eli-
gible agencies shall coordinate where possible, and avoid du-
plicating efforts, in order to maximize the impact of the 
activities described in subsection (a). 
‘‘(c) STATE-IMPOSED REQUIREMENTS.—Whenever a 
State or outlying area implements any rule or policy relat-
ing to the administration or operation of a program au-
thorized under this title that has the effect of imposing a 
requirement that is not imposed under Federal law (includ-
ing any rule or policy based on a State or outlying area 
interpretation of a Federal statute, regulation, or guide-
line), the State or outlying area shall identify, to eligible 
providers, the rule or policy as being imposed by the State 
or outlying area.
120
‘‘SEC. 224. STATE PLAN. 
‘‘(a) 6-YEAR PLANS.—
‘‘(1) IN GENERAL.—Each eligible agency desiring 
a grant under this title for any fiscal year shall sub-
mit to, or have on file with, the Secretary a 6-year 
State plan. 
‘‘(2) COMPREHENSIVE PLAN OR APPLICATION.—
The eligible agency may submit the State plan as 
part of a comprehensive plan or application for Fed-
eral education assistance. 
‘‘(b) PLAN CONTENTS.—The eligible agency shall in-
clude in the State plan or any revisions to the State plan—
‘‘(1) an objective assessment of the needs of indi-
viduals in the State or outlying area for adult basic 
skills and family literacy education programs, includ-
ing individuals most in need or hardest to serve; 
‘‘(2) a description of the adult basic skills and 
family literacy education programs that will be car-
ried out with funds received under this title; 
‘‘(3) a description of how the eligible agency will 
evaluate and measure annually the effectiveness and 
improvement of the adult basic skills and family lit-
eracy education programs based on the performance 
measures described in section 212 including—
121
‘‘(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 title 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 
nonperformance); 
‘‘(4) a description of the performance measures 
described in section 212 and how such performance 
measures have significantly improved adult basic 
skills and family literacy education programs in the 
State or outlying area; 
‘‘(5) an assurance that the eligible agency will, 
in addition to meeting all of the other requirements 
of this title, award not less than one grant under this 
title to an eligible provider that—
122
‘‘(A) offers flexible schedules and necessary 
support services (such as child care and trans-
portation) to enable individuals, including indi-
viduals with disabilities, or individuals with 
other special needs, to participate in adult basic 
skills and family literacy education programs; 
and 
‘‘(B) attempts to coordinate with support 
services that are not provided under this title 
prior to using funds for adult basic skills and 
family literacy education programs provided 
under this title for support services; 
‘‘(6) an assurance that the funds received under 
this title will not be expended for any purpose other 
than for activities under this title; 
‘‘(7) a description of how the eligible agency will 
fund local activities in accordance with the measur-
able goals described in section 231(d); 
‘‘(8) an assurance that the eligible agency will 
expend the funds under this title only in a manner 
consistent with fiscal requirements in section 241; 
‘‘(9) a description of the process that will be used 
for public participation and comment with respect to 
the State plan, which process—
123
‘‘(A) shall include consultation with the 
State workforce investment board, the State 
board responsible for administering community 
or technical colleges, the Governor, the State edu-
cational agency, the State board or agency re-
sponsible for administering block grants for tem-
porary assistance to needy families under title 
IV of the Social Security Act, the State council 
on disabilities, the State vocational rehabilita-
tion agency, other State agencies that promote 
the improvement of adult basic skills and family 
literacy education programs, and direct pro-
viders of such programs; and 
‘‘(B) may include consultation with the 
State agency on higher education, institutions 
responsible for professional development of adult 
basic skills and family literacy education pro-
grams instructors, representatives of business 
and industry, refugee assistance programs, and 
faith-based organizations; 
‘‘(10) a description of the eligible agency’s strate-
gies for serving populations that include, at a min-
imum—
‘‘(A) low-income individuals; 
‘‘(B) individuals with disabilities;
124
‘‘(C) the unemployed; 
‘‘(D) the underemployed; and 
‘‘(E) individuals with multiple barriers to 
educational enhancement, including individuals 
with limited English proficiency; 
‘‘(11) a description of how the adult basic skills 
and family literacy education programs that will be 
carried out with any funds received under this title 
will be integrated with other adult education, career 
development, and employment and training activities 
in the State or outlying area served by the eligible 
agency; 
‘‘(12) a description of the steps the eligible agen-
cy will take to ensure direct and equitable access, as 
required in section 231(c)(1), including—
‘‘(A) how the State will build the capacity 
of community-based and faith-based organiza-
tions to provide adult basic skills and family lit-
eracy education programs; and 
‘‘(B) how the State will increase the partici-
pation of business and industry in adult basic 
skills and family literacy education programs; 
and 
‘‘(13) a description of how the eligible agency 
will consult with any State agency responsible for
125
postsecondary education to develop adult education 
that prepares students to enter postsecondary edu-
cation without the need for remediation upon comple-
tion of secondary school equivalency programs. 
‘‘(c) PLAN REVISIONS.—When changes in conditions 
or other factors require substantial revisions to an approved 
State plan, the eligible agency shall submit the revisions 
of the State plan to the Secretary. 
‘‘(d) CONSULTATION.—The eligible agency shall—
‘‘(1) submit the State plan, and any revisions to 
the State plan, to the Governor, the chief State school 
officer, or the State officer responsible for admin-
istering community or technical colleges, or outlying 
area for review and comment; and 
‘‘(2) ensure that any comments regarding the 
State plan by the Governor, the chief State school offi-
cer, or the State officer responsible for administering 
community or technical colleges, and any revision to 
the State plan, are submitted to the Secretary. 
‘‘(e) PLAN APPROVAL.—A State plan submitted to the 
Secretary shall be approved by the Secretary only if the 
plan is consistent with the specific provisions of this title.
126
‘‘SEC. 225. PROGRAMS FOR CORRECTIONS EDUCATION AND 
OTHER INSTITUTIONALIZED INDIVIDUALS. 
‘‘(a) PROGRAM
AUTHORIZED.—From funds made 
available under section 222(a)(1) for a fiscal year, each eli-
gible agency shall carry out corrections education and edu-
cation for other institutionalized individuals. 
‘‘(b) USES OF FUNDS.—The funds described in sub-
section (a) shall be used for the cost of educational programs 
for criminal offenders in correctional institutions and for 
other institutionalized individuals, including academic 
programs for—
‘‘(1) basic skills education; 
‘‘(2) special education programs as determined 
by the eligible agency; 
‘‘(3) reading, writing, speaking, and math pro-
grams; and 
‘‘(4) secondary school credit or diploma pro-
grams or their recognized equivalent. 
‘‘(c) PRIORITY.—Each eligible agency that is using as-
sistance provided under this section to carry out a program 
for criminal offenders within a correctional institution 
shall give priority to serving individuals who are likely to 
leave the correctional institution within 5 years of partici-
pation in the program. 
‘‘(d) DEFINITION OF CRIMINAL OFFENDER.—For pur-
poses of this section:
127
‘‘(1) CORRECTIONAL
INSTITUTION.—The term 
‘correctional institution’ means any—
‘‘(A) prison; 
‘‘(B) jail; 
‘‘(C) reformatory; 
‘‘(D) work farm; 
‘‘(E) detention center; or 
‘‘(F) halfway house, community-based reha-
bilitation center, or any other similar institution 
designed for the confinement or rehabilitation of 
criminal offenders. 
‘‘(2) CRIMINAL OFFENDER.—The term ‘criminal 
offender’ means any individual who is charged with, 
or convicted of, any criminal offense. 
‘‘CHAPTER 3—LOCAL PROVISIONS 
‘‘SEC. 231. GRANTS AND CONTRACTS FOR ELIGIBLE PRO-
VIDERS. 
‘‘(a) GRANTS AND CONTRACTS.—From grant funds 
made available under section 211(b), each eligible agency 
shall award multiyear grants or contracts, on a competitive 
basis, to eligible providers within the State or outlying area 
that meet the conditions and requirements of this title to 
enable the eligible providers to develop, implement, and im-
prove adult basic skills and family literacy education pro-
grams within the State.
128
‘‘(b) LOCAL ACTIVITIES.—The eligible agency shall re-
quire eligible providers receiving a grant or contract under 
subsection (a) to establish or operate one or more programs 
of instruction that provide services or instruction in one 
or more of the following categories: 
‘‘(1) Adult basic skills and family literacy edu-
cation programs, including essential workplace skills 
(including proficiency in reading, writing, speaking, 
and math). 
‘‘(2) Workplace literacy programs. 
‘‘(3) English language acquisition programs. 
‘‘(4) family literacy education programs. 
‘‘(c) DIRECT AND EQUITABLE ACCESS; SAME PROC-
ESS.—Each eligible agency receiving funds under this title 
shall ensure that— 
‘‘(1) all eligible providers have direct and equi-
table access to apply for grants or contracts under 
this section; and 
‘‘(2) the same grant or contract announcement 
process and application process is used for all eligible 
providers in the State or outlying area. 
‘‘(d) MEASURABLE GOALS.—The eligible agency shall 
require eligible providers receiving a grant or contract 
under subsection (a) to demonstrate—
129
‘‘(1) the eligible provider’s measurable goals for 
participant outcomes to be achieved annually on the 
core indicators of performance and employment per-
formance indicators described in section 212(b)(2); 
‘‘(2) the past effectiveness of the eligible provider 
in improving the basic academic skills of adults and, 
for eligible providers receiving grants in the prior 
year, the success of the eligible provider receiving 
funding under this title in meeting or exceeding its 
performance goals in the prior year; 
‘‘(3) the commitment of the eligible provider to 
serve individuals in the community who are the most 
in need of basic academic skills instruction services, 
including individuals who are low-income or have 
minimal reading, writing, speaking, and math skills, 
or limited English proficiency. 
‘‘(4) whether or not the program—
‘‘(A) is of sufficient intensity and duration 
for participants to achieve substantial learning 
gains; and 
‘‘(B) uses instructional practices that in-
clude the essential components of reading in-
struction; 
‘‘(5) whether educational practices are based on 
scientifically based research;
130
‘‘(6) whether the activities of the eligible provider 
effectively employ advances in technology, as appro-
priate, including the use of computers; 
‘‘(7) whether the activities provide instruction in 
real-life contexts, to ensure that an individual has the 
skills needed to compete in the workplace and exercise 
the rights and responsibilities of citizenship; 
‘‘(8) whether the activities are staffed by well-
trained instructors, counselors, and administrators; 
‘‘(9) whether the activities are coordinated with 
other available resources in the community, such as 
through strong links with elementary schools and sec-
ondary schools, postsecondary educational institu-
tions, one-stop centers, job training programs, com-
munity-based and faith-based organizations, and so-
cial service agencies; 
‘‘(10) whether the activities offer flexible sched-
ules and support services (such as child care and 
transportation) that are necessary to enable individ-
uals, including individuals with disabilities or other 
special needs, to attend and complete programs; 
‘‘(11) whether the activities include a high-qual-
ity information management system that has the ca-
pacity to report measurable participant outcomes and
131
to monitor program performance against the perform-
ance measures established by the eligible agency; 
‘‘(12) whether the local communities have a dem-
onstrated need for additional English language acqui-
sition programs; 
‘‘(13) the capacity of the eligible provider to 
produce valid information on performance results, in-
cluding enrollments and measurable participant out-
comes; 
‘‘(14) whether adult basic skills and family lit-
eracy education programs offer rigorous reading, 
writing, speaking, and math content that are based 
on scientific research; and 
‘‘(15) whether applications of technology, and 
services to be provided by the eligible providers, is of 
sufficient intensity and duration to increase the 
amount and quality of learning and lead to measur-
able learning gains within specified time periods. 
‘‘SEC. 232. LOCAL APPLICATION. 
‘‘Each eligible provider desiring a grant or contract 
under this title shall submit an application to the eligible 
agency containing such information and assurances as the 
eligible agency may require, including—
132
‘‘(1) a description of how funds awarded under 
this title will be spent consistent with the require-
ments of this title; 
‘‘(2) a description of any cooperative arrange-
ments the eligible provider has with other agencies, 
institutions, or organizations for the delivery of adult 
basic skills and family literacy education programs; 
and 
‘‘(3) each of the demonstrations required by sec-
tion 231(d). 
‘‘SEC. 233. LOCAL ADMINISTRATIVE COST LIMITS. 
‘‘(a) IN GENERAL.—Subject to subsection (b), of the 
amount that is made available under this title to an eligible 
provider—
‘‘(1) at least 95 percent shall be expended for 
carrying out adult basic skills and family literacy 
education programs; and 
‘‘(2) the remaining amount shall be used for 
planning, administration, personnel and professional 
development, development of measurable goals in 
reading, writing, speaking, and math, and inter-
agency coordination. 
‘‘(b) SPECIAL RULE.—In cases where the cost limits 
described in subsection (a) are too restrictive to allow for 
adequate planning, administration, personnel development,
133
and interagency coordination, the eligible provider may ne-
gotiate with the eligible agency in order to determine an 
adequate level of funds to be used for noninstructional pur-
poses. 
‘‘CHAPTER 4—GENERAL PROVISIONS 
‘‘SEC. 241. ADMINISTRATIVE PROVISIONS. 
‘‘(a) SUPPLEMENT NOT SUPPLANT.—Funds made 
available for adult basic skills and family literacy edu-
cation programs under this title shall supplement and not 
supplant other State or local public funds expended for 
adult basic skills and family literacy education programs. 
‘‘(b) MAINTENANCE OF EFFORT.—
‘‘(1) IN GENERAL.—
‘‘(A) DETERMINATION.—An eligible agency 
may receive funds under this title for any fiscal 
year if the Secretary finds that the fiscal effort 
per student or the aggregate expenditures of such 
eligible agency for activities under this title, in 
the second preceding fiscal year, were not less 
than 90 percent of the fiscal effort per student or 
the aggregate expenditures of such eligible agency 
for adult basic skills and family literacy edu-
cation programs, in the third preceding fiscal 
year.
134
‘‘(B) PROPORTIONATE REDUCTION.—Subject 
to paragraphs (2), (3), and (4), for any fiscal 
year with respect to which the Secretary deter-
mines under subparagraph (A) that the fiscal ef-
fort or the aggregate expenditures of an eligible 
agency for the preceding program year were less 
than such effort or expenditures for the second 
preceding program year, the Secretary—
‘‘(i) shall determine the percentage de-
creases in such effort or in such expendi-
tures; and 
‘‘(ii) shall decrease the payment made 
under this title for such program year to the 
agency for adult basic skills and family lit-
eracy education programs by the lesser of 
such percentages. 
‘‘(2) COMPUTATION.—In computing the fiscal ef-
fort and aggregate expenditures under paragraph (1), 
the Secretary shall exclude capital expenditures and 
special one-time project costs. 
‘‘(3) DECREASE IN FEDERAL SUPPORT.—If the 
amount made available for adult basic skills and 
family literacy education programs under this title 
for a fiscal year is less than the amount made avail-
able for adult basic skills and family literacy edu-
135
cation programs under this title for the preceding fis-
cal year, then the fiscal effort per student and the ag-
gregate expenditures of an eligible agency required in 
order to avoid a reduction under paragraph (1)(B) 
shall be decreased by the same percentage as the per-
centage decrease in the amount so made available. 
‘‘(4) WAIVER.—The Secretary may waive the re-
quirements of this subsection for not more than 1 fis-
cal year, if the Secretary determines that a waiver 
would be equitable due to exceptional or uncontrol-
lable circumstances, such as a natural disaster or an 
unforeseen and precipitous decline in the financial re-
sources of the State or outlying area of the eligible 
agency. If the Secretary grants a waiver under the 
preceding sentence for a fiscal year, the level of effort 
required under paragraph (1) shall not be reduced in 
the subsequent fiscal year because of the waiver. 
‘‘SEC. 242. NATIONAL LEADERSHIP ACTIVITIES. 
‘‘The Secretary shall establish and carry out a pro-
gram of national leadership activities that may include the 
following: 
‘‘(1) Technical assistance, on request, including 
assistance—
‘‘(A) on requests to volunteer community- 
and faith-based organizations, including but not
136
limited to, improving their fiscal management, 
research-based instruction, and reporting re-
quirements, and the development of measurable 
objectives to carry out the requirements of this 
title; 
‘‘(B) in developing valid, measurable, and 
reliable performance data, and using perform-
ance information for the improvement of adult 
basic skills and family literacy education pro-
grams; 
‘‘(C) on adult education professional devel-
opment; and 
‘‘(D) in using distance learning and im-
proving the application of technology in the 
classroom. 
‘‘(2) Providing for the conduct of research on na-
tional literacy basic skill acquisition levels among 
adults, including the number of adults functioning at 
different levels of reading proficiency. 
‘‘(3) Improving the coordination, efficiency, and 
effectiveness of adult education and workforce develop-
ment services at the national, State, and local levels. 
‘‘(4) Determining how participation in adult 
basic skills and family literacy education programs 
prepares individuals for entry into and success in
137
postsecondary education and employment, and in the 
case of prison-based services, the effect on recidivism. 
‘‘(5) Evaluating how different types of providers, 
including community and faith-based organizations 
or private for-profit agencies measurably improve the 
skills of participants in adult basic skills and family 
literacy education programs. 
‘‘(6) Identifying model integrated basic and 
workplace skills education programs, coordinated lit-
eracy and employment services, and effective strate-
gies for serving adults with disabilities. 
‘‘(7) Supporting the development of an entity 
that would produce and distribute technology-based 
programs and materials for adult basic skills and 
family literacy education programs using an inter-
communication system, as that term is defined in sec-
tion 397 of the Communications Act of 1934 (47 
U.S.C. 397), and expand the effective outreach and 
use of such programs and materials to adult edu-
cation eligible providers. 
‘‘(8) Initiating other activities designed to im-
prove the measurable quality and effectiveness of 
adult basic skills and family literacy education pro-
grams nationwide.’’.
138
PART B—NATIONAL INSTITUTE FOR LITERACY 
SEC. 211. SHORT TITLE; PURPOSE. 
(a) SHORT TITLE.—This part may be cited as the 
‘‘National Institute for Literacy Establishment Act’’. 
(b) PURPOSE.—The purpose of this part is to establish 
a National Institute for Literacy to provide national leader-
ship in promoting reading research, reading instruction, 
and professional development in reading based on scientif-
ically based research by—
(1) disseminating widely information on sci-
entifically based reading research to improve aca-
demic achievement for children, youth, and adults; 
(2) identifying and disseminating information 
about schools, local educational agencies, and State 
educational agencies that have effectively developed 
and implemented classroom reading programs that 
meet the requirements of subpart 1 of part B of title 
I of the Elementary and Secondary Education Act of 
1965 (20 U.S.C. 6361 et seq.), including those State 
educational agencies, local educational agencies, and 
schools that are identified as effective through the Ex-
ternal Evaluation of Reading First under section 
1205 of the Elementary and Secondary Education 
Act of 1965 (20 U.S.C. 6365); 
(3) serving as a national resource for informa-
tion on reading instruction programs that contain the
139
essential components of reading instruction as sup-
ported by scientifically based reading research, and 
that can lead to improved reading outcomes for chil-
dren, youth, and adults; 
(4) developing print and electronic materials 
that describe and model the application of scientif-
ically based reading research; 
(5) providing national and regional reading 
leadership for State and local personnel for the appli-
cation and implementation of scientifically based 
reading research; 
(6) coordinating efforts among Federal agencies, 
especially the Department of Labor, the Department 
of Health and Human Services, and the National In-
stitute of Child Health and Human Development, 
that provide reading programs, conduct research, and 
provide services to recipients of Federal financial as-
sistance under titles I and III of the Elementary and 
Secondary Education Act of 1965, the Head Start 
Act, the Individuals with Disabilities Education Act, 
and the Adult Basic Skills and Family Literacy Edu-
cation Act, and each Bureau funded school (as defined 
in title XI of the Education Amendments of 1978 (25 
U.S.C. 2001 et seq.)); and
140
(7) informing the Congress, Federal departments 
and agencies, schools of education, and the public of 
successful local, State, and Federal program activities 
in reading instruction that are determined to be effec-
tive based on the findings of scientifically based read-
ing research. 
SEC. 212. ESTABLISHMENT. 
(a) IN GENERAL.—There is established within the exec-
utive branch an independent establishment (as defined in 
title 104 of title 5, United States Code) to be known as the 
‘‘National Institute for Literacy’’. The Institute shall be ad-
ministered, in accordance with this part, under the super-
vision and direction of a Director in consultation with the 
Board, and subject to all fiscal and ethical requirements 
of an executive branch agency. 
(b) DIRECTOR.—
(1) 
APPOINTMENT.—The 
Board 
(established 
under section 216 of this part), in consultation with 
the Secretary of Education, shall appoint a Director 
of the Institute, who has an understanding of, sup-
ports, and is familiar with scientifically based read-
ing research, instruction, and professional develop-
ment applicable to children, youth, and adults.
141
(2) PAY.—The Director of the Institute shall re-
ceive the rate of basic pay for level IV of the Executive 
Schedule. 
(3) TERM.—The Director of the Institute shall be 
appointed for an initial term of 3 years and, if ap-
proved by the Board, may serve not more than 1 ad-
ditional term of 3 years.
SEC. 213. ADMINISTRATION. 
(a) IN GENERAL.—The Institute shall be administered 
by the Director of the Institute in consultation with the 
Board. 
(b) AUTHORITY.—Subject to the general policies, deci-
sions, findings, and determinations of the Board, the Direc-
tor of the Institute shall be responsible for administering 
the Institute. The Director may delegate the powers granted 
under this paragraph to an officer, employee, or office of 
the Institute. The Director shall—
(1) provide leadership for the Institute, con-
sistent with the purposes defined in section 211; 
(2) appoint and supervise all employees in the 
Institute, including attorneys, to provide legal aid 
and service to the Board and the Institute, and to 
represent the Board and the Institute in any case in 
court;
142
(3) appoint the heads of offices in the Institute 
with the approval of the Board; 
(4) assign responsibility to carry out the duties 
of the Institute among officers and employees, and of-
fices of the Institute; 
(5) prepare requests for appropriations for the 
Institute and submit those requests to the President 
and the Congress with the prior approval of the 
Board; 
(6) oversee the expenditure of all funds allocated 
for the Institute to carry out the purposes under sec-
tion 211; and 
(7) confer regularly with the Board on matters 
of policy, personnel, and progress in carrying out the 
mission of the Institute. 
(c) AGENCY DESIGNATION.—For purposes of section 
552b of title 5, United States Code, the Institute is deemed 
to be an agency. 
(d) BUDGET REQUESTS.—In each annual request for 
appropriations by the President, the Director of the Insti-
tute, in consultation with the Board, shall submit a budget 
to carry out the mission of the Institute including—
(1) the amount requested by the Institute in its 
budgetary presentation to the Office of Management 
and Budget; and
143
(2) an assessment of the budgetary needs of the 
Institute. 
(e) BUDGET TRANSMITTAL TO CONGRESS.—The Insti-
tute shall transmit to the Congress copies of budget esti-
mates, requests, and information (including personnel 
needs), legislative recommendations, prepared testimony for 
congressional hearings, and comments on legislation. 
(f) OFFICES.—The Institute shall have offices separate 
from the offices of the Department of Education. 
(g) ADMINISTRATIVE SUPPORT.—
(1) IN GENERAL.—The Secretary of Education 
shall provide administrative support for the Institute, 
including the administration of grants, contracts and 
cooperative agreements, personnel, legal counsel, and 
payroll after the Office of Management and Budget 
has approved the Institute’s budget. 
(2) OTHER DEPARTMENTS AND AGENCIES.—In 
addition to any support obtained under paragraph 
(1) from the Secretary of Education, the Institute 
may obtain administrative support services from 
other departments and agencies within the executive 
branch if determined by the Director of the Institute, 
in consultation with the Board, to be in the best in-
terest of the Institute.
144
SEC. 214. DUTIES. 
(a) IN GENERAL.—In order to provide leadership for 
the improvement and expansion of the system for delivery 
of scientifically based reading instructional practices, the 
Institute shall—
(1) establish a national electronic database of ef-
fective reading programs for children, youth, and 
adults that include the essential components of read-
ing instruction, and disseminate such information to 
parents, teachers, State and Federal elected officials, 
and the public; 
(2) develop print and electronic materials for 
professional development that provide applications of 
scientifically based reading research, and instruc-
tional practices in reading for children, youth, and 
adults; 
(3) provide, when requested, policy and technical 
assistance to the Congress, school Boards, Federal 
agencies, State departments of education, adult edu-
cation programs, local school districts, local public 
and private schools, and schools of education, on sci-
entifically based reading instructional practices in-
cluding diagnostic and assessment instruments and 
instructional materials; 
(4) collaborate and support Federal research pro-
grams in reading instruction, including, where ap-
145
propriate, those areas of study addressed by the Na-
tional Institute of Child Health and Human Develop-
ment, the Institute for Education Sciences, the Na-
tional Science Foundation, the Department of Labor, 
and the National Research Council; 
(5) coordinate with the Department of Edu-
cation, the Department of Labor, the Department of 
Health and Human Services, and the National Insti-
tute of Child Health and Human Development on all 
programs that include improving reading instruc-
tional practices for children, youth, and adults, and 
teacher training in reading instructional practices; 
(6) use and support the collection of the best pos-
sible information in carrying out this section, and 
where appropriate, including reviews of research on 
instruction using the criteria for quality identified by 
the Institute for Education Sciences; and 
(7) conduct reviews of research, including ran-
domized field trials, on reading programs, and con-
duct reviews of Federal reading policies and reading 
program implementation using a board of visitors as 
described in subchapter 300 of the National Science 
Foundation Administrative Manual. 
(b) GRANTS, CONTRACTS, AND COOPERATIVE AGREE-
MENTS.—The Institute may award grants to, or enter into
146
contracts or cooperative agreements with, individuals, pub-
lic or private institutions, agencies, organizations, or other 
legal entities to carry out the activities of the Institute. 
(c) RELATION TO OTHER LAWS.—The duties and pow-
ers of the Institute under this part are in addition to the 
duties and powers of the Institute under subparts 1, 2, and 
3 of part B of the Elementary and Secondary Education 
Act of 1965 (20 U.S.C. 1201 et seq.) (commonly referred 
to as Reading First, Early Reading First, and the William 
F. Goodling Even Start Family Literacy Programs, respec-
tively). 
SEC. 215. LEADERSHIP IN SCIENTIFICALLY BASED READING 
INSTRUCTION. 
(a) IN GENERAL.—The Institute, in consultation with 
the Board, may award fellowships, with such stipends and 
allowances as the Director of the Institute considers nec-
essary, to outstanding individuals who are pursuing careers 
in scientifically based research in reading instruction or 
pre-service or in-service training in reading instruction, in-
cluding teaching children and adults to read. 
(b) FELLOWSHIPS.—Fellowships awarded under this 
subsection shall be used, under the auspices of the Institute, 
to engage in research, education training, technical assist-
ance, or other activities to advance the field of scientifically 
based reading instruction for children, youth, and adults,
147
including the training of volunteers in such reading skills 
instruction. 
(c) INTERNS
AND VOLUNTEERS.—The Institute, in 
consultation with the Board, may award paid and unpaid 
internships to individuals seeking to assist the Institute in 
carrying out its mission. Notwithstanding section 1342 of 
title 31, United States Code, the Institute may accept and 
use voluntary and uncompensated services as the Institute 
deems necessary. 
SEC. 216. NATIONAL INSTITUTE FOR LITERACY ADVISORY 
BOARD. 
(a) ESTABLISHMENT.—
(1) IN GENERAL.—There shall be a National In-
stitute for Literacy Advisory Board, which shall con-
sist of 10 individuals appointed by the President with 
the advice and consent of the Senate. 
(2) COMPOSITION.—The Board shall be com-
prised of individuals who are not otherwise officers or 
employees of the Federal Government and who are 
knowledgeable about scientifically based reading in-
struction, and the findings of scientifically based 
reading research. The members of the Board may in-
clude—
(A) representatives from teacher training 
institutions where scientifically based reading
148
instruction is a major component of pre-service 
training; 
(B) teachers who have been successful in 
teaching children to read proficiently; 
(C) members of the business community who 
have developed successful employee reading in-
struction programs; 
(D) volunteer tutors in reading who are 
using scientifically based reading instruction; 
(E) reading researchers who have conducted 
scientifically based research; and 
(F) other qualified individuals knowledge-
able about scientifically based reading instruc-
tion, including adult education. 
(b) DUTIES.—The Board shall—
(1) work closely with the Director of the Institute 
to ensure that the purposes of the Institute under sec-
tion 211 are carried out effectively; 
(2) approve the annual report to the Congress; 
(3) provide policy guidance and advice to the 
Director of the Institute in the administration of the 
Institute; and 
(4) appoint the Director of the Institute, in con-
sultation with the Secretary.
149
(c) FEDERAL ADVISORY COMMITTEE ACT.—Except as 
otherwise provided in this part, the Board established by 
this section shall be subject to the provisions of the Federal 
Advisory Committee Act (5 U.S.C. App.). 
(d) APPOINTMENTS.—
(1) IN GENERAL.—Each member of the Board 
shall be appointed for a term of 3 years, except that 
the initial terms for members may be 1, 2, or 3 years 
in order to establish a rotation, in which 1⁄3 of the 
members are selected each year. Any such member 
may be appointed for not more than 2 consecutive 
terms. 
(2) VACANCIES.—Any member appointed to fill a 
vacancy occurring before the expiration of the term 
for which the member’s predecessor was appointed 
shall be appointed only for the remainder of that 
term. A member may serve after the expiration of that 
member’s term until a successor has taken office. 
(e) QUORUM.—A majority of the members of the Board 
shall constitute a quorum, but a lesser number may hold 
hearings. Any recommendation of the Board may be passed 
only by a majority of the Board members present. 
(f) ELECTION OF OFFICERS.—The Chairperson and 
Vice Chairperson of the Board shall be elected by the mem-
150
bers of the Board. The term of office of the Chairperson and 
Vice Chairperson shall be 2 years. 
(g) MEETINGS.—The Board shall meet at the call of 
the Chairperson, or a majority of the members of the Board, 
but not less than quarterly. 
SEC. 217. GIFTS, BEQUESTS, AND DEVISES. 
(a) IN GENERAL.—The Institute may accept, admin-
ister, and use gifts or donations of services, money, or prop-
erty, whether real or personal, tangible or intangible. 
(b) RULES.—The Board, in consultation with the Di-
rector of the Institute, shall establish written rules setting 
forth the criteria to be used by the Institute in determining 
whether the acceptance of contributions of services, money, 
or property whether real or personal, tangible or intangible, 
would reflect unfavorably upon the ability of the Institute 
or any employee to carry out the responsibilities of the In-
stitute or employee, or official duties, in a fair and objective 
manner, or would compromise the integrity or the appear-
ance of the integrity of the Institute’s programs or any offi-
cial involved in those programs. 
SEC. 218. MAILS. 
The Board and the Institute may use the United States 
mails in the same manner and under the same conditions 
as other departments and agencies of the United States.
151
SEC. 219. APPLICABILITY OF CERTAIN CIVIL SERVICE LAWS. 
The Director of the Institute and the staff of the Insti-
tute may be appointed without regard to the provisions of 
title 5, United States Code, governing appointments in the 
competitive service, and may be paid without regard to the 
provisions of chapter 51 and subchapter III of chapter 53 
of that title relating to classification and General Schedule 
pay rates, except that an individual so appointed may not 
receive pay in excess of the annual rate of basic pay payable 
for level IV of the Executive Schedule. 
SEC. 220. EXPERTS AND CONSULTANTS. 
The Institute may procure temporary and intermittent 
services under section 3109(b) of title 5, United States Code. 
SEC. 221. REPORT. 
(a) IN GENERAL.—The Institute shall submit a bien-
nial report to the Committee on Education and the Work-
force of the House of Representatives and the Committee 
on Labor and Human Resources of the Senate. Each report 
submitted under this section shall include—
(1) a comprehensive and detailed description of 
the Institute’s operations, activities, financial condi-
tion, and accomplishments in carrying out the pur-
poses of the Institute as specified in section 211, for 
the period covered by the report; and
152
(2) a summary description of how the Institute 
will advance the purposes of the Institute for the next 
biennium. 
(b) FIRST REPORT.—The Institute shall submit a re-
port under this section not later than 1 year after the date 
of enactment of this part. 
SEC. 222. DEFINITIONS. 
For purposes of this part—
(1) the term ‘‘Board’’ means the National Insti-
tute for Literacy Advisory Board; 
(2) the term ‘‘Institute’’ means the National In-
stitute for Literacy; and 
(3) the terms ‘‘reading’’, ‘‘scientifically based 
reading research’’, and ‘‘essential components of read-
ing instruction’’ have the meanings given those terms 
in section 1208 of part B of title I of the Elementary 
and Secondary Education Act of 1965 (20 U.S.C. 
6368). 
SEC. 223. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated to administer 
and carry out this part $6,700,000 for fiscal year 2004 and 
such sums as may be necessary for each of the 5 succeeding 
fiscal years.
153
SEC. 224. RESERVATION. 
From amounts appropriated to the Institute, the Di-
rector of the Institute may use not more than 5 percent of 
such amounts for information dissemination under section 
1207 of the Elementary and Secondary Education Act of 
1965 (20 U.S.C. 6367). 
SEC. 225. AUTHORITY TO PUBLISH. 
The Institute, including the Board, may prepare, pub-
lish, and present (including through oral presentations) 
such research-based information and research reports as 
needed to carry out the purposes and mission of the Insti-
tute. 
TITLE III—AMENDMENTS TO THE 
WAGNER-PEYSER ACT 
SEC. 301. AMENDMENTS TO THE WAGNER-PEYSER ACT. 
The Wagner-Peyser Act (29 U.S.C. 49 et. seq.) is 
amended—
(1) by striking sections 1 through 13; 
(2) in section 14 by inserting ‘‘of Labor’’ after 
‘‘Secretary’’; and 
(3) by amending section 15 to read as follows: 
‘‘SEC. 15. WORKFORCE AND LABOR MARKET INFORMATION 
SYSTEM. 
‘‘(a) SYSTEM CONTENT.—
‘‘(1) IN GENERAL.—The Secretary of Labor, in 
accordance with the provisions of this section, shall
154
oversee the development, maintenance, and continuous 
improvement of a nationwide workforce and labor 
market information system that includes—
‘‘(A) statistical data from cooperative sta-
tistical survey and projection programs and data 
from administrative reporting systems that, 
taken together, enumerate, estimate, and project 
employment opportunities and conditions at na-
tional, State, and local levels in a timely man-
ner, including statistics on—
‘‘(i) employment and unemployment 
status of national, State, and local popu-
lations, including self-employed, part-time, 
and seasonal workers; 
‘‘(ii) industrial distribution of occupa-
tions, as well as current and projected em-
ployment 
opportunities, 
wages, 
benefits 
(where data is available), and skill trends 
by occupation and industry, with par-
ticular attention paid to State and local 
conditions; 
‘‘(iii) the incidence of, industrial and 
geographical location of, and number of 
workers displaced by, permanent layoffs 
and plant closings; and
155
‘‘(iv) employment and earnings infor-
mation maintained in a longitudinal man-
ner to be used for research and program 
evaluation; 
‘‘(B) information on State and local em-
ployment opportunities, and other appropriate 
statistical data related to labor market dynam-
ics, which—
‘‘(i) shall be current and comprehen-
sive; 
‘‘(ii) shall meet the needs identified 
through the consultations described in sub-
paragraphs (A) and (B) of subsection (e)(2); 
and 
‘‘(iii) shall meet the needs for the infor-
mation identified in section 134(d); 
‘‘(C) technical standards (which the Sec-
retary shall publish annually) for data and in-
formation described in subparagraphs (A) and 
(B) that, at a minimum, meet the criteria of 
chapter 35 of title 44, United States Code; 
‘‘(D) procedures to ensure compatibility and 
additivity of the data and information described 
in subparagraphs (A) and (B) from national, 
State, and local levels;
156
‘‘(E) procedures to support standardization 
and aggregation of data from administrative re-
porting systems described in subparagraph (A) 
of employment-related programs; 
‘‘(F) analysis of data and information de-
scribed in subparagraphs (A) and (B) for uses 
such as—
‘‘(i) national, State, and local policy-
making; 
‘‘(ii) implementation of Federal poli-
cies (including allocation formulas); 
‘‘(iii) program planning and evalua-
tion; and 
‘‘(iv) researching labor market dynam-
ics; 
‘‘(G) wide dissemination of such data, in-
formation, and analysis in a user-friendly man-
ner and voluntary technical standards for dis-
semination mechanisms; and 
‘‘(H) programs of—
‘‘(i) training for effective data dissemi-
nation; 
‘‘(ii) research and demonstration; and 
‘‘(iii) programs and technical assist-
ance.
157
‘‘(2) INFORMATION TO BE CONFIDENTIAL.—
‘‘(A) IN GENERAL.—No officer or employee 
of the Federal Government or agent of the Fed-
eral Government may—
‘‘(i) use any submission that is fur-
nished for exclusively statistical purposes 
under the provisions of this section for any 
purpose other than the statistical purposes 
for which the submission is furnished; 
‘‘(ii) make any publication or media 
transmittal of the data contained in the 
submission described in clause (i) that per-
mits information concerning individual 
subjects to be reasonably inferred by either 
direct or indirect means; or 
‘‘(iii) permit anyone other than a 
sworn officer, employee, or agent of any 
Federal department or agency, or a con-
tractor (including an employee of a con-
tractor) of such department or agency, to 
examine an individual submission described 
in clause (i); 
without the consent of the individual, agency, or 
other person who is the subject of the submission 
or provides that submission.
158
‘‘(B) IMMUNITY
FROM
LEGAL
PROCESS.—
Any submission (including any data derived 
from the submission) that is collected and re-
tained by a Federal department or agency, or an 
officer, employee, agent, or contractor of such a 
department or agency, for exclusively statistical 
purposes under this section shall be immune 
from the legal process and shall not, without the 
consent of the individual, agency, or other person 
who is the subject of the submission or provides 
that submission, be admitted as evidence or used 
for any purpose in any action, suit, or other ju-
dicial or administrative proceeding. 
‘‘(C) RULE OF CONSTRUCTION.—Nothing in 
this section shall be construed to provide immu-
nity from the legal process for such submission 
(including any data derived from the submis-
sion) if the submission is in the possession of 
any person, agency, or entity other than the Fed-
eral Government or an officer, employee, agent, 
or contractor of the Federal Government, or if 
the submission is independently collected, re-
tained, or produced for purposes other than the 
purposes of this Act. 
‘‘(b) SYSTEM RESPONSIBILITIES.—
159
‘‘(1) IN
GENERAL.—The workforce and labor 
market information system described in subsection (a) 
shall be planned, administered, overseen, and evalu-
ated through a cooperative governance structure in-
volving the Federal Government and States. 
‘‘(2) DUTIES.—The Secretary, with respect to 
data collection, analysis, and dissemination of labor 
employment statistics for the system, shall carry out 
the following duties: 
‘‘(A) Assign responsibilities within the De-
partment of Labor for elements of the workforce 
and labor market information system described 
in subsection (a) to ensure that all statistical 
and administrative data collected is consistent 
with appropriate Bureau of Labor Statistics 
standards and definitions. 
‘‘(B) Actively seek the cooperation of other 
Federal agencies to establish and maintain 
mechanisms for ensuring complementarity and 
nonduplication in the development and oper-
ation of statistical and administrative data col-
lection activities. 
‘‘(C) Eliminate gaps and duplication in 
statistical undertakings, with the systemization 
of wage surveys as an early priority.
160
‘‘(D) In collaboration with the Bureau of 
Labor Statistics and States, develop and main-
tain the elements of the workforce and labor mar-
ket information system described in subsection 
(a), including the development of consistent pro-
cedures and definitions for use by the States in 
collecting the data and information described in 
subparagraphs (A) and (B) of subsection (a)(1). 
‘‘(E) Establish procedures for the system to 
ensure that—
‘‘(i) such data and information are 
timely; 
‘‘(ii) paperwork and reporting for the 
system are reduced to a minimum; and 
‘‘(iii) States and localities are fully in-
volved in the development and continuous 
improvement of the system at all levels, in-
cluding ensuring the provision, to such 
States and localities, of budget information 
necessary for carrying out their responsibil-
ities under subsection (e). 
‘‘(c) NATIONAL ELECTRONIC TOOLS TO PROVIDE 
SERVICES.—The Secretary is authorized to assist in the de-
velopment of national electronic tools that may be used to 
facilitate the delivery of core services described in section
161
134 and to provide workforce information to individuals 
through the one-stop delivery systems descried in section 
121 and through other appropriate delivery systems. 
‘‘(d) COORDINATION WITH THE STATES.—
‘‘(1) IN
GENERAL.—The Secretary, working 
through the Bureau of Labor Statistics and the Em-
ployment and Training Administration, shall regu-
larly consult with representatives of State agencies 
carrying out workforce information activities regard-
ing strategies for improving the workforce and labor 
market information system. 
‘‘(2) FORMAL CONSULTATIONS.—At least twice 
each year, the Secretary, working through the Bureau 
of Labor Statistics, shall conduct formal consultations 
regarding programs carried out by the Bureau of 
Labor Statistics with representatives of each of the 10 
Federal regions of the Department of Labor, elected 
from the State directors affiliated with State agencies 
that perform the duties described in subsection (e)(2). 
‘‘(e) STATE RESPONSIBILITIES.—
‘‘(1) DESIGNATION OF STATE AGENCY.—In order 
to receive Federal financial assistance under this sec-
tion, the Governor of a State shall—
‘‘(A) designate a single State agency to be 
responsible for the management of the portions of
162
the workforce and labor market information sys-
tem described in subsection (a) that comprise a 
statewide workforce and labor market informa-
tion system and for the State’s participation in 
the development of the annual plan; and 
‘‘(B) establish a process for the oversight of 
such system. 
‘‘(2) DUTIES.—In order to receive Federal finan-
cial assistance under this section, the State agency 
shall—
‘‘(A) consult with State and local employ-
ers, participants, and local workforce investment 
boards about the labor market relevance of the 
data to be collected and disseminated through the 
statewide workforce and labor market informa-
tion system; 
‘‘(B) consult with State educational agen-
cies and local educational agencies concerning 
the provision of employment statistics in order to 
meet the needs of secondary school and postsec-
ondary school students who seek such informa-
tion; 
‘‘(C) collect and disseminate for the system, 
on behalf of the State and localities in the State,
164
‘‘(3) RULE OF CONSTRUCTION.—Nothing in this 
section shall be construed as limiting the ability of a 
State agency to conduct additional data collection, 
analysis, and dissemination activities with State 
funds or with Federal funds from sources other than 
this section. 
‘‘(f) NONDUPLICATION REQUIREMENT.—None of the 
functions and activities carried out pursuant to this section 
shall duplicate the functions and activities carried out 
under the Carl D. Perkins Vocational and Applied Tech-
nology Education Act (20 U.S.C. 2301 et seq.). 
‘‘(g) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to carry out this section 
such sums as may be necessary for each of the fiscal years 
2004 through 2009. 
‘‘(h) DEFINITION.—In this section, the term ‘local 
area’ means the smallest geographical area for which data 
can be produced with statistical reliability.’’. 
TITLE IV—AMENDMENTS TO THE 
REHABILITATION ACT OF 1973
SEC. 401. CHAIRPERSON. 
Section 705(b)(5) of the Rehabilitation Act of 1973 (29 
U.S.C. 796d(b)(5)) is amended to read as follows:
165
‘‘(5) CHAIRPERSON.—The Council shall select a 
chairperson from among the voting membership of the 
Council.’’. 
SEC. 402. REHABILITATION SERVICES ADMINISTRATION. 
Section 3(a) of the Rehabilitation Act of 1973 (29 
U.S.C. 702(a)) is amended—
(1) by striking ‘‘Office of the Secretary’’ and in-
serting ‘‘Department of Education’’; 
(2) by striking ‘‘President by and with the ad-
vice and consent of the Senate’’ and inserting ‘‘Sec-
retary, except that the current Commissioner ap-
pointed under the authority existing on the day prior 
to the date of enactment of this Act may continue to 
serve in the former capacity’’; and 
(3) by striking ‘‘, and the Commissioner shall be 
the principal officer,’’. 
SEC. 403. DIRECTOR. 
(a) IN GENERAL.—The Rehabilitation Act of 1973 (29 
U.S.C. 701 et seq.) is amended by striking ‘‘Commissioner’’ 
each place it appears, except in section 21, and inserting 
‘‘Director’’. 
(b) EXCEPTION.—Section 21 of the Rehabilitation Act 
of 1973 (29 U.S.C. 718) is amended—
(1) in subsection (b)(1)—
166
(A) by striking ‘‘Commissioner’’ the first 
place it appears and inserting ‘‘Director of the 
Rehabilitation Services Administration’’; and 
(B) by striking ‘‘(referred to in this sub-
section as the ‘Director’) ’’; and 
(2) by striking ‘‘Commissioner and the Director’’ 
each place it appears and inserting ‘‘both such Direc-
tors’’. 
SEC. 404. STATE GOALS. 
Section 101(a) of the Rehabilitation Act of 1973 (29 
U.S.C. 721(a)) is amended—
(1) in paragraph (11)(D)(i) by inserting ‘‘, 
which may be provided using alternative means of 
meeting participation (such as video conferences and 
conference calls)’’ before the semicolon; and 
(2) in paragraph (15)—
(A) in subparagraph (A), by redesignating 
clauses (ii) and (iii) as clauses (iii) and (iv), re-
spectively, and inserting after clause (i) the fol-
lowing: 
‘‘(ii) include an assessment of the tran-
sition services provided under this Act, and 
coordinated with transition services under 
the Individuals with Disabilities Education
167
Act, as to those services meeting the needs of 
individuals with disabilities.’’; and 
(B) by amending subparagraph (D)(i) to 
read as follows: 
‘‘(i) the methods to be used to expand 
and improve the services to individuals 
with disabilities including—
‘‘(I) how a broad range of assist-
ive technology services and assistive 
technology devices will be provided to 
such individuals at each stage of the 
rehabilitative process and how such 
services and devices will be provided to 
such individuals on a statewide basis; 
and 
‘‘(II) how transition services will 
be better coordinated with those serv-
ices under the Individuals with Dis-
abilities Education Act in order to im-
prove transition services for individ-
uals with disabilities served under this 
Act;’’. 
SEC. 405. AUTHORIZATIONS OF APPROPRIATIONS. 
The Rehabilitation Act of 1973 is further amended—
168
(1) in section 100(b)(1) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(2) in section 100(d)(1)(B) by striking ‘‘fiscal 
year 2003’’ and inserting ‘‘fiscal year 2009’’; 
(3) in section 110(c) by amending paragraph (2) 
to read as follows: 
‘‘(2) The sum referred to in paragraph (1) shall 
be, as determined by the Secretary, not less than 1 
percent and not more than 1.5 percent of the amount 
referred to in paragraph (1) for each of fiscal years 
2003 through 2009.’’; 
(4) in section 112(h) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(5) in section 201(a) by striking ‘‘fiscal years 
1999 through 2003’’ each place it appears and insert-
ing ‘‘fiscal years 2004 through 2009’’; 
(6) in section 302(i) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(7) in section 303(e) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’;
169
(8) in section 304(b) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(9) in section 305(b) by striking ‘‘fiscal years 
1999 through 2003’’ and insert ‘‘fiscal years 2004 
through 2009’’; 
(10) in section 405 by striking ‘‘fiscal years 1999 
through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(11) in section 502(j) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(12) in section 509(l) by striking ‘‘fiscal years 
1999 through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(13) in section 612 by striking ‘‘fiscal years 1999 
through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(14) in section 628 by striking ‘‘fiscal years 1999 
through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; 
(15) in section 714 by striking ‘‘fiscal years 1999 
through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’;
170
(16) in section 727 by striking ‘‘fiscal years 1999 
through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’; and 
(17) in section 753 by striking ‘‘fiscal years 1999 
through 2003’’ and inserting ‘‘fiscal years 2004 
through 2009’’. 
SEC. 406. HELEN KELLER NATIONAL CENTER ACT. 
(a) GENERAL AUTHORIZATION OF APPROPRIATIONS.—
The first sentence of section 205(a) of the Helen Keller Na-
tional Center Act (29 U.S.C. 1904(a)) is amended by strik-
ing ‘‘1999 through 2003’’ and inserting ‘‘2004 through 
2009’’. 
(b) HELEN KELLER NATIONAL CENTER FEDERAL EN-
DOWMENT FUND.—The first sentence of section 208(h) of 
such Act (29 U.S.C. 1907(h)) is amended by striking ‘‘1999 
through 2003’’ and inserting ‘‘2004 through 2009’’. 
TITLE V—TRANSITION AND 
EFFECTIVE DATE 
SEC. 501. TRANSITION PROVISIONS. 
The Secretary of Labor shall take such actions as the 
Secretary determines to be appropriate to provide for the 
orderly implementation of this Act.
171
SEC. 502. EFFECTIVE DATE. 
Except as otherwise provided in this Act, this Act and 
the amendments made by this Act, shall take effect on the 
date of enactment of this Act.
Union Calendar No. 46
108TH CONGRESS 
1ST SESSION 
H. R. 1261
[Report No. 108–82] 
A BILL 
To enhance the workforce investment system of the 
Nation by strengthening one-stop career centers, 
providing for more effective governance arrange-
ments, promoting access to a more comprehen-
sive array of employment, training, and related 
services, establishing a targeted approach to serv-
ing youth, and improving performance account-
ability, and for other purposes. 
MAY 1, 2003
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed