State under section 6 of the Wagner-Peyser 
Act for fiscal year 2005. 
‘‘(ii) 
EXCESS
AMOUNTS.—If 
the 
amount referred to in paragraph (2)(A) for 
fiscal year 2006 exceeds the amount that 
was available for allotment to the States 
under the Wagner-Peyser Act for fiscal year 
2005, such excess amount shall be allotted 
on the basis of the relative number of indi-
viduals in the civilian labor force in each 
State, compared to the total number of indi-
viduals in the civilian labor force in all 
States, adjusted to ensure that no State re-
ceives less than 3⁄10 of one percent of such 
excess amount. 
‘‘(iii) DEFINITION.—For purposes of 
this subparagraph, the term ‘allotment per-
centage’ means the percentage of the 
amounts allotted to States under section 6 
of the Wagner-Peyser Act that is received by 
the State involved for fiscal year 2005. 
‘‘(B) FISCAL
YEARS
2007
AND
THERE-
AFTER.—
‘‘(i) IN
GENERAL.—Subject to clause 
(ii), the amount referred to in para-
graph(2)(A) shall be allotted for fiscal year 
2007 and each fiscal year thereafter on the 
basis of the allotment percentage of each 
State under this paragraph for the pre-
ceding fiscal year. 
‘‘(ii) 
EXCESS
AMOUNTS.—If 
the 
amount referred to in paragraph (2)(A) for 
fiscal year 2007 or any fiscal year there-
after exceeds the amount that was available 
for allotment under this paragraph for the 
prior fiscal year, such excess amount shall 
be allotted on the basis of the relative num-
ber of individuals in the civilian labor force 
in each State, compared to the total number 
of individuals in the civilian labor force in 
all States, adjusted to ensure that no State 
receives less than 3⁄10 of one percent of such 
excess amount. 
‘‘(iii) DEFINITION.—For purposes of 
this subparagraph, the term ‘allotment per-
centage’ means the percentage of the 
amounts allotted to States under this para-
graph in a fiscal year that is received by 
the State involved for such fiscal year. 
‘‘(4) CONSOLIDATED FORMULA.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graphs (B) and (C), of the amount referred to in 
paragraph (2)(B)—
‘‘(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) 25 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; and 
‘‘(iii) 15 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. 
‘‘(B) MINIMUM
AND
MAXIMUM
PERCENT-
AGES.—
‘‘(i) MINIMUM PERCENTAGE.—The Sec-
retary shall ensure that no State shall re-
ceive an allotment under this paragraph for 
a fiscal year that is less than 90 percent of
the allotment percentage of the State under 
this paragraph for the preceding fiscal year. 
‘‘(ii) MAXIMUM PERCENTAGE.—Subject 
to clause (i), the Secretary shall ensure that 
no State shall receive an allotment for a fis-
cal year under this paragraph that is more 
than 130 percent of the allotment of the 
State under this paragraph for the pre-
ceding fiscal year. 
‘‘(C) SMALL STATE MINIMUM ALLOTMENT.—
Subject to subparagraph (B), the Secretary shall 
ensure that no State shall receive an allotment 
under this paragraph that is less than 2⁄10 of 1 
percent of the amount available under subpara-
graph (A). 
‘‘(D) DEFINITIONS.—For the purposes of 
this paragraph: 
‘‘(i) ALLOTMENT
PERCENTAGE.—The 
term ‘allotment percentage’, used with re-
spect to fiscal year 2006 or a subsequent fis-
cal year, means a percentage of the amounts 
described in paragraph (2)(B) that is re-
ceived through an allotment made under 
this paragraph for the fiscal year. The term, 
with respect to fiscal year 2005, 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 Job 
Training Improvement Act of 2005) and 
under reemployment service grants received 
by the State involved for fiscal year 2005. 
‘‘(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 41⁄2 percent of the civilian labor 
force in the State. 
‘‘(5) ADJUSTMENTS IN ALLOTMENTS BASED ON 
DIFFERENCES WITH UNCONSOLIDATED FORMULAS.—
‘‘(A) IN GENERAL.—The Secretary shall en-
sure that for any fiscal year no State has an al-
lotment difference, as defined in subparagraph
(C), that is less than zero. The Secretary shall 
adjust the amounts allotted to the States under 
this subsection in accordance with subparagraph 
(B) if necessary to carry out this subparagraph. 
‘‘(B) ADJUSTMENTS IN ALLOTMENTS.—
‘‘(i) 
REDISTRIBUTION
OF
EXCESS 
AMOUNTS.—
‘‘(I) IN GENERAL.—If necessary to 
carry out subparagraph (A), the Sec-
retary shall reduce the amounts that 
would be allotted under paragraphs (3) 
and (4) to States that have an excess 
allotment difference, as defined in sub-
clause (II), by the amount of such ex-
cess, and use such amounts to increase 
the allotments to States that have an 
allotment difference less than zero. 
‘‘(II) 
EXCESS
AMOUNTS.—For 
purposes of subclause (I), the term ‘ex-
cess’ allotment difference means an al-
lotment difference for a State that is—
‘‘(aa) in excess of 3 percent 
of the amount described in sub-
paragraph (C)(i)(II); or
‘‘(bb) in excess of a percent-
age established by the Secretary 
that is greater than 3 percent of 
the amount described in subpara-
graph (C)(i)(II) if the Secretary 
determines that such greater per-
centage is sufficient to carry out 
subparagraph (A). 
‘‘(ii) USE
OF
AMOUNTS
AVAILABLE 
UNDER
NATIONAL
RESERVE
ACCOUNT.—If 
the funds available under clause (i) are in-
sufficient to carry out subparagraph (A), 
the Secretary shall use funds reserved under 
section 132(a) in such amounts as are nec-
essary to increase the allotments to States to 
meet the requirements of subparagraph (A). 
Such funds shall be used in the same man-
ner as the States use the other funds allotted 
under this subsection. 
‘‘(C) DEFINITION
OF
ALLOTMENT
DIF-
FERENCE.—
‘‘(i) IN
GENERAL.—For purposes of 
this paragraph, the term ‘allotment dif-
ference’ means the difference between—
‘‘(I) the total amount a State 
would receive of the amounts available 
for allotment under subsection (b)(2) 
for a fiscal year pursuant to para-
graphs (3) and (4); and 
‘‘(II) the total amount the State 
would receive of the amounts available 
for allotment under subsection (b)(2) 
for the fiscal year if such amounts were 
allotted pursuant to the unconsolidated 
formulas (applied as described in 
clause (iii)) that were used in allotting 
funds for fiscal year 2005. 
‘‘(ii) UNCONSOLIDATED
FORMULAS.—
For purposes of clause (i), the unconsoli-
dated formulas are: 
‘‘(I) The requirements for the al-
lotment of funds to the States con-
tained in section 132(b)(1)(B) of this 
Act (as in effect on the day before the 
date of enactment of the Job Training 
Improvement Act of 2005) that were 
applicable to the allotment of funds 
under such section for fiscal year 2005.
‘‘(II) The requirements for the al-
lotment of funds to the States con-
tained in section 132(b)(2)(B) of this 
Act (as in effect on the day before the 
date of enactment of the Job Training 
Improvement Act of 2005) that were 
applicable to the allotment of funds 
under such section for fiscal year 2005. 
‘‘(III) The requirements for the al-
lotment of funds to the States that were 
contained in section 6 of the Wagner-
Peyser Act (as in effect on the day be-
fore the date of enactment of the Job 
Training Improvement Act of 2005) 
that were applicable to the allotment of 
funds under such Act for fiscal year 
2005. 
‘‘(IV) The requirements for the al-
lotment of funds to the States that were 
established by the Secretary for Reem-
ployment Services Grants that were 
applicable to the allotment of funds for 
such grants for fiscal year 2005. 
‘‘(iii) PROPORTIONATE
APPLICATION 
OF UNCONSOLIDATED FORMULAS BASED ON
FISCAL
YEAR
2005.—In calculating the 
amount under clause (i)(II), each of the un-
consolidated formulas identified in clause 
(ii) shall be applied, respectively, only to 
the proportionate share of the total amount 
of funds available for allotment under sub-
section (b)(2) for a fiscal year that is equal 
to the proportionate share to which each of 
the unconsolidated formulas applied with 
respect to the total amount of funds allotted 
to the States under all of the unconsolidated 
formulas in fiscal year 2005. 
‘‘(iv) RULE
OF
CONSTRUCTION.—The 
amounts used to adjust the allotments to a 
State under subparagraph (B) for a fiscal 
year shall not be included in the calculation 
of the amounts under clause (i) for a subse-
quent fiscal year, including the calculation 
of allocation percentages for a preceding fis-
cal year applicable to paragraphs (3) and 
(4) and to the unconsolidated formulas de-
scribed in clause (ii).’’. 
(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 at the end of the 
program year prior to the program year for which the 
determination is made exceeds 30 percent of the total 
amount of funds available to the State under this sec-
tion during such prior program year (including 
amounts allotted to the State in all prior program 
years that remained available). For purposes of this 
paragraph, the expended balance is the amount that 
is the difference between—
‘‘(A) the total amount of funds available to 
the State under this section during the program 
year prior to the program year for which the de-
termination is made (including amounts allotted 
to the State in all prior program years that re-
mained available); and 
‘‘(B) the accrued expenditures during such 
prior program year.’’; 
(B) in paragraph (3)—
(i) by striking ‘‘for the prior program 
year’’ and inserting ‘‘for the program year 
in which the determination is made’’; and
(ii) by striking ‘‘such prior program 
year’’ and inserting ‘‘such program year’’; 
(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.’’; and 
(D) in paragraph (5), by striking ‘‘obliga-
tion’’ and inserting ‘‘accrued expenditure’’. 
(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) 85 percent of such amounts shall be al-
located by the Governor to local areas in accord-
ance with paragraph (2); and 
‘‘(B) 15 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) 25 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; and 
‘‘(iii) 15 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 2006 or a subsequent fis-
cal year, means a percentage of the amount 
described in paragraph (1)(A) that is re-
ceived through an allocation made under 
this paragraph for the fiscal year. The term, 
with respect to fiscal year 2005, 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 Job 
Training Improvement Act of 2005) that is 
received by the local area involved for fiscal 
year 2005.
‘‘(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 at the end of the 
program year prior to the program year for which the 
determination is made exceeds 30 percent of the total
amount of funds available to the local area under this 
section during such prior program year (including 
amounts allotted to the local area in prior program 
years that remain available). For purposes of this 
paragraph, the unexpended balance is the amount 
that is the difference between—
‘‘(A) the total amount of funds available to 
the local area under this section during the pro-
gram year prior to the program year for which 
the determination is made (including amounts 
allocated to the local area in all prior program 
years that remained available); and 
‘‘(B) the accrued expenditures during such 
prior program year.’’; 
(C) by amending paragraph (3)—
(i) by striking ‘‘subsection (b)(3)’’ the 
first two places 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-