of individuals in the civilian labor 
force who are ages 16–19 in all 
States; 
‘‘(II) 331⁄3 percent shall be allot-
ted on the basis of the relative num-
ber of unemployed individuals in each 
State, compared to the total number 
of unemployed individuals in all 
States; and 
‘‘(III) 331⁄3 percent shall be allot-
ted on the basis of the relative num-
ber of disadvantaged youth who are 
ages 16 through 21 in each 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 fiscal year that is less than 90 percent 
or greater than 130 percent of the allot-
ment percentage of that State for the pre-
ceding fiscal year. 
‘‘(iv) SMALL STATE MINIMUM ALLOT-
MENT.—Subject to clause (iii), the Sec-
retary shall ensure that no State shall re-
ceive an allotment under this 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 2006 or a subsequent fiscal year, 
means a percentage of the remainder described 
in paragraph (1)(C)(i) that is received through 
an allotment made under this subsection for the 
fiscal year. The term, with respect to fiscal year 
2005, means the percentage of the amounts al-
lotted to States 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 State involved for fiscal year 
2005. 
‘‘(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.
‘‘(3) SPECIAL RULE.—For purposes of the for-
mulas specified in paragraph (1)(C), the Secretary 
shall, as appropriate and to the extent practicable, 
exclude college students and members of the Armed 
Forces from the determination of the number of dis-
advantaged youth.’’. 
(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 redesig-
nated)— 
(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 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 section during such prior program year (includ-
ing amounts allotted to the State in all prior pro-
gram 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 
determination is made (including amounts allot-
ted to the State in all prior program years that 
remained available); and 
‘‘(B) the accrued expenditures during such 
prior program year.’’; 
(ii) in paragraph (3)— 
(I) by striking ‘‘for the prior pro-
gram year’’ and inserting ‘‘for the 
program year in which the determina-
tion 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 
determination under paragraph (2) is made.’’; and
(iv) in paragraph (5), by striking ‘‘ob-
ligation’’ and inserting ‘‘accrued expendi-
ture’’. 
(b) WITHIN STATE ALLOCATIONS.— 
(1) RESERVATION
FOR
STATEWIDE
ACTIVI-
TIES.—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 activi-
ties. 
‘‘(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 
section 132 and reserved under section 133(a), the 
Governor 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
ALLOCATIONS.—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 re-
served under subsection (a)(1)— 
‘‘(A) 80 percent of such amounts shall be 
allocated by the Governor to local areas in ac-
cordance with paragraph (2); and 
‘‘(B) 20 percent of such amounts shall be 
allocated by the Governor to local areas in ac-
cordance with paragraph (3). 
‘‘(2) ESTABLISHED FORMULA.— 
‘‘(A) IN GENERAL.—Of the amounts de-
scribed in paragraph (1)(A), the Governor shall 
allocate— 
‘‘(i) 331⁄3 percent shall be allotted on 
the basis of the relative number of individ-
uals in the civilian labor force who are ages 
16–19 in each local area, compared to the 
total number of individuals in the civilian 
labor force who are ages 16–19 in all local 
areas in the State; 
‘‘(ii) 331⁄3 percent shall be allotted on 
the basis of the relative number of unem-
ployed individuals in each local area, com-
pared to the total number of unemployed
individuals in all local areas in the State; 
and 
‘‘(iii) 331⁄3 percent on the basis of the 
relative number of disadvantaged youth 
who are ages 16 through 21 in each local 
area, compared to the total number of 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 per-
cent or greater than 130 percent of the alloca-
tion percentage of the local area for the pre-
ceding fiscal year. 
‘‘(C) DEFINITIONS.— 
‘‘(i) ALLOCATION PERCENTAGE.—For 
purposes of this paragraph, the term ‘allo-
cation percentage’, used with respect to fis-
cal year 2006 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 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 fis-
cal year 2005. 
‘‘(ii) DISADVANTAGED
YOUTH.—The 
term ‘disadvantaged youth’ means an indi-
vidual who is age 16 through 21 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. 
‘‘(3) YOUTH
DISCRETIONARY
ALLOCATION.— 
The Governor shall allocate to local areas the 
amounts described in paragraph (1)(B) in accord-
ance 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 car-
rying out local workforce investment activities 
under this chapter or chapter 5. 
‘‘(B) USE OF FUNDS.—Funds made avail-
able for administrative costs under subpara-
graph (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 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)’’ 
each place it appears and inserting ‘‘sub-
section (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 re-
allocation 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 24; and 
‘‘(B) one or more of the following: 
‘‘(i) school dropouts; 
‘‘(ii) recipients of a secondary school 
diploma or General Educational Develop-
ment credential (GED) (including recog-
nized alternative standards for individuals 
with disabilities) who are deficient in basic 
skills; 
‘‘(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 
following: 
‘‘(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 
priority in the provision of services under this chap-
ter shall be given to individuals who are school drop-
outs. 
‘‘(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.— 
Activities 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 session (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 in-
cluding— 
‘‘(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 chap-
ter and chapter 5 in coordination with evalua-
tions 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 activi-
ties, and the provision of technical assistance to 
local areas that fail to meet local performance 
measures; 
‘‘(F) operating a fiscal and management 
accountability system under section 136(f); and 
‘‘(G) carrying out monitoring and over-
sight of activities under this chapter and chap-
ter 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 de-
velop 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 
appropriate, of’’; 
(B) in subparagraph (B), by inserting ‘‘are 
directly linked to one or more of the perform-
ance outcomes relating to this chapter under 
section 136, and that’’ after ‘‘for each partici-
pant that’’; and 
(C) in subparagraph (C)— 
(i) 
by 
redesignating 
clauses 
(i) 
through (iv) as clauses (ii) through (v), re-
spectively; 
(ii) by inserting before clause (ii) (as 
so redesignated) the following: 
‘‘(i) activities leading to the attainment of a sec-
ondary school diploma or the General Educational Devel-
opment credential (GED) (including recognized alter-
native standards for individuals with disabilities);’’; 
(iii) in clause (ii) (as so redesignated), 
by inserting ‘‘and advanced training’’ after 
‘‘opportunities’’; 
(iv) in clause (iii) (as so redesig-
nated), by inserting ‘‘that lead to the at-
tainment of recognized credentials’’ after 
‘‘learning’’; and 
(v) by amending clause (v) (as redes-
ignated by this subparagraph) to read as 
follows: 
‘‘(v) effective connections to employers in sectors of 
the local labor market experiencing high growth in employ-
ment opportunities.’’. 
(2) PROGRAM
ELEMENTS.—Section 129(c)(2) 
(29 U.S.C. 2854(c)(2)) is amended— 
(A) in subparagraph (A), by striking ‘‘sec-
ondary school, including dropout prevention 
strategies’’ and inserting ‘‘secondary school di-
ploma or the General Educational Development 
credential (GED) (including recognized alter-
native standards for individuals with disabil-
ities), including dropout prevention strategies’’;