II 115th CONGRESS 2d Session S. 3601 IN THE SENATE OF THE UNITED STATES October 11, 2018 Mr. Booker (for himself and Mr. Young ) introduced the following bill; which was read twice and referred to the Committee on the Judiciary A BILL To amend the Workforce Innovation and Opportunity Act to provide for a program that employs pay-for-performance financing for workforce development projects.

1. Short title This Act may be cited as the Delivering Outcomes for American Workers Act . 2. Pay-for-performance workforce development program Subtitle D of title I of the Workforce Innovation and Opportunity Act ( 29 U.S.C. 3221 et seq.) is amended— (1) by redesignating section 172 as section 173; and (2) by inserting after section 171 the following: 172. Pay-for-performance workforce development program (a) General authority The Secretary shall establish and carry out a Pay-for-Performance workforce development program. In carrying out the program, the Secretary may enter into agreements with eligible entities to provide for workforce development projects that are designed to accomplish outcomes that, in turn, enable the eligible entities to achieve specified long-term employment-related goals. (b) Long-Term employment-Related goals Not less often than annually, the Secretary shall issue guidance that specifies long-term employment-related goals, such as sustained long-term employment or increased earnings over time, for projects carried out under this section. The guidance shall specify long-term employment-related goals that an eligible entity shall address in an application for a project to be carried out in the upcoming fiscal year. (c) Eligible entities To be eligible to enter into an agreement under this section, an entity shall be a State, a political subdivision of a State, a State board, a local board, an Indian tribe or tribal organization (as such terms are defined in section 166(b)), or a partnership of entities described in this subsection. (d) Applications To be eligible to enter into an agreement under this section, an entity shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require, including— (1) a description of a potential workforce development approach that the entity proposes to carry out by entering into a contract with one or more service providers for a workforce development project, in accordance with an outcomes rate card described in subsection (e)(1) and approved as part of the application; (2) a description of the geographic area and target population that the entity intends to serve through the project, along with a data-driven rationale for the size and expected impact of the project; (3) a description of expected participant- and community-level social benefits as a result of the project; (4) the outcomes rate card described in subsection (e)(1) and an assurance that the entity will incorporate the terms specified on the card into the contracts with service providers; (5) evidence, including the results of prior rigorous experimental or quasi-experimental studies, demonstrating that the outcomes specified on the outcomes rate card predict whether the long-term employment-related goals will be achieved; (6) an assurance that the entity will contribute the non-program share described in subsection (g) of the cost of each project involved; (7) an assurance that the entity will hold an open and fair procurement process to select service providers to provide services under the project; (8) a commitment that the entity will ensure that service delivery is not skewed toward the participants most likely to achieve the desired outcomes; (9) an assurance that necessary administrative data systems and information technology infrastructure are available or will be available to connect the data and information from a service provider with outcomes validation and performance management and payment processes; and (10) a plan for evaluation of the project as described in subsection (j)(1). (e) Outcomes (1) Card prepared by eligible entity To be eligible to enter into an agreement under this section, an entity shall prepare an outcomes rate card that specifies each of the following and any additional information requested by the Secretary: (A) The long-term employment-related goals the eligible entity hopes to achieve. (B) The specific outcomes that the eligible entity hopes to achieve, which will be used to assess whether long-term employment-related goals are achieved. (C) The price for each such outcome, that the eligible entity proposes that the Secretary will pay to reimburse an eligible entity for each participant that achieves the outcome, consistent with paragraph (2)(B). (D) Other terms that the eligible entity proposes to incorporate into each contract with a service provider. (2) Guidance prepared by secretary Not less often than annually, the Secretary shall issue guidance, on which eligible entities may base outcomes rate cards prepared under paragraph (1). The guidance shall include information describing sample outcomes and factors for entities to consider when proposing their prices, including the type of population being served. The guidance shall describe the harder-to-serve populations for which entities may propose higher prices. (f) Awarding agreements (1) Timeline in awarding agreement Not later than 6 months after receiving an application, the Secretary shall determine whether to enter into an agreement for a workforce development project with an eligible entity. (2) Priority populations In selecting eligible entities for agreements, the Secretary shall give priority to entities who propose to serve veterans and individuals with barriers to employment, including homeless individuals and long-term unemployed individuals. (3) Agreement authority (A) Agreement requirements The Secretary may enter into an agreement for a workforce development project if the Secretary approves the application and determines that each of the following requirements are met: (i) Outcome and reimbursement The eligible entity agrees to develop and implement (through contracts with service providers) a workforce development project— (I) that is designed to achieve specified long-term employment-related goals; and (II) for which the Secretary will reimburse the eligible entity for a program share of the cost of the project, subject to subparagraph (B). (ii) Outcome that predicts achievement Based on information provided in the application submitted under subsection (d) or other relevant information, particularly the results of prior rigorous experimental or quasi-experimental studies, the proposed outcomes predict whether the long-term employment-related goals will be achieved. (B) Maximum reimbursement The Secretary may enter into an agreement with a target reimbursement amount (for the total reimbursement expected to be provided under the agreement for the project involved) of not more than $20,000,000, except that the maximum reimbursement to be provided under such an agreement— (i) subject to clause (ii), will be determined in accordance with the outcomes rate card described in subsection (e)(1) and included in the agreement; and (ii) will not exceed the amount of the program share of the cost described in subsection (d)(6). (g) Program share (1) In general The program share of the cost described in subsection (d)(6) shall be not more than 75 percent. (2) Non-program share An eligible entity shall contribute the non-program share of the cost— (A) in cash; and (B) from public or private sources, including Federal sources other than the program carried out under this section. (3) Federal sources Funds that are appropriated to carry out this section, or appropriated under Federal law and designated for use under paragraph (2)(B), shall remain available until expended. (h) Technical assistance The Secretary shall reserve not more than $10,000,000 to provide technical assistance to aid entities described in subsection (c) in developing outcomes rate cards under subsection (e)(1) and refining the data systems described in subsection (d)(9). (i) Data sharing The Secretary shall ensure that the eligible entities that enter into agreements under this section have appropriate data sharing agreements in place, to enable the eligible entities to access administrative data needed to measure the outcomes, and to measure the long-term employment-related goals. (j) Evaluations (1) Projects The Secretary shall conduct an evaluation of each workforce development project carried out under this section, using reliable, evidence-based research methodologies (including if possible contemporaneous use of a comparison group) that allow for the strongest possible causal inferences for the project— (A) to determine whether the project carried out in accordance with the related outcome rate card yielded the desired long-term employment-related goals; (B) to determine if the outcomes were accurate predictors of whether the corresponding long-term employment-related goals were achieved; (C) to assess the implementation of the project and its impact on— (i) employment, including private sector employment; (ii) wages and benefits in private sector employment; and (iii) poverty; and (D) to develop best practices for workforce development projects. (2) Program The Secretary shall conduct an evaluation of the Pay-for-Performance workforce development program carried out under this section— (A) using the methodologies described in paragraph (1); (B) making the determinations and assessment required in subparagraphs (A) through (C) of paragraph (1) for that program; and (C) developing best practices for pay-for-performance workforce development programs. (3) Reservation The Secretary shall reserve, for each fiscal year in which a project or program is to be evaluated under this subsection, not less than $5,000,000 to carry out this subsection. (k) Website The Secretary shall establish and maintain a web page on which the Secretary shall make publicly available— (1) a copy of, or method of accessing, each notice published in the Federal Register regarding a project to be funded pursuant to this section; and (2) for each eligible entity that has entered into an agreement with the Secretary for such a project, information stating— (A) the long-term employment-related goals and outcome rate cards for the project; (B) a description of each workforce development approach and service provider to be used in the project; (C) the target population that will be served by the project; (D) the expected social benefits to participants in the project and others who may be impacted; (E) the information included in the outcomes rate card and the methodology to be used to determine if the participants achieve the outcomes; (F) the project timeline; and (G) the maximum reimbursement possible for the project. (l) Regulations The Secretary may issue regulations as necessary to carry out this section. . 3. Funding Section 173 of the Workforce Innovation and Opportunity Act, as redesignated by section 2(1), is amended— (1) by redesignating subsections (e) and (f) as subsections (f) and (g), respectively; and (2) by inserting after subsection (d) the following: (e) Pay-for-Performance workforce development program To carry out section 172— (1) funds available under section 286(s)(2)(A) of the Immigration and Nationality Act ( 8 U.S.C. 1356(s)(2)(A) ) may be used; and (2) there are authorized to be appropriated such sums as may be necessary for fiscal year 2019, and sums appropriated under this paragraph shall remain available until 5 years after the date of enactment of the Delivering Outcomes for American Workers Act . . 4. Conforming amendments (a) Immigration and Nationality Act Section 286(s)(2) of the Immigration and Nationality Act ( 8 U.S.C. 1356(s)(2) ) is amended by striking (2) and all that follows through 50 percent of amounts and inserting the following: (2) Use of fees (A) Pay-for-performance workforce development program From a portion equal to 50 percent of the amounts deposited into the H–1B Nonimmigrant Petitioner Account for a fiscal year, the greater of $100,000,000, or all of the portion, shall remain available to the Secretary of Labor until expended to carry out the section 172 of the Workforce Innovation and Opportunity Act. (B) Job training The remainder of the portion . (b) Table of Contents The table of contents in section 1(b) of the Workforce Innovation and Opportunity Act is amended— (1) by redesignating the item relating to section 172 as the item relating to section 173; and (2) by inserting after the item relating to section 171 the following: Sec. 172. Pay-for-Performance workforce development program. . 5. Prospective repeal of authority (a) Repeal Effective 5 years after the date of enactment of this Act— (1) section 172 of the Workforce Innovation and Opportunity Act, as added by section 2 of this Act, is repealed; (2) the Workforce Innovation and Opportunity Act ( 29 U.S.C. 3101 et seq.), as amended by sections 3 and 4 of this Act, is amended— (A) in the table of contents, by striking the item relating to section 172; and (B) in section 173, by striking subsection (e); and (3) section 286(s)(2) of the Immigration and Nationality Act ( 8 U.S.C. 1356(s)(2) ), as amended by section 4 of this Act, is amended— (A) by striking subparagraph (A); and (B) in subparagraph (B), by striking (B) and all that follows through of the portion and inserting 50 percent of amounts . (b) Agreements still in effect Notwithstanding the amendments made by subsection (a), an agreement entered into under section 172(a) of the Workforce Innovation and Opportunity Act before the effective date of the amendments made by subsection (a) shall remain in full force and effect under the terms, and for the duration, of the agreement.