H. Rept. 104-152 - 104th Congress (1995-1996)

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House Report 104-152 - CONSOLIDATED AND REFORMED EDUCATION, EMPLOYMENT, AND REHABILITATION SYSTEMS ACT (CAREERS ACT)

[House Report 104-152]
[From the U.S. Government Printing Office]





   104th Congress 1st 
         Session        HOUSE OF REPRESENTATIVES        Report
                                                       104-152
_______________________________________________________________________

                                     

 
  CONSOLIDATED AND REFORMED EDUCATION, EMPLOYMENT, AND REHABILITATION 
                       SYSTEMS ACT (CAREERS ACT)

                               ----------                              

                              R E P O R T

                                 of the

                              COMMITTEE ON
                        ECONOMIC AND EDUCATIONAL
                             OPPORTUNITIES

                             together with

               MINORITY, DISSENTING, AND ADDITIONAL VIEWS

                        [To accompany H.R. 1617]




 June 22, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed
CONSOLIDATED AND REFORMED EDUCATION, EMPLOYMENT, AND REHABILITATION SYSTEMS 
ACT (CAREERS ACT)
   104th Congress 1st   HOUSE OF REPRESENTATIVES        Report
         Session
                                                       104-152
_______________________________________________________________________



                                     


  CONSOLIDATED AND REFORMED EDUCATION, EMPLOYMENT, AND REHABILITATION 
                       SYSTEMS ACT (CAREERS ACT)

                               __________

                              R E P O R T

                                 of the

                              COMMITTEE ON
                        ECONOMIC AND EDUCATIONAL
                             OPPORTUNITIES



                             together with



               MINORITY, DISSENTING, AND ADDITIONAL VIEWS



                        [To accompany H.R. 1617]




 June 22, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed
                                                                       
104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                    104-152
_______________________________________________________________________



  CONSOLIDATED AND REFORMED EDUCATION, EMPLOYMENT, AND REHABILITATION 
                       SYSTEMS ACT (CAREERS ACT)

_______________________________________________________________________


 June 22, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


     Mr. Goodling, from the Committee on Economic and Educational 
                 Opportunities, submitted the following

                              R E P O R T

                             together with

               MINORITY, DISSENTING, AND ADDITIONAL VIEWS

                        [To accompany H.R. 1617]

      [Including cost estimate of the Congressional Budget Office]
  The Committee on Economic and Educational Opportunities, to 
whom was referred the bill (H.R. 1617) to consolidate and 
reform workforce development and literacy programs, and for 
other purposes, having considered the same, report favorably 
thereon with an amendment and recommend that the bill as 
amended do pass.
  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:
SECTION 1. SHORT TITLE.

  This Act may be cited as the--
          (1) ``Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act''; or
          (2) ``CAREERS Act''.

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. Findings and purpose.
Sec. 4. Authorization of appropriations.
Sec. 5. Definitions.
Sec. 6. Transition.

             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

Sec. 101. Purpose of title.

              Subtitle A--State and Local Responsibilities

Sec. 102. State requirements.
Sec. 103. Collaborative process regarding State system.
Sec. 104. Consolidated State workforce development and literacy plan.
Sec. 105. Establishment of workforce development areas.
Sec. 106. Provisions regarding local workforce development boards.
Sec. 107. Establishment of one-stop career center systems.
Sec. 108. Certification of education, training, and vocational 
rehabilitation service providers.
Sec. 109. Management information systems.
Sec. 110. Performance accountability system.

              Subtitle B--Amendments to Wagner-Peyser Act

Sec. 131. General program requirements.
Sec. 132. Labor market information.

                       Subtitle C--Worker Rights

Sec. 141. Requirements.

 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

Sec. 201. Purposes.
Sec. 202. Definitions.

                       Subtitle A--State Funding

Sec. 211. National and State funding.
Sec. 212. Within State allocation.

       Subtitle B--State Organizational, Planning, and Reporting 
                            Responsibilities

Sec. 221. State plan.
Sec. 222. State programs and State activities.
Sec. 223. Incentive awards.
Sec. 224. Core standards, performance goals, and measures.

         Subtitle C--Subgrants for In-School and At-Risk Youth

Sec. 231. Partnership agreements.
Sec. 232. Distribution of funds.

                       Chapter 1--In-School Youth

Sec. 241. Uses of funds for in-school youth.

                        Chapter 2--At-Risk Youth

Sec. 245. Uses of funds for at-risk youth.
Sec. 246. At-risk youth providers.

                     Subtitle D--National Programs

Sec. 251. Research activities.
Sec. 252. Assessment and data collection of youth development and 
career preparation programs.
Sec. 253. National center or centers for research.

      TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANT

     Subtitle A--Adult Employment and Training Consolidation Grant

Sec. 301. Purpose.
Sec. 302. Authorization.
Sec. 303. Allotment among States.
Sec. 304. Allocation within States.
Sec. 305. Additional State plan requirements.
Sec. 306. Use of amounts.
Sec. 307. Core standards, performance goals, and measures.

                      Subtitle B--Federal Programs

Sec. 311. National discretionary grants.
Sec. 312. Disaster relief employment assistance.
Sec. 313. Research, demonstration, evaluation, and capacity building.
Sec. 314. Workforce skills and development loans.
Sec. 315. Employment, training, and education assistance for Native 
Americans.
Sec. 316. Employment, training, and education assistance for migrant 
and seasonal farmworkers.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
          LIBRARY SERVICES AND TECHNOLOGY CONSOLIDATION GRANT

Sec. 401. Findings.
Sec. 402. Definitions.

  Subtitle A--Adult Education and Family Literacy Consolidation Grant

Sec. 411. Purposes.

                           Chapter 1--Funding

Sec. 421. Reservations from amounts appropriated.
Sec. 422. Allotment.

                      Chapter 2--Grants To States

Sec. 431. Requirement to make grants.
Sec. 432. Uses of funds.
Sec. 433. Additional grant requirements.
Sec. 434. Performance measures.

                      Chapter 3--National Programs

Sec. 441. National Institute for Literacy.
Sec. 442. National leadership activities.

    Subtitle B--Library Services and Technology Consolidation Grant

Sec. 451. Purposes.
Sec. 452. Authorization of appropriations.
Sec. 453. Allotments.
Sec. 454. Grants to States.
Sec. 455. Uses of funds.
Sec. 456. Annual applications.

           TITLE V--AMENDMENTS TO REHABILITATION ACT OF 1973

       Subtitle A--Vocational Rehabilitation Consolidation Grant

                      Chapter 1--Transition Period

Sec. 501. Transition.

      Chapter 2--Revision Of Title I of Rehabilitation Act of 1973

Sec. 511. Revision of title I.

       Subtitle B--Other Amendments to Rehabilitation Act of 1973

Sec. 521. Training and demonstration projects.
Sec. 522. Employment opportunities for individuals with disabilities.

                TITLE VI--REPEALERS AND OTHER AMENDMENTS

Sec. 601. Carl D. Perkins Vocational and Applied Technology Education 
Act.
Sec. 602. School-to-Work Opportunities Act.
Sec. 603. Adult Education Act.
Sec. 604. National Literacy Act.
Sec. 605. Library Services and Construction Act.
Sec. 606. Technology for Education Act of 1994.
Sec. 607. Job Training Partnership Act.
Sec. 608. Stewart B. McKinney Homeless Assistance Act.
Sec. 609. Effective date.
SEC. 3. FINDINGS AND PURPOSE.

  (a) Findings.--The Congress finds the following:
          (1) The knowledge and skills of the United States workforce 
        are fundamental to the economic competitiveness of the Nation 
        today and in the future, however, the United States does not 
        currently possess a comprehensive, effective, and efficient 
        system of workforce preparation and development.
          (2) Due to global competition, emerging technologies in the 
        workplace, the emergence of quality managing, corporate 
        realignments, and the loss of many low-skilled jobs, United 
        States workers will increasingly need to enhance their skills 
        on a continuing, lifelong basis through such a workforce 
        preparation and development system.
          (3) Reports from the Comptroller General of the United States 
        have identified 163 different Federal programs, totaling 
        $20,000,000,000, and administered by 14 different Federal 
        agencies, that offer some form of education, job training, or 
        employment assistance to youth and adults.
          (4) Such reports point to the many problems of duplication 
        and fragmentation that exist within the varied Federal 
        workforce preparation and development programs, including--
                  (A) the additional costs of administering overlapping 
                workforce preparation and development programs at the 
                Federal, State, and local levels which divert scarce 
                resources that could be better used to assist all 
                individuals in preparing for and entering the 
                workforce; and
                  (B) conflicting eligibility requirements, annual 
                budgeting and operating cycles, planning and reporting 
                requirements, and performance measurement systems which 
                serve as barriers to the integration of Federal 
                workforce preparation and development programs and 
                result in an inefficient use of resources.
          (5) Major goals of any reform of the Federal workforce 
        preparation and development system must be--
                  (A) to streamline and consolidate individual 
                workforce preparation and development programs, 
                eliminating unnecessary duplication and fragmentation 
                in such programs;
                  (B) to provide maximum authority and responsibility 
                to States and local communities for operation of State 
                and local workforce preparation and development 
                programs;
                  (C) to stress private sector partnerships, including 
                the use of private sector service providers and 
                encourage increased leadership and responsibility on 
                the part of the private sector through the use of 
                creative incentives for investment in workforce 
                training (which may include reduced regulatory burdens, 
                tax incentives, and employer loans for the training of 
                incumbent workers);
                  (D) to establish a system which is market-driven, 
                accountable, provides customer choice and easy access 
                to services, and reinforces individual responsibility;
                  (E) to improve education, literacy, job training, 
                rehabilitation, and employment assistance programs in 
                the United States, encouraging lifelong learning and 
                skills upgrading through a seamless system connecting 
                elementary, secondary, postsecondary, rehabilitation, 
                adult, and work-based training and education; and
                  (F) to establish a comprehensive, integrated labor 
                market information system to ensure that workforce 
                preparation and development programs are related to the 
                demand for particular skills in local labor markets, 
                and to ensure that information about the employment and 
                earnings of the local workforce, occupations in demand, 
                skill requirements for such occupations, and the 
                performance of education, rehabilitation, and training 
                providers, are available to job seekers, employers, 
                teachers, students, and decisionmakers.
          (6) Early exposure to career opportunities, including 
        opportunities in the practical arts or trade, can enrich the 
        education experience and provide incentives for students to 
        stay in school and achieve higher levels of learning.
          (7) Millions of families in the United States are trapped in 
        a cycle of poverty, dependency, and inadequate education that 
        is linked to illiteracy and low educational achievement, for 
        which adult education and family literacy programs have been 
        shown to be successful in improving the educational attainment 
        and job skills of parents and their children, contributing to 
        reductions in crime, welfare dependency, and enhancing 
        employment opportunities for such individuals.
          (8) In recent years, a number of innovative States and local 
        communities have begun successful efforts to integrate Federal 
        workforce preparation and development programs through one-stop 
        service delivery systems, however, without exception, such 
        States and communities have experienced numerous Federal 
        barriers to such program integration.
          (9) An extremely high percentage of Americans with 
        disabilities are unemployed, and need access to high quality, 
        specialized rehabilitation services that lead to employment, 
        independence, and full participation in the mainstream of life 
        in America.
  (b) Purpose.--The purpose of this Act is to transform the vast array 
of Federal workforce development and literacy programs from a 
collection of fragmented and duplicative categorical programs into a 
streamlined, comprehensive, coherent, high-quality, cost-effective, 
market-based, and accountable Federal workforce development and 
literacy system that is designed to meet the education, employment, and 
training needs of the workforce and the competitiveness needs of 
employers of the United States, both today and in the future.

SEC. 4. AUTHORIZATION OF APPROPRIATIONS.

  (a) In General.--There are authorized to be appropriated--
          (1) for title II, $2,308,200,000 for fiscal year 1997 and 
        such sums as may be necessary for each of the fiscal years 1998 
        through 2002 to carry out the programs under such title;
          (2) for title III, $2,263,400,000 for fiscal year 1997 and 
        such sums as may be necessary for each of the fiscal years 1998 
        through 2002 to carry out the programs under such title; and
          (3) for subtitle A of title IV, $280,000,000 for fiscal year 
        1997 and such sums as may be necessary for each of the fiscal 
        years 1998 through 2002 to carry out the programs under such 
        subtitle.
  (b) Program Year.--
          (1) In general.--Beginning with fiscal year 1997, and 
        thereafter, appropriations for any fiscal year for programs and 
        activities under this Act 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.
          (2) Obligation.--Funds obligated for any program year under 
        titles II, III, and IV, may be expended by each recipient 
        during that program year and the two succeeding program years, 
        except that the Secretary shall, in accordance with paragraph 
        (3), reallot to eligible States the funds allotted to States 
        from funds appropriated for reallotments.
          (3) Amounts available for reallotment.--The amount available 
        for reallotment is equal to--
                  (A) the amount by which the unobligated balance of 
                the State allotment at the end of the program year 
                prior to the program year for which the determination 
                under this section is made exceeds 20 percent of such 
                allotment for the prior program year; plus
                  (B) the unexpended balance of the State allotment 
                from any program year prior to the program year in 
                which there is such excess.

SEC. 5. DEFINITIONS.

  For purposes of this Act:
          (1) Adult.--The term ``adult'' means an individual who is 16 
        years of age, or beyond the age of compulsory school attendance 
        under State law, and who is not enrolled or required to be 
        enrolled in secondary school.
          (2) Adult education.--The term ``adult education'' means 
        services or instruction below the postsecondary level for 
        adults--
                  (A) who are not enrolled in secondary school;
                  (B) who lack sufficient mastery of basic educational 
                skills to enable them to function effectively in 
                society or who do not have a certificate of graduation 
                from a school providing secondary education and who 
                have not achieved an equivalent level of education;
                  (C) who are not currently required to be enrolled in 
                school; and
                  (D) whose lack of mastery of basic skills results in 
                an inability to speak, read, or write the English 
                language which constitutes a substantial impairment of 
                their ability to get or retain employment commensurate 
                with their real ability, and thus are in need of 
                programs to help eliminate such inability and raise the 
                level of education of such individuals with a view to 
                making them less likely to become dependent on others.
          (3) Area vocational education school.--The term ``area 
        vocational education school'' means--
                  (A) a specialized high school used exclusively or 
                principally for the provision of vocational education 
                to individuals who are available for study in 
                preparation for entering the labor market;
                  (B) the department of a high school exclusively or 
                principally used for providing vocational education in 
                not less than 5 different occupational fields to 
                individuals who are available for study in preparation 
                for entering the labor market;
                  (C) a technical institute or vocational school used 
                exclusively or principally for the provision of 
                vocational education to individuals who have completed 
                or left high school and who are available for study in 
                preparation for entering the labor market; or
                  (D) the department or division of a junior college, 
                community college or university operating under the 
                policies of the State board and which provides 
                vocational education in not less than 5 different 
                occupational fields leading to immediate employment but 
                not necessarily leading to a baccalaureate degree, if, 
                in the case of a school, department, or division 
                described in subparagraph (C) or this subparagraph, it 
                admits as regular students both individuals who have 
                completed high school and individuals who have left 
                high school.
          (4) At-risk youth.--The term ``at-risk youth'' means--
                  (A) an out-of-school, at-risk youth who is an 
                individual age 24 or younger and who is not enrolled in 
                a secondary or postsecondary education program, has not 
                received a high school diploma or equivalent and must 
                overcome barriers to employment such as economic 
                disadvantages, disability, or limited English 
                proficiency; or
                  (B) an in-school, at-risk youth who is an individual 
                age 24 or younger who is enrolled in an accredited 
                secondary or postsecondary education program but is at 
                risk of dropping out of school or must overcome 
                barriers to complete an education program, such as 
                economic disadvantages, disability, or limited English 
                proficiency.
          (5) Career exploration and guidance counseling.--The term 
        ``career exploration and guidance counseling'' means a 
        program--
                  (A) which pertains to the body of subject matter and 
                related techniques and methods organized for the 
                development in individuals of career awareness, career 
                planning, career decisionmaking, placement skills, and 
                knowledge and understanding of local, State, and 
                national occupational, educational, and labor market 
                needs, trends, and opportunities;
                  (B) which assists such individuals in making and 
                implementing informed educational and occupational 
                choices; and
                  (C) which is comprehensive in nature and provided 
                through an educational program beginning in as early a 
                grade as possible, including late elementary and middle 
                school grades.
          (6) Case management.--The term ``case management'' means the 
        provision of a client-centered approach in the delivery of 
        services designed to--
                  (A) prepare and coordinate comprehensive employment 
                plans, such as service strategies for participants, to 
                ensure access to necessary training and supportive 
                services, using, where feasible, computer-based 
                technologies; and
                  (B) provide job and career counseling during program 
                participation and after job placement.
          (7) Chief elected official.--The term ``chief elected 
        official'' means the chief elected executive officer of a unit 
        of general local government in a workforce development area.
          (8) Community-based organization.--The term ``community-based 
        organization'' means a private nonprofit organization that is 
        representative of a community or significant segments of a 
        community that provides education, vocational rehabilitation, 
        job training, supportive services, or internship services and 
        programs.
          (9) Demographic characteristics.--The term ``demographic 
        characteristics'' means information on population, especially 
        with reference to size, density, distribution, and vital 
        statistics including, age, race, sex, ethnic origin, and income 
        status.
          (10) Dislocated worker.--The term ``dislocated worker'' means 
        an individual who--
                  (A) has been terminated or laid off or who has 
                received a notice of termination or layoff from 
                employment, is eligible for or has exhausted 
                entitlement to unemployment compensation, and is 
                unlikely to return to a previous industry or 
                occupation;
                  (B) has been terminated, or has received a notice of 
                termination of employment, as a result of any permanent 
                closure of, or any substantial layoff at, a plant, 
                facility, or enterprise;
                  (C) has been unemployed long-term and has limited 
                opportunities for employment or reemployment in the 
                same or a similar occupation in the area in which such 
                individual resides, including an older individual who 
                may have substantial barriers to employment by reason 
                of age; or
                  (D) was self-employed (including farmers and 
                ranchers) but is unemployed as a result of general 
                economic conditions in the community in which they 
                reside or because of natural disasters.
          (11) Displaced homemaker.--The term ``displaced homemaker'' 
        means an individual who--
                  (A) is an adult; and
                  (B)(i) has worked as an adult primarily without 
                remuneration to care for the home and family, and for 
                that reason has diminished marketable skills;
                  (ii) has been dependent on public assistance or on 
                the income of a relative but is no longer supported by 
                such income;
                  (iii) is a parent whose youngest dependent child will 
                become ineligible to receive assistance under the 
                program for aid to families with dependent children 
                under part A of title IV of the Social Security Act 
                within 2 years of the parent's application for 
                assistance under title II of this Act; or
                  (iv) is unemployed or underemployed and is 
                experiencing difficulty in obtaining any employment or 
                suitable employment, as appropriate.
          (12) Earnings.--The term ``earnings'' means gross hourly 
        wages before any deduction, plus the estimated hourly value of 
        bonuses, tips, gratuities, commissions, and overtime pay either 
        expected or received. In the case of individuals in subsidized 
        employment, total hourly earnings include any wage subsidy paid 
        to the individual.
          (13) Economic development agencies.--The term ``economic 
        development agencies'' means State and local planning and 
        zoning commissions or boards, community development agencies, 
        and other State and local agencies and institutions responsible 
        for regulating, promoting, or assisting in State and local 
        economic development.
          (14) Economically disadvantaged.--The term ``economically 
        disadvantaged'' means an individual who--
                  (A) receives, or is a member of a family which 
                receives, cash welfare payments under a Federal, State, 
                or local welfare program;
                  (B) has, or is a member of a family which has, 
                received a total family income for the 6-month period 
                prior to application for the program involved 
                (exclusive of unemployment compensation, child support 
                payments, and welfare payments) which, in relation to 
                family size, was not in excess of the higher of--
                          (i) the official poverty line (as defined by 
                        the Office of Management and Budget, and 
                        revised annually in accordance with section 
                        673(2) of the Omnibus Budget Reconciliation Act 
                        of 1981 (42 U.S.C. 9902(2)), or
                          (ii) 70 percent of the lower living standard 
                        income level;
                  (C) is receiving (or has been determined within the 
                6-month period prior to the application for the program 
                involved to be eligible to receive) food stamps 
                pursuant to the Food Stamp Act of 1977;
                  (D) qualifies as a homeless individual under 
                subsections (a) and (c) of section 103 of the Stewart 
                B. McKinney Homeless Assistance Act;
                  (E) is a foster child on behalf of whom State or 
                local government payments are made;
                  (F) in cases permitted by regulations of the 
                Secretary, is an individual with a disability whose own 
                income meets the requirements of subparagraph (A) or 
                (B), but who is a member of a family whose income does 
                not meet such requirements; or
                  (G) is an individual meeting appropriate criteria 
                approved by a State.
          (15) Educational service agency.--The term ``educational 
        service agency'' means a regional public multiservice agency 
        authorized by State statute to develop, manage, and provide 
        services or programs to local education agencies, and is 
        recognized as an administrative agency for such State's 
        vocational or technical education schools or for vocational 
        programs within its public elementary or secondary schools. 
        Such term includes any other public institution or agency 
        having administrative control and direction over a public 
        elementary or secondary school.
          (16) Employed.--The term ``employed'' means an individual who 
        is currently--
                  (A) a paid employee;
                  (B) works in his or her own business, profession, or 
                farm;
                  (C) works 15 hours or more per week as an unpaid 
                worker in an enterprise operated by a family member; or 
                is one who is not working, but has a job or business 
                from which he or she is temporarily absent due to 
                illness, bad weather, vacation, labor-management 
                dispute, or personal reasons; or
                  (D) on active military duty.
          (17) English literacy program.--The term ``English literacy 
        program'' means a program of instruction designed to help 
        limited English proficient adults, out-of-school youths, or 
        both, achieve full competence in the English language.
          (18) Excess number.--The term ``excess number'' means, 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, or the number that represents the number of 
        unemployed individuals in excess of 4.5 percent of the civilian 
        labor force in areas of substantial unemployment in such State.
          (19) Governor.--The term ``Governor'' means the chief 
        executive of State.
          (20) Individual of limited english proficiency.--The term 
        ``individual of limited English proficiency'' means an adult or 
        out-of-school youth who has limited ability in speaking, 
        reading, writing, 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.
          (21) Individuals with disabilities.--The term ``individuals 
        with disabilities'' has the meaning given such term in the 
        Vocational Rehabilitation Act of 1973.
          (22) Institution of higher education.--The term ``institution 
        of higher education'' has the meaning given such term in 
        section 481 of the Higher Education Act of 1965.
          (23) Job search assistance.--The term ``job search 
        assistance'' means a service that helps a job-ready individual 
        seek, locate, apply for, and obtain employment. Such services 
        may include, but are not limited to, job-finding skills, 
        orientation to the labor market, resume preparation assistance, 
        job finding clubs, job search workshops, vocational 
        exploration, and other employability services.
          (24) Labor market area.--The term ``labor market area'' means 
        an economically integrated geographic area within which 
        individuals can reside and find employment within a reasonable 
        distance or can readily change employment without changing 
        their place of residence. Such areas shall be identified in 
        accordance with criteria used by the Bureau of Labor Statistics 
        of the Department of Labor in defining such areas or similar 
        criteria established by a Governor.
          (25) Library.--The term ``library'' includes--
                  (A) a public library;
                  (B) a public elementary or secondary school library;
                  (C) an academic library;
                  (D) a research library; and
                  (E) a private library, but only if the State in which 
                such private library is located determines that the 
                library should be considered a library for purposes of 
                this Act.
          (26) Literacy.--The term ``literacy'' means an individual's 
        ability to read, write, and speak in English, and compute and 
        solve problems, at levels of proficiency necessary--
                  (A) to function on the job, in the individual's 
                family and in society;
                  (B) to achieve the individual's goals; and
                  (C) to develop the individual's knowledge potential.
          (27) Local educational agency.--The term ``local educational 
        agency'' has the same meaning given such term in section 14101 
        of the Elementary and Secondary Education Act of 1965.
          (28) Native american.--The term ``native American'' means 
        Indians, Alaskan natives, and Hawaiian natives.
          (29) Nontraditional employment.--The term ``nontraditional 
        employment'' as applied to women refers to occupations or 
        fields of work where women comprise less than 25 percent of the 
        individuals employed in such occupation or field of work.
          (30) On-the-job training.--The term ``on-the-job training'' 
        means training in the public or private sector that is provided 
        to a paid employee while he or she is engaged in productive 
        work that--
                  (A) provides knowledge or skills essential to the 
                full and adequate performance of the job;
                  (B) provides reimbursement to employers, up to 50 
                percent of the participant's wage rate, for the costs 
                of providing training and additional supervision; and
                  (C) is based on the Occupational Employment 
                Statistics Program Dictionary.
          (31) Postsecondary educational institution.--The term 
        ``postsecondary educational institution'' means an institution 
        of higher education (as such term is defined in section 481 of 
        the Higher Education Act of 1965) which continues to meet the 
        eligibility and certification requirements under title IV of 
        such Act (20 U.S.C. 1070 et seq.).
          (32) Preemployment skills training; job readiness skills 
        training.--The terms ``preemployment skills training'' and 
        ``job readiness skills training'' mean training that helps 
        prepare individuals for work by assuring that they are familiar 
        with general workplace expectations and exhibit work behavior 
        and attitudes necessary to compete successfully in the job 
        market.
          (33) Public assistance.--The term ``public assistance'' means 
        Federal, State, or local government cash payments for which 
        eligibility is determined by a needs or income test.
          (34) Rapid response.--The term ``rapid response'' means 
        assistance that is directly provided by the State, or by local 
        grantees with funds provided by the State, in the case of mass 
        layoffs or plant closures, and that establishes on-site contact 
        with employer and employee representatives within a short 
        period of time (preferably 48 hours or less) after becoming 
        aware of a current or projected permanent closure or 
        substantial layoff in order to--
                  (A) provide information on, and facilitate access to, 
                available public programs and services for workers 
                losing jobs as a result of such layoff or closure;
                  (B) provide emergency assistance adapted to the 
                particular closure or layoff;
                  (C) promote the formation of labor-management 
                committees, where appropriate;
                  (D) collect information related to economic 
                dislocation and available resources within the State 
                for dislocated workers;
                  (E) provide or obtain appropriate financial and 
                technical advice and liaison with economic development 
                agencies and other organizations to assist in efforts 
                to avert worker dislocation; and
                  (F) assist the local community in developing its own 
                coordinated response and in obtaining access to State 
                economic development assistance.
          (35) Registered apprenticeship.--The term ``registered 
        apprenticeship'' means a program registered by the Bureau of 
        Apprenticeship and Training in the United States Department of 
        Labor, or a State Apprenticeship Agency recognized and approved 
        by the Bureau of Apprenticeship and Training as the appropriate 
        body for State registration or approval of local apprenticeship 
        programs and agreements.
          (36) School dropout.--The term ``school dropout'' means a 
        youth who is no longer attending any school and who has not 
        received a secondary school diploma or a certificate from a 
        program of equivalency for such a diploma.
          (37) Skill certificate.--The term ``skill certificate'' means 
        a portable, industry-recognized credential issued by programs 
        authorized under this Act, that certifies that an individual 
        has mastered skills at levels that are at least as challenging 
        as skill standards endorsed by the National Skill Standards 
        Board, except that until such skill standards are developed, 
        the term ``skill certificate'' means a credential issued under 
        a process determined by the State.
          (38) State.--The term ``State'' means any of the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, the Virgin Islands, American Samoa, Guam, and the 
        Commonwealth of the Northern Mariana Islands.
          (39) State educational agency.--The term ``State educational 
        agency'' has the meaning given such term in section 14101 of 
        the Elementary and Secondary Education Act of 1965.
          (40) State library administrative agency.--The term ``State 
        library administrative agency'' means the official agency of a 
        State charged by the law of the State with the extension and 
        development of public library services throughout the State.
          (41) Supportive services.--The term ``supportive services'' 
        means services which are necessary to enable an individual 
        eligible for training under this Act, but who cannot afford to 
        pay for such services, to participate in a training or 
        vocational rehabilitation program or job search activities 
        funded under this Act. Such supportive services may include 
        transportation, individual and family counseling, child care 
        and dependent care, meals, temporary shelter, financial 
        counseling, needs-based payments, and other reasonable expenses 
        required for participation in a training, job preparation, or 
        job placement program. Such services may be provided in-kind or 
        through cash assistance, except that such services will be 
        provided with funds provided under this Act only after 
        alternative funding sources specifically designated for such 
        services have been exhausted.
          (42) Unemployed.--The term ``unemployed'' refers to an 
        individual who is not employed, who is available for work, and 
        who has made specific efforts to find a job within the prior 4 
        weeks. Included as unemployed are individuals who are not 
        working, are available for work, and are waiting to be called 
        back to a job from which they have been laid off.
          (43) Unit of general local government.--The term ``unit of 
        general local government'' means any general purpose political 
        subdivision of a State which has the power to levy taxes and 
        spend funds, as well as general corporate and police powers.
          (44) Veteran.--The term ``veteran'' has the meaning given 
        such term in section 101(2) of title 38, United States Code.
          (45) Work experience.--The term ``work experience'' means a 
        time-limited work activity that provides an individual with the 
        opportunity to acquire the general skills and knowledge 
        necessary to obtain employment.
          (46) Workplace mentor.--The term ``workplace mentor'' means 
        an employee or other individual, approved by the employer at a 
        workplace, who possesses the skills and knowledge to be 
        mastered by a student or program participant, and who 
        instructs, critiques the performance, and challenges the 
        student or program participant to perform well, and works in 
        consultation with classroom teachers, training providers, and 
        the employer of the student or program participant.
          (47) Youth.--The term ``youth'' means an individual under the 
        age of 24.

SEC. 6. TRANSITION.

  The Secretary of Education and the Secretary of Labor shall take such 
steps as they determine to be appropriate to provide for the orderly 
transition from any authority under provisions of statutes amended or 
repealed by this Act or any related authority under provisions of this 
Act.

             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

SEC. 101. PURPOSE OF TITLE.

  The purpose of this title is to provide for the establishment of an 
infrastructure within States on which to build a comprehensive system 
of workforce development and literacy.

              Subtitle A--State and Local Responsibilities

SEC. 102. STATE REQUIREMENTS.

  (a) In General.--For fiscal year 1997 and subsequent fiscal years, a 
State that desires to receive a grant under one or more of the programs 
specified in subsection (b) shall--
          (1) establish a collaborative process, pursuant to section 
        103;
          (2) develop a State workforce development and literacy plan, 
        pursuant to section 104; and
          (3) otherwise comply with the requirements of this Act.
  (b) Workforce Development and Literacy Programs.--
          (1) In general.--The programs referred to in subsection (a) 
        are the following:
                  (A) The program under title II, the Youth Development 
                and Career Preparation Consolidation Grant.
                  (B) The program under title III, the Adult Employment 
                and Training Consolidation Grant.
                  (C) The program under subtitle A of title IV, the 
                Adult Education and Family Literacy Consolidation 
                Grant.
                  (D) The program amended by subtitle A of title V 
                (relating to title I of the Rehabilitation Act of 
                1973).
          (2) Definition.--For purposes of this Act, the term 
        ``Workforce Development and Literacy programs'' means the 
        programs specified in paragraph (1).

SEC. 103. COLLABORATIVE PROCESS REGARDING STATE SYSTEM.

  (a) In General.--The Governor of a State that desires to receive a 
grant under one or more of the programs specified in section 102(b) 
shall certify to the Secretary of Education and the Secretary of Labor 
that a collaborative process, as described in subsection (b) or (c), 
has been used in complying with the applicable provisions of this Act.
  (b) Collaborative Process.--The collaborative process referred to in 
subsection (a) is a process for making decisions which includes as 
participants, at a minimum, the Governor and--
          (1) representatives of the following (which representatives 
        are appointed by the Governor)--
                  (A) business and industry;
                  (B) local chief elected officials (representing both 
                cities and counties);
                  (C) local educational agencies (including vocational 
                educators);
                  (D) postsecondary institutions (including community 
                and technical colleges);
                  (E) the State rehabilitation advisory council;
                  (F) organizations representing individuals served by 
                programs established under this Act (including 
                community-based organizations); and
                  (G) employees.
          (2) the lead State agency official or officials for--
                  (A) the State educational agency (including 
                representatives of vocational education, adult 
                education and literacy, and libraries);
                  (B) the State agency responsible for economic 
                development;
                  (C) the State agency responsible for employment; 
                security (and the State agency responsible for job 
                training where different from such agency);
                  (D) the State agency responsible for postsecondary 
                education;
                  (E) the State agency responsible for vocational 
                rehabilitation, and where applicable, the State agency 
                providing vocational rehabilitation services for the 
                blind;
                  (F) the State agency responsible for welfare; and
                  (G) the representative of the Veterans' Service 
                assigned to the State under section 4103 of title 38, 
                United States Code.
  (c) Rule of Construction.--With respect to compliance with subsection 
(b)--
          (1) a State may use any existing State process (including any 
        council or similar entity) that substantially meets the 
        purposes of such subsection; or
          (2) if prior to the date of enactment of this Act, a State 
        has developed a one-stop career center system or a school-to-
        work system through a collaborative process substantially 
        similar to the process described in subsection (b), the State 
        may use such process.

SEC. 104. CONSOLIDATED STATE WORKFORCE DEVELOPMENT AND LITERACY PLAN.

  (a) In General.--The Governor of a State that desires to receive a 
grant under one or more of the programs specified in section 102(b) 
shall submit a strategic State workforce development and literacy plan 
to provide policy guidance with respect to workforce development 
programs operated in the State, and that meets the requirements of this 
section to--
          (1) the Secretary of Education; and
          (2) the Secretary of Labor.
  (b) Contents.--A State workforce development and literacy plan shall 
include the following:
          (1) A description of the collaborative process under section 
        103 used in developing the plan.
          (2) A statement of the goals of the State workforce 
        development and literacy system, that includes--
                  (A) a description of how the State will progress 
                toward achieving the goals and purpose of this Act as 
                established in sections 3(a)(5) and 3(b);
                  (B) an assessment of the needs of the State with 
                regard to current and projected demands for workers by 
                occupation, the skills and education levels of the 
                workforce, the vocational rehabilitation needs of 
                individuals with severe disabilities residing in the 
                State, the skill and economic development needs of the 
                State, and an assessment of the type and availability 
                of workforce development, adult education, vocational 
                rehabilitation, and literacy programs in the State;
                  (C) the identification of progress indicators, based 
                on the performance measures described in titles II and 
                III, subtitle A of title IV, and title I of the 
                Vocational Rehabilitation Act of 1973, and a model of 
                continuous improvement, that the State will use to 
                measure progress made by the State, local workforce 
                development boards, and other applicable local entities 
                who are recipients of financial assistance under this 
                Act in meeting such goals; and
                  (D) a description of how performance measures are 
                consistent across the 4 grant programs established in 
                titles II and III, subtitle A of title IV, and title I 
                of the Vocational Rehabilitation Act of 1973.
          (3) A description of how the State has complied, or will 
        comply, with the provisions of sections 105 through 108.
          (4) A description of how a State will participate in the 
        National Labor Market Information system pursuant to subtitle 
        B.
          (5) Any information required to be included in the plan under 
        any of titles II through IV, and title I of the Vocational 
        Rehabilitation Act of 1973, (in the case of a State that 
        desires to receive a grant under any such title).
          (6) A description of the measures that will be taken by the 
        State to ensure coordination and consistency and avoid 
        duplication among programs receiving assistance under this Act, 
        including a description of common data collection and reporting 
        processes (including the establishment of a common management 
        information system) across such programs.
          (7) A description of the process used by the State to provide 
        an opportunity for public comment, and input into the 
        development of the plan, prior to submission of the plan.
          (8) A description of the process used by the State to consult 
        with representatives of business and industry with respect to 
        the requirements of subparagraphs (A), (B), and (C) of 
        paragraph (2) of this subsection.
          (9) Assurances that the State will provide for fiscal control 
        and fund accounting procedures that may be necessary to ensure 
        the proper disbursement of, and accounting for, funds paid to 
        the State under this Act.
          (10) A description of the sanctions which the State may 
        impose (including restrictions from future participation or 
        consideration for funding) in instances where recipients of 
        funds under this Act fail to achieve agreed upon performance 
        measures, fail to adhere to State mandated fiscal control and 
        funds accounting procedures, or take or fail to take other 
        actions required under the State plan, contracts, or other 
        agreements.
  (c) Authority of Governor.--
          (1) Final authority.--If, after a reasonable effort, a 
        Governor is unable to obtain agreement through the 
        collaborative process described in subsection (b)(1), the 
        Governor shall have final authority to make decisions and 
        submit a plan for the design of a comprehensive system of 
        workforce development and literacy for the State under 
        subsection (a).
          (2) Disagreement.--The Governor shall accept and include with 
        the plan submitted under paragraph (1) any disagreeing views 
        submitted by a participant of the collaborative process if such 
        views represent disagreement in the area in which such 
        participant was selected for representation.
          (3) Exception.--Nothing in this Act shall be construed to 
        negate or supersede the legal authority, under State law or 
        other applicable law, of any State agency, State entity, or 
        State public official over programs that are under the 
        jurisdiction of the agency, entity, or official. Nothing in 
        this Act shall be construed to interfere with the authority of 
        such agency, entity, or official to enter into a contract under 
        any provision of law.
  (d) Modifications to Plan.--A plan submitted by a State in accordance 
with this section remains in effect until the State submits to the 
Secretary such modifications as the State determines necessary. This 
section applies to the modifications to the same extent and in the same 
manner as this section applies to the original plan.
  (e) Allocation of Responsibilities of Secretaries.--The Secretary of 
Education and the Secretary of Labor shall collaborate in establishing 
and using a common procedure in making determinations regarding 
compliance by the States with the requirements established in this 
title.

SEC. 105. ESTABLISHMENT OF WORKFORCE DEVELOPMENT AREAS.

  The Governor of a State that desires to receive a grant under one or 
more of the programs specified in section 102(b) shall, through the 
collaborative process established under section 103 and after 
consultation with local chief elected officials, and after 
consideration of comments received through the public participation 
process as described in the State plan, designate local workforce 
development areas within the State. Such areas shall be designated 
taking into consideration the following:
          (1) Existing labor market areas.
          (2) Units of general local government.
          (3) Geographic areas served by local educational agencies and 
        intermediate educational agencies.
          (4) Geographic areas served by postsecondary institutions and 
        area vocational education schools.
          (5) Service delivery areas established under section 101 of 
        the Job Training Partnership Act (29 U.S.C. 1511) (as such Act 
        was in effect on the day before the date of the enactment of 
        this Act).
          (6) The distance that individuals will need to travel to 
        receive services from one-stop career centers.

SEC. 106. PROVISIONS REGARDING LOCAL WORKFORCE DEVELOPMENT BOARDS.

  (a) In General.--The Governor of a State that desires to receive a 
grant under one or more of the programs specified in section 102(b) 
shall ensure the establishment of a local workforce development board 
in each local workforce development area within the State.
  (b) State Criteria.--The Governor, through the collaborative process 
described under section 103, shall establish criteria for use by local 
chief elected officials in the workforce development area, in the 
selection of members of local workforce development boards, in 
accordance with requirements prescribed under subsections (c) and (d).
  (c) Representation Requirement.--Such criteria shall require, at a 
minimum, that a local workforce development board consist of--
          (1) a majority of members who are representatives of business 
        and industry, including individuals who are owners of 
        businesses, chief executives or chief operating officers of 
        private business, and other business executives with optimum 
        policymaking authority in local businesses, selected from among 
        nominees submitted by local business organizations and trade 
        associations;
          (2) an individual or individuals with disabilities, who have 
        special knowledge or expertise in the area of vocational 
        rehabilitation;
          (3) representatives of education, including local educational 
        agencies and postsecondary institutions, selected from among 
        individuals nominated by regional or local educational 
        agencies, vocational education institutions, institutions of 
        postsecondary institutions (including community colleges), or 
        general organizations of such institutions within the workforce 
        development area; and
          (4) representatives of community-based organizations, 
        employees, and veterans as nominated or recommended to the 
        board through a process established by the Governors through 
        the collaborative process.
  (d) Establishment of Board.--
          (1) Selection of board members.--
                  (A) Single unit of local government in area.--In the 
                case of a workforce development area that is comprised 
                of only one unit of general local government, the chief 
                elected official of such unit shall select the members 
                of the local workforce development board for such area, 
                in accordance with the State criteria developed 
                pursuant to subsection (b).
                  (B) Multiple units in area.--In the case of a 
                workforce development area that is comprised of more 
                than one unit of general local government, the chief 
                elected official of such units shall select the members 
                of the local workforce development board from the 
                individuals so nominated or recommended for such area 
                in accordance with an agreement entered into by such 
                officials and with the State criteria developed under 
                subsection (b). In the absence of such an agreement, 
                the appointments shall be made by the Governor, through 
                the collaborative process, from the individuals so 
                nominated or recommended.
          (2) Certification.--The Governor shall biennially certify one 
        local workforce development board for each workforce 
        development area.
          (3) Exception.--In any case in which a local workforce 
        development area is a State, the individuals comprising the 
        Governor's collaborative process as described in section 103, 
        may be reconstituted to meet the requirements of this section.
  (e) Duties of Local Workforce Development Board.--
          (1) Local workforce development plan.--Each local workforce 
        development board shall develop a biennial strategic plan and 
        provide policy guidance with respect to workforce development 
        programs operated within their respective workforce development 
        areas. Such strategic plan shall be consistent with the State's 
        collaborative workforce development and literacy plan, shall be 
        approved by the appropriate chief elected official or 
        officials, and shall be submitted to the Governor for approval. 
        If after a reasonable effort, a local workforce development 
        board is unable to obtain the approval of the chief elected 
        official or officials, the Board has the authority to forward 
        the plan, with the comments of the chief elected official or 
        officials, to the Governor for final approval or disapproval. 
        Such local plan shall include the following:
                  (A) Both short-term and long-term goals, and related 
                strategies, to ensure that workforce preparation and 
                development programs, including programs established 
                pursuant to this Act, title I of the Rehabilitation Act 
                of 1973, and the Wagner-Peyser Act, contribute to a 
                coherent workforce development system in the workforce 
                development area.
                  (B) A description of the performance measures to be 
                used by the local workforce development board for 
                measuring the performance of local service providers 
                under chapter 2 of title II, title III, and title I of 
                the Rehabilitation Act of 1973, and the performance of 
                one-stop career center operators, with whom the Board 
                contracts.
                  (C) A description of the local one-stop career center 
                system to be established in the workforce development 
                area, including--
                          (i) a description of the process the local 
                        workforce development board will use to 
                        designate or establish career center system 
                        which ensures that the most effective and 
                        efficient service providers are chosen;
                          (ii) an identification of the roles of 
                        individual workforce development programs, 
                        including programs authorized by the Wagner-
                        Peyser Act; and
                          (iii) a description of the funding sources to 
                        be used in the operation of the career center 
                        system.
                  (D) A description of strategies the local workforce 
                development board will undertake to fully involve local 
                employers, local educational agencies, postsecondary 
                education institutions, adult education and literacy 
                providers, local service providers, and other 
                consumers, including individuals with disabilities, in 
                the development of the workforce development system.
                  (E) Such other information as requested by the State.
          (2) Identification of occupations in demand and training 
        needs.--The local workforce development board shall use 
        available labor market information and other appropriate 
        methods in order to identify and assess the needs of the 
        workforce development area with regard to--
                  (A) current and projected demand for workers by 
                occupation;
                  (B) skill levels, including literacy and basic 
                skills, of the local workforce and the needs of 
                business and industry for a skilled workforce;
                  (C) economic development needs of the area;
                  (D) the type and availability of workforce 
                preparation and development programs in the area; and
                  (E) the needs for vocational rehabilitation among 
                individuals with disabilities.
        Such information shall be used to develop the goals of, and 
        activities provided by the workforce development programs in 
        the local area.
          (3) Budget and program oversight.--
                  (A) Budgeting.--
                          (i) The local workforce development board, 
                        working through the State administrative agent, 
                        shall develop a budget for the purpose of 
                        carrying out local programs established under 
                        chapter 2 of title II, title III, and title I 
                        of the Rehabilitation Act of 1973, and for one-
                        stop career center systems established or 
                        designated under section 107.
                          (ii) Such budget shall be subject to the 
                        approval of the appropriate chief elected 
                        official or officials in the workforce 
                        development area.
                  (B) Program oversight.--The local workforce 
                development board, in partnership with the chief 
                elected official or officials in the workforce 
                development area, shall conduct oversight of the 
                workforce development programs listed in subparagraph 
                (A), and of one-stop career centers established under 
                this title.
          (4) Administration.--
                  (A) Fiscal agent.--
                          (i) The local workforce development board may 
                        receive and disburse funds made available for 
                        carrying out programs authorized under chapter 
                        2 of title II, title III, and title I of the 
                        Rehabilitation Act of 1973 of this Act, or the 
                        local workforce development board may designate 
                        a fiscal agent (which may include the State 
                        through a mutual agreement between the local 
                        board and the State), for the purpose of 
                        disbursement of funds to one-stop centers and 
                        other service providers, as designated by the 
                        local workforce development board.
                          (ii) The Board may employ its own staff, 
                        independent of local programs and service 
                        providers, and may solicit or accept grants and 
                        contributions from sources other than from this 
                        Act.
                  (B) Limitation.--The workforce development board, or 
                employees of such board, may not operate programs 
                established under this Act.
                  (C) Conflict of interest.--A member of a workforce 
                development board may not--
                          (i) discuss or participate in board 
                        consideration; or
                          (ii) cast a vote;
                regarding the provision of services by such member (or 
                by an organization that such member represents) or 
                regarding any matter that would provide direct 
                financial benefit to such member.
                The Governor may enforce more rigorous conflict of 
                interest standards, as determined appropriate.
                  (D) Independent authority.--
                          (i) The Board shall elect its own chairperson 
                        from among the members of the board.
                          (ii) The board may adopt bylaws and other 
                        operating procedures as consistent with the 
                        purposes of this Act, and with the policies 
                        established in the State workforce development 
                        and literacy plan.
          (5) Other.--Each local workforce development board shall 
        carry out such other duties as determined to be appropriate by 
        the Governor and the individuals and entities described in 
        section 103, through the collaborative process described in the 
        State plan.

SEC. 107. ESTABLISHMENT OF ONE-STOP CAREER CENTER SYSTEMS.

  (a) In General.--The Governor of a State that desires to receive a 
grant under one or more of the programs specified in section 102(b) 
shall ensure that each local workforce development board shall 
establish or designate a one-stop career center system in the workforce 
development area of such board, consistent with criteria established 
under subsection (b).
  (b) State Criteria.--The Governor, through the collaborative process 
described under section 103, shall establish statewide criteria for use 
by local workforce development boards in the designation or 
establishment of one-stop career center systems to ensure that the most 
effective and efficient service providers are chosen. Such criteria 
shall be consistent with the requirements prescribed under subsection 
(c).
  (c) One-Stop Career Center System Requirements.--At a minimum, one-
stop career center systems shall include--
          (1) common intake;
          (2) preliminary assessment;
          (3) integrated job search assistance;
          (4) to the extent practicable, as determined by the Governor, 
        unified and linked computer systems, including the availability 
        of labor market information as described under subtitle B, and 
        linkages through uniform management information systems; and
          (5) to the extent practicable, as determined by the Governor, 
        at least one physical, co-located site which provides 
        comprehensive and fully integrated workforce development 
        services to any individual seeking such services.
Local workforce development areas are encouraged to establish a network 
of comprehensive and fully-integrated co-located one-stop career 
centers to provide the services described in subsection (f), 
supplemented with multiple affiliated sites or satellites that provide 
one or more of such services and are linked through electronic and 
technological access points. Such affiliated sites may include entities 
designated as having a specialization in addressing special needs, such 
as the needs of individuals with disabilities.
  (d) Common Access.--Information pertaining to the labor market which 
is compiled pursuant to the Wagner-Peyser Act, as described in subtitle 
B of this title, shall be available, to the extent practicable, through 
integrated electronic networks, at all one-stop career centers and 
affiliated sites.
  (e) Eligibility for Designation.--Any entity or consortium of 
entities located in the workforce development area may be designated by 
the local workforce development board to operate a one-stop career 
center or to participate in a one-stop career center system. Such 
entities may include the following:
          (1) Institutions of higher education.
          (2) Local educational agencies.
          (3) Area vocational education schools.
          (4) Local employment service offices, established under the 
        Wagner-Peyser Act.
          (5) Private nonprofit organizations, (including community-
        based organizations).
          (6) Private for-profit entities.
          (7) Agencies of local governments.
          (8) Other interested organizations and entities of 
        demonstrated effectiveness, including local chambers of 
        commerce and other business organizations, consistent with 
        State criteria established pursuant to subsection (b).
  (f) Duties.--Each one-stop career center shall carry out the 
following duties:
          (1) Provision of core services.--A center shall make 
        available the following information and core services to 
        individuals on a universal and nondiscriminatory basis, with 
        reasonable accommodations to address the needs of individuals 
        with disabilities, in the workforce development area in which 
        such center is located:
                  (A) Outreach and intake for services provided under 
                chapter 2 of title II, title III, subtitle A of title 
                IV, and title I of the Rehabilitation Act of 1973.
                  (B) A preliminary assessment of the skill levels and 
                the need for services of the individual for programs 
                under chapter 2 of title II, title III, subtitle A of 
                title IV, and title I of the Rehabilitation Act of 1973 
                of individuals, which may include such factors as basic 
                skills, occupational skills, career development skills, 
                prior work experience, employability, interests, 
                aptitudes, vocational rehabilitation needs, and 
                supportive service needs.
                  (C) Information relating to local and State, and if 
                appropriate, to regional or national, occupations in 
                demand and skill requirements for such occupations.
                  (D) Information relating to youth services, including 
                information on at-risk youth workforce development 
                programs authorized under title II, on school-to-work 
                opportunities, and on youth apprenticeship 
                opportunities.
                  (E) Career counseling and career planning based on a 
                preliminary assessment of the individual.
                  (F) Job search assistance.
                  (G) Information related to vocational rehabilitation 
                services, as provided for in title I of the 
                Rehabilitation Act of 1973.
                  (H) Information relating to federally funded 
                education and job training programs (including 
                registered apprenticeships), and student aid programs, 
                including the eligibility requirements of and services 
                provided by such programs.
                  (I) Information on, and assistance in accessing 
                referral to additional services through programs 
                providing adult education and literacy services, 
                vocational rehabilitation, workforce preparation and 
                development, and supportive services, including those 
                programs authorized in titles II through IV, title I of 
                the Vocational Rehabilitation Act of 1973, available in 
                the workforce development area.
                  (J) Information on the extent to which the services 
                provided under titles II and III, subtitle A of title 
                IV, and title I of the Vocational Rehabilitation Act of 
                1973, meet or exceed the performance standards 
                described in the State plan, and the performance-based 
                information provided by the State to local workforce 
                development boards on certified providers of education 
                and training, as required under section 108(d)(3).
                  (K) Information on industry-recognized skill 
                standards and assessments.
                  (L) Job listings for local labor market 
                opportunities.
                  (M) Acceptance of applications for unemployment 
                compensation.
                  (N) Other appropriate activities to assist 
                individuals into employment.
          (2) Distribution of vouchers and skill grants.--A center 
        shall serve as the point of distribution of vouchers for 
        education, training, and vocational rehabilitation services to 
        eligible individuals in accordance with section 108.
          (3) Special arrangements.--For the purpose of providing core 
        services to individuals with severe disabilities in the most 
        effective and efficient manner possible, the one-stop career 
        center may arrange to have such core services provided to an 
        individual by a certified provider, either on a contract basis 
        or through the use of vouchers.
  (g) Additional Services.--One-stop career centers may provide 
customized workforce development services to employers on a fee-for-
service basis, as determined by the local workforce development board.
  (h) Alternative State Procedure.--Through the collaborative process 
described in section 103, the Governor has the authority to develop 
alternative procedures to the one-stop career center system, which are 
designed to accomplish the full integration of workforce development 
programs. These alternative procedures shall be described in a proposal 
to the Secretaries of Education and Labor for joint review and approval 
or disapproval within 60 days.

SEC. 108. CERTIFICATION OF EDUCATION, TRAINING, AND VOCATIONAL 
                    REHABILITATION SERVICE PROVIDERS.

  (a) Eligibility Requirements.--A program offered by a provider of 
education and training services shall be eligible to receive funds 
under title III, and title I of the Vocational Rehabilitation Act of 
1973 through the receipt of vouchers, skill grants, or through 
contract, if such program and provider--
          (1) are either--
                  (A) eligible to participate in title IV of the Higher 
                Education Act of 1965, or
                  (B) determined to be eligible under the procedures 
                described in subsection (b); and
          (2) provides the performance-based information required 
        pursuant to subsection (c), except that providers eligible 
        under subparagraph (A) only have to provide information for 
        programs other than programs leading to a degree.
  (b) Alternative Eligibility Procedure.--(1) The Governor shall 
establish an alternative eligibility procedure for providers of 
education, training, and vocational rehabilitation services in any 
State desiring to receive funds under title III of this Act and title I 
of the Vocational Rehabilitation Act of 1973, but that are not eligible 
to participate in title IV of the Higher Education Act of 1965. Such 
procedure shall establish minimum acceptable levels of performance for 
such providers, and shall be based on guidelines developed by the 
Secretaries of Labor and Education. The Governor shall utilize the 
local workforce development boards, for the identification and 
certification of qualified providers of education, training, and 
vocational rehabilitation services. During a transition period, not to 
exceed 2 years, certification of programs and providers under this 
subsection shall be based on the performance of such programs and 
providers under the Job Training Partnership Act, the Vocational 
Rehabilitation Act, or other objective measures of previous 
performance, such as employer evaluations.
  (2) Notwithstanding paragraph (1), if the participation of an 
institution of higher education in any of the programs under such title 
of such Act is terminated, such institution shall not be eligible to 
receive funds under this Act for a period of two years.
  (c) Performance-Based Information.--The State shall identify 
performance-based information that is to be submitted by providers of 
services for programs to be eligible under this section. Such 
information may include information, consistent with guidelines 
developed by the Secretaries of Education and Labor, relating to--
          (1) the percentage of students completing the programs 
        conducted by the provider;
          (2) the rates of licensure of graduates of the programs 
        conducted by the provider;
          (3) the percentage of graduates of the programs meeting skill 
        standards and certification requirements endorsed by the 
        National Skill Standards Board established under the Goals 
        2000: Educate America Act;
          (4) the rates of placement and retention in employment, and 
        earnings of the graduates of the programs conducted by the 
        provider;
          (5) the percentage of students who obtained employment in an 
        occupation related to the program conducted by the provider;
          (6) the warranties or guarantees provided by such provider 
        relating to the skill levels or employment to be attained by 
        students; and
          (7) other information for providers of services under title I 
        of the Rehabilitation Act of 1973 that reflects the priority of 
        serving individuals with severe disabilities.
  (d) Administration.--
          (1) State agency.--The Governor shall designate a State 
        agency to collect, verify, and disseminate the performance-
        based information submitted pursuant to subsection (c).
          (2) Application.--A provider of education and training 
        services that desires to be eligible to receive funds under 
        this title shall submit the information required under 
        subsection (c) to the State agency designated under paragraph 
        (1) at such time and in such form as such State agency may 
        require.
          (3) List of eligible providers.--The State agency shall 
        compile a list of eligible programs and providers, accompanied 
        by the performance-based information submitted, and disseminate 
        such list and information to the local workforce development 
        boards within the State.
          (4) Accuracy of information.--
                  (A) In general.--If the State agency determines that 
                information concerning a provider is inaccurate, such 
                provider shall be disqualified from receiving funds 
                under this title for a period of not less than two 
                years, unless such provider can demonstrate to the 
                satisfaction of the Governor or his or her designee, 
                that the information was provided in good faith.
                  (B) Appeal.--The Governor shall establish a procedure 
                for a service provider to appeal a determination by a 
                State agency that results in a disqualification under 
                subparagraph (A). Such procedure shall provide an 
                opportunity for a hearing and prescribe appropriate 
                time limits to ensure prompt resolution of the appeal.
          (5) Assistance in developing information.--The State agency 
        established pursuant to paragraph (1) may provide technical 
        assistance to education, training, and vocational 
        rehabilitation providers in developing the information required 
        under subsection (b). Such assistance may include facilitating 
        the utilization of State administrative records, such as 
        unemployment compensation wage records, and other appropriate 
        coordination activities.
  (e) On-The-Job Training Exception.--
          (1) In general.--Providers of on-the-job training shall not 
        be subject to the requirements of subsections (a), (b), (c), 
        and (d).
          (2) Collection and dissemination of information.--The 
        Workforce Development Board shall collect such performance-
        based information from on-the-job training providers as the 
        Governor may require, and shall disseminate such information to 
        the one-stop career centers.

SEC. 109. MANAGEMENT INFORMATION SYSTEMS.

  (a) In General.--Each State shall use a portion of the funds it 
receives under this Act to design a unified management information 
system that is in accordance with guidelines established jointly by the 
Secretaries in consultation with the Governors.
  (b) Requirements.--Each unified management information system shall, 
to the extent practicable as determined by the Governor--
          (1) be utilized for federally required fiscal reporting and 
        monitoring for each of the programs authorized under this Act;
          (2) be used by all agencies involved in workforce development 
        activities, including one-stop career centers which shall have 
        the capability to track the overall public investments within 
        the State and workforce development areas, and to inform 
        policymakers as to the results being achieved and the 
        demographic characteristics of the individuals served through 
        that investment;
          (3) contain a common structure of financial reporting 
        requirements, fiscal systems and monitoring for all workforce 
        development expenditures included in the workforce development 
        system that shall utilize common data elements and the 
        definitions included in section 5;
          (4) support local efforts to establish workforce development 
        systems, including intake and eligibility determination for all 
        services;
          (5) contain data on the demographic characteristics on the 
        individual participants served by programs authorized under 
        this Act, which shall be collected, produced, and published by 
        the Secretaries; and
          (6) be in accordance with guidelines established jointly by 
        the Secretaries in consultation with the States.

SEC. 110. PERFORMANCE ACCOUNTABILITY SYSTEM.

  (a) In General.--In order to promote high levels of performance and 
to ensure an appropriate return on the Nation's investment in the 
workforce development and literacy system, each State receiving funds 
under this Act shall develop, or have developed, a statewide 
performance accountability system in accordance with the provisions of 
this section.
  (b) Indicators of Performance.--
          (1) In general.--Each State receiving funds under this Act 
        shall identify indicators of performance for each of the 
        programs established under titles II through IV of this Act and 
        title I of the Vocational Rehabilitation Act of 1973, 
        consistent with State goals as described in the State plan in 
        accordance with section 104. Such indicators shall at a minimum 
        include core indicators described in such titles. Such 
        indicators may also take into account post-program surveys 
        measuring customer satisfaction of both employers and program 
        participants.
          (2) Technical definitions of core indicators.--In order to 
        ensure nationwide comparability of performance data, the 
        Secretary of Labor and the Secretary of Education, in 
        collaboration with the States and with representatives of 
        business and industry, employees, educational agencies, service 
        providers, participants, and other interested parties, shall 
        promulgate technical definitions of each of the core indicators 
        described in titles II through IV of this Act and in title I of 
        the Vocational Rehabilitation Act. Such definitions shall be 
        used under this Act in measuring performance.
  (c) Expected Levels of Performance.--
          (1) In general.--(A) Each State shall identify the level of 
        performance, consistent with State goals described under 
        section 104, that is expected for local workforce development 
        areas and other applicable local administrative entities under 
        this Act. In determining such levels, the State shall take into 
        account the world class levels identified under paragraph (2), 
        and shall initially develop baseline levels of performance upon 
        which States will measure continuous improvement.
          (B) The Governor, through the collaborative process, may 
        adjust the expected level of performance with respect to each 
        local area taking into account specific economic, demographic, 
        and geographic factors, and the characteristics of the 
        population to be served.
          (2) World class levels of performance.--In order to encourage 
        high levels of performance and advance the Nation's 
        competitiveness in the global economy, the Secretary of Labor 
        and the Secretary of Education, in collaboration with the 
        States and with representatives of business and industry, 
        employees, educational agencies, service providers, 
        participants, and other interested parties, shall identify 
        world class levels of performance with respect to appropriate 
        core indicators selected from among the core indicators 
        described in titles II through IV and in title I of the 
        Vocational Rehabilitation Act of 1973. Where applicable, such 
        world class standards shall reflect industry-recognized skill 
        standards and the National Education Goals.
  (d) Report on Performance.--
          (1) In general.--The State shall report to the Secretary of 
        Labor and the Secretary of Education, the levels of performance 
        achieved by local workforce development areas and other 
        applicable local administrative entities with respect to the 
        indicators identified pursuant to subsection (b)(1) for each 
        program year. The Secretaries shall make such information 
        available to the general public through publication and other 
        appropriate methods, and shall disseminate State-by-State 
        comparisons, and comparisons with other industrialized nations 
        (where appropriate).
          (2) Reporting options.--In the collection and reporting of 
        such data, States are encouraged to utilize administrative 
        reporting data on quarterly earnings, establishment and 
        industry affiliation, and geographic location of employment, 
        such as unemployment insurance wage-data records.
  (e) Consequences for Poor Performance.--
          (1) Criteria.--The Governor, through the collaborative 
        process, shall establish criteria for determining whether local 
        workforce development areas and other applicable local 
        administrative entities have failed to meet expected levels of 
        performance with respect to programs under this Act.
          (2) Consequences for poor performance.--
                  (A) State consequences.--If a State fails to meet 
                expected levels of performance for a program for any 
                program year as established pursuant to subsection (a), 
                the Secretary of Education or the Secretary of Labor, 
                as appropriate to the particular program, may provide 
                technical assistance, including assistance in the 
                development of a performance improvement plan. If such 
                failure continues for a second consecutive year, the 
                appropriate Secretary may reduce by not more than 5 
                percent, the amount of the grant that would (in the 
                absence of this paragraph) be payable to the State 
                under such program for the immediately succeeding 
                program year. Such penalty shall be based on the degree 
                of failure to meet expected levels of performance.
                  (B) Local consequences.--(i) If a local workforce 
                development area, or other applicable local 
                administrative entity, fails to meet expected levels of 
                performance for a program for any program year under 
                the criteria established in paragraph (1), the 
                Governor, through the collaborative process, may 
                provide technical assistance, including the development 
                of a performance improvement plan.
                  (ii) If such failure continues for a second 
                consecutive year, the Governor may take corrective 
                actions, such as the withholding of funds, the 
                redesignation of a local administrative entity, or such 
                other actions as the Governor, through the 
                collaborative process, determines are appropriate, 
                consistent with State law, section 104(c)(3) of this 
                Act, and the requirements of this Act.

              Subtitle B--Amendments to Wagner-Peyser Act

SEC. 131. GENERAL PROGRAM REQUIREMENTS.

  (a) Definitions.--Section 2 of the Act of June 6, 1933 (commonly 
known as the ``Wagner-Peyser Act'') (29 U.S.C. 49a) is amended--
          (1) in paragraph (1), by striking ``Job Training Partnership 
        Act'' and inserting ``Consolidated and Reformed Education, 
        Employment, and Rehabilitation Systems Act'';
          (2) in paragraph (2) to read as follows:
          ``(2) the term `local workforce development board' means a 
        local workforce development board established under title I of 
        the Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act;'';
          (3) in paragraph (4) to read as follows:
          ``(4) the term `local workforce development area' means a 
        local workforce development area established under title I of 
        the Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act;'';
          (4) in paragraph (5), by striking the period at the end and 
        inserting a semicolon; and
          (5) by adding at the end the following new paragraphs:
          ``(6) the term `local public service office' means an office 
        which provides employment services to the general public under 
        a one-stop career center system; and
          ``(7) the term `one-stop career center system' means a one-
        stop career center system established under title I of the 
        Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act.''.
  (b) Duties.--Section 3(a) of such Act (29 U.S.C. 49b(a)) is amended 
to read as follows:
  ``(a) The Secretary of Labor shall, pursuant to title II of the 
Wagner-Peyser Act--
          ``(1) assist in the coordination and development of a 
        nationwide system of labor exchange services for the general 
        public, provided through the one-stop career center system, in 
        coordination with the public employment services;
          ``(2) assist in the development of performance standards, 
        benchmarks, and continuous improvement models for such 
        nationwide system which ensures private sector satisfaction and 
        meets the demands of jobseekers; and
          ``(3) ensure the continued services for individuals receiving 
        unemployment compensation.''.
  (c) Requirements for Receipt of Funds.--Section 4 of such Act (29 
U.S.C. 49c) is amended by striking ``a State shall, through its 
legislature'' and inserting ``the Governor of a State, through the 
collaborative process described in title I of the Consolidated and 
Reformed Education, Employment, and Rehabilitation Systems Act''.
  (d) Authorization of Appropriations.--Section 5 of such Act (29 
U.S.C. 49d) is amended by inserting before the period at the end the 
following: ``, of which not less than 25 percent shall be for carrying 
out both section 14 and title II of this Act''.
  (e) Use of Funds Under This Act.--Section 7(c)(2) of such Act (29 
U.S.C. 49f(c)(2)) is amended by striking ``any of the following 
provisions of law'' and all that follows and inserting ``the 
Consolidated and Reformed Education, Employment, and Rehabilitation 
Systems Act.''.
  (f) State Plan.--Section 8 of such Act (29 U.S.C. 49g) is amended--
          (1) in subsection (a) to read as follows:
  ``(a) Any State desiring to receive assistance under this Act shall 
submit to the Secretary, as part of the State workforce development and 
literacy plan authorized under title I of the Consolidated and Reformed 
Education, Employment, and Rehabilitation Systems Act, detailed plans 
for carrying out the provisions of this Act within such State.'';
          (2) by striking subsections (b), (c), and (e); and
          (3) by redesignating subsection (d) as subsection (b).
  (g) Elimination of Federal Advisory Council.--Section 11 of such Act 
(29 U.S.C. 49j) is hereby repealed.
  (h) Conforming Amendments.--
          (1) After section 2 of such Act insert the following new 
        heading:

               ``TITLE I--GENERAL PROGRAM REQUIREMENTS''

          (2) Section 4 of such Act is amended by striking ``United 
        States Employment Service'' and inserting ``Secretary of 
        Labor''.
          (3) Section 7(b)(2) of such Act is amended by striking 
        ``private industry council'' and inserting ``local workforce 
        development board''.
          (4) Section 7(d) of such Act is amended--
                  (A) by striking ``United States Employment Service'' 
                and inserting ``Secretary of Labor''; and
                  (B) by striking ``Job Training Partnership Act'' and 
                inserting ``Consolidated and Reformed Education, 
                Employment, and Rehabilitation Systems Act''.
          (5) Section 12 of such Act is amended by striking ``The 
        Director, with the approval of the Secretary of Labor,'' and 
        inserting ``The Secretary of Labor''.

SEC. 132. LABOR MARKET INFORMATION.

  The Act of June 6, 1933 (commonly known as the ``Wagner-Peyser Act''; 
29 U.S.C. 49), as amended by section 131, is further amended by adding 
at the end the following new title:
                  ``TITLE II--LABOR MARKET INFORMATION

``SEC. 21. PURPOSE.

  ``The purpose of this title is to ensure a comprehensive and 
coordinated system of labor market information which will provide 
locally based, accurate, up-to-date, easily accessible, and user 
friendly labor market information through a cooperative Federal, State, 
and local governance structure which includes partnerships with the 
private sector at all levels.

``SEC. 22. SYSTEM CONTENT.

  ``The Secretary of Labor, in accordance with the provisions of this 
title, shall oversee the development, maintenance, and continuous 
improvement of a nationwide system of labor market information using 
data from all available and appropriate sources, which shall include--
          ``(1) statistical data from survey and projection programs 
        and data from administrative reporting systems, which, taken 
        together, shall enumerate, estimate, and project the supply and 
        demand for labor at national, State, and local levels in a 
        timely manner, including data on--
                  ``(A) the demographic characteristics, as defined in 
                title I of the Careers Act, socioeconomic 
                characteristics, and current employment status of the 
                population, including self-employed, part-time, and 
                seasonal workers, and individuals with severe 
                disabilities;
                  ``(B) job vacancies, education and training 
                requirements, skills, wages, benefits, working 
                conditions, and industrial distribution of occupations, 
                as well as current and projected employment 
                opportunities and trends by industry and occupation;
                  ``(C) the educational attainment, training, skills, 
                skill levels, and occupations of the population by 
                demographic characteristics such as unemployment 
                insurance wage data records;
                  ``(D) information maintained in a longitudinal manner 
                on the quarterly earnings, establishment and industry 
                affiliation, and geographic location of employment for 
                all individuals for whom such information is collected 
                by the States; and
                  ``(E) the incidence, industrial and geographical 
                location, and number of workers displaced by permanent 
                layoffs and plant closings;
          ``(2) State and local employment and consumer information 
        on--
                  ``(A) job openings, locations, hiring requirements, 
                and application procedures, as well as profiles of 
                employers in the local labor market describing the 
                nature of work performed, employment requirements, 
                wages, benefits, and hiring patterns;
                  ``(B) job seekers, including their education and 
                training, skills, skill levels, employment experience, 
                and employment goals; and
                  ``(C) education courses, training programs, job 
                placement programs, and vocational rehabilitation 
                programs (where appropriate), including--
                          ``(i) performance information, such as the 
                        ratio of program completion, acquisition of 
                        industry-recognized skill standards, job 
                        placement, earnings, and the level of 
                        satisfaction of the participants and their 
                        employers; and
                          ``(ii) descriptive information, such as 
                        eligibility requirements, costs, financial 
                        support, or other supportive services, and 
                        other appropriate information which may be 
                        available with these courses and programs;
          ``(3) technical standards for data and information that 
        will--
                  ``(A) ensure compatibility and additivity of data and 
                information from local to State and national levels;
                  ``(B) support standardization and aggregation of data 
                and information from the administrative reporting 
                systems of employment-related programs; and
                  ``(C) include--
                          ``(i) classification and coding systems for 
                        industries, occupations, skills, programs, and 
                        courses;
                          ``(ii) nationally standardized definitions of 
                        terms;
                          ``(iii) a common system for designating 
                        geographic areas;
                          ``(iv) quality control mechanisms for data 
                        collection and analysis; and
                          ``(v) common schedules for data collection 
                        and dissemination;
          ``(4) analysis of data and information for uses including--
                  ``(A) national, State, and local economic 
                policymaking;
                  ``(B) the implementation of Federal policies, 
                including the allocation of Federal funds to States and 
                localities and the facilitation of job search and 
                hiring in local labor markets;
                  ``(C) national, State, and local program planning and 
                evaluation; and
                  ``(D) research on labor market dynamics;
          ``(5) dissemination mechanisms for data and analysis, 
        including mechanisms which may be standardized among the States 
        and technical standards in the design of automated databases, 
        and the design of user interfaces and communications protocols;
          ``(6) programs of technical assistance for States and 
        localities in the development, maintenance, and utilization of 
        data, analysis, and dissemination mechanisms, including 
        assistance in adopting and utilizing automated systems and 
        improving the access, through electronic and other means, of 
        youth, adults, and employers to labor market information for 
        localities, States, and the Nation;
          ``(7) programs of research and demonstration, which may be 
        carried out by States and other public or private entities, on 
        ways to improve the products and processes authorized in this 
        title; and
          ``(8) objective performance measures, which will allow for 
        the continuous monitoring of the progress of the labor market 
        information system at national, State, and local levels.

``SEC. 23. FEDERAL RESPONSIBILITIES.

  ``(a) In General.--The Nation's labor market information system shall 
be planned, administered, overseen, and evaluated by a cooperative 
governance structure involving the Federal Government and the States.
  ``(b) Duties.--The Secretary, with respect to data collection, 
analysis, and dissemination of labor market information, shall carry 
out the following duties:
          ``(1) Ensure that all statistical and administrative data 
        collection activities within the Department of Labor, including 
        the Employment and Training Administration, Veterans' 
        Employment and Training Service, Employment Standards 
        Administration, and Occupational Health and Safety 
        Administration, are consistent with those of the Bureau of 
        Labor Statistics.
          ``(2) Assign responsibilities, as appropriate, to agencies 
        such as the Employment and Training Administration to work with 
        the Bureau of Labor Statistics in the collection, analysis and, 
        particularly, in the dissemination of labor market information, 
        and in the provision of training and technical assistance to 
        users of information, including the States, employers, youth, 
        and adults.
          ``(3) In cooperation with other Federal agencies, including 
        but not limited to the Departments of Commerce, Defense, 
        Treasury, Education, Health and Human Services, Agriculture, 
        Veterans' Affairs, and the Office of Management and Budget, 
        establish and maintain mechanisms for ensuring complementarity 
        and nonduplication in the development and operation of 
        statistical and administrative data collection activities, in 
        order to ensure a comprehensive labor market information 
        system.
          ``(4) Actively seek the participation of other Federal 
        agencies, particularly the National Center for Education 
        Statistics and the Division of Adult and Vocational Education, 
        and the Rehabilitation Services Administration of the 
        Department of Education, the Veterans' Employment and Training 
        Service of the Department of Labor and the Department of 
        Veterans' Affairs with respect to vocational rehabilitation 
        programs in the design and provision of standardized 
        information to the States to support section 22(2), and in the 
        dissemination of labor market information.
          ``(5) Establish confidentiality standards for the labor 
        market information system at national, State, and local levels, 
        including such provisions as may be necessary, to be taken in 
        coordination with the States, to ensure that privacy and 
        confidentiality protections are guaranteed with respect to 
        individuals and firm data.
  ``(c) Additional Duties.--The Secretary, in collaboration with the 
Bureau of Labor Statistics, with the assistance of other agencies of 
the Department where appropriate, shall--
          ``(1) establish and maintain, with the cooperation of the 
        States, elements of the system described in sections 22(1) and 
        22(3);
          ``(2) develop and promulgate standards, definitions, formats, 
        collection methodologies, and other necessary system elements 
        for the use of the States in their assembling and presentation 
        of the employment information specified in section 22(2);
          ``(3) eliminate gaps and duplication in statistical 
        undertakings, with the systemization of wage surveys as an 
        early priority;
          ``(4) recommend any needed improvements in administrative 
        reporting systems to support the development of labor market 
        information from their data; and
          ``(5) ensure that--
                  ``(A) data are sufficiently timely and locally 
                detailed for uses including those specified in section 
                22(4);
                  ``(B) administrative records are standardized to 
                facilitate the aggregation of data from local to State 
                and national levels and to support the creation of new 
                statistical series from program records; and
                  ``(C) paperwork and reporting requirements on 
                employers and individuals are reduced.

``SEC. 24. ANNUAL PLAN.

  ``(a) In General.--The Secretary of Labor, working through the Bureau 
of Labor Statistics, and in consultation with other appropriate Federal 
agencies, shall prepare an annual plan, which shall be the operational 
mechanism for achieving a cooperative Federal/State governance 
structure for labor market information. The annual plan shall provide 
the verbal justification for the Department of Labor's budget request 
to Congress by describing the activities of the Bureau, other agencies 
of the Department of Labor, and other Federal agencies with regard to 
data collection, analysis, and dissemination of labor market 
information for fiscal years succeeding the fiscal year in which the 
plan is developed and shall include--
          ``(1) the results of a periodic review of users' needs, 
        including the identification of new employment issues and the 
        attendant emergence of new needs, on the part of Congress, the 
        States, employers, youth, and adults, for data, analysis, and 
        dissemination;
          ``(2) an evaluation, including the results of objective 
        measures, of the performance of the labor market information 
        system in meeting these needs and the steps to be taken to 
        overcome deficiencies;
          ``(3) a summary of ongoing data programs and activities under 
        section 22 and a description of the development of new data 
        programs, analytical techniques, definitions and standards, 
        dissemination mechanisms, training and technical assistance, 
        governance mechanisms, and funding processes to meet new needs; 
        and
          ``(4) the results of an annual review of the costs to the 
        States of meeting contract requirements for data production 
        under this title, including a description of how the 
        Secretary's requested budget will cover these costs.
  ``(b) Cooperation With the States.--The Secretary shall involve the 
States with the Bureau of Labor Statistics in a cooperative manner in 
the development of the plan by--
          ``(1) establishing procedures and mechanisms for holding 
        formal and periodic consultations on products and 
        administration of the system, at least once each quarter, with 
        representatives of the States from each of the 10 Federal 
        regions of the Department of Labor, elected by and from among 
        the State directors of labor market information, according to a 
        process set forth by the Secretary; and
          ``(2) incorporating in the annual plan, for its submission to 
        Congress, the results of these consultations, including any 
        supplementary or dissenting views from representatives of the 
        States.
  ``(c) Representatives of States Deemed To Be Federal Employees.--For 
purposes of the development of the annual plan and to meet the 
provisions of Office of Management and Budget Circular A-11, the 
representatives of the States, elected in accordance with subsection 
(b)(1), shall be considered to be employees of the Department of Labor.

``SEC. 25. GOVERNOR'S RESPONSIBILITIES.

  ``(a) Designation of State Agency.--The Governor of each State shall 
designate a single State agency to be the agency responsible for the 
management and oversight of a statewide comprehensive labor market 
information system and for the State's participation in the cooperative 
Federal/State governance structure for the nationwide labor market 
information system.
  ``(b) Duties.--In order to receive Federal financial assistance under 
this Act, the State agency shall--
          ``(1) develop, maintain, and continuously improve a 
        comprehensive labor market information system, which shall--
                  ``(A) include all the elements specified in section 
                22; and
                  ``(B) be responsive to the needs of the State and its 
                localities for planning and evaluative data, including 
                employment and economic analyses and projections, as 
                required by this Act, the Consolidated and Reformed 
                Education, Employment, and Rehabilitation Systems Act, 
                the Social Security Act, and other provisions of law 
                under which Congress has required the use of labor 
                market information;
          ``(2) ensure the performance of contract and grant 
        responsibilities for data collection, analysis, and 
        dissemination;
          ``(3) conduct such other data collection, analysis, and 
        dissemination activities as will ensure comprehensive State and 
        local labor market information;
          ``(4) actively seek the participation of other State and 
        local agencies, with particular attention to State education, 
        economic development, human services, and welfare agencies, in 
        data collection, analysis, and dissemination activities in 
        order to ensure complementarity and compatibility among data; 
        and
          ``(5) participate in the development of the national annual 
        plan.
  ``(c) Rule of Construction.--Nothing in this Act shall be construed 
as limiting the State agency's ability to conduct additional data 
collection, analysis, and dissemination activities with State funds or 
with Federal funds from sources other than this Act.''.

                       Subtitle C--Worker Rights

SEC. 141. REQUIREMENTS.

  The following requirements shall apply to programs under titles II 
and III of this Act:
          (1) Prohibition on displacement.--A participant in a program 
        under titles II or III shall not displace any currently 
        employed worker (including a partial displacement, such as a 
        reduction in the hours of non-overtime work, wages, or 
        employment benefits).
          (2) Prohibition on impairment of contracts.--A program under 
        title II or III shall not impair existing contracts for 
        services or collective bargaining agreements, and no such 
        program that would be inconsistent with the terms of a 
        collective bargaining agreement shall be undertaken without the 
        written concurrence of the labor organization and employer 
        concerned.
          (3) Prohibition on replacement.--A participant in a program 
        under title II or III shall not be employed--
                  (A) when any other individual is on temporary layoff, 
                with the clear possibility of recall, from the same or 
                any substantially equivalent job with the participating 
                employer; or
                  (B) when the employer has terminated the employment 
                of any regular employee or otherwise reduced the 
                workforce of the employer with the intention of filling 
                the vacancy so created with the student.
          (4) Workplaces.--A participant in a program under title II or 
        III shall be provided with adequate and safe equipment and safe 
        and healthful workplaces in conformity with all health and 
        safety requirements of Federal, State, and local law.
          (5) Effect on other laws.--Nothing in this Act shall be 
        construed to modify or affect any Federal or State law 
        prohibiting discrimination on the basis of race, religion, 
        color, ethnicity, national origin, gender, age, or disability, 
        or to modify or affect any right to enforcement of this Act 
        that may exist under other Federal laws, except as expressly 
        provided by this Act.

 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

SEC. 201. PURPOSES.

  It is the purpose of this title to provide States and local 
communities maximum flexibility in designing workforce preparation 
programs that--
          (1) help individuals attain the academic skills, as well as 
        occupational skills, needed to be successful in a global 
        economy and for lifelong learning;
          (2) best suit the needs of in-school and at-risk youth in 
        their communities, as well as the skill needs of State and 
        local employers;
          (3) promote strong connections between in-school and at-risk 
        programs, to ensure that youth are prepared for good jobs and 
        further education opportunities, and promote youth development 
        and career preparation programs that provide opportunities for 
        individuals to receive postsecondary education and occupational 
        training;
          (4) promote the formation of business and education 
        partnerships that are dedicated to linking the worlds of school 
        and work; and
          (5) promote high academic and occupational standards and 
        quality vocational-technical education, including improved 
        secondary and postsecondary programs, by focusing resources on 
        program improvement initiatives that help prepare students for 
        further education and training and high-wage jobs in high-
        performance workplaces.

SEC. 202. DEFINITIONS.

  For purposes of this title:
          (1) The term ``administration'' means activities of a State 
        necessary for the proper and efficient performance of its 
        duties under this title, including supervision, but does not 
        include curriculum development activities, personnel 
        development, or research activities.
          (2) The term ``all aspects of the industry'' means strong 
        experience in, and understanding of, all aspects of the 
        industry the students are preparing to enter, including 
        planning, management, finances, technical and production 
        skills, underlying principles of technology, labor issues, and 
        health and safety.
          (3) The term ``articulation agreement'' means a commitment to 
        a program designed to provide students with a nonduplicative 
        sequence of progressive coursework in secondary and 
        postsecondary education.
          (4) The term ``cooperative education'' means a method of 
        instruction of vocational education for individuals who, 
        through written cooperative arrangements between the school and 
        employers, receive instruction, including required academic 
        courses and related vocational instruction by alternation of 
        study in school with a job in any occupational field. Such 
        alternation shall be planned and supervised by the school and 
        employers so that each contributes to the student's education 
        and employability. Work periods and school attendance may be on 
        alternate half days, full days, weeks, or other periods of time 
        in fulfilling the cooperative program.
          (5) The term ``corrections vocational education'' means 
        programs administered by the State to assist juvenile and adult 
        criminal offenders in correctional institutions in the State, 
        including correctional institutions operated by local 
        authorities.
          (6) The term ``curricula'' means instructional and related or 
        supportive material, including materials using advanced 
        learning technology, in any occupational field which is 
        designed to strengthen the academic foundation and prepare 
        individuals for employment at the entry level or to upgrade 
        occupational competencies of those previously or presently 
        employed in any occupational field, and appropriate counseling 
        and guidance material.
          (7) Except as otherwise provided, the term ``eligible 
        institution'' means a local educational agency, an area 
        vocational education school, an intermediate educational 
        agency, an institution of higher education (as such term is 
        defined in section 1201(a) of the Higher Education Act of 
        1965), a State corrections educational agency, or consortia of 
        such entities.
          (8) The term ``partnership'' means a local entity that is 
        responsible for local youth development and career preparation 
        programs and may consist of employers, representatives of local 
        educational agencies and local postsecondary educational 
        institutions (including representatives of area vocational 
        education schools, where applicable), local educators (such as 
        teachers, counselors, or administrators), representative 
        employee organizations, and students; and include other 
        entities.
          (9) The term ``Secretary'' means the Secretary of Education.
          (10) The term ``sequential course of study'' means an 
        integrated series of courses which are directly related to the 
        educational and occupational skills preparation of individuals 
        for jobs, or preparation for postsecondary education.
          (11) The term ``single parent'' means an individual who--
                  (A) is unmarried or legally separated from a spouse; 
                and
                  (B)(i) has a minor child or children for whom the 
                parent has either custody or joint custody; or
                  (ii) is pregnant.
          (12) The term ``special populations'' includes individuals 
        with disabilities, economically disadvantaged individuals, 
        individuals of limited English proficiency, and individuals in 
        nontraditional training and employment.
          (13) The term ``tech-prep education program'' means a program 
        of study which--
                  (A) combines at least 2 years of secondary and 2 
                years of postsecondary education in a nonduplicative 
                sequence;
                  (B) integrates academic and vocational instruction;
                  (C) provides technical preparation in at least 1 
                field of engineering technology, applied science, 
                mechanical, industrial, or practical art or trade, or 
                agriculture, health occupations, or business;
                  (D) builds student competence in mathematics, 
                science, communications, and workplace skills, through 
                applied academics and integrated instruction in a 
                coherent sequence of courses;
                  (E) leads to an associate degree or certificate in a 
                specific career field;
                  (F) leads to placement in appropriate employment or 
                further education; and
                  (G) enables a student to fulfill a career pathway 
                plan relating to labor market needs.
          (14) The term ``vocational education'' means organized 
        educational programs offering a sequence of courses which are 
        directly related to the preparation of individuals in paid or 
        unpaid employment in current or emerging occupations, including 
        nonbaccalaureate certificate and degree programs and 
        baccalaureate vocational degree programs. Such programs include 
        competency-based applied learning which contributes to an 
        individual's academic knowledge, higher-order reasoning, and 
        problem-solving skills, work attitudes, general employability 
        skills, and the occupational-specific skills necessary for 
        economic independence as a productive and contributing member 
        of society. Such term also includes applied technology 
        education.
          (15) The term ``vocational student organizations'' means 
        those organizations for individuals enrolled in vocational 
        education programs which engage in activities as an integral 
        part of the instructional program. Such organizations may have 
        State and national units which aggregate the work and purposes 
        of instruction in vocational education at the local level.

                       Subtitle A--State Funding

SEC. 211. NATIONAL AND STATE FUNDING.

  (a) National Programs.--In each fiscal year, of the amounts made 
available under section 4, the Secretary shall reserve 20 percent or 
$25,000,000, whichever is less, to carry out the provisions of subtitle 
D.
  (b) State Allotment.--
          (1) In general.--Of the funds remaining after the reservation 
        under subsection (a), the Secretary shall allot to each State 
        for each fiscal year an amount based on that State's allotment 
        percentage.
          (2) Allotment percentage.--(A) Except as provided in 
        subparagraph (B), the allotment percentage of a State for a 
        fiscal year shall be the same percentage of funds allotted to 
        the State under this section in the preceding fiscal year.
          (B) The allotment percentage of a State for fiscal year 1996 
        shall be the percentage of funds allotted to the State in 
        fiscal year 1995 under--
                  (i) section 101 or 101A of the Carl D. Perkins 
                Vocational and Applied Technology Education Act as such 
                Act was in effect on the day before the date of the 
                enactment of this Act; and
                  (ii) the funding allotted in fiscal year 1995 under 
                section 252 and 262 of the Job Training Partnership Act 
                as such Act was in effect on the day before the date of 
                the enactment of this Act.
          (3) State minimum.--Notwithstanding any other provision of 
        law and subject to paragraph (1), any fiscal year for which the 
        amounts appropriated for programs authorized by this title 
        exceed the amounts available for fiscal year 1985, a State 
        shall not receive less than one-quarter of one percent of the 
        amount available for each such program for that fiscal year 
        under this subsection. Amounts necessary for increasing such 
        payments to States to comply with the preceding sentence shall 
        be obtained by ratably reducing the amounts to be paid to other 
        States.
          (4) Definition.--For the purposes of this subsection the term 
        ``State'' means, in addition to the several States, the 
        District of Columbia, the Commonwealth of Puerto Rico, the 
        Virgin Islands, Guam, American Samoa, and the Northern Mariana 
        Islands.
  (c) Funding for State Programs.--Of the funds allotted to a State 
under subsection (b) for each fiscal year, the Governor, through the 
collaborative process, shall--
          (1) make available not less than 90 percent to local 
        providers;
          (2) make available not more than 8 percent for State programs 
        described in section 222; and
          (3) make available not more than 2 percent for administrative 
        purposes.

SEC. 212. WITHIN STATE ALLOCATION.

  (a) In General.--From the amounts made available pursuant to section 
211(c)(1), the Governor, through the collaborative process, shall--
          (1) allocate to eligible institutions an amount equal to not 
        less than 40 percent of such amount for in-school youth 
        programs described in section 241;
          (2) allocate to local workforce development boards an amount 
        equal to not less than 40 percent of such amount for at-risk 
        youth programs described in section 245;
          (3) provide an amount equal to 10 percent of the remainder to 
        eligible institutions or local workforce development boards; 
        and
          (4) allocate the remainder of any amounts under this 
        subsection to carry out the purposes of paragraph (1) or (2).
  (b) Within State Formula.--
          (1) Establishment.--The Governor, through the collaborative 
        process, and after consultation with local chief elected 
        officials in the local workforce development area and, where 
        appropriate, local educators in such area, shall develop a 
        formula for the allocation of funds in accordance with 
        paragraphs (1), (2), and (4) of subsection (a). Such formula 
        shall take into account--
                  (A) poverty rates within each local community, as 
                determined by the State;
                  (B) the proportion of the State's youth population 
                residing within each local community; and
                  (C) such other factors as considered appropriate.
          (2) Additional factors.--In establishing such formula, the 
        Governor shall ensure that funds are distributed equitably 
        throughout the State, and that the factors described in 
        paragraph (1) do not receive disproportionate weighting.
  (c) Minimum Grant Amounts.--
          (1) Local educational agencies.--A local educational agency 
        or consortium of such agencies that receives a subgrant from a 
        State under this subtitle for any fiscal year shall receive not 
        less than $15,000.
          (2) Postsecondary institutions.--A postsecondary institution 
        or consortium of such institutions that receives a subgrant 
        from a State under this subtitle for any fiscal year shall 
        receive not less than $50,000.
          (3) Local development board.--A local development board that 
        receives a subgrant from a State under this subtitle for any 
        fiscal year shall receive not less than $15,000.
          (4) Secondary-postsecondary consortia.--One or more local 
        educational agencies and one or more eligible institutions may 
        enter into a consortium agreement. A consortium formed pursuant 
        to this paragraph that receives a subgrant from a State under 
        this subtitle shall receive not less than $50,000 in any fiscal 
        year.
  (d) Funds to Consortium.--Funds allocated to a consortium formed to 
meet the minimum grant requirements of this section shall be used only 
for purposes and activities that are mutually beneficial to all members 
of the consortium. Such funds may not be reallocated to individual 
members of the consortium for purposes or activities benefiting only 
one member of the consortium.
  (e) Waiver.--The State may waive the application of subsection (c) in 
any case in which a grant recipient--
          (1) is located in a rural, sparsely-populated area; and
          (2) demonstrates an inability to enter into a consortium for 
        purposes of providing services under this title.

       Subtitle B--State Organizational, Planning, and Reporting 
                            Responsibilities

SEC. 221. STATE PLAN.

  In addition to the requirements described in title I, a State that 
desires to receive funds for any fiscal year under this title shall, as 
part of the State Workforce Development and Literacy Plan under title 
I, submit to the Secretary of Education information that includes--
          (1) a description of how the State will adopt, develop, or 
        assist local providers to adopt or develop model curricula and 
        innovative instructional methodologies, to be used in the 
        postsecondary, secondary, and where possible, the elementary 
        grades, and in programs for at-risk youth that integrate 
        academic, vocational, and work-based learning, stressing 
        applied and contextual learning, and promote career awareness;
          (2) a description of how the State will expand and improve 
        career exploration and guidance counseling for students in the 
        elementary and secondary grades, which may include linkages to 
        career exploration, guidance counseling and labor market 
        information services outside of the school system and shall 
        describe how the State will effectively demonstrate the system 
        of career preparation for youth, which includes elements such 
        as professional development, and secondary-postsecondary 
        collaborations;
          (3) a description of the strategy of the State for 
        integrating academic, vocational, and work-based learning, 
        including a description of how the State will promote 
        collaboration between secondary and postsecondary occupational 
        and academic programs and institutions;
          (4) a description of the State's plan to develop the academic 
        and occupational skills of students and provide the attainment 
        of challenging vocational-technical education standards, 
        including industry-approved skill standards and workplace 
        competencies, and a description of how the State will develop a 
        State process for issuing skill certificates that, to the 
        extent feasible, are consistent with the skill standards 
        certification systems endorsed by the National Skill Standards 
        Board;
          (5) a description of how the State will promote the active 
        involvement of business (including small- and medium-sized 
        businesses) in the planning, development, and implementation of 
        youth development and career preparation programs authorized 
        under this title; and
          (6) a description of how the State will coordinate the Goals 
        2000: Educate America Act, and Improving America's Schools Act 
        of 1994, and other State education improvement plans.

SEC. 222. STATE PROGRAMS AND STATE ACTIVITIES.

  (a) General Authority.--From amounts made available to a State under 
section 211, each State shall conduct State programs and activities.
  (b) Required Uses of Funds.--The programs and activities described in 
subsection (a) shall include an assessment of programs conducted with 
assistance under this title, including the development of--
          (1) performance standards and measures for such programs; and
          (2) program improvement and accountability with respect to 
        such programs.
  (c) Additional Uses of Funds.--The programs and activities described 
in subsection (a) may include--
          (1) the support for tech-prep education;
          (2) support for workforce preparation programs for single 
        parents, displaced homemakers, and single pregnant women;
          (3) support for corrections vocational education;
          (4) professional development activities for vocational 
        teachers, academic teachers, school administrators, counselors, 
        workplace mentors, and local providers regarding integration of 
        vocational, academic, and work-based curricula, including--
                  (A) inservice and preservice training of teachers and 
                faculty in state-of-the-art programs and techniques and 
                nontraditional training and employment; and
                  (B) support of public teacher-education programs to 
                ensure vocational teachers stay current with the needs, 
                expectations, and methods of industry to meet employer 
                standards;
          (5) development, dissemination, and field testing of 
        curricula, especially--
                  (A) curricula that integrate vocational, academic, 
                and work-based methodologies;
                  (B) curricula that provide a coherent sequence of 
                courses through which academic and occupational skills 
                may be measured; and
                  (C) curricula for work-based learning;
          (6) leadership and instructional programs in technology 
        education;
          (7) data collection, including support for management 
        information systems as defined in section 109;
          (8) support for 1-stop career centers described in section 
        107;
          (9) support for cooperative education and family and consumer 
        science programs;
          (10) creative use of technologies, including professional 
        development in the use of such technologies for instructional 
        purposes and to increase counselors' and students' knowledge 
        of, and use of, additional information resources to make career 
        pathways and coursework decisions;
          (11) support for vocational student organizations; and
          (12) improving career guidance and counseling.

SEC. 223. INCENTIVE AWARDS.

  The State, may, from the amount made available under section 
211(c)(2) for any fiscal year make performance awards to 1 or more 
eligible institutions or local providers that have--
          (1) exceeded in the performance goals described in section 
        224;
          (2) implemented exemplary youth development and career 
        preparation programs at the local level in accordance with the 
        purposes described in section 201; or
          (3) provided exemplary education services and activities for 
        at-risk youth.

SEC. 224. CORE STANDARDS, PERFORMANCE GOALS, AND MEASURES.

  (a) General Authority.--
          (1) Standards and measures.--In addition to the State's goals 
        described in section 104, each State receiving funds under this 
        title shall have developed or shall develop and implement a 
        statewide system of core standards and measures of performance 
        for youth development and career preparation programs in 
        coordination with other titles of this Act.
          (2) Statewide system.--Each statewide system, in accordance 
        with the provisions of section 104, shall--
                  (A) establish or have established performance goals 
                to define the level of performance to be achieved by 
                youth served under this title and to evaluate the 
                quality and effectiveness of services and activities 
                under this title;
                  (B) express such goals in an objective, quantifiable, 
                and measurable form;
                  (C) establish progress indicators that the State and 
                local recipients will use in measuring or assessing 
                progress toward achieving such goals; and
                  (D) provide biennial reports to the public and to the 
                Secretary on the State's progress in achieving its 
                goals.
  (b) Requirements.--Each system developed under subsection (a) shall 
include--
          (1) measures of academic and occupational competency gains, 
        including progress in the achievement of the following:
                  (A) Academic and occupational competency attainment 
                which includes--
                          (i) attainment of challenging State academic 
                        standards;
                          (ii) attainment of challenging vocational-
                        technical education standards; and
                          (iii) attainment of industry-recognized 
                        occupational standards, including basic 
                        workplace competencies and industry-recognized 
                        skill standards (endorsed by the National Skill 
                        Standards Board), which may include the receipt 
                        of a skill certificate in the occupation for 
                        which the student has been prepared;
                  (B) retention in school or completion of secondary 
                school or the equivalent;
                  (C) placement into additional training or 
                postsecondary education, military service, registered 
                apprenticeship, or employment; and
                  (D) employment retention and earnings levels;
          (2) reduction of the dropout rate; and
          (3) success of special populations in meeting these 
        performance standards, including nontraditional training and 
        employment.
  (c) Performance Goals and Measures.--The Governor shall, acting 
through the collaborative process, work to ensure that the performance 
goals are consistent with challenging State academic standards, 
industry-recognized skill standards once established by the National 
Skill Standards Board and the State goals established under this title.

         Subtitle C--Subgrants for In-School and At-Risk Youth

SEC. 231. PARTNERSHIP AGREEMENTS.

  (a) Partnership.--A local workforce development board and an eligible 
institution that desires to receive a subgrant from a State under this 
subtitle in any fiscal year shall form a partnership for the purposes 
of collaborative planning, coordination of in-school and at-risk 
programs, and effective public participation.
  (b) Plan.--The partnership referred to in subsection (a) shall, in 
collaboration, develop and submit for approval to the Governor through 
the State collaborative process a comprehensive youth development and 
career preparation plan for in-school and at-risk youth. Such plan 
shall describe how the youth development and career preparation system 
meets the requirements of sections 241 and 245 and shall address 
comments received through the collaborative process. The partnership 
shall assure the involvement of parents, teachers, and the community in 
the collaborative planning process which involves design of the 
standards, strategies, articulation, and cooperative agreements, 
assessments, and evaluation of program activities.

SEC. 232. DISTRIBUTION OF FUNDS.

  (a) In-School Programs.--Based upon an application submitted by the 
partnership to the Governor through the State collaborative process, a 
State shall distribute funds made available in a fiscal year as 
provided in section 212(a)(1) to eligible institutions to carry out in-
school youth programs described in section 241.
  (b) At-Risk Youth Programs.--A State shall distribute funds made 
available in any fiscal year as provided in section 212(a)(2) to local 
workforce development boards to carry out at-risk youth programs 
described in section 245.

                       CHAPTER 1--IN-SCHOOL YOUTH

SEC. 241. USES OF FUNDS FOR IN-SCHOOL YOUTH.

  (a) General Authority.--Each eligible institution that receives a 
subgrant under this chapter shall use funds provided under such grant 
to improve youth development and career preparation programs.
  (b) Requirements for Uses of Funds.--Funds provided by a State 
pursuant to section 212(a)(1) shall be used to provide in-school youth 
development and career preparation programs that--
          (1) are of such size, scope, and quality as to be effective;
          (2) integrate academic, vocational, and work-based learning, 
        stressing applied and contextual learning, through a coherent 
        sequence of courses so that youth achieve both academic and 
        occupational competencies;
          (3) involve employers in the design and implementation of 
        programs, including the development of curriculum;
          (4) establish effective linkages between at-risk youth 
        programs, secondary and postsecondary education;
          (5) provide work-based learning experiences with adult 
        mentoring where appropriate; and, to the extent possible, with 
        strong experiences and understanding of all aspects of an 
        industry appropriately tied to the student's career major; and
          (6) provide career exploration, including exploration in the 
        practical arts or trade, career awareness and career guidance 
        opportunities, beginning in the earliest grades possible.
  (c) Additional Uses of Funds.--In carrying out the provisions of 
subsection (b), funds may be used by schools for in-school youth 
activities such as--
          (1) purchasing, leasing, or upgrading of equipment, including 
        instructional aides and material;
          (2) inservice training of vocational instructors, academic 
        instructors, employers, and workplace mentors, to integrate 
        academic and vocational education, and provide high-quality 
        work-based learning experiences;
          (3) tech-prep education programs;
          (4) supplementary services designed to meet the needs of 
        special populations;
          (5) adaptation of equipment;
          (6) apprenticeship programs;
          (7) comprehensive mentoring programs in institutions of 
        higher education offering comprehensive programs in teacher 
        preparation which seek to fully use the skills and work 
        experience of individuals currently or formerly employed in 
        business and industry who are interested in becoming classroom 
        instructors and to meet the need of vocational educators who 
        wish to upgrade their teaching competencies;
          (8) local education and business partnerships for developing 
        and implementing workforce preparation systems;
          (9) support for vocational student organizations; and
          (10) establishing effective activities and procedures to 
        enable program participants and their parents to participate 
        directly in decisions that influence the character of programs, 
        including providing information and assistance needed for 
        informed and effective participation.

                        CHAPTER 2--AT-RISK YOUTH

SEC. 245. USES OF FUNDS FOR AT-RISK YOUTH.

  (a) General Authority.--Each local workforce development board that 
receives a subgrant under this chapter shall use funds provided under 
such grant to improve youth development and career preparation 
programs.
  (b) Requirements for Uses of Funds.--Funds provided by a State 
pursuant to section 212(a)(2) shall be used to provide youth 
development and career preparation programs for at-risk youth that--
          (1) are of such size, scope, and quality as to be effective;
          (2) integrate academic, vocational, and work-based learning, 
        stressing applied and contextual learning, through a coherent 
        sequence of courses so that students and at-risk youth achieve 
        both academic and occupational competencies;
          (3) involve employers in the design and implementation of 
        programs, including the development of curriculum;
          (4) establish effective linkages between at-risk youth 
        programs, and secondary and postsecondary education;
          (5) provide work-based learning experiences, including 
        experiences in the practical arts or trade, if applicable;
          (6) provide adult mentoring as a core component of the 
        program;
          (7) provide an objective assessment of the academic and skill 
        levels, and service needs of each participant; and
          (8) provide career exploration and counseling.
  (c) Additional Uses of Funds.--In carrying out the provisions of 
subsection (b), providers of at-risk youth programs, as selected by the 
local workforce development board, may provide activities such as--
          (1) tutoring, study skills training and instruction leading 
        to completion of high school;
          (2) alternative high school services;
          (3) training or education that is combined with community 
        service, and service learning opportunities;
          (4) paid work experience, including limited internships, 
        entry-employment experience programs, and summer employment 
        opportunities that are integrated with the year-round school-
        based or alternative school-based program;
          (5) dropout prevention strategies and strategies to encourage 
        at-risk youth to reenter high school or alternative high school 
        programs and programs that encourage pregnant and parenting 
        youth to stay in school;
          (6) preemployment and work maturity skills training;
          (7) peer-centered activities encouraging responsibility and 
        other positive social behaviors during non-school hours; and
          (8) training-related supportive services.
  (d) Limitations on Use of Funds.--Not more than 10 percent of the 
funds provided under this chapter to a local workforce development 
board may be used for administrative purposes.

SEC. 246. AT-RISK YOUTH PROVIDERS.

  (a) Role of Workforce Development Board.--A workforce development 
board that receives funds under this chapter shall not operate 
programs, but shall contract with eligible providers of demonstrated 
effectiveness, or with eligible providers utilizing service 
methodologies with demonstrated effectiveness in serving the workforce 
preparation needs of at-risk youth, for the purpose of providing 
services under this chapter.
  (b) Eligible Providers.--For purposes of this chapter, eligible 
providers may include--
          (1) an ``eligible institution'' as defined under section 
        202(7);
          (2) a unit of local government;
          (3) a private, nonprofit organization (including community-
        based organizations);
          (4) a private, for-profit entity;
          (5) a designated 1-stop career center; or
          (6) other organizations or entities of demonstrated 
        effectiveness and approved by the local Board.
                     Subtitle D--National Programs

SEC. 251. RESEARCH ACTIVITIES.

  (a) General Authority.--
          (1) In general.--In order to carry out the purpose of this 
        title, the Secretary may, directly or through grants, 
        contracts, or cooperative agreements, carry out research, 
        development, dissemination, replication of model programs, 
        demonstration programs, evaluation, capacity-building, and 
        technical assistance activities with regard to the services and 
        activities carried out under this title.
          (2) Information systems.--Activities carried out under this 
        section may include support for occupational and career 
        information systems.
  (b) Dissemination.--The Secretary shall establish a system for 
disseminating information resulting from research and development 
activities carried out under this title.

SEC. 252. ASSESSMENT AND DATA COLLECTION OF YOUTH DEVELOPMENT AND 
                    CAREER PREPARATION PROGRAMS.

  (a) In General.--The Secretary, through the Office of Educational 
Research and Improvement, shall conduct a biennial assessment of 
services and activities assisted under this title, through studies and 
analyses conducted independently through competitive awards.
  (b) Contents.--The assessment required under subsection (a) shall 
examine the extent to which services and activities assisted under this 
title have achieved their intended purposes and results, including the 
extent to which--
          (1) State and local services and activities have developed, 
        implemented, or improved systems established under this title;
          (2) services and activities assisted under this title succeed 
        in preparing students, including students who are members of 
        special populations, for postsecondary education, further 
        learning, or entry into high-skill, high-wage careers;
          (3) students who participate in services and activities 
        supported under this title succeed in meeting challenging State 
        academic and industry-based skill standards; and
          (4) the system improvement, participation, local and State 
        assessment, and accountability provisions of this title, 
        including the performance goals and indicators established 
        under section 224, are effective.

SEC. 253. NATIONAL CENTER OR CENTERS FOR RESEARCH.

  (a) General Authority.--
          (1) National center.--The Secretary may, through a grant or 
        contract, establish one or more national centers for conducting 
        applied research, development, dissemination, and technical 
        assistance activities which would focus on improving the career 
        preparation of individuals. The Secretary shall consult with 
        States prior to establishing one or more such centers.
          (2) Eligibility.--Entities eligible to receive funds under 
        this section are institutions of higher education, other public 
        or private nonprofit organizations or agencies, and consortia 
        of such institutions, organizations, or agencies.
          (3) Previous center.--The national center in existence on the 
        day before the date of the enactment of the this Act shall 
        continue to receive assistance under this section in accordance 
        with the terms of its current award.
  (b) Activities.--
          (1) In general.--The applied research, development, 
        dissemination, and technical assistance activities carried out 
        by the national center or centers shall include--
                  (A) activities that assist recipients of funds under 
                this title to meet the requirements of section 224;
                  (B) research and development of activities that 
                combine academic, vocational education, and work-based 
                learning;
                  (C) developing new models for remediation of basic 
                academic skills which incorporate appropriate 
                instructional methods;
                  (D) identifying ways to establish links among 
                educational and job training activities at the State 
                and local levels;
                  (E) new models for career guidance, career 
                information, and counseling services;
                  (F) studies providing longitudinal information or 
                formative evaluation on programs funded under this 
                title, including an analysis of the effectiveness of 
                youth development and career preparation programs in 
                serving at-risk youth; and
                  (G) such other activities as the Secretary determines 
                to be appropriate to achieve the purpose of this Act.
          (2) Duties.--The center or centers shall--
                  (A) provide assistance to States and local recipients 
                in developing and using systems of performance measures 
                and standards for improvement of programs and services; 
                and
                  (B) provide technical assistance and outreach.
          (3) Summary.--The center or centers conducting the activities 
        described in paragraph (1) shall annually prepare a summary of 
        key research findings of such center or centers and shall 
        submit copies of the summary to the Secretaries of Education 
        and Labor. The Secretary shall submit that summary to the 
        Committee on Labor and Human Resources of the Senate, and the 
        Committee on Economic and Educational Opportunities of the 
        House of Representatives.
  (c) Clearinghouse.--The center or centers shall maintain a 
clearinghouse that will provide data and information to Federal, State, 
and local organizations and agencies about the condition of systems and 
programs funded under this title.

      TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANT

     Subtitle A--Adult Employment and Training Consolidation Grant

SEC. 301. PURPOSE.

  The purpose of this title is to establish an efficient, high-quality, 
and equitable system of employment, job training, and related 
assistance designed to facilitate the transition of adults into 
productive, high skills, private sector employment.

SEC. 302. AUTHORIZATION.

  (a) In General.--In the case of each State that in accordance with 
the requirements of section 102 submits to the Secretary of Labor 
(hereinafter in this title referred to as the ``Secretary'') a State 
workforce development and literacy plan under section 104, the 
Secretary shall provide a grant to the State for the purpose of 
providing employment, job training, and related assistance for adults 
in the State.
  (b) Amount.--The grant shall consist of the allotment determined for 
the State under section 303.

SEC. 303. ALLOTMENT AMONG STATES.

  (a) In General.--Of the amount appropriated pursuant to section 
4(a)(2) to carry out this title for a fiscal year, the Secretary 
shall--
          (1) allot 85 percent of such amounts in accordance with 
        subsection (b); and
          (2) reserve 15 percent for use under subtitle B.
  (b) Allotment Among States.--
          (1) Reservation for the territories.--Of the amount allotted 
        under subsection (a)(1), the Secretary shall allot not more 
        than one quarter of one percent among the Commonwealth of the 
        Northern Mariana Islands, American Samoa, Guam, and the Virgin 
        Islands.
          (2) States.--After determining the amount to be allotted 
        under paragraph (1), the Secretary shall allot the remaining 
        amount to the remaining States so that each State receives an 
        amount that bears the same proportion to such remaining amount 
        as--
                  (A) the amount allotted to each such State from 
                allotments under sections 202 and 302 of the Job 
                Training Partnership Act (29 U.S.C. 1602 and 1652) (as 
                in effect before the date of the enactment of this Act) 
                for fiscal year 1995; bears to
                  (B) the aggregate of the amounts allotted to all such 
                States from allotments under such sections for such 
                fiscal year.
        Notwithstanding any other provision of law and subject to 
        paragraph (1), in any fiscal year for which the amounts 
        appropriated for programs authorized by title III exceed the 
        amounts so available for fiscal year 1985, no State shall 
        receive less than one-quarter of one percent of the amount 
        available for each such program for that fiscal year under this 
        subsection. Amounts necessary for increasing such payments to 
        States to comply with the preceding sentence shall be obtained 
        by ratably reducing the amounts to be paid to other States.

SEC. 304. ALLOCATION WITHIN STATES.

  (a) Reservations for State Activities.--
          (1) In general.--The Governor of the State shall reserve not 
        more than 20 percent of the amount allotted to the State under 
        section 303(b) for a fiscal year for statewide activities for 
        employment, job training, and related assistance for adults.
          (2) Mandatory activities.--Such activities shall include--
                  (A) rapid response activities; and
                  (B) additional assistance to areas that experience 
                disasters, mass layoffs or plant closings, or other 
                events which precipitate substantial increases in the 
                number of unemployed workers, to be expended in 
                accordance with the local plan of the relevant 
                workforce development area.
          (3) Discretionary activities.--
                  (A) In general.--Such activities may include--
                          (i) subject to subparagraph (B), 
                        administration by the State of programs under 
                        this subtitle;
                          (ii) capacity building and technical 
                        assistance to local workforce development 
                        areas, one-stop career centers, and service 
                        providers, including the development and 
                        training of staff and the development of 
                        exemplary program activities;
                          (iii) incentives for program coordination, 
                        performance awards, and research and 
                        demonstrations;
                          (iv) implementation of innovative incumbent 
                        worker training programs, which may include the 
                        establishment and implementation of an employer 
                        loan program to assist in skills upgrading for 
                        non-managerial employees (in accordance with 
                        the requirements of section 314);
                          (v) implementation of experimentation model 
                        activities, pilot projects, and demonstration 
                        projects which further the goals and purposes 
                        of this Act;
                          (vi) additional assistance for the 
                        development and implementation of the one-stop 
                        delivery system of the State established in 
                        accordance with title I of this Act; and
                          (vii) support for a common management 
                        information system as described in section 109.
                  (B) Limitation.--Not more than \1/4\ of the amount 
                reserved by the Governor under paragraph (1) may be 
                used for administration by the State of programs under 
                this subtitle.
  (b) Within State Allocation.--
          (1) In general.--The Governor of the State, based upon an 
        allocation formula established in accordance with paragraph 
        (2), shall allocate the remainder of the amount allotted to the 
        State under section 303(b) to workforce development areas 
        designated under title I of this Act for the purpose of 
        providing employment, job training, and related assistance for 
        adults in accordance with section 306.
          (2) Within state formula.--
                  (A) Establishment.--The Governor, through the 
                collaborative process, and after consultation with 
                local chief elected officials in the local workforce 
                development area, shall develop a formula for the 
                allocation of funds to workforce development areas. 
                Such formula shall take into account--
                          (i) poverty rates within each local workforce 
                        development area, as determined by the State;
                          (ii) unemployment rates within each local 
                        workforce development area;
                          (iii) the proportion of the State's adult 
                        population residing within each local workforce 
                        development area; and
                          (iv) such other factors as considered 
                        appropriate.
                  (B) Additional factors.--In establishing such 
                formula, the Governor shall ensure that funds are 
                distributed equitably throughout the State, and that 
                the factors described in subparagraph (A) do not 
                receive disproportionate weighting.
          (3) Exception.--Notwithstanding the provisions of paragraphs 
        (1) and (2), the Governor shall provide 10 percent of the 
        remainder described in paragraph (1) to local workforce areas 
        designated under title I of this Act.
SEC. 305. ADDITIONAL STATE PLAN REQUIREMENTS.

  The State shall, as part of the State workforce development and 
literacy plan under title I of this Act, submit to the Secretary the 
following additional information:
          (1) A description of how the State will serve the employment 
        and training needs of dislocated workers, economically 
        disadvantaged individuals, older workers, individuals with 
        disabilities, displaced homemakers, veterans, and individuals 
        with multiple barriers to employment (as determined by the 
        State), including individuals who are basic skills deficient.
          (2) A description of how the State will provide rapid 
        response assistance to workers experiencing dislocation as a 
        result of mass layoffs and plant closings, either through the 
        direct provision of services or through the transfer of funds 
        to local workforce development areas for the provision of such 
        services.

SEC. 306. USE OF AMOUNTS.

  (a) Core Services.--Amounts allocated under section 304(b) shall be 
used to provide core services to adults through one-stop career centers 
in accordance with title I of this Act.
  (b) Intensive Services.--
          (1) In general.--Amounts allocated under section 304(b) shall 
        be used to provide intensive services to adults--
                  (A) who are unable to obtain employment through core 
                services under subsection (a); and
                  (B) who have been determined to be in need of more 
                intensive services in order to gain employment.
          (2) Delivery of services.--Such intensive services shall be 
        provided--
                  (A) directly through one-stop career centers in 
                accordance with title I of this Act; or
                  (B) through contracts through such centers with 
                service providers approved by the local workforce 
                development board, which may include private, for-
                profit providers.
          (3) Types of services.--Such intensive services may include 
        the following:
                  (A) Comprehensive and specialized assessments of the 
                skill levels and service needs of adults, which may 
                include--
                          (i) diagnostic testing and other assessment 
                        tools; and
                          (ii) in-depth interviewing and evaluation to 
                        identify employment barriers and appropriate 
                        employment goals.
                  (B) Development of an individual employment plan, to 
                identify the employment goals, appropriate achievement 
                objectives, and the appropriate combination of services 
                for the adult to achieve the employment goal.
                  (C) Group counseling.
                  (D) Individual counseling and career planning.
                  (E) Case management for adults receiving education 
                and training services under subsection (c) or 
                supportive services under subsection (d).
                  (F) Follow-up counseling for adults placed in 
                training or employment, for up to 1 year.
  (c) Education and Training Services.--
          (1) In general.--Amounts allocated under section 304(b) shall 
        be used to provide education and training services to adults--
                  (A) who are unable to obtain employment through core 
                services under subsection (a);
                  (B) who are in need of education and training 
                services in order to gain employment as a result of 
                determinations made through--
                          (i) preliminary assessments under section 
                        107(f)(1)(B) of this Act; or
                          (ii) comprehensive and specialized 
                        assessments under subsection (b)(3)(A); and
                  (C) who are unable to obtain other grant assistance 
                for such services, such as through Pell Grants 
                established under title IV of the Higher Education Act.
          (2) Delivery of services.--Such education and training 
        services shall be provided through education and training 
        providers certified in accordance with title I of this Act.
          (3) Types of services.--Such education and training services 
        may include the following:
                  (A) Basic skills training, including remedial 
                education, literacy training, and English literacy 
                program instruction.
                  (B) Occupational skills training, including training 
                for nontraditional employment.
                  (C) On-the-job training.
                  (D) Programs that combine workplace training with 
                related instruction.
                  (E) Training programs operated by the private sector.
                  (F) Skill upgrading and retraining.
                  (G) Entrepreneurial training.
                  (H) Employability training to enhance basic workplace 
                competencies.
                  (I) Customized training conducted with a commitment 
                by an employer or group of employers to employ an 
                individual upon successful completion of the training.
          (4) Additional requirements.--
                  (A) Use of skill grants.--
                          (i) In general.--Except as provided in clause 
                        (ii), education and training services under 
                        this section shall be provided through the use 
                        of skill grants in accordance with this 
                        subsection, and in accordance with section 108 
                        regarding the certification of education and 
                        training providers.
                          (ii) Exceptions.--Education and training 
                        services authorized under this title may be 
                        provided pursuant to a contract for services in 
                        lieu of a skill grant if--
                                  (I) such services are on-the-job 
                                training provided by an employer;
                                  (II) the local workforce development 
                                board determines there are an 
                                insufficient number of certified 
                                providers of education and training 
                                services in the workforce development 
                                area to accomplish the purposes of a 
                                skill grant system;
                                  (III) the local workforce development 
                                board determines that the certified 
                                providers of education and training in 
                                the workforce development area are 
                                unable to provide effective services to 
                                special participant populations; or
                                  (IV) the local workforce development 
                                board decides to enter into a direct 
                                training contract with a community 
                                based organization serving special 
                                populations.
                  (B) Linkage to occupations in demand.--Education and 
                training services under this subsection shall be 
                directly linked to occupations for which there is a 
                demand in the local workforce development area, or in 
                another area to which an adult receiving such services 
                is willing to relocate.
  (d) Additional Services.--
          (1) Supportive services.--Supportive services may be provided 
        for individuals--
                  (A) who are receiving assistance under any of 
                subsections (a) through (c); and
                  (B) who are unable to receive such services through 
                other programs providing such services.
          (2) Needs-related payments.--
                  (A) In general.--Amounts allocated under section 
                304(b) may be used to provide needs-related payments to 
                adults who are unemployed and do not qualify for (or 
                have ceased to qualify for) unemployment compensation 
                for the purpose of enabling such adults to participate 
                in education and training programs under subsection 
                (c).
                  (B) Additional eligibility requirements.--In addition 
                to the requirements contained in subparagraph (A), a 
                dislocated worker who has exhausted unemployment 
                insurance benefits shall be eligible to receive needs-
                related payments under this paragraph only if such 
                worker was enrolled in education or training by the end 
                of the 8th week of the worker's initial unemployment 
                compensation benefit period, or, if later, by the end 
                of the 8th week after the worker is informed that a 
                short-term layoff will in fact exceed 6 months.
  (e) Priority.--Local workforce development boards shall establish a 
process through which priority is given to dislocated workers and 
economically disadvantaged individuals, for receipt of services 
provided under subsections (b) and (c), in the event that funds are 
limited within the workforce development area.
  (f) Prohibition on Private Right of Action.--Nothing in this section 
shall be construed to establish a right for a participant to bring an 
action to obtain services under a program established under this 
section.
  (g) Limitations on Use of Funds.--Not more than 10 percent of the 
funds provided under this title to a local workforce development board 
may be used for administrative purposes.

SEC. 307. CORE STANDARDS, PERFORMANCE GOALS, AND MEASURES.

  (a) General Authority.--
          (1) Standards and measures.--Each State receiving a grant 
        under this title shall have developed or shall develop and 
        implement a statewide system of core standards and measures of 
        performance for programs established under this title, based 
        upon performance standards described in paragraph (2), and 
        consistent with the State's goals and objectives, and 
        benchmarking process described in the State plan required under 
        section 104.
          (2) Statewide system.--Each statewide system shall--
                  (A) establish or have established performance goals 
                to define the level of performance to be achieved by 
                adults served under this title and to evaluate the 
                quality and effectiveness of services and activities 
                under this title;
                  (B) express such goals in an objective, quantifiable, 
                and measurable form;
                  (C) establish performance indicators or benchmarks 
                that the State and local recipients of funds will use 
                in measuring or assessing progress toward achieving 
                such goals; and
                  (D) provide biennial reports to the public and to the 
                Secretary on the State's progress in achieving its 
                goals.
  (b) Requirements.--Each system developed under subsection (a) shall 
include measures of--
          (1) placement, retention, and earnings of participants in 
        unsubsidized employment, including retention and earnings at 6 
        months, and at one year after program termination, 
        respectively;
          (2) the provision of services to dislocated workers, 
        economically disadvantaged individuals, older workers, 
        individuals with disabilities, displaced homemakers, veterans, 
        and individuals with multiple barriers to employment (as 
        determined by the State), including individuals who are basic 
        skills deficient; and
          (3) acquisition of skills certificates pursuant to a skill 
        standards and skill certification system endorsed by the 
        National Skill Standards Board, once such system is 
        established.

                      Subtitle B--Federal Programs

SEC. 311. NATIONAL DISCRETIONARY GRANTS.

  (a) Grants for Dislocated Workers.--
          (1) In general.--From amounts reserved under section 
        303(a)(2) for any fiscal year, the Secretary is authorized to 
        award national discretionary grants to address major economic 
        dislocations that result from plant closures, base closures, or 
        mass layoffs.
          (2) Application.--To receive a grant under this section, an 
        eligible entity shall submit an application to the Secretary at 
        such time, in such manner, and accompanied by such information 
        as the Secretary determines is appropriate.
          (3) Eligible entities.--Grants under this section may be 
        awarded to--
                  (A) the State;
                  (B) a local workforce development board administering 
                assistance under this Act;
                  (C) employers and employer associations;
                  (D) worker-management transition assistance 
                committees and other employer-employee entities;
                  (E) representatives of employees;
                  (F) community development corporations and community-
                based organizations; and
                  (G) industry consortia.
  (b) Incentive Grants.--From amounts reserved under section 303(a)(2) 
for any fiscal year, the Secretary may provide awards to States--
          (1) to assist in the implementation of exemplary statewide 
        workforce development system designs; and
          (2) for the achievement of exceptional performance in the 
        statewide workforce development system.
SEC. 312. DISASTER RELIEF EMPLOYMENT ASSISTANCE.

  (a) In General.--From amounts reserved under section 303(a)(2) for 
any fiscal year, the Secretary may provide assistance to the Governor 
of any State within which is located an area that has suffered an 
emergency or a major disaster as defined in paragraphs (1) and (2), 
respectively, of section 102 of the Robert T. Stafford Disaster Relief 
and Emergency Assistance Act (referred to in this section as the 
``disaster area'').
  (b) Use of Funds.--
          (1) Projects restricted to disaster areas.--Funds made 
        available under this section--
                  (A) shall be used exclusively to provide employment 
                on projects to provide food, clothing, shelter, and 
                other humanitarian assistance for disaster victims and 
                on projects regarding demolition, cleanup, repair, 
                renovation, and reconstruction of damaged and destroyed 
                structures, facilities, and lands located within the 
                disaster area; and
                  (B) may be expended through public and private 
                agencies and organizations engaged in such projects.
          (2) Eligibility requirements.--An individual shall be 
        eligible to be offered disaster employment under this section 
        if such individual is a dislocated worker or is temporarily or 
        permanently laid off as a consequence of the disaster.
          (3) Limitations on disaster relief employment.--No individual 
        shall be employed under this part for more than 6 months for 
        work related to recovery from a single natural disaster.

SEC. 313. RESEARCH, DEMONSTRATION, EVALUATION, AND CAPACITY BUILDING.

  (a) In General.--From amounts reserved under section 303(a)(2) for 
any fiscal year, the Secretary shall establish and carry out research, 
demonstration, and capacity building activities in accordance with this 
section.
  (b) Activities.--The Secretary shall carry out the following 
activities under this section:
          (1) Research.--The Secretary shall conduct continuing 
        research, which may include studies and other methods and 
        techniques, that will aid in the solution of the employment and 
        training problems of the United States. Such studies may 
        include the extent to which individuals who participate in 
        programs established under this title achieve self-sufficiency 
        as a result of such participation, including the identification 
        by State and locality, to the extent practicable, of indicators 
        measuring such self-sufficiency.
          (2) Demonstrations.--The Secretary shall conduct pilot and 
        demonstration projects for the purpose of developing and 
        improving methods and techniques for addressing employment and 
        training needs which may include projects conducted jointly 
        with the Department of Defense to develop training programs 
        utilizing computer-based and other innovative learning 
        technologies. The Secretary may award grants and enter into 
        contracts with appropriate entities to carry out such projects.
          (3) Evaluation.--
                  (A) Activities.--
                          (i) Job training activities.--The Secretary 
                        shall provide for the continuing evaluation of 
                        activities conducted under this Act, including 
                        the cost-effectiveness of such activities in 
                        achieving the purposes of this Act.
                          (ii) Other programs.--The Secretary may 
                        conduct evaluations of other federally funded 
                        employment-related activities including 
                        programs administered under--
                                  (I) the Wagner-Peyser Act (29 U.S.C. 
                                49 et seq.);
                                  (II) the National Apprenticeship Act 
                                (29 U.S.C. 50 et seq.);
                                  (III) the Older Americans Act of 1965 
                                (42 U.S.C. 3001 et seq.); and
                                  (IV) the Federal unemployment 
                                insurance program under titles III, IX, 
                                and XII of the Social Security Act (42 
                                U.S.C. 501 et seq., 1101 et seq., and 
                                1321 et seq.).
                  (B) Effectiveness.--The Secretary shall evaluate the 
                effectiveness of programs authorized under this Act 
                with respect to--
                          (i) the statutory goals;
                          (ii) the performance standards established by 
                        the Secretary; and
                          (iii) the extent to which such programs 
                        enhance the employment and earnings of 
                        participants, reduce income support costs, 
                        improve the employment competencies of 
                        participants in comparison to comparable 
                        persons who did not participate in such 
                        programs, and to the extent feasible, increase 
                        the level of total employment over the level 
                        that would have existed in the absence of such 
                        programs.
          (4) National partnership and special training.--The Secretary 
        may award special grants to eligible entities to carry out 
        activities that are most appropriately administered at the 
        national level. Such activities may include--
                  (A) partnerships with national organizations with 
                special expertise in developing, organizing, and 
                administering employment and training services at the 
                national, State, and local levels, such as industry and 
                labor associations, public interests groups, community-
                based organizations representative of groups that 
                encounter special difficulties in the labor market, in 
                education and training; and
                  (B) activities that--
                          (i) address industry-wide skill shortages;
                          (ii) meet training needs that are best 
                        addressed on a multistate basis;
                          (iii) further the goals of increasing the 
                        competitiveness of the United States labor 
                        force; and
                          (iv) require technical expertise available at 
                        the national level to serve the needs of 
                        particular client groups that encounter 
                        significant barriers to employment and who the 
                        Secretary determines require special 
                        assistance; and
                          (v) promote and experiment with model 
                        activities, pilot projects, and demonstration 
                        projects which further the goals and purposes 
                        of this Act.
          (5) Capacity building and technical assistance.--
                  (A) In general.--The Secretary shall provide, through 
                grants, contracts, or other arrangements, staff 
                training and technical assistance to States, local 
                workforce development boards, career centers, 
                communities, business and labor organizations, service 
                providers, industry consortia, and other entities, to 
                enhance their capacity to develop and deliver effective 
                employment and training services.
                  (B) Activities.--The staff training and technical 
                assistance authorized under subparagraph (A) may 
                include--
                          (i) development of management information 
                        systems;
                          (ii) development and maintenance of a 
                        national capacity building, information and 
                        dissemination network; and
                          (iii) grants for the replication of 
                        successful employment and training models and 
                        activities.

SEC. 314. WORKFORCE SKILLS AND DEVELOPMENT LOANS.

  (a) Authorization.--
          (1) In general.--From amounts reserved under section 
        303(a)(2) for any fiscal year, the Secretary of Labor may use a 
        portion of such amounts to provide grants to States to provide 
        loans to eligible entities described in paragraph (2) to assist 
        such entities in providing skills upgrading.
          (2) Eligible entities.--An eligible entity described in this 
        paragraph is--
                  (A) an employer;
                  (B) a representative of employees;
                  (C) a business association;
                  (D) a trade organization; or
                  (E) a consortium consisting of--
                          (i) more than 1 of the entities described in 
                        subparagraphs (A) through (D); or
                          (ii) an institution of higher education (as 
                        such term is defined in section 481 of the 
                        Higher Education Act of 1965 (20 U.S.C. 1088) 
                        which continues to meet the eligibility and 
                        certification requirements under section 498 of 
                        such Act) and 1 or more of the entities 
                        described in subparagraphs (A) through (D).
  (b) Application.--The Secretary may provide a grant to a State under 
subsection (a) only if such State submits to the Secretary an 
application which contains such information as the Secretary may 
reasonably require.
  (c) Use of Amounts.--A State shall use amounts received from a grant 
under subsection (a) to establish a loan guarantee program to assist 
eligible entities described in paragraph (2) of such subsection to 
provide skills upgrading for nonmanagerial employees. In carrying out 
such program, the State shall meet the following requirements:
          (1) Establishment of reserve fund for loan guarantees.--The 
        State shall establish a reserve fund from amounts received from 
        such grant for the purpose of making commitments to guarantee 
        the payment of principal and interest on loans made by 
        financial institutions to such eligible entities to provide 
        skills upgrading for nonmanagerial employees.
          (2) Criteria for loan guarantees.--The State, in conjunction 
        with appropriate financial institutions, shall establish and 
        publish criteria for providing loan guarantees to eligible 
        entities under the program, including criteria that provides 
        for the following:
                  (A) A loan guarantee may be issued under the program 
                only if, at the time such guarantee is issued the 
                eligible entity agrees to pay as an insurance premium 
                an amount equal to 1 percent of the principal received 
                by such entity under the loan to the State's reserve 
                fund.
                  (B)(i) Subject to clause (ii), the eligible entity 
                will use amounts received from the loan to provide 
                skills upgrading for mid- and lower-level employees, 
                which may include--
                          (I) training in total quality management, 
                        statistical process control, production 
                        techniques, office automation, materials 
                        resource planning; and
                          (II) training to improve basic skills, 
                        including reading, writing, and arithmetic.
                  (ii) In providing such skills upgrading, the eligible 
                entity shall give priority to nonmanagerial employees 
                who--
                          (I) directly produce or deliver goods or 
                        services; or
                          (II) are in danger of being terminated or 
                        laid off as a result of modernization in the 
                        workplace, corporate downsizing, foreign or 
                        domestic competition, or Federal policies 
                        adversely affecting 1 or more industries.
                  (C) Amounts from a loan shall not be used to pay the 
                wages or other benefits of any employee receiving 
                assistance under the program.
          (3) Payment by state to financial institutions in cases of 
        default.--
                  (A) In general.--In accordance with criteria 
                developed by the Secretary, the State shall make 
                payments from the State's reserve fund to financial 
                institutions that have provided loans to eligible 
                entities that have defaulted on such loans for the 
                purpose of reimbursing such institutions for the amount 
                of principal and interest remaining unpaid to the 
                institutions by reason of such default.
                  (B) No full faith and credit of the united states.--
                Loans provided by financial institutions to eligible 
                entities under loan guarantee programs under this 
                section shall not be obligations of, or guaranteed in 
                any respect by, the United States.
          (4) Interest from amounts in reserve fund.--Any interest 
        earned from amounts in the State's reserve fund shall be 
        credited to such fund.
  (d) Federal and State Share.--
          (1) Federal share.--The Federal share under this section may 
        not exceed 50 percent of the total cost of the program 
        established under subsection (c) for any fiscal year.
          (2) State share.--The State share shall be provided from non-
        Federal sources and may be in cash or in-kind, fairly 
        evaluated.

SEC. 315. EMPLOYMENT, TRAINING, AND EDUCATION ASSISTANCE FOR NATIVE 
                    AMERICANS.

  (a) Authorization.--From amounts reserved under section 303(a)(2) for 
any fiscal year, the Secretary of Labor shall provide grants to, or 
enter into contracts or cooperative agreements with, Indian tribes and 
tribal organizations, tribally-controlled colleges, tribally-controlled 
postsecondary vocational institutions, Indian-controlled organizations 
serving off-reservation areas, Alaska Native village and regional 
entities serving areas as described in the Alaska Native Claims 
Settlement Act and Hawaiian Native-controlled organizations to provide 
employment, training, vocational rehabilitation, library services, and 
education assistance for Native Americans.
  (b) Transfer of Authority for Vocational Education Activities.--In 
carrying out subsection (a), the Secretary of Labor may enter into an 
agreement with the Secretary of Education to carry out any portion of 
assistance under such subsection devoted to vocational educational 
activities, including support for the United Tribes Technical College 
and Crownpoint Institute of Technology.
  (c) Consolidation of Funds.--Entities receiving assistance under 
subsection (a) may consolidate such assistance with assistance received 
from related programs in accordance with the provisions of the Indian 
Employment, Training and Related Services Demonstration Act (Public Law 
102-477).
  (d) Regulations.--The Secretary shall consult with Indian, Alaska 
Native and Hawaiian Native groups in establishing regulations to carry 
out this section, including performance standards for entities 
receiving assistance under subsection (a), taking into account the 
economic circumstances of such groups.

SEC. 316. EMPLOYMENT, TRAINING, AND EDUCATION ASSISTANCE FOR MIGRANT 
                    AND SEASONAL FARMWORKERS.

  (a) Authorization.--
          (1) In general.--From amounts reserved under section 
        303(a)(2) for any fiscal year, the Secretary of Labor shall 
        provide grants to, or enter into contracts or cooperative 
        agreements with, entities described in paragraph (2) to provide 
        employment, training, and education assistance for migrant and 
        seasonal farmworkers.
          (2) Entities described.--An entity described in this 
        paragraph is an entity the Secretary determines to have the 
        capacity to administer effectively a diversified development 
        program for migrant and seasonal farmworkers.
  (b) Use of Amounts.--An entity shall use amounts received under 
subsection (a) to provide employment, training, educational 
development, high school equivalency, postsecondary education 
assistance, vocational rehabilitation, literacy, English as a second 
language, work-based education and development, worker safety training, 
employability enhancements, emergency or other disaster relief, 
including housing, technical assistance, outreach, intake, assessment, 
follow-up, stipend support, supportive services, other needs-based 
assistance, self-employment and related business enterprise development 
education, and the management of a database on participating migrant 
and seasonal farmworkers.
  (c) Transfer of Authority for Education Activities.--In carrying out 
subsection (b), the Secretary of Labor may enter into an agreement with 
the Secretary of Education to carry out assistance as described in--
          (1) a secondary and postsecondary high school equivalency 
        program to serve migrants and seasonal farmworkers; and
          (2) a college assistance migrant program to provide outreach 
        and recruitment services for migrants and seasonal farmworkers.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
          LIBRARY SERVICES AND TECHNOLOGY CONSOLIDATION GRANT

SEC. 401. FINDINGS.

  The Congress finds as follows:
          (1) According to the 1990 census, 21 percent of our Nation's 
        adults (more than 38 million persons) lack a high school 
        credential or are limited English proficient.
          (2) The National Adult Literacy Survey, conducted under the 
        Adult Education Act, found that 20 percent of all adults in the 
        United States, or about 40 million people, have minimal levels 
        of literacy skills and that the lack of such skills is related 
        to unemployment, low wages, and fewer weeks worked.
          (3) The success of State efforts to reform and improve public 
        education are dependent on the ability of the United States to 
        break intergenerational cycles of illiteracy and inadequate 
        education by ensuring that parents possess a strong educational 
        foundation and, as the first and most continuous teachers of 
        their children, model for, and instill in, their children a 
        commitment to family literacy and life-long learning.
          (4) Generations of immigrants have contributed to our 
        communities and our economy, but for them to continue to do so 
        given recent technologies and the competitive global economy, 
        they must master English as rapidly as possible.
          (5) Studies have found that incarcerated adults are twice as 
        likely as nonincarcerated adults to lack a good education and 
        that such lack is a significant statistical indicator of 
        recidivism.
          (6) Certain short-term and long-term goals of the Nation may 
        not be met unless the United States improves its current system 
        of adult education and life-long learning through Federal 
        leadership.

SEC. 402. DEFINITIONS.

  As used in this title:
          (1) Correctional education agency.--The term ``correctional 
        education agency'' means an entity that provides programs for 
        criminal offenders in corrections institutions and for other 
        institutionalized individuals which include academic programs 
        for basic education, special education, bilingual or English 
        language instruction, vocational training, library development, 
        corrections education programs, guidance and counseling, and 
        other supportive services for criminal offenders which may 
        emphasize coordination of educational services with educational 
        institutions, community-based organizations of demonstrative 
        effectiveness, and the private sector, designed to provide 
        education and training.
          (2) Educationally disadvantaged adult.--The term 
        ``educationally disadvantaged adult'' means an adult who--
                  (A) demonstrates basic skills equivalent to or below 
                that of students at the fifth grade level; or
                  (B) has been placed in the lowest or beginning level 
                of an adult education program when that program does 
                not use grade level equivalencies as a measure of 
                students' basic skills.
          (3) Family literacy services.--The term ``family literacy 
        services'' means services that integrate all of the following 
        activities and are of sufficient intensity in terms of hours, 
        and of sufficient duration, to make sustainable changes in a 
        family:
                  (A) Interactive literacy activities between parents 
                and their children.
                  (B) Training for parents on how to be their 
                children's primary teacher and full partners in the 
                education of their children.
                  (C) Parent literacy training.
                  (D) Early childhood education.
          (4) Secretary.--The term ``Secretary'' means the Secretary of 
        Education.

  Subtitle A--Adult Education and Family Literacy Consolidation Grant

SEC. 411. PURPOSES.

  The purposes of this subtitle are to assist States to provide--
          (1) to adults, the basic educational skills necessary for 
        employment and self-sufficiency;
          (2) to adults who are parents, the educational skills 
        necessary to be full partners in the educational development of 
        their children;
          (3) to adults, the basic English language skills necessary to 
        participate in the civic, social, and economic life of the 
        United States; and
          (4) to adults, the opportunity to attain a high school degree 
        or its equivalent in order to permit them to pursue further 
        education and training or improve their family and work 
        situations.

                           CHAPTER 1--FUNDING

SEC. 421. RESERVATIONS FROM AMOUNTS APPROPRIATED.

  (a) National Institute for Literacy.--For any fiscal year, the 
Secretary shall reserve $4,500,000 of the amount appropriated under 
section 4(a)(3) to carry out the activities of the National Institute 
for Literacy described in section 441.
  (b) National Leadership Activities.--For any fiscal year, the 
Secretary shall reserve $4,500,000 of the amount appropriated under 
section 4(a)(3) to establish and carry out the program of national 
leadership and evaluation activities described in section 442.

SEC. 422. ALLOTMENT.

  (a) Initial Allotment.--From the sums available for the purpose of 
making grants under chapter 2 for any fiscal year, the Secretary shall 
allot--
          (1) $100,000 each to Guam, American Samoa, the Commonwealth 
        of the Northern Mariana Islands, and the Virgin Islands; and
          (2) $250,000 to each of the other States.
  (b) Additional Allotment.--
          (1) In general.--From the remainder of the sums described in 
        subsection (a) after the application of the subsection, the 
        Secretary shall allot to each State an amount which bears the 
        same ratio to such remainder as the number of qualifying adults 
        in the State bears to the number of such adults in all States.
          (2) Qualifying adult.--For purposes of this subsection, the 
        term ``qualifying adult'' means an adult who--
                  (A) is at least 16 years of age, but less than 61 
                years of age;
                  (B) is beyond the age of compulsory school attendance 
                under State law;
                  (C) does not have a certificate of graduation from a 
                school providing secondary education (or its 
                equivalent); and
                  (D) is not currently enrolled in elementary or 
                secondary school.

                      CHAPTER 2--GRANTS TO STATES

SEC. 431. REQUIREMENT TO MAKE GRANTS.

  For fiscal year 1997 and subsequent fiscal years, the Secretary shall 
make a grant to a State in an amount equal to the initial and 
additional allotments of the State for the year if the State--
          (1) has satisfied the requirements of title I and section 
        433(a)(1);
          (2) enters into a written agreement with the Secretary that 
        the State--
                  (A) will not expend the grant for any purpose other 
                than in accordance with section 432;
                  (B) will satisfy the grant requirements in section 
                433(a)(2) and 433(b); and
                  (C) will not expend the grant for the purpose of 
                supporting or providing programs, services, or 
                activities for individuals who are not adults, except 
                if such programs, services, or activities are related 
                to family literacy services.

SEC. 432. USES OF FUNDS.

  (a) State Uses of Funds.--
          (1) Grants to serve target populations.--
                  (A) In general.--Of the funds paid to a State under 
                this title for fiscal year 1998 and subsequent fiscal 
                years, 3 percent shall be distributed as performance 
                grants made by the State on a competitive basis, and 
                consistent with subsection (b) and section 433(b)(2), 
                to local service providers that have provided, during 
                the immediately preceding fiscal year, adult education 
                or family literacy services to the target populations 
                described in subparagraph (C).
                  (B) Local service providers.--The local service 
                providers referred to in subparagraph (A) may include 
                the following:
                          (i) Local educational agencies.
                          (ii) Correctional educational agencies.
                          (iii) Community-based organizations.
                          (iv) Public or private nonprofit agencies.
                          (v) Institutions of higher education.
                          (vi) Libraries.
                          (vii) Other institutions that the State 
                        determines to have the ability to provide 
                        literacy services to adults and families.
                  (C) Target populations.--The target populations 
                referred to in subparagraph (A) are the following:
                          (i) Adults with more than one barrier to 
                        self-sufficiency, such as being unemployed or 
                        an educationally disadvantaged adult.
                          (ii) Families on public assistance (as 
                        determined by the State).
                          (iii) Parents who are educationally 
                        disadvantaged adults and who have a child who 
                        is less than 8 years of age.
                          (iv) Adults who are individuals with 
                        disabilities or who have similar special needs.
          (2) Grants to local service providers.--Of the funds paid to 
        a State under this subtitle for any fiscal year that remain 
        after the application of paragraph (1), at least 85 percent 
        shall be distributed as grants made by the State on a 
        competitive basis, and consistent with subsection (b) and 
        section 433(b)(2), to local service providers to establish, 
        conduct, or expand programs, services, or activities to achieve 
        a purpose of this subtitle. Such local service providers may 
        include the local service providers described in paragraph 
        (1)(B).
          (3) Other state activities.--A State may use not more than 12 
        percent of the funds paid to the State under this subtitle for 
        any fiscal year that remain after the application of paragraph 
        (1) for one or more of the following purposes:
                  (A) The establishment or operation of professional 
                development programs to improve the quality of 
                instruction provided in local adult education and 
                literacy programs, including instruction provided by 
                volunteers.
                  (B) The provision of technical assistance to local 
                service providers.
                  (C) The provision of technology assistance to local 
                service providers to enable them to improve the quality 
                of their programs, services, and activities that 
                achieve a purpose of this subtitle, including--
                          (i) providing hardware and software;
                          (ii) paying for service connection fees 
                        associated with gaining access to computerized 
                        databases; and
                          (iii) upgrading the technological 
                        capabilities of local service providers to 
                        improve the quality of their services and to 
                        assist them in providing services on a flexible 
                        schedule that meets the needs of diverse 
                        populations.
                  (D) The support of State or regional networks of 
                literacy resource centers that--
                          (i) enhance the coordination of literacy 
                        services across public and private programs and 
                        State agencies;
                          (ii) enhance the capacity of the State and 
                        local service providers to provide literacy 
                        services through the diffusion and adoption of 
                        state-of-the-art teaching methods and 
                        technologies;
                          (iii) provide linkages between the National 
                        Institute for Literacy established under 
                        section 441 and local service providers for the 
                        sharing of literacy information, research, and 
                        resources;
                          (iv) encourage government and industry 
                        partnerships; and
                          (v) provide training and technical assistance 
                        to literacy instructors in reading instruction, 
                        the use of state-of-the-art methodologies, 
                        instructional materials, and technologies, and 
                        professional development.
                  (E) Monitoring and evaluating the quality of, and the 
                improvement in, services and activities conducted with 
                Federal financial assistance under this subtitle, 
                including carrying out section 433(a)(2).
                  (F) The support of a common management information 
                system as described in section 109.
                  (G) Carrying out other activities of statewide 
                significance that promote the purposes of this Act.
          (4) Administrative expenses.--For any fiscal year, a State 
        may use not more than 3 percent of the funds paid to the State 
        under this subtitle that remain after the application of 
        paragraph (1) or $50,000, whichever is greater, for--
                  (A) planning, administration, and interagency 
                coordination associated with a grant under this 
                subtitle; and
                  (B) support for one-stop career center systems 
                described in section 107.
  (b) Local Uses of Funds.--A State shall require that a local service 
provider that receives a grant from the State under paragraph (1) or 
(2) of subsection (a) use the grant to establish or operate one or more 
programs that provide instruction or services within one or more of the 
following categories:
          (1) Adult basic education that is designed for an adult who--
                  (A) has minimal competence in reading, writing, or 
                computation;
                  (B) is not sufficiently competent in reading, 
                writing, or computation to meet the requirements of 
                adult life in the United States; or
                  (C) is not sufficiently competent in speaking, 
                reading, or writing the English language to obtain 
                employment commensurate with the adult's intellectual 
                abilities.
          (2) Adult secondary education that is designed for an adult 
        who is literate and can function in everyday life, but who--
                  (A) has not acquired basic educational skills, 
                including reading, writing, and computation; or
                  (B) does not have a certificate of graduation from a 
                school providing education to students in grade 12, or 
                its equivalent.
          (3) English literacy instruction that is designed for an 
        adult--
                  (A) who--
                          (i) has limited ability in speaking, reading, 
                        writing, or understanding the English language 
                        and whose native language is a language other 
                        than English; or
                          (ii) lives in a family or community 
                        environment where a language other than English 
                        is the dominant language; and
                  (B) who, by reason of a condition described in 
                subparagraph (A), has sufficient difficulty reading, 
                writing, or understanding the English language that the 
                adult is unable--
                          (i) to learn successfully in a classroom 
                        where the language of instruction is English; 
                        or
                          (ii) to participate fully in the society of 
                        the United States.
          (4) Family literacy services.

SEC. 433. ADDITIONAL GRANT REQUIREMENTS.

  (a) Goals, Progress Indicators, Performance Measures.--
          (1) Planning requirements.--A State that desires to receive a 
        grant under this subtitle shall accomplish the following:
                  (A) Establish, through the collaborative process 
                described in section 103, measurable goals for 
                improving literacy levels, retention in literacy 
                programs, and long-term learning gains of individuals 
                in the State.
                  (B) Based on such goals and the performance measures 
                described in section 434, establish, through such 
                collaborative process, progress indicators to be used 
                to evaluate the performance of local service providers 
                receiving a grant under paragraph (1) or (2) of section 
                432(a).
                  (C) Describe such goals and progress indicators in 
                the State workforce development and literacy plan 
                submitted to the Secretary under section 104.
          (2) Implementation requirements.--A State that receives a 
        grant under this subtitle shall accomplish the following:
                  (A) With respect to each local service provider 
                receiving a grant under paragraph (1) or (2) of section 
                432(a), based on the goals and progress indicators 
                established under paragraph (1), measure the 
                performance measures described in section 434 and use 
                the data produced by such measurement to improve the 
                quality of services provided to program participants or 
                service recipients.
                  (B) Beginning on the date that is 2 years after the 
                first date that a local service provider receives a 
                grant under paragraph (1) or (2) of section 432(a), 
                annually assess the degree to which the provider is 
                meeting or exceeding the progress indicators applicable 
                to the provider.
                  (C) Annually report to the Secretary on the 
                performance measures described in section 434 for each 
                category described in such section.
  (b) Other Requirements.--A State that receives a grant under this 
subtitle shall ensure the following:
          (1) Expenditures of non-federal funds.--For any fiscal year 
        for which a grant is made to the State under this subtitle, the 
        State shall expend, on programs and activities relating to 
        adult education and family literacy services, an amount, 
        derived from sources other than the Federal Government, equal 
        to 25 percent of the State's initial and additional allotments 
        for the year.
          (2) Priority for planning with boards and systems.--In 
        awarding grants to local service providers under paragraph (1) 
        or (2) of section 432(a), the State shall give priority to 
        providers that demonstrate joint planning with local workforce 
        development boards and one-stop career center systems.
          (3) Equitable access.--Local educational agencies, public or 
        private nonprofit agencies, community-based organizations, 
        correctional education agencies, institutions of higher 
        education, libraries, and institutions which serve 
        educationally disadvantaged adults shall be provided direct and 
        equitable access to Federal funds provided under this subtitle 
        in accordance with this subtitle.
          (4) Payments by one-stops to local service providers.--A one-
        stop career center system in a State that refers an adult who 
        is in need of adult education or literacy services in order to 
        achieve such adult's career goals to a local service provider 
        shall pay to such provider, in accordance with the biennial 
        strategic plan of the local workforce development board 
        pursuant to which such center is established or designated, an 
        amount appropriate to pay for such services if such provider 
        renders such services and--
                  (A) is receiving a grant from the State under 
                paragraph (1) or (2) of section 432(a); or
                  (B) is not receiving such a grant but has been 
                certified by the State as eligible to receive such 
                amounts.

SEC. 434. PERFORMANCE MEASURES.

  A State that receives a grant under this subtitle for a fiscal year 
shall measure the performance in the following categories for such year 
of the programs, services, and activities carried out by each local 
service provider receiving a grant under paragraph (1) or (2) of 
section 432(a):
          (1) The percentage of adults served who, based on skills or 
        abilities acquired through such a program, service, or 
        activity--
                  (A) demonstrate skills necessary to assist their 
                children to succeed in school, such as the ability to--
                          (i) read to their children;
                          (ii) provide support to their children in the 
                        completion of homework assignments; or
                          (iii) participate on an ongoing basis in 
                        activities that support their childrens' 
                        schools;
                  (B) enrolled in institutions of higher education or 
                occupational training;
                  (C) obtained a job;
                  (D) advanced in their job; or
                  (E) performed new job requirements essential to 
                retaining their job.
          (2) The percentage of adults served who, based on skills or 
        abilities acquired through such a program, service, or 
        activity--
                  (A) obtained a high school diploma; or
                  (B) obtained a high school equivalency diploma.
          (3) The percentage of adults served who, based on skills or 
        abilities acquired through such a program, service, or 
        activity--
                  (A) register to vote;
                  (B) obtain United States citizenship; or
                  (C) seek preventive health services.
          (4) The percentage of incarcerated adults served who, based 
        on skills or abilities acquired through such a program, 
        service, or activity, during their term of incarceration or 
        upon the termination of such term--
                  (A) enrolled in job training or education programs; 
                or
                  (B) obtained employment.

                      CHAPTER 3--NATIONAL PROGRAMS

SEC. 441. NATIONAL INSTITUTE FOR LITERACY.

  (a) Establishment.--
          (1) In general.--There shall be established a National 
        Institute for Literacy (in this section referred to as the 
        ``Institute''). The Institute shall be administered under the 
        terms of an interagency agreement entered into by the Secretary 
        of Education with the Secretary of Labor and the Secretary of 
        Health and Human Services (in this section referred to as the 
        ``Interagency Group''). The Secretary may include in the 
        Institute any research and development center, institute, or 
        clearinghouse established within the Department of Education 
        whose purpose is determined by the Secretary to be related to 
        the purpose of the Institute.
          (2) Board recommendations.--The Interagency Group shall 
        consider the recommendations of the National Institute for 
        Literacy Advisory Board (in this section referred to as the 
        ``Board'') established under subsection (d) in planning the 
        goals of the Institute and in the implementation of any 
        programs to achieve such goals.
          (3) Daily operations.--The daily operations of the Institute 
        shall be carried out by the Director of the Institute appointed 
        under subsection (g).
  (b) Duties.--
          (1) In general.--The Institute shall--
                  (A) provide national leadership for the improvement 
                and expansion of the system for delivery of literacy 
                services;
                  (B) coordinate the delivery of such services;
                  (C) support the creation of new methods of offering 
                improved services;
                  (D) serve as a national resource for adult education 
                and family literacy services by providing to the public 
                the best and most current information available on the 
                subjects; and
                  (E) assist States in developing levels of 
                performance.
          (2) Authorized activities.--In order to carry out the duties 
        described in paragraph (1), the Institute may--
                  (A) establish a national electronic database of 
                information that includes--
                          (i) information on--
                                  (I) effective practices in the 
                                provision of literacy and basic skills 
                                instruction;
                                  (II) public and private literacy and 
                                basic skills programs and Federal, 
                                State, and local policies affecting the 
                                provision of literacy services at the 
                                national, State, and local levels; and
                                  (III) technical assistance, meetings, 
                                conferences, and other opportunities 
                                that lead to the improvement of 
                                literacy and basic skills services; and
                          (ii) a communication network for literacy 
                        programs, providers, and students;
                  (B) coordinate support for the provision of literacy 
                and basic skills services across Federal agencies and 
                at the State and local level;
                  (C) coordinate the support of research and 
                development on literacy and basic skills in families 
                and adults across Federal agencies and carry out basic 
                and applied research and development on topics that are 
                not being investigated by other organizations or 
                agencies;
                  (D) collect and disseminate information on methods of 
                advancing literacy that show promise of success;
                  (E) work with the National Education Goals Panel 
                established under Goals 2000: Educate America Act to 
                assist local, State, and national organizations and 
                agencies in making and measuring progress toward the 
                National Education Goals established under such Act; 
                and
                  (F) assist in the development of policy with respect 
                to literacy and basic skills.
          (3) Grants, contracts, and agreements.--The Institute may 
        enter into contracts or cooperative agreements with, or make 
        grants to, individuals, public or private institutions, 
        agencies, organizations, or consortia of such institutions, 
        agencies, or organizations to carry out the activities of the 
        Institute. Such grants, contracts, or agreements shall be 
        subject to the laws and regulations that generally apply to 
        grants, contracts, or agreements entered into by Federal 
        agencies.
  (c) Literacy Leadership.--
          (1) Fellowships.--The Institute, in consultation with the 
        Board, may award fellowships, with such stipends and allowances 
        as the Director considers necessary, to outstanding individuals 
        pursuing careers in adult education or literacy in the areas of 
        instruction, management, research, or innovation.
          (2) Use of fellowships.--Fellowships awarded under this 
        subsection shall be used, under the auspices of the Institute, 
        to engage in research, education, training, technical 
        assistance, or other activities to advance the field of adult 
        education or literacy, including the training of volunteer 
        literacy providers at the national, State, or local level.
          (3) 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 determines necessary.
  (d) National Institute for Literacy Advisory Board.--
          (1) Establishment.--
                  (A) In general.--There shall be a National Institute 
                for Literacy Advisory Board. The Board shall consist of 
                10 individuals appointed by the President with the 
                advice and consent of the Senate from individuals who--
                          (i) are not otherwise officers or employees 
                        of the Federal Government; and
                          (ii) are representative of entities or groups 
                        described in subparagraph (B).
                  (B) Entities or groups described.--The entities or 
                groups referred to in subparagraph (A) are--
                          (i) literacy organizations and providers of 
                        literacy services, including--
                                  (I) nonprofit providers of literacy 
                                services;
                                  (II) providers of programs and 
                                services involving English language 
                                instruction; and
                                  (III) providers of services receiving 
                                assistance under this subtitle;
                          (ii) businesses that have demonstrated 
                        interest in literacy programs;
                          (iii) literacy students;
                          (iv) experts in the area of literacy 
                        research;
                          (v) State and local governments; and
                          (vi) organized labor.
          (2) Duties.--The Board shall--
                  (A) make recommendations concerning the appointment 
                of the Director and staff of the Institute;
                  (B) provide independent advice on the operation of 
                the Institute; and
                  (C) receive reports from the Interagency Group and 
                the Director.
          (3) Terms.--
                  (A) 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.
                  (B) Vacancy appointments.--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 
                members' term until a successor has taken office. A 
                vacancy in the Board shall be filled in the manner in 
                which the original appointment was made. A vacancy in 
                the Board shall not affect the powers of the Board.
          (4) Quorum.--A majority of the members of the Board shall 
        constitute a quorum but a lesser number may hold hearings. Any 
        recommendation may be passed only by a majority of its members 
        present.
          (5) Chairperson and vice chairperson.--The chairperson and 
        vice chairperson of the Board shall be elected by the members. 
        The term of office of the chairperson and vice chairperson 
        shall be 1 year.
          (6) Meetings.--The Board shall meet at the call of the 
        chairperson or a majority of its members.
  (e) Gifts, Bequests, and Devises.--The Institute may accept, 
administer, and use gifts or donations of services, money, or property, 
both real and personal.
  (f) 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.
  (g) Staff.--The Interagency Group, after considering recommendations 
made by the Board, shall appoint and fix the pay of a Director.
  (h) Applicability of Certain Civil Service Laws.--The Director and 
staff of the Institute 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 maximum 
rate payable under section 5376 of title 5, United States Code.
  (i) Experts and Consultants.--The Board and the Institute may procure 
temporary and intermittent services under section 3109(b) of title 5, 
United States Code.
  (j) Report.--The Institute shall submit a biennial report to the 
Interagency Group and the Congress.

SEC. 442. NATIONAL LEADERSHIP ACTIVITIES.

  (a) In General.--The Secretary shall establish and carry out a 
program of national leadership and evaluation activities to enhance the 
quality of adult education and family literacy programs nationwide.
  (b) Required Activity.--
          (1) In general.--The program of national leadership and 
        evaluation activities under subsection (a) shall include a 
        national evaluation, conducted by the Secretary, of the 
        programs and activities carried out by States and local service 
        providers with Federal funds received under this subtitle. Such 
        evaluation shall include information on the following:
                  (A) The manner in which States and local service 
                providers use Federal funds, including the manner in 
                which States allocate such funds among such providers.
                  (B) The manner in which States establish goals and 
                performance standards and use such goals and standards 
                to manage and improve programs.
                  (C) The effectiveness of the funds used under 
                subparagraphs (B) and (C) of section 432(a)(3).
                  (D) The manner in which economically disadvantaged 
                individuals and educationally disadvantaged adults are 
                being served by States and local service providers.
                  (E) The coordination between programs and activities 
                carried out with Federal funds received under titles II 
                and III and programs and activities carried out with 
                Federal funds received under this subtitle.
                  (F) The percentage of individuals receiving a service 
                from a one-stop career center system who are referred 
                by such system to a local service provider providing 
                adult education or literacy services.
          (2) Report.--Not later than September 30, 2001, the Secretary 
        shall provide to the Congress and publicly publish the results 
        of the evaluation conducted under paragraph (1).
  (c) Authorized Activities.--
          (1) In general.--The program of national leadership and 
        evaluation activities under subsection (a) may include the 
        following:
                  (A) Assisting States in developing levels of 
                performance.
                  (B) Research and development.
                  (C) Demonstration of model and innovative programs.
                  (D) Evaluations, including independent evaluations of 
                adult education and family literacy programs carried 
                out with financial assistance received pursuant to this 
                subtitle.
                  (E) Data collection.
                  (F) Professional development.
                  (G) Technical assistance to States and local service 
                providers receiving Federal financial assistance 
                pursuant to this subtitle.
                  (H) Making grants to State or regional networks of 
                literacy resource centers described in section 
                432(a)(3)(D).
                  (I) Other activities to enhance the quality of adult 
                education and family literacy programs nationwide.
          (2) Grants, contracts, and cooperative agreements.--The 
        Secretary may carry out the activities described in paragraph 
        (1) directly or through grants, contracts, and cooperative 
        agreements.

    Subtitle B--Library Services and Technology Consolidation Grant

SEC. 451. PURPOSES.

  The purposes of this subtitle are--
          (1) to consolidate Federal library service programs;
          (2) to improve public access to information through 
        electronic networks; and
          (3) to provide linkages among and between libraries and one-
        stop career center systems.

SEC. 452. AUTHORIZATION OF APPROPRIATIONS.

  (a) In General.--There are authorized to be appropriated to carry out 
this subtitle $110,000,000 for each of the fiscal years 1997 through 
2002.
  (b) Advance Notice of Funding.--For the purpose of affording adequate 
notice of funding available under this subtitle, an appropriation to 
carry out this subtitle is authorized to be included in an 
appropriation Act for the fiscal year preceding the fiscal year for 
which such appropriation is first available for obligation.

SEC. 453. ALLOTMENTS.

  (a) Initial Allotments.--
          (1) In general.--From the sums appropriated under section 452 
        for any fiscal year, the Secretary shall allot--
                  (A) $40,000 each to Guam, American Samoa, the 
                Commonwealth of the Northern Mariana Islands, and the 
                Virgin Islands; and
                  (B) $200,000 to each of the other States.
          (2) Ratable reduction.--If the sums appropriated under 
        section 452 for any fiscal year are insufficient to pay all of 
        the allotments under paragraph (1), each such allotment shall 
        be ratably reduced.
  (b) Additional Allotments.--
          (1) In general.--From the remainder of the sums appropriated 
        under section 452 for any fiscal year after the application of 
        subsection (a), the Secretary shall allot to each State an 
        amount which bears the same ratio to such remainder as the 
        population of the State bears to the population of all States.
          (2) Determination of population of states.--For the purpose 
        of this subsection, the population of each State, and the total 
        population of all States, shall be determined by the Secretary 
        on the basis of the most recent census data available to the 
        Secretary, and the Secretary shall use for such purpose, if 
        available, the annual interim current census data produced by 
        the Secretary of Commerce pursuant to section 181 of title 13, 
        United States Code.

SEC. 454. GRANTS TO STATES.

  (a) In General.--The Secretary shall make a grant for a fiscal year 
to a State if the State--
          (1) has submitted to the Secretary for the year an annual 
        application that has been approved by the Secretary under 
        section 456; and
          (2) has entered into a written agreement with the Secretary 
        that--
                  (A) the State will provide 100 percent of the funds 
                paid to the State under this subtitle for the year to 
                the State library administrative agency for the State;
                  (B) such agency will be required to use such funds to 
                carry out activities that--
                          (i) are described in such annual application;
                          (ii) achieve the purposes of this subtitle; 
                        and
                          (iii) satisfy the requirements of section 
                        455;
                  (C) there will be available from State and local 
                sources for expenditure by such agency to carry out 
                such activities an amount that equals or exceeds 25 
                percent of the total cost (as determined by the 
                Secretary) of carrying out such activities for the 
                year; and
                  (D) such agency has the fiscal and legal authority 
                and capability to administer all aspects of such 
                activities.
  (b) Amount of Grants.--The amount of a grant to a State under 
subsection (a) for a fiscal year shall equal the lesser of the 
following:
          (1) The sum of the initial and additional allotments of the 
        State for the year.
          (2) 75 percent of the total cost (as determined by the 
        Secretary) of carrying out the activities described in 
        subsection (a)(2)(B) for the year.

SEC. 455. USES OF FUNDS.

  (a) In General.--Of the funds provided to a State library 
administrative agency under section 454(a)(2)(A), the agency shall 
expend at least 97 percent for one or more of the following purposes:
          (1) Electronically connecting libraries with one-stop career 
        center systems designated or established under section 107 and 
        local service providers receiving grants under paragraph (1) or 
        (2) of section 432(a).
          (2) Establishing or enhancing linkages among libraries.
          (3) Assisting libraries in accessing information through 
        electronic networks.
          (4) Encouraging libraries in different Federal, State, and 
        local jurisdictions, and different types of libraries, to 
        establish consortia and share resources.
          (5) Paying costs for libraries to acquire or share computer 
        systems and telecommunications technologies.
          (6) Improving library and information services for 
        individuals who have difficulty using a library or who need 
        special library materials or services, including individuals 
        under the age of 18.
  (b) Administrative Expenses.--In any fiscal year, a State library 
administrative agency may use not more than 3 percent of the funds 
provided to the agency under section 454(a)(2)(A) for planning, 
administration, evaluations, and interagency coordination associated 
with a grant under this subtitle.

SEC. 456. ANNUAL APPLICATIONS.

  (a) Submission.--A State that desires to receive a grant under this 
subtitle for a fiscal year shall submit to the Secretary, in such form 
and manner and before such deadline as the Secretary shall specify in 
regulations, an application for such year. Such application shall--
          (1) establish goals, and specify priorities, for the State 
        consistent with the purposes of this subtitle;
          (2) describe activities that are consistent with such goals 
        and priorities, the purposes of this subtitle, and the 
        requirements of section 455 that the State library 
        administrative agency will carry out during such year using 
        such grant;
          (3) describe the procedures that such agency will use to 
        carry out such activities;
          (4) describe the methodology that such agency will use to 
        evaluate the success of such activities in achieving such goals 
        and meeting such priorities;
          (5) describe procedures that such agency will use to involve 
        libraries and library users throughout the State in policy 
        decisions regarding implementation of this subtitle; and
          (6) provide assurances satisfactory to the Secretary that 
        such agency will make such reports, in such form and containing 
        such information, as the Secretary may reasonably require to 
        carry out this subtitle and to determine the extent to which 
        funds provided under this subtitle have been effective in 
        carrying out its purposes.
  (b) Approval.--
          (1) In general.--The Secretary shall approve each application 
        submitted under subsection (a) that satisfies the requirements 
        of the subsection.
          (2) Rights of states upon disapproval.--If the Secretary 
        determines that an application submitted by a State under 
        subsection (a) does not satisfy the requirements of such 
        subsection, the Secretary shall--
                  (A) immediately notify the State of such 
                determination and the reasons for such determination; 
                and
                  (B) offer the State an opportunity to revise its 
                application to correct any deficiencies.

           TITLE V--AMENDMENTS TO REHABILITATION ACT OF 1973

       Subtitle A--Vocational Rehabilitation Consolidation Grant

                      CHAPTER 1--TRANSITION PERIOD

SEC. 501. TRANSITION.

  With respect to the amendment made by section 511(4) to title I of 
the Rehabilitation Act of 1973, the Secretary of Education, acting 
through the Commissioner of the Rehabilitation Services Administration, 
shall administer the amendment in accordance with the following:
          (1) During fiscal year 1996, the Secretary shall develop 
        administrative policies for implementing the amendment.
          (2) During the fiscal years 1997 and 1998, the Secretary 
        shall begin implementing the amendment in accordance with 
        paragraph (4).
          (3) The Secretary shall ensure that, by the first day of 
        fiscal year 1999, the amendment is fully implemented.
          (4) For purposes of paragraph (2), the Secretary shall ensure 
        that, before the first day of fiscal year 1999, the following 
        requirements, administered as conditions on the receipt of 
        grants under such title, have been met:
                  (A) The States have complied with section 103(b)(4) 
                of such title (as amended by section 511) regarding the 
                participation of certain providers.
                  (B) The States have established policies and made 
                arrangements for the operation of the system of 
                vouchers described in section 103(c) of such title, 
                including with respect to the reimbursement of 
                providers.
                  (C) The States have established policies and made 
                arrangements under section 103(b)(12) of such title 
                regarding the training of the management and staff of 
                one-stop career centers with respect to individuals 
                with disabilities.
                  (D) The States have established policies and made 
                arrangements under section 104 of such title regarding 
                the establishment of such centers, including providing 
                for the significant participation of community-based 
                providers in the program carried out by the State 
                pursuant to such title.
                  (E) Such other requirements under the amendment as 
                the Secretary determines to be appropriate.
          (5)(A) Notwithstanding the amendment, during the fiscal years 
        1996 through 1998, the provisions of title I of the 
        Rehabilitation Act of 1973 that were in effect on the day 
        before the date of the enactment of this Act continue to be in 
        effect, subject to paragraphs (1) through (4). In implementing 
        the amendment, the Secretary shall seek to avoid unnecessarily 
        disrupting the provision of services under such title to 
        individuals who, as of the date of the enactment of this Act, 
        were receiving services pursuant to an individualized plan 
        under such title.
          (B) On and after the first day of fiscal year 1999, the 
        provisions referred to in the first sentence of subparagraph 
        (A) do not have any legal effect.

      CHAPTER 2--REVISION OF TITLE I OF REHABILITATION ACT OF 1973

SEC. 511. REVISION OF TITLE I.

  (a) In General.--Effective October 1, 1995, the Rehabilitation Act of 
1973 (29 U.S.C. 701 et seq.) is amended--
          (1) by transferring section 112 from the current placement of 
        the section;
          (2) by redesignating such section as section 510;
          (3) by adding such section at the end of title V; and
          (4) by amending title I to read as follows:

             ``TITLE I--VOCATIONAL REHABILITATION SERVICES

``SEC. 100. PURPOSE.

  ``The purpose of this title is to assist States in making available 
to individuals with disabilities a program of employment, training, and 
rehabilitation services that is consistent with their strengths, 
resources, priorities, concerns, abilities, and capabilities; that 
maximizes individuals' control over their vocational and career 
choices; and that is in accordance with the goal of assuring equality 
of opportunity, full participation, independent living, and economic 
self-sufficiency for such individuals.

``SEC. 101. FORMULA GRANTS.

  ``(a) In General.--
          ``(1) Formula grants.--In the case of each State that submits 
        to the Secretary a workforce development and literacy plan for 
        fiscal year 1999 or any subsequent fiscal year that meets the 
        requirement of section 104 of the Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act, the 
        Secretary shall make a grant for the year to the State as the 
        Federal share of carrying out the purposes specified in this 
        title. The grant shall consist of the allotment determined for 
        the State under section 107.
          ``(2) Conditions for grant.--A State may receive a grant 
        under paragraph (1) for a fiscal year only if the State meets 
        the conditions described in this title for the State for the 
        fiscal year.
  ``(b) Administrator of Federal Program.--The Secretary shall carry 
out this title acting through the Commissioner of the Rehabilitation 
Services Administration, except as indicated otherwise.
  ``(c) Rule of Construction.--The purpose specified in section 100 
shall be carried out only in accordance with the other provisions of 
this title.
  ``(d) Funding.--
          ``(1) Authorization of appropriations.--For the purpose of 
        carrying out this title, there are authorized to be 
        appropriated such sums as may be necessary for each of the 
        fiscal years 1999 through 2002, except that the amount to be 
        appropriated for a fiscal year shall not be less than the 
        amount of the appropriation under this subsection for the 
        immediately preceding fiscal year, plus the amount of the 
        Consumer Price Index addition determined under paragraph (2) 
        for the immediately preceding fiscal year.
          ``(2) Adjustments pursuant to consumer price index.--
                  ``(A) Not later than November 15 of each fiscal year, 
                the Secretary of Labor shall publish in the Federal 
                Register the percentage change in the Consumer Price 
                Index published for October of the preceding fiscal 
                year and October of the fiscal year in which such 
                publication is made.
                  ``(B) If in any fiscal year the percentage change 
                published under subparagraph (A) indicates an increase 
                in the Consumer Price Index, then the amount to be 
                appropriated under paragraph (1) for the subsequent 
                fiscal year shall be at least the amount appropriated 
                for the fiscal year in which the publication is made 
                under subparagraph (A) increased by such percentage 
                change.
                  ``(C) If in any fiscal year the percentage change 
                published under subparagraph (A) does not indicate an 
                increase in the Consumer Price Index, then the amount 
                to be appropriated under paragraph (1) for the 
                subsequent fiscal year shall be at least the amount 
                appropriated for the fiscal year in which the 
                publication is made under subparagraph (A).
                  ``(D) For purposes of this paragraph, the term 
                `Consumer Price Index' means the Consumer Price Index 
                for All Urban Consumers, published monthly by the 
                Bureau of Labor Statistics.
          ``(3) Automatic extension of authorization.--
                  ``(A) Unless, in the regular session that ends prior 
                to the beginning of the last fiscal year for which an 
                authorization of appropriations is provided in 
                paragraph (1), legislation has been enacted that has 
                the effect of extending such authorization, such 
                authorization is automatically extended for one 
                additional year.
                  ``(B) The amount authorized to be appropriated for 
                the additional fiscal year described in subparagraph 
                (A) shall be an amount equal to the amount appropriated 
                for such program for fiscal year 2002, plus the amount 
                of the Consumer Price Index addition determined under 
                paragraph (2) for the immediately preceding fiscal 
                year.
                  ``(C) In any case where the Commissioner is required 
                under an applicable statute to carry out certain acts 
                or make certain determinations that are necessary for 
                the continuation of the program authorized by this 
                title, and such acts or determinations are required 
                during the last fiscal year for which an authorization 
                of appropriations is provided in paragraph (1), such 
                acts and determinations shall be required during any 
                fiscal year for which subparagraph (A) is in operation.

``SEC. 102. ALLOCATION WITHIN STATE OF ADMINISTRATIVE RESPONSIBILITIES.

  ``(a) In General.--For purposes of section 101(a), a State will--
          ``(1) subject to subsection (b), reserve not more than 20 
        percent of the grant under such section for the fiscal year 
        involved for carrying out the responsibilities of a State 
        administrative agent under section 103; and
          ``(2) reserve not less than 80 percent of the grant for 
        carrying out the responsibilities under section 104 of local 
        workforce development boards and one-stop career centers with 
        respect to workforce development areas.
  ``(b) Additional State Responsibilities.--Amounts reserved by a State 
under subsection (a)(1) may be expended by the State administrative 
agent to carry out responsibilities that otherwise would be carried out 
under section 104 by local workforce development boards or one-stop 
career centers, if the State determines that such expenditures are 
justified to make available goods and services that could not otherwise 
be obtained within a local workforce development area, to provide 
services to individuals unable to utilize the one-stop career centers, 
or to otherwise ensure the efficient and equitable provision in the 
State of services under this title, including the provision of services 
for individuals in rural areas.
  ``(c) Certain Definitions.--For purposes of this Act, the terms 
`State administrative agent', `local workforce development area', 
`local workforce development board', and `one-stop career center' have 
the meanings given such terms in sections 105 through 108, 
respectively, of the Consolidated and Reformed Education, Employment, 
and Rehabilitation Systems Act.

``SEC. 103. RESPONSIBILITIES OF STATE ADMINISTRATIVE AGENT.

  ``(a) State Administrative Agent.--In carrying out the requirements 
of the Consolidated and Reformed Education, Employment, and 
Rehabilitation Systems Act, a Governor may designate--
          ``(1) one State administrative agent to be responsible for 
        carrying out this title for individuals who are blind; and
          ``(2) a different State administrative agent to carry out the 
        remaining responsibilities in this title.
  ``(b) Responsibilities.--For purposes of section 101(a) and the 
operation in a State of the program under this title:
          ``(1) This subsection, and the subsequent provisions of this 
        section, will be carried out by State administrative agents 
        designated by the Governor in accordance with subsection (a), 
        through the collaborative process established under section 103 
        of the Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act.
          ``(2)(A) The State will provide to the public an explanation 
        of the methods by which the State will provide vocational 
        rehabilitation services (as defined in section 104(b))--
                  ``(i) to all eligible individuals (as defined in 
                section 105(d)); and
                  ``(ii) within all local workforce delivery areas in 
                the State.
          ``(B) In the event that such services cannot be provided to 
        all eligible individuals who apply for the services, the State 
        will show and provide the justification for the order to be 
        followed in selecting individuals to whom the services will be 
        provided.
          ``(C) The order of selection under subparagraph (B) will be 
        determined on the basis of serving first those individuals with 
        the most severe disabilities, in accordance with criteria 
        established by the State.
          ``(3) The State will establish guidelines providing that, in 
        the case of an individual to whom the State will provide a 
        service (in accordance with the order of selection under 
        paragraph (2) and the assessment of needs under section 
        104(c)(1)), the individual will have the option of receiving 
        the service from a provider designated by the center or from a 
        provider selected by the individual pursuant to vouchers under 
        subsection (c).
          ``(4) Pursuant to section 109 of the Consolidated and 
        Reformed Education, Employment, and Rehabilitation Systems Act, 
        the State will make significant efforts to encourage the 
        participation in the State program of community-based private 
        providers, with special consideration given to providers who 
        have received funds under this Act regarding projects with 
        industry or supported employment services, or under the Act 
        commonly known as the Javits-Wagner-O'Day Act (41 U.S.C. 46 et 
        seq.) for employment and training services.
          ``(5) The State will establish provisions to govern 
        determinations under section 105 (relating to the eligibility 
        of individuals).
          ``(6) The State will establish standards to govern the 
        conduct under section 104(c)(1) of assessments of need, 
        including the development of a methodology that will be applied 
        in a reasonably uniform manner to all individuals for whom such 
        assessments are conducted, and that (subject to the order of 
        selection under paragraph (2)) will be designed to prevent 
        substantial disparities, among individuals with comparable 
        circumstances, in the monetary value of the services to be 
        provided pursuant to the assessments.
          ``(7)(A) The State will establish procedures through which an 
        individual may request and obtain an impartial review, 
        utilizing an impartial hearing officer, of whether standards 
        for determinations of eligibility for services, assessments of 
        vocational rehabilitation needs, and development of 
        individualized rehabilitation and employment plans under this 
        title were correctly applied to the individual by the one-stop 
        career center involved.
          ``(B) The State will designate a number of days (applied 
        uniformly to all individuals) within which review under 
        subparagraph (A) will be conducted once a request for such 
        review is made by an individual, subject to subparagraph (C).
          ``(C)(i) The State will provide that there may be an informal 
        hearing, mediation, or alternatives to such review, if agreed 
        upon by the individual and the one-stop career center involved.
          ``(ii) The State will provide that if, in a process utilized 
        under clause (i) by an individual, there is a not a final 
        disposition of the matter involved, review under subparagraph 
        (A) will remain available to the individual.
          ``(8) The State will ensure that vocational rehabilitation 
        services under this title, and related core services, are 
        provided by personnel who are qualified to provide the services 
        involved. For purposes of the preceding sentence, the term 
        `core services' has the meaning indicated for such term under 
        title I of the Consolidated and Reformed Education, Employment, 
        and Rehabilitation Systems Act.
          ``(9) The State will establish plans, policies, and 
        procedures to be followed in carrying out the program under 
        this title in the State (including entering into a formal 
        interagency cooperative agreement with education officials 
        responsible for the provision of a free appropriate public 
        education to students who are individuals with disabilities). 
        The State will ensure that such plans, policies, and procedures 
        are designed in accordance with the following:
                  ``(A)(i) To facilitate the development and 
                accomplishment of the goals and objectives described in 
                clause (ii) (including the specification of plans for 
                coordination with the educational agencies in the 
                provision of transition services), to the extent that 
                the goals and objectives are included in an 
                individualized education program of a student.
                  ``(ii) The goals and objectives referred to in clause 
                (i) are long-term rehabilitation goals; intermediate 
                rehabilitation objectives; and goals and objectives 
                related to enabling a student to live independently 
                before the student leaves a school setting.
                  ``(B) To facilitate the transition from the provision 
                of a free appropriate public education under the 
                responsibility of an educational agency to the 
                provision of vocational rehabilitation services under 
                this title, including the specification of plans for 
                coordination with educational agencies in the provision 
                of transition services to an individual.
                  ``(C) To provide for--
                          ``(i) provisions for determining State lead 
                        agencies and qualified personnel responsible 
                        for transition services;
                          ``(ii) procedures for outreach to and 
                        identification of youth in need of such 
                        services; and
                          ``(iii) a timeframe for evaluation and 
                        follow-up of youth who have received such 
                        services.
          ``(10) The State will provide for coordination and working 
        relationships with the Statewide Independent Living Council 
        established under section 705 and independent living centers 
        within the State.
          ``(11) The State will provide for interagency cooperation 
        with, and the utilization of the services and facilities of, 
        the State agencies administering the State's public assistance 
        programs, and other programs for individuals with disabilities.
          ``(12) With respect to the one-stop career centers operated 
        pursuant to section 104, the State will provide for the 
        appropriate training of the management and staff of the centers 
        regarding the effective provision of services to individuals 
        with disabilities.
          ``(13) The State will provide technical assistance to local 
        boards, one-stop career centers, and providers relating to the 
        effective provision of vocational rehabilitation services under 
        this title, including the effective development of 
        individualized rehabilitation and employment plans, and will 
        ensure that such technical assistance is provided through 
        appropriate means.
  ``(c) Availability of Voucher System Regarding Services.--For 
purposes of section 101(a) and the operation in a State of the program 
under this title:
          ``(1) The State will provide for the establishment of a 
        system to carry out this subsection.
          ``(2) In the case of an eligible individual who (in 
        accordance with the order of selection under subsection (b)(2) 
        and the assessment of needs under section 105(b)(2)(A)) will 
        receive vocational rehabilitation services under this title, 
        the one-stop career center involved will, upon request of the 
        individual, provide to the individual vouchers in accordance 
        with this subsection.
          ``(3) Vouchers under this subsection will enable such 
        individual to obtain the vocational rehabilitation services 
        involved from providers selected by the individual from among a 
        list of providers approved by the State for such purpose in 
        accordance with section 109 of the Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act.
          ``(4) The monetary value of a voucher provided to the 
        individual for a particular type of service will be calculated 
        at a fair market value.
          ``(5) To the extent practicable, the list of providers under 
        paragraph (3) will provide for the availability within each 
        local workforce development area of a broad range of services.
  ``(d) State Options.--With respect to compliance with this section, a 
State may, in the discretion of the State, expend a grant under section 
101 for the following:
          ``(1) To disseminate findings from research regarding 
        vocational rehabilitation services, after consideration of 
        requests from local workforce development boards and one-stop 
        career centers regarding the types of information needed by 
        such boards and centers.
          ``(2) To conduct demonstration projects regarding 
        improvements with respect to vocational rehabilitation 
        services, subject to providing the results of such projects to 
        the Commissioner and as appropriate disseminating the results 
        within the State.
  ``(e) Core Standards, Performance Goals, and Measures.--For purposes 
of section 101(a):
          ``(1) The State involved will develop and implement a 
        statewide system of core standards and measures of performance 
        for programs established under this title, based upon 
        performance standards described in paragraph (3), and 
        consistent with the State's goals and objectives and the 
        benchmarking process described in the workforce development and 
        literacy plan submitted by the State under section 104 of the 
        Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act.
          ``(2) The statewide system will--
                  ``(A) establish performance goals to define the level 
                of performance to be achieved by individuals served 
                under this title and to evaluate the quality and 
                effectiveness of services and activities under this 
                title;
                  ``(B) express such goals in an objective, 
                quantifiable, and measurable form;
                  ``(C) establish performance indicators or benchmarks 
                that the State and local recipients of funds will use 
                in measuring or assessing progress toward achieving 
                such goals; and
                  ``(D) provide biennial reports to the public and to 
                the Secretary on the State's progress in achieving its 
                goals.
          ``(3) The statewide system will include measures of--
                  ``(A) placement, retention, and earnings of 
                participants in integrated employment, including 
                retention and earnings at 6 months, and at 1 year after 
                program termination, respectively;
                  ``(B) the percentage of individuals served who had 
                severe disabilities, including those individuals 
                determined to have a disability under title II or title 
                XVI of the Social Security Act; and
                  ``(C) other relevant measures of program performance 
                included in the standards and indicators promulgated by 
                the Commissioner under sections 621 and 106 (relating 
                to projects with industry, and relating to evaluation 
                standards and indicators for vocational rehabilitation, 
                respectively), as such sections were in effect for 
                fiscal year 1995.
``SEC. 104. RESPONSIBILITIES FOR LOCAL BOARDS AND SERVICE CENTERS.

  ``(a) Provision of Vocational Rehabilitation Services.--For purposes 
of section 101(a) and the operation in a State of the program under 
this title:
          ``(1) This section will be carried out by the one-stop career 
        centers in the State, with each such center acting under the 
        guidance of the local workforce development board for the local 
        workforce area within which the center operates. Such centers 
        will provide services under this section directly or through 
        contract.
          ``(2) In accordance with the order of selection under section 
        103(b)(2), a one-stop career center will, in expending amounts 
        provided to the center from a grant under section 101, carry 
        out the following:
                  ``(A) Make determinations under section 105 of the 
                eligibility of individuals for vocational 
                rehabilitation services (as defined in subsection (b)).
                  ``(B) Provide for vocational rehabilitation services 
                for eligible individuals.
                  ``(C) In the case of individuals with severe 
                disabilities, conduct outreach and intake activities 
                for such individuals who are not able to directly 
                access the one-stop career centers because of the 
                nature of their disabilities.
          ``(3) A one-stop career center will, in expending amounts 
        provided to the center from a grant under section 101, make 
        vocational rehabilitation services available at a variety of 
        locations and, as appropriate for particular populations, in a 
        variety of environments.
  ``(b) Definition.--For purposes of this title, the term `vocational 
rehabilitation services' means such goods or services for eligible 
individuals as are--
          ``(1) necessary to render the individuals employable and 
        achieve an employment outcome; and
          ``(2) provided in response to needs that arise, to a 
        significant extent, from the disability involved and do not 
        duplicate, to any significant extent, the core services 
        available under title I of the Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act.
  ``(c) Certain Services.--For purposes of section 101(a), the 
vocational rehabilitation services available through one-stop career 
centers will include the following:
          ``(1) An assessment of the needs of eligible individuals for 
        such services.
          ``(2) Development, in accordance with section 105(b)(2), of 
        an individualized rehabilitation and employment plan for the 
        purpose of identifying employment goals, appropriate 
        intermediate rehabilitation objectives, and an appropriate 
        combination of goods and services for the individual to achieve 
        the employment goals.
          ``(3) Counseling, guidance, and work-related placement 
        services for individuals with disabilities, including job 
        search assistance, placement assistance, job retention 
        services, personal assistance services, and follow-up, follow-
        along, and specific postemployment services necessary to assist 
        such individuals to maintain, regain, or advance in employment.
          ``(4) Vocational and other training services for individuals 
        with disabilities, including personal and vocational 
        adjustment, books, or other training materials, and such 
        services to the families of such individuals as are necessary 
        to the adjustment or rehabilitation of such individuals.
          ``(5) Rehabilitation technology services.
          ``(6) Supported employment services.
          ``(7) Physical and mental restoration services.
          ``(8) Interpreter services for individuals who are deaf, and 
        reader services for individuals who are blind.
          ``(9) Rehabilitation teaching services and orientation and 
        mobility services for individuals who are blind.
          ``(10) Referral and other services designed to assist 
        individuals with disabilities in securing needed services from 
        other agencies through agreements developed under section 
        103(b)(10), if such services are not available under this Act.
          ``(11) Transportation in connection with the rendering of any 
        vocational rehabilitation service.
          ``(12) Telecommunications, sensory, and other technological 
        aids and devices.
          ``(13) On-the-job, or other related personal-assistance 
        services, provided while eligible individuals are receiving 
        other vocational rehabilitation services under this title.
  ``(d) Certain Arrangements.--For purposes of section 101(a), a one-
stop career center will, with respect to the provision of vocational 
rehabilitation services to individuals with the most severe 
disabilities, provide for necessary arrangements with community-based 
providers, including arrangements regarding supported employment 
services and extended services, periodic reviews of individuals placed 
in extended employment, and services to promote movement from extended 
employment to integrated employment.
  ``(e) Optional Provision of Other Services.--For purposes of this 
title, a one-stop career center may provide such vocational 
rehabilitation services in addition to the services specified in 
subsection (c) as the center determines to be appropriate.
  ``(f) Allocation for Core Services.--For purposes of section 101(a):
          ``(1) With respect to a fiscal year, a local workforce 
        development board receiving amounts from a grant under section 
        101 will reserve an amount for the provision of core services 
        under title I of the Consolidated and Reformed Education, 
        Employment, and Rehabilitation Systems Act.
          ``(2) The amount so reserved will be based on the number of 
        eligible individuals with disabilities in the local workforce 
        development area and the costs of training employees of the 
        one-stop career centers to provide high-quality services to 
        individuals with disabilities.
  ``(g) Performance Payments Regarding Vouchers.--For purposes of 
section 101(a):
          ``(1) The local workforce development board involved will 
        ensure that, in providing for the payment of services provided 
        pursuant to vouchers, a portion of the total payment is 
        withheld from the provider until the delivery of the services 
        involved is completed in reasonable accordance with the outcome 
        designated for the service pursuant to a prior understanding 
        with the provider.
          ``(2) In the case of education, training, and placement 
        services that are designed to lead to an employment outcome, a 
        portion of the total payment will be withheld from the provider 
        until--
                  ``(A) the participant has successfully completed the 
                training; and
                  ``(B) the participant has been employed, and has 
                retained employment for a period of not less than 90 
                days.
  ``(h) Payor of Last Resort Regarding Medical Services and Educational 
Assistance.--For purposes of section 101(a), a State will not expend a 
grant under section 101 to pay for training services in institutions of 
higher education, or to pay for medical services, unless significant 
efforts have been made to secure payments, in whole or in part, from 
other sources, except that such efforts are not required if making the 
efforts would delay the provision of such services to any eligible 
individual who is at extreme medical risk, or if making the efforts 
would result in the loss of a job placement that (but for the efforts) 
would be immediately available to an eligible individual.

``SEC. 105. ELIGIBLE INDIVIDUAL.

  ``(a) In General.--For purposes of section 101:
          ``(1) An individual will not receive vocational 
        rehabilitation services under this title unless the 
        individual--
                  ``(A) is an individual with a disability under 
                section 7(8)(A); and
                  ``(B) requires vocational rehabilitation services to 
                prepare for, enter, engage in, or retain gainful 
                employment.
          ``(2) If the individual has a disability or is blind as 
        determined pursuant to title II or title XVI of the Social 
        Security Act, the individual will be considered to have--
                  ``(A) a physical or mental impairment which for such 
                individual constitutes or results in a substantial 
                impediment to employment under section 7(8)(A)(i); and
                  ``(B) a severe physical or mental impairment which 
                seriously limits one or more functional capacities in 
                terms of an employment outcome under section 
                7(15)(A)(i).
          ``(3) It will be presumed that an individual can benefit in 
        terms of an employment outcome from vocational rehabilitation 
        services for purposes of section 7(8)(A)(ii), unless the one-
        stop career center involved can demonstrate by clear and 
        convincing evidence that such individual is incapable of 
        benefiting from vocational rehabilitation services in terms of 
        an employment outcome.
  ``(b) Process.--For purposes of section 101(a), a State will ensure 
that, subject to the order of selection under section 102(b)(2), the 
following applies to an individual:
          ``(1) Once the individual makes a request in person for a 
        determination of eligibility:
                  ``(A) A qualified rehabilitation adviser will be made 
                available to the individual regarding the process of 
                obtaining services under this title.
                  ``(B) An initial interview will be conducted, 
                followed by an initial assessment.
                  ``(C) A final determination will be made not later 
                than 30 days after the request (subject to the 
                cooperation of the individual in the process of 
                determination).
                  ``(D) The determination of eligibility will be based 
                on the review of existing data described in clause (i) 
                of section 7(22)(A), and, to the extent necessary, the 
                preliminary assessment described in clause (ii) of such 
                section.
                  ``(E) If it is determined that the individual is not 
                an eligible individual, the individual will be provided 
                a written statement explaining the following:
                          ``(i) The basis of the determination.
                          ``(ii) The availability of impartial review 
                        under section 103(b)(7).
                          ``(iii) The availability of services under 
                        the client assistance program under section 
                        510.
          ``(2)(A) If it is determined that the individual is an 
        eligible individual--
                          ``(i) the needs of the individual for 
                        vocational rehabilitation services will be 
                        assessed; and
                          ``(ii) subject to subparagraph (D), an 
                        individualized rehabilitation and employment 
                        plan will be developed for the individual 
                        regarding the provision of services pursuant to 
                        clause (i).
          ``(B) The plan under subparagraph (A) will be developed and 
        mutually agreed upon by the individual and an appropriate staff 
        member of the one-stop career center involved.
          ``(C) A plan under subparagraph (A) is individualized if the 
        plan is consistent with the unique strengths, resources, 
        priorities, concerns, abilities, and capabilities of the 
        individual for whom the plan is developed.
          ``(D) A plan under subparagraph (A) is not required for an 
        individual if the individual signs a waiver stating that such a 
        plan is not necessary for the individual.
  ``(c) Rule of Construction.--This title may not be construed as 
establishing an entitlement in any individual.
  ``(d) Definition.--For purposes of this title, the term `eligible 
individual' means an individual described in subsection (a)(1).

``SEC. 106. STATE REHABILITATION ADVISORY COUNCIL.

  ``(a) In General.--For purposes of section 101(a):
          ``(1) A State will establish a State Rehabilitation Advisory 
        Council (referred to in this section as the `Council') in 
        accordance with this section.
          ``(2) The Council will be composed of the following:
                  ``(A) Representatives of organizations within the 
                State providing services to individuals with 
                disabilities and their families, including 
                representatives of the client assistance program under 
                section 510.
                  ``(B) Representatives of business, industry, and 
                labor.
                  ``(C) Representatives of disability advocacy groups 
                representing a cross section of--
                          ``(i) individuals with physical, cognitive, 
                        sensory, and mental disabilities; and
                          ``(ii) parents, family members, guardians, 
                        advocates, or authorized representatives, of 
                        individuals with disabilities who have 
                        difficulty in representing themselves or are 
                        unable due to their disabilities to represent 
                        themselves.
          ``(3) The State administrative agent will be an ex officio 
        member of the Council.
          ``(4) Members of the Council will be appointed by the 
        Governor or another entity that has appointment authority under 
        State law.
          ``(5) A majority of Council members will be persons who are--
                  ``(A) individuals with disabilities described in 
                section 7(8)(B); and
                  ``(B) not employed by the designated State 
                administrative agent.
          ``(6)(A) Except as provided in subparagraph (B), the Council 
        will select a chairperson from among the membership of the 
        Council.
          ``(B) In States in which the Governor does not have veto 
        power pursuant to State law, the Governor will designate a 
        member of the Council to serve as the chairperson of the 
        Council or will require the Council to so designate such a 
        member.
          ``(7) Each member of the Council will serve for a term 
        determined by the Governor or another entity that has 
        appointment authority under State law.
          ``(8) Any vacancy occurring in the membership of the Council 
        will be filled in the same manner as the original appointment. 
        The vacancy will not affect the power of the remaining members 
        to execute the duties of the Council.
  ``(b) Functions of Council.--For purposes of section 101(a), the 
Council will carry out the following:
          ``(1) Advise the collaborative process under section 103 of 
        the Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act, and the State administrative agent, 
        in the preparation of the State workforce development and 
        literacy plan and other plans, reports, needs assessments, and 
        evaluations required by this title.
          ``(2) To the extent feasible, conduct a review and analysis 
        of the effectiveness of, and consumer satisfaction with, the 
        delivery of core services and vocational rehabilitation 
        services to individuals with disabilities within the State.
          ``(3) Prepare and submit an annual report to the 
        collaborative process or appropriate State administrative agent 
        and the Commissioner on the status of vocational rehabilitation 
        programs operated within the State, and make the report 
        available to the public.
          ``(4) Coordinate with other councils within the State 
        established to address the needs of individuals with 
        disabilities.
          ``(5) Perform such other functions, consistent with the 
        purpose of this title, as the State Rehabilitation Advisory 
        Council determines to be appropriate, that are comparable to 
        the other functions performed by the Council.
  ``(c) Resources.--
          ``(1) Plan.--For purposes of section 101(a), the Council will 
        prepare, in conjunction with the State administrative agent, a 
        plan for the provision of such resources, including such staff 
        and other personnel, as may be necessary to carry out the 
        functions of the Council under this section. The resource plan 
        shall, to the maximum extent possible, rely on the use of 
        resources in existence during the period of implementation of 
        the plan.
          ``(2) Resolution of disagreements.--For purposes of section 
        101(a), to the extent that there is a disagreement between the 
        Council and the State administrative agent in regard to the 
        resources necessary to carry out the functions of the Council 
        as set forth in this section, the disagreement will be resolved 
        by the Governor or appointing agency identified in subsection 
        (a)(4).
          ``(3) Supervision and evaluation.--For purposes of section 
        101(a), the Council will, consistent with State law, supervise 
        and evaluate such staff and other personnel as may be necessary 
        to carry out its functions under this section.
          ``(4) Personnel conflict of interest.--For purposes of 
        section 101(a), while assisting the Council in carrying out its 
        duties, staff and other personnel will not be assigned duties 
        by the State administrative agent or any other agency or office 
        of the State, that would create a conflict of interest.
  ``(d) Conflict of Interest.--For purposes of section 101(a), no 
member of the Council will cast a vote on any matter that would provide 
direct financial benefit to the member or otherwise give the appearance 
of a conflict of interest under State law.
  ``(e) Meetings.--For purposes of section 101(a), the Council will 
convene meetings and conduct such forums or hearings as the Council 
considers appropriate. The meetings, hearings, and forums will be 
publicly announced. The meetings will be open and accessible to the 
general public unless there is a valid reason for an executive session.
  ``(f) Compensation and Expenses.--For purposes of section 101(a), the 
Council may use funds appropriated under this title to reimburse 
members of the Council for reasonable and necessary expenses of 
attending Council meetings and performing Council duties (including 
child care and personal assistance services), and to pay compensation 
to a member of the Council, if such member is not employed or must 
forfeit wages from other employment, for each day the member is engaged 
in performing the duties of the Council.
  ``(g) Rule of Construction.--Nothing in this section prohibits a 
State from establishing and providing funds to a separate council to 
carry out functions described in subsection (b) with respect to 
vocational rehabilitation services for individuals who are blind.

``SEC. 107. AMOUNT OF ALLOTMENT.

  ``(a)(1) Subject to the provisions of subsection (d), for each fiscal 
year beginning before October 1, 1978, each State shall be entitled to 
an allotment of an amount bearing the same ratio to the amount 
authorized to be appropriated under section 101(d) for allotment under 
this section as the product of (A) the population of the State, and (B) 
the square of its allotment percentage, bears to the sum of the 
corresponding products for all the States.
  ``(2)(A) For each fiscal year beginning on or after October 1, 1978, 
each State shall be entitled to an allotment in an amount equal to the 
amount such State received under paragraph (1) for the fiscal year 
ending September 30, 1978, and an additional amount determined pursuant 
to subparagraph (B) of this paragraph.
  ``(B) For each fiscal year beginning on or after October 1, 1978, 
each State shall be entitled to an allotment, from any amount 
authorized to be appropriated for such fiscal year under section 101(d) 
for allotment under this section in excess of the amount appropriated 
under such section for the fiscal year ending September 30, 1978, in an 
amount equal to the sum of--
          ``(i) an amount bearing the same ratio to 50 percent of such 
        excess amount as the product of the population of the State and 
        the square of its allotment percentage bears to the sum of the 
        corresponding products for all the States; and
          ``(ii) an amount bearing the same ratio to 50 percent of such 
        excess amount as the product of the population of the State and 
        its allotment percentage bears to the sum of the corresponding 
        products for all the States.
  ``(3) The sum of the payment to any State (other than Guam, American 
Samoa, the Virgin Islands, and the Northern Mariana Islands) under this 
subsection for any fiscal year which is less than one-third of 1 
percent of the amount appropriated under section 101(d), or $3,000,000, 
whichever is greater, shall be increased to that amount, the total of 
the increases thereby required being derived by proportionately 
reducing the allotment to each of the remaining such States under this 
subsection, but with such adjustments as may be necessary to prevent 
the sum of the allotments made under this subsection to any such 
remaining State from being thereby reduced to less than that amount.
  ``(4) For each fiscal year beginning on or after October 1, 1984, for 
which any amount is appropriated pursuant to section 101(d), each State 
shall receive an allocation (from such appropriated amount) in addition 
to the allotment to which such State is entitled under paragraphs (2) 
and (3) of this subsection. Such additional allocation shall be an 
amount which bears the same ratio to the amount so appropriated as that 
State's allotment under paragraphs (2) and (3) of this subsection bears 
to the sum of such allotments of all the States.
  ``(b)(1) If the payment to a State pursuant to this section for a 
fiscal year is less than the total payments such State received under 
section 2 of the Vocational Rehabilitation Act for the fiscal year 
ending June 30, 1973, such State shall be entitled to an additional 
payment (subject to the same terms and conditions applicable to other 
payments under this title) equal to the difference between the payment 
under this section and the amount so received by it.
  ``(2) If a State receives as its Federal share pursuant to this 
section for any fiscal year less than the applicable Federal share of 
the expenditure of such State for fiscal year 1972 for vocational 
rehabilitation services under the plan for such State approved under 
section 101 as in effect for such year (including any amount expended 
by such State for the administration of the State plan but excluding 
any amount expended by such State from non-Federal sources for 
construction under such plan), such State shall be entitled to an 
additional payment for such fiscal year, subject to the same terms and 
conditions applicable to other payments under this title, equal to the 
difference between such payment pursuant to this section and an amount 
equal to the applicable Federal share of such expenditure for 
vocational rehabilitation services.
  ``(3) Any payment attributable to the additional payment to a State 
under this subsection shall be made only from appropriations 
specifically made to carry out this subsection, and such additional 
appropriations are hereby authorized.''.
  (b) Certain Funding Provision.--Effective October 1, 1995, the 
Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended by 
inserting after section 3 the following section:
                        ``availability of funds
  ``Sec. 3A. Notwithstanding any other provision of law, funding to 
carry out titles II through VII for any fiscal year is available only 
to such extent as is provided, or in such amounts as are provided, in 
appropriations Acts.''.
  (c) Conforming Amendments.--Effective October 1, 1995, the 
Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended in the 
table of contents in the first section--
          (1) by inserting after the item relating to section 3 the 
        following item:

``Sec. 3A. Availability of funds.'';

          (2) by striking the items relating to sections 100 through 
        109, to sections 110 through 112, to sections 120 through 124, 
        to section 130, and to sections 140 and 141;
          (3) by striking the items relating to the title designation 
        and heading for title I, and to the part designations and 
        headings for parts A, B, C, D, and E of title I;
          (4) by inserting after the item relating to section 21 the 
        following items:

             ``TITLE I--VOCATIONAL REHABILITATION SERVICES

``Sec. 100. Purpose.
``Sec. 101. Formula Grants.
``Sec. 102. Allocation Within State of Administrative Responsibilities.
``Sec. 103. Responsibilities of State Administrative Agent.
``Sec. 104. Responsibilities for Local Boards and Service Centers.
``Sec. 105. Eligible Individual.
``Sec. 106. State Rehabilitation Advisory Council.
``Sec. 107. Amount of Allotment.''; and

          (5) by inserting after the item relating to section 509 the 
        following item:

``Sec. 510. Client assistance program.''.

       Subtitle B--Other Amendments to Rehabilitation Act of 1973

SEC. 521. TRAINING AND DEMONSTRATION PROJECTS.

  (a) In General.--Effective October 1, 1995, the Rehabilitation Act of 
1973 (29 U.S.C. 701 et seq.) is amended--
          (1) in title III--
                  (A) by striking section 303;
                  (B) by striking section 304;
                  (C) in section 311, by striking subsection (f);
                  (D) by striking section 312; and
                  (E) by striking section 316;
          (2)(A) by transferring subsection (a) of section 802 from the 
        current placement of the subsection;
          (B) by redesignating such subsection as subsection (f); and
          (C) by inserting such subsection at the end of section 311 
        (as amended by paragraph (1)(C) of this subsection);
          (3)(A) by transferring subsection (g) of section 802 from the 
        current placement of the subsection; and
          (B) by inserting such subsection at the end of section 311 
        (as amended by paragraph (2)(C) of this subsection);
          (4)(A) by transferring subsection (c) of section 803 from the 
        current placement of the subsection;
          (B) by redesignating such subsection as subsection (h); and
          (C) by inserting such subsection at the end of section 311 
        (as amended by paragraph (3)(B) of this subsection);
          (5)(A) by transferring subsection (b) of section 803 from the 
        current placement of the subsection;
          (B) by redesignating such subsection as subsection (j); and
          (C) by inserting such subsection at the end of section 302; 
        and
          (6) by striking the remaining provisions of title VIII.
  (b) Section 311(c).--Effective October 1, 1998, section 311 of the 
Rehabilitation Act of 1973 (29 U.S.C. 777a), as amended by subsection 
(a) of this subsection, is amended--
          (1) by striking subsection (c); and
          (2) by redesignating subsections (d) through (h) as 
        subsections (c) through (g), respectively.
  (c) Conforming Amendments.--Effective October 1, 1995, the 
Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended in the 
table of contents in the first section--
          (1) by striking the items relating to sections 303, 304, 312, 
        and 316;
          (2) by striking the items relating to sections 801 through 
        803 of title VIII; and
          (3) by striking the item relating to the title designation 
        and heading for title VIII.
SEC. 522. EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH DISABILITIES.

  (a) In General.--Effective October 1, 1995, title VI of the 
Rehabilitation Act of 1973 (29 U.S.C. 795 et seq.) is amended--
          (1) by striking part A;
          (2) by striking part C;
          (3) by striking part D; and
          (4) in part B, by striking the part designation and heading.
  (b) Projects With Industry.--Effective October 1, 1998, title VI of 
the Rehabilitation Act of 1973, as amended by subsection (a) of this 
section, is repealed.
  (c) Conforming Amendments.--Effective October 1, 1995, the 
Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended in the 
table of contents in the first section by striking the items relating 
to sections 611 through 617, to sections 631 through 638, and to 
section 641; and by striking the items relating to the part 
designations and headings for parts A, B, C, and D of title VI. 
Effective October 1, 1998, such table of contents is amended by 
striking the items relating to sections 621 through 623; and by 
striking the item relating to the title designation and heading for 
title VI.

                TITLE VI--REPEALERS AND OTHER AMENDMENTS

SEC. 601. CARL D. PERKINS VOCATIONAL AND APPLIED TECHNOLOGY EDUCATION 
                    ACT.

  The Carl D. Perkins Vocational and Applied Technology Education Act 
(20 U.S.C. 2301 et seq.) is repealed.

SEC. 602. SCHOOL-TO-WORK OPPORTUNITIES ACT.

   The School-to-Work Opportunities Act of 1994 (20 U.S.C. 6101 et 
seq.) is repealed.

SEC. 603. ADULT EDUCATION ACT.

  (a) In General.--The Adult Education Act (20 U.S.C. 1201 et seq.) is 
repealed.
  (b) Conforming Amendments.--
          (1) Esea.--The Elementary and Secondary Education Act of 1965 
        (20 U.S.C. 6301 et seq.) is amended--
                  (A) in section 1202(c)(1), by striking ``the Adult 
                Education Act,'' and inserting ``title IV of the 
                CAREERS Act,'';
                  (B) in section 1205(8)(B), by striking ``the Adult 
                Education Act,'' and inserting ``title IV of the 
                CAREERS Act,'';
                  (C) in section 1206(a)(1)(A), by striking ``the Adult 
                Education Act;'' and inserting ``title IV of the 
                CAREERS Act;''; and
                  (D) in section 9161(2), by striking ``section 312(2) 
                of the Adult Education Act.'' and inserting ``section 5 
                of the CAREERS Act.''.
          (2) Technology for education act.--The Technology for 
        Education Act of 1994 (20 U.S.C. 6801 et seq.) is amended in 
        section 3113(1) by striking ``section 312 of the Adult 
        Education Act;'' and inserting ``section 5 of the CAREERS 
        Act;'';

SEC. 604. NATIONAL LITERACY ACT.

  The National Literacy Act of 1991, except section 101 of such Act, is 
repealed.

SEC. 605. LIBRARY SERVICES AND CONSTRUCTION ACT.

  (a) In General.--The Library Services and Construction Act (20 U.S.C. 
351 et seq.) is repealed.
  (b) Conforming Amendment.--The Technology for Education Act of 1994 
(20 U.S.C. 6801 et seq.) is amended in section 3113(10) by striking 
``section 3 of the Library Services and Construction Act;'' and 
inserting ``section 5 of the CAREERS Act;''.

SEC. 606. TECHNOLOGY FOR EDUCATION ACT OF 1994.

  Part F of the Technology for Education Act of 1994 (20 U.S.C. 7001 et 
seq.) (relating to the library media resources program) is repealed.

SEC. 607. JOB TRAINING PARTNERSHIP ACT.

  (a) In General.--The Job Training Partnership Act (29 U.S.C. 1501 et 
seq.), except section 1, sections 421 through 439 (relating to the Job 
Corps), and section 441 of such Act (relating to veterans' employment 
programs), is hereby repealed.
  (b) Conforming Amendments.--
          (1) Short title.--Section 1 of the Job Training Partnership 
        Act (29 U.S.C. 1501, note) is amended--
                  (A) in the heading, by striking ``; table of 
                contents''; and
                  (B) by striking all that follows after ``Job Training 
                Partnership Act''.
          (2) Job corps.--Such Act (29 U.S.C. 1501 et seq.), as amended 
        by this section, is further amended--
                  (A) by redesignating sections 421 through 439 as 
                sections 2 through 21, respectively;
                  (B) in section 2 (as redesignated), by striking 
                ``part'' each place it appears and inserting ``Act'';
                  (C) in section 4(4) (as redesignated), by striking 
                ``sections 424 and 425'' and inserting ``sections 5 and 
                6'';
                  (D) in section 5 (as redesignated)--
                          (i) in subsection (a), by striking ``entities 
                        administering programs under title II of this 
                        Act,''; and
                          (ii) in subsection (b), by striking ``part'' 
                        and inserting ``Act'';
                  (E) in section 7 (as redesignated)--
                          (i) in subsection (a), by striking ``section 
                        428'' and inserting ``section 9''; and
                          (ii) by striking subsection (d);
                  (F) in section 8 (as redesignated)--
                          (i) by striking subsection (b); and
                          (ii) by redesignating subsection (c) as 
                        subsection (b);
                  (G) in section 14 (as redesignated)--
                          (i) in subsection (a)(4), by striking 
                        ``part'' and inserting ``Act'';
                          (ii) in subsection (c)(1), by striking ``and 
                        activities authorized under sections 452 and 
                        453''; and
                          (iii) in subsection (e), by striking 
                        ``section 431'' and inserting ``section 12'';
                  (H) in section 15 (as redesignated)--
                          (i) in subsection (a)--
                                  (I) in the matter preceding paragraph 
                                (1), by striking ``section 427'' and 
                                inserting ``section 8''; and
                                  (II) in paragraph (4)(A), by striking 
                                ``section 428'' and inserting ``section 
                                9'';
                          (ii) in subsection (c)(3), by striking 
                        ``section 423'' and inserting ``section 4'';
                          (iii) in subsection (d), by striking 
                        ``sections 424 and 425'' and inserting 
                        ``sections 5 and 6''; and
                          (iv) in subsection (e), by striking ``, 
                        pursuant to section 452(d),'';
                  (I) in section 17 (as redesignated), by striking 
                ``purpose of this part'' each place it appears and 
                inserting ``purpose of this Act'';
                  (J) in section 20 (as redesignated), by striking 
                ``part'' each place it appears and inserting ``Act''; 
                and
                  (K) in section 21 (as redesignated), by striking 
                ``part'' and inserting ``Act''.
          (3) Veterans' employment programs.--Such Act (29 U.S.C. 1501 
        et seq.), as amended by this section, is further amended--
                  (A) by redesignating section 441 as section 22;
                  (B) by striking the heading of such section 22 (as 
                redesignated), and inserting the following:
                 ``veterans' employment programs''; and
                  (C) in such section 22, by striking ``part'' each 
                place it appears and inserting ``section''.
          (4) Authorization of appropriations.--Such Act (29 U.S.C. 
        1501 et seq.), as amended by this section, is further amended 
        by adding at the end the following new section:
                   ``authorization of appropriations
  ``Sec. 23. There are authorized to be appropriated such sums as are 
necessary to carry out this Act.''.

SEC. 608. STEWART B. MCKINNEY HOMELESS ASSISTANCE ACT.

  (a) Adult Education.--
          (1) In general.--Subtitle A of title VII of the Stewart B. 
        McKinney Homeless Assistance Act (42 U.S.C. 11421 et seq.) is 
        repealed.
          (2) Table of contents.--The table of contents of such Act is 
        amended by striking the items relating to subtitle A of title 
        VII of such Act.
  (b) Subtitle C.--
          (1) In general.--Subtitle C of title VII of the Stewart B. 
        McKinney Homeless Assistance Act (42 U.S.C. 11441 et seq.), 
        except section 738, is hereby repealed.
          (2) Table of contents.--The table of contents of such Act is 
        amended--
                  (A) by striking the item relating to subtitle C of 
                title VII of such Act; and
                  (B) by striking the items relating to sections 731 
                through 737 and sections 739 through 741.

SEC. 609. EFFECTIVE DATE.

  The repeals and amendments made by this title shall take effect on 
October 1, 1996.

    The provisions of the substitute are explained in this 
report.

                                Purpose

    The purpose of this Act is to transform the vast array of 
Federal workforce development and literacy programs from a 
collection of fragmented and duplicative categorical programs 
into a streamlined, comprehensive, coherent, high-quality, 
cost-effective, market-based, and accountable Federal workforce 
development and literacy system that is designed to meet the 
education, employment, and training needs of the workforce and 
the competitiveness needs of employers of the United States, 
both today and in the future.

                            Committee Action

    Subcommittee on Postsecondary Education, Training and Life-Long 
                                Learning

    The Subcommittee on Postsecondary Education, Training, and 
Life-Long Learning held hearings on February 6, 1995, February 
7, 1995, March 1, 1995, March 3, 1995, March 7, 1995, March 16, 
1995, March 21, 1995, March 23, 1995, and May 3, 1995, to 
consider reforming the U.S. workforce preparation system. On 
February 9, 1995, the Subcommittee on Investigations and 
Oversight held a hearing on education block grants.
    The February 6 and February 7, 1995, hearings in 
Washington, D.C., examined business perspectives on educational 
and training needs. The Subcommittee also heard testimony from 
the U.S. Departments of Education and Labor and the U.S. 
General Accounting Office. The Subcommittee received testimony 
from Clarence Crawford, Associate Director, U.S. General 
Accounting Office, Washington, D.C.; Jere Jacobs, Assistant 
Vice President, Pacific Telesis Group, San Francisco, 
California; Harry Featherstone, Chairman, the Will-Burt 
Company, Orville, Ohio; Wayne Rowley, Director of Human 
Resources Development, Tulsa, Oklahoma, Chamber of Commerce; 
Lawrence Katz, Professor of Economics, Harvard University, 
Cambridge, Massachusetts; Doug Ross, Assistant Secretary of 
Labor, Washington, D.C.; Marshall Smith, Undersecretary of 
Education, Washington, D.C.; Argeo Paul Cellucci, Lieutenant 
Governor of Massachusetts, Boston, Massachusetts; Peter 
Calderone, New Jersey Commissioner of Labor, Trenton, New 
Jersey; and Pam Anderson representing the U.S. Conference of 
Mayors.
    The March 1, 1995, hearing in Washington, D.C., focused on 
the Carl D. Perkins Vocational and Applied Technology Education 
Act. The Subcommittee received testimony from John Polto, 
Vocational Administrative Director, and Jim Sweetheimer, 
English Teacher, Dauphin County Technical School, Harrisburg, 
Pennsylvania; William Ihlenfeldt, President, Chippewa Valley 
Technical College, Eau Claire Wisconsin; Lawrence Rosenstock, 
Executive Director, Rindge School of Technical Arts, Cambridge, 
Massachusetts; Pamela Neifert, Director of Federal Programs, 
York City Schools, York Pennsylvania; Jim This, Executive Vice 
President, Washington State Employees Credit Union, Olympia, 
Washington; and students Richard Gonzales of Covina, 
California, and Jonna Scott of Lacey, Washington.
    The March 3, 1995, hearing in Washington, D.C., continued 
examination of educational and training issues including 
innovative State and local programs. The Subcommittee received 
testimony from Augusta Kappner, Assistant Secretary of 
Vocational and Adult Education, U.S. Department of Education, 
Washington, D.C.; John McKernan, Former Governor of Maine; 
Bruce Kimery, Acting Commissioner, Indiana Department of 
Workforce Development, Indianapolis, Indiana; Art Glatfelter, 
President and CEO, Glatfelter Insurance Group, York, 
Pennsylvania; Jack Van Newkirk, Superintendent of York City 
Schools, York, Pennsylvania; Susan Carreon, Dean of Vocational 
Education, Golden West Community College, Huntington Beach, 
California; Paul Mashburn, Westminster High School, 
Westminister, California; and Paul Weckstein, Co-Director, 
Center for Law & Education, Washington, D.C.
    The March 7, 1995, hearing in Washington, D.C., continued 
examination of educational and training issues including 
programs for the disadvantaged. The Subcommittee received 
testimony from Robert Ivry, Senior Vice President, Manpower 
Demonstration Research Corporation, New York, New York; Russ 
Tershy, Director, and Estaban Guzman, Program Graduate, Center 
for Employment Training (CET), San Jose, California; Brene 
Patrick, Assistant CEO, Youth Division, Private Industry 
Council, San Diego, California; Neil Derrough, President, KNSD-
TV 39, Member of San Diego PIC, San Diego, California; William 
Johnson, Mayor of Rochester, New York; Cindy Dotson, Director, 
and Lester Westry, Student, Crispus Attucks YouthBuild Program, 
York, Pennsylvania.
    The March 16, 1995, hearing in Washington, D.C., heard 
testimony on programs for disadvantaged youth and Job Corps 
programs. The Subcommittee received testimony from Nora Wang, 
Commissioner, New York City Department of Employment; Sharon 
Williams, Director, Opportunities Industrialization Center, 
Menlo Park, California; Gary Walker, President, Public Private 
Ventures, Philadelphia, Pennsylvania; Charles Masten, Inspector 
General, U.S. Department of Labor, Washington, D.C.; Charles 
Tetro, President, Training and Development Corporation, 
Bucksport, Maine; and Cathy Clendenning, Participant, Penobscot 
Job Corps Center, Bangor, Maine.
    The March 21, 1995, hearing in Washington, D.C., dealt with 
governance issues related to training programs. The 
Subcommittee also heard testimony from service providers. The 
Subcommittee received testimony from Randy Johnson, County 
Commissioner, Hennepin County, Minnesota; James Dickerson, 
Private Industry Council Chair, Camdenton, Missouri; Rodo 
Sofranac, Chairman, Arizona Job Training Coordinating Council, 
Phoenix, Arizona; Debra Bowland, Ohio Bureau of Employment 
Services, Columbus, Ohio; Augustine Gallego, Chancellor, San 
Diego Community College District, San Diego, California; J. 
Handel Evans testifying for Molly Corbett Broad, Executive Vice 
Chancellor, California State University, Long Beach, 
California; Peter Cove, CEO, America Works, New York, New York; 
and Jose Perez, Executive Director, SER--Jobs for Progress, 
Inc., Houston, Texas.
    The March 23, 1995, hearing in Washington, D.C., covered 
issues related to system infrastructure, forecasting, and 
special populations. The Subcommittee received testimony from 
Anthony Carnevale, Chairman, National Commission for Employment 
Policy, Washington, D.C.; Kevin Wheeler, Director, National 
Semiconductor University, Sunnyvale, California; Tom Gallagher, 
Manager of Research and Planning, Wyoming Department of 
Employment, Casper, Wyoming; Roy Vanderford, President, 
Indianapolis Network for Employment and Training, Indianapolis, 
Indiana; Calvin Johnson, AFL-CIO, Washington, D.C.; Patricia 
Jagiel, Seminole Tribe of Florida, Hollywood, Florida; Stuart 
Mitchell, Executive Director, Rural Opportunities, Inc., 
Rochester, New York; Graciela Pena, Former Farmworker and JTPA 
Section 402 Participant, Aspers, Pennsylvania; Ronald Drach, 
National Employment Director, Disabled American Veterans, 
Washington, D.C.; and Carolyn Stearnes, Vice President for 
Employment Division, Senior Citizen Services, Memphis, 
Tennessee.
    The March 29, 1995 hearing focused on vocational 
rehabilitation. Witnesses testifying were: Mr. Frederic 
Schroeder, Commissioner, Rehabilitation Services 
Administration, U.S. Department of Education, Washington, D.C.; 
Ms. Lenny Granger of Northern Virginia accompanied by, Harry 
Hall, Director, The Development Team, Jacksonville, FL.; Mr. 
Sam Serraglio, Commissioner, Kentucky Department of Vocational 
Rehabilitation, Frankfort, KY; Mr. Pat Kemp, Executive 
Director, RCH Technical Institute Inc., Seattle, WA.; Mr. Tony 
Young, Director, Residential Services & Community Supports 
American Rehabilitation Association on behalf of the Coalition 
for Citizens with Disabilities, Washington, D.C.

          Subcommittee on Early Childhood, Youth, and Families

    On April 25, 1995, the Subcommittee on Early Childhood, 
Youth and Families conducted a field hearing on adult 
education, literacy, and library-related programs in San Diego, 
California. Witnesses focusing primarily upon libraries and 
library literacy programs were Anne Campbell, Director of the 
National City Public Library; John Corcoran, a literacy program 
participant from Oceanside, California; James Olson, Group Vice 
President, Toyota Motor Sales USA, Inc, Torrance, California; 
Rodgers Smith, Provost, Continuing Education Centers, San Diego 
Community College District, San Diego, California; Scott 
Himlestein, Executive Director, William Lynch Foundation for 
Children, San Diego, California; Dr. Barbara McDonald, San 
Diego Consortium for Workforce Education and Life-Long Learning 
(CWELL), San Diego, California; Jerry Rindone, Assistant 
Superintendent, Adult and Continuing Education, Sweetwater 
Union High School, Chula Vista, California; Jeffrey Stafford, 
Executive Director, San Diego Council on Literacy, San Diego, 
California.
    On May 2, 1995, the Subcommittee on Early Childhood, Youth 
and Families conducted a second hearing on adult education, 
literacy, and library-related programs. Witnesses were Jean 
Hurley Simon, Chairperson of the U.S. Commission on Libraries 
and Informational Science; Dr. Augusta Kappner, Assistant 
Secretary, Vocational and Adult Education, U.S. Department of 
Education; Sharon Darling, President, National Center for 
Family Literacy, Louisville, Kentucky; Dr. Andrew Hartman, 
Director, National Institute for Literacy; Cheryl Keenan, 
Director, Bureau of Adult Basic and Literacy Education, 
Harrisburg, Pennsylvania; Bob Bickerton, Administrator, Adult 
and Community Learning Services; Massachusetts Department of 
Education, Malden, Massachusetts; Dr. Judith Crocker, 
Supervisor, Adult and Continuing Education, Cleveland Public 
Schools, Cleveland, Ohio; Maggie Gaines, Executive Director, 
Baltimore Reads, Baltimore, Maryland; Dr. Steve Steurer, Office 
of Correctional Education Maryland State Department of 
Education, Baltimore, Maryland; Minnie Mae Robinson, Program 
Participant, GROWS Literacy Council, Apopka, Florida.
              Introduction of Workforce Preparation System

    On May 11, 1995, Representatives McKeon, Goodling, 
Cunningham, Gunderson, Riggs, DeLay, Boehner, Kasich, McIntosh, 
Petri, Roukema, Funderburk, Souder, Fawell, Ballenger, Barrett, 
Hoekstra, Castle, Meyers, Johnson (TX), Talent, Greenwood, 
Hutchinson, Knollenberg, Graham, Weldon (FL), Norwood, and 
Davis introduced H.R. 1617, the Consolidated and Reformed 
Employment, Education and Rehabilitation Systems (CAREERS) Act. 
H.R. 1617 was designed to consolidate and reform workforce 
development and literacy programs.

                           Legislative Action

    On May 16, 1995, the Subcommittee on Early Childhood, Youth 
& Families approved the bill, as amended, by a voice vote.
    On May 17, 1995, the Subcommittee on Postsecondary 
Education, Training and Life-Long Learning assembled to 
consider H.R. 1617, the Consolidated and Reformed Education, 
Employment, and Rehabilitation Systems (CAREERS) Act. Chairman 
McKeon offered an amendment in the nature of a substitute to 
H.R. 1617. Further amendments to the amendment in the nature of 
a substitute were adopted, and the Subcommittee adopted the 
amendment in the nature of a substitute, as amended. H.R. 1617, 
as amended, was approved by the Subcommittee on Postsecondary 
Education, Training and Life-Long Learning on May 17, 1995, by 
voice vote, and ordered reported to the Committee on Economic 
and Educational Opportunities.
    On May 24, 1995, the Committee on Economic and Educational 
Opportunities assembled to consider H.R. 1617, the Consolidated 
and Reformed Education, Employment, and Rehabilitation Systems 
(CAREERS) Act. Chairman Goodling offered an amendment in the 
nature of a substitute to H.R. 1617. Further amendments to the 
amendment in the nature of a substitute were adopted, and the 
Committee adopted the amendment in the nature of a substitute, 
as amended. H.R. 1617, as amended, was favorably reported by 
the Committee on Economic and Educational Opportunities on May 
24, 1995, by a recorded vote of 29-5.

                  Background and Need for Legislation

             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

                         Need for System Reform

    The skill levels of the U.S. workforce are more important 
than ever before. Participation in the global economy requires 
that we move toward high-performance work organizations built 
around highly trained workers. Further, changes in our domestic 
economy highlight the need to focus on worker preparation. As 
stated by Mr. Jere Jacobs, Assistant Vice President of the 
Pacific Telesis Group, before the Subcommittee on Postsecondary 
Education, Training, and Lifelong Learning, on behalf of the 
California Business Roundtable, and the National Alliance of 
Business:

          The emerging age of information and 
        telecommunications has changed the nature of work and 
        the workplace for good. These changes demand a new kind 
        of worker, a knowledge worker, with new sets of skills. 
        Increasingly, jobs with a future and suitable pay 
        require education and training that many current 
        workers, employed and unemployed, do not have. At 
        Pacific Telesis we want employees who are 
        technologically capable and can show competence in 
        problem solving, team work, initiative, and 
        communications skills. For workers in this new global 
        economy, knowledge and skills will be the ultimate 
        determinance of their economic success. It is no longer 
        good enough to hire someone to show up on time and 
        merely do what they are told to do day after day.

    Ensuring employment, reemployment, and job security for 
workers and future workers, as well as U.S. competitiveness, 
will increasingly depend on an effective and efficient U.S. 
workforce development and literacy system. However, the United 
States currently does not possess such a system.
    Reports from the U.S. General Accounting Office (GAO) 
highlighting the excessive number of Federally funded job 
training programs, as well as negative reports on the quality 
of the U.S. job training system have sparked both public and 
Congressional interest in system reform. To date, the GAO has 
identified 163 different programs, totaling $20 billion, 
administered by 15 different Federal agencies, which offer some 
form of career-related education, job training, or employment 
assistance to youth and adults.
    While care must be taken when considering the GAO reports, 
as a number of the 163 programs listed do not have job training 
or employment assistance as their primary purpose, the report 
legitimately points out the duplication, fragmentation, and 
turf wars that permeate our current workforce preparation 
programs. In testimony provided to the Subcommittee on 
Postsecondary Education, Training, and Lifelong Learning, Mr. 
Clarence Crawford, Associate Director for Education and 
Employment Issues, of the U.S. General Accounting Office, 
stated that:

          Despite spending billions of dollars each year, most 
        Federal agencies do not know if their programs are 
        really helping people find jobs. The current ``system'' 
        wastes resources and confuses and frustrates clients, 
        employers, and administrators.'' Crawford continued, 
        ``The current system for providing employment training 
        assistance suffers from a variety of problems that 
        arise from a multitude of narrowly focused programs 
        that often compete for clients and funds. * * * This 
        extensive overlap raises questions about the system's 
        efficiency.

    In its studies, the GAO has found that the additional costs 
of administering overlapping workforce development programs at 
the Federal, State, and local levels, diverts scarce resources 
that could be better spent to assist individuals in preparing 
for and entering into work. The studies have further concluded 
that conflicting eligibility requirements, annual budgeting and 
operating cycles, planning and reporting requirements, and 
performance measurement systems, which serve as barriers to 
program integration, also result in an inefficient use of 
taxpayer dollars. In fact, the GAO claims that the amount of 
money spent administering employment training programs cannot 
be readily quantified, finding that estimates of administrative 
costs range from as low as 7 percent for some programs to as 
high as 15 or 20 percent for others. On this subject, Mr. 
Crawford in his testimony stated that:

          Eliminating duplicate bureaucracies will reduce 
        administrative costs, saving money that can be used 
        instead for client services. Eliminating separate 
        staffs to administer, monitor, and evaluate programs at 
        the State and local levels could also save resources.

    Mr. Crawford provided the Subcommittee with the GAO's 
recommendations for system reform, as follows:

          We are convinced that a major overhaul and 
        consolidation of programs is needed to create an 
        effective and efficient employment training system 
        that: (1) provides easy access to services; (2) 
        encourages the efficient use of resources; (3) offers a 
        wide variety of employment training services; and (4) 
        holds program administrators accountable for results, 
        while allowing States and local agencies the 
        flexibility to determine how best to meet the needs of 
        their communities.

    The overwhelming number of witnesses who came before the 
Subcommittee to testify on reform of the U.S. workforce 
development system, agreed with Mr. Crawford's account of the 
problems and with his initial recommendations for reform. In 
fact, everyone including representatives from the 
Administration, State officials, local officials, business 
leaders, educators, program providers, researchers, and 
organized labor, agreed that significant program consolidation 
and reform is in order.
    Mr. Doug Ross, Assistant Secretary for the Employment and 
Training Administration at the U.S. Department of Labor, 
expressed support for reform that is built on individual choice 
and a free market. Summarizing the shortfalls of the current 
job training system as: being too inflexible--providing little 
customer choice; having inadequate consequences for poor 
performance; being too complex and bureaucratic; and being 
little known, Mr. Ross stressed the need for universality, 
customer choice, program integration, and accountability in a 
new workforce development system. Specifically, he recommended: 
a one-stop system that makes available an array of job finding 
and employment development services to all populations; a 
system that provides customers with options and choice of where 
to get the services that best meet their needs; program, 
service and governance structures that are fully integrated; 
and a system with clear performance outcomes, and consequences 
for failure to achieve such outcomes, including measures of 
customer satisfaction.
    Mr. Harry Featherstone, Chairman of the Will-Burt Company, 
Orville, Ohio, who testified on behalf of the National 
Association of Manufacturers, urged the Subcommittee:

    Not to just tinker with this system, not just consolidate 
programs, but to be bold, be expansive, be innovative, be 
creative, to radically restructure our workforce system.

    Mr. Featherstone continued,

    One clear goal is to enhance U.S. competitiveness globally. 
* * * Let's structure a system that is based on local knowledge 
and local conditions, let's include from the beginning the 
business community in its leadership role. It is ready to share 
its knowledge about skill training in new and innovative ways.

    As was the goal of several workforce preparation reform 
initiatives introduced by Members of the Committee last 
Congress, there is no doubt that we must eliminate unnecessary 
duplication and fragmentation in these systems, in order to 
provide the highest quality of services to the largest number 
of individuals, as well as identifying Federal savings. In 
1989, the Job Training Partnership Act Advisory Committee 
concluded that ``In this era of budget stringency, 
particularly, we should no longer accept a fragmented, 
uncoordinated approach to the delivery of human services.'' Yet 
up until now, the number of Federal workforce development 
programs has continued to grow.
    As summed up in the publication ``Toward a Workforce 
Investment System'' issued by the National Alliance of 
Business:

           As a Nation, we are faced with a paradox: 
        competitive pressures are placing unprecedented demands 
        on our workforce in an environment of severe budgetary 
        constraints, and yet at the same time, we are not 
        efficiently managing those resources that are already 
        at our disposal for investing in the future 
        productivity of our labor force. The challenge to 
        business and industry is to build in partnership with 
        public officials, a cohesive management system at the 
        State and local levels that will achieve significant 
        progress in each of three key areas of human resource 
        investment: building a strong foundation of basic 
        skills for workforce entrants through education reform; 
        providing lifelong learning opportunities for employed 
        workers; and streamlining the delivery of employment 
        and training services for youth and adults who face 
        special barriers to employment.

    The idea of an integrated workforce investment system is 
not new, but has been evolving throughout the history of 
Federal training and employment assistance programs. The 
Comprehensive Employment and Training Act (CETA), remembered 
for its controversial public service employment component, was 
originally established to coordinate existing job training 
programs under the control of locally elected officials. 
Throughout the history of the Job Training Partnership Act 
(JTPA), as well as in amendments added to authorizing 
legislation for vocational education, the Employment Service, 
and welfare employment programs, provisions for program 
coordination have been added and embellished; nevertheless, 
program fragmentation persists. In fact, as late as 1992, in 
amendments enacted to the Job Training Partnership Act, 
language was included with the purpose of strengthening 
coordination between workforce development systems, but as was 
recognized in the House Report on that legislation, 
``coordination of related programs has been a long-standing 
goal of Federal employment and training policy; however, this 
goal has never been fully or consistently realized.''
    Last Congress, the School-to-Work Opportunities Act was 
enacted with bi-partisan support. A major premise of that 
legislation was to coordinate school-to-work initiatives with 
other Federal job training activities, such as vocational 
education and JTPA. Thus, a major step was taken in bringing 
some coordination to job training strategy. This bill builds on 
that and significantly advances efforts at developing an 
integrated and coordinated workforce investment system.

   Framework for a National Workforce Development and Literacy System

    As included in the findings section of H.R. 1617, the major 
goals of any reform of Federal workforce development 
legislation must be to:
          Streamline and consolidate programs, eliminating 
        unnecessary duplication and fragmentation;
          Provide maximum authority and responsibility to 
        States and to local communities for the design and 
        operation of workforce development and literacy 
        programs;
          Increase the involvement of the private sector in the 
        design and implementation of workforce preparation 
        programs;
          Establish a system which is market-driven, provides 
        customer choice, and easy access to services;
          Reinforce individual responsibility and ensure 
        accountability; and
          Establish a comprehensive, integrated labor market 
        information system to ensure that workforce development 
        programs are related to the demand for particular 
        skills in local labor markets, and to ensure that 
        information about the employment and earnings of the 
        local workforce, occupations in demand, skill 
        requirements for available jobs, and the performance of 
        education and training and rehabilitation providers is 
        available to job seekers, employers, teachers, 
        students, and decision-makers.
    H.R. 1617 is designed to achieve these goals.
    The CAREERS legislation consolidates (and eliminates) over 
90 existing education, employment, and job training programs 
into 4 consolidation grants. This consolidation eliminates 
unnecessary duplication and fragmentation within programs, 
while redesigning programs serving youth, adults, the disabled, 
and individuals with basic skills deficiencies. The bill 
transfers authority for the design and operation of programs to 
the States and to local communities, with limited direction on 
the establishment of an infrastructure to support State and 
local workforce development systems. The bill establishes a 
system which is market-driven, provides customer choice, and is 
easily accessible, by: strongly encouraging service delivery 
through a one-stop career center system--or single points of 
entry into local workforce development programs; by involving 
employers in the design and implementation of systems; by 
strongly encouraging the use of vouchers or skill grants for 
receipt of training and educational services; through the 
provision of information on the performance of local service 
providers as well as enhanced labor market information; and 
through an enhanced performance measurement system, that takes 
into account customer satisfaction (both of employers and of 
participants).
    In development of the CAREERS Act, a great deal of thought 
and care went into the design of a system infrastructure. 
Starting with the CAREERS legislation introduced by Chairman 
Goodling and other Committee Republicans in the last Congress, 
Members deliberated over how far to go with program 
consolidation, elimination, and reform. After considerable 
study and in-depth conversations with, and consideration of 
testimony from experts around the country, in the Postsecondary 
Subcommittee's nine hearings solely devoted to this bill, and 
the Youth Subcommittee's two hearings devoted to the issue of 
adult education and literacy program reform, Members decided to 
establish a workforce development and literacy system composed 
of 4 consolidation grants.
    These grants include: a Youth Development and Career 
Preparation Consolidation Grant (consolidating Vocational 
Education, School-to-Work, and youth programs established under 
the Job Training Partnership Act); an Adult Employment and 
Training Consolidation Grant (consolidating programs for 
Disadvantaged Adults and for Dislocated Workers, among others); 
a Vocational Rehabilitation Consolidation Grant; and an Adult 
Education and Literacy Consolidation Grant (consolidating all 
Adult Education and Literacy programs). The Committee believes 
that the very different and important missions of the four 
consolidation grants, as well as the very different needs of 
the populations being served, are necessary functions of the 
Federal government to support a comprehensive and effective 
workforce development system in States and communities 
throughout our Nation.

                    State and Local Responsibilities
    In a report entitled ``Advancing America's Workforce,'' 
issued this year by the National Association of State Workforce 
Investment Policy Council Chairs (business leaders who advise 
Governors on the design of State workforce development 
systems), the State chairs addressed the issue of governance 
over the U.S. workforce development system, by stating:

          The system must be governed through a new Federal-
        State-local partnership with clearly defined roles and 
        responsibilities at each level. Overall direction and 
        oversight for the system should be provided at the 
        Federal level, with less policing of process and 
        procedures. States and localities should have greater 
        flexibility in the design of the system and the 
        delivery of services, with increased accountability for 
        achieving outcomes across the system.

    Specifically, the report explains that the Federal role 
should be framing the vision for the system; developing broad 
policy; establishing national priorities and performance 
standards. The report cites the appropriate role of the State 
as defining a State vision; establishing statewide priorities, 
policies and performance standards; developing a statewide 
strategic plan; building Federal-State and State-local 
partnerships; determining funding needs in consultation with 
localities; deciding on substate funding allocations based on 
needs; providing technical assistance and capacity building; 
and overseeing the State system. And finally, the report states 
that the local role should be developing a strategic plan, 
based on local priorities; designing and administering the 
local delivery system, including establishing performance 
measures, overseeing and evaluating performance of local 
providers; determining customer satisfaction; and implementing 
processes to continually improve the quality of services. This 
is consistent with the provisions of H.R. 1617.
    A major objective of this bill is to shift the authority 
for the design and operation of workforce development and 
literacy programs to States and to local communities. Clearly, 
the intent of H.R. 1617, is to transfer such responsibilities 
out of Washington, closer to the individuals being served. The 
CAREERS legislation does, however, establish a broad framework 
or infrastructure around which States and local communities may 
build their individual workforce development systems.
    Members of the Committee believe that the role of States, 
and in particular the role of Governors, is of paramount 
importance in the overall design and implementation of 
statewide workforce development efforts. However, the Committee 
believes that this will work best through a collaborative 
process that involves a variety of concerned participants. Such 
a collaborative process is essential to the development of a 
successful statewide workforce development strategy. There is 
no question that the Committee intent is for Governors to take 
the lead in determining the workforce needs of their States and 
in designing their statewide systems. In fact, the CAREERS 
legislation provides a great deal more flexibility and 
authority for Governors for the overall policy guidance and 
design of the workforce system than now is provided under 
current law.
    The Committee also recognizes, however, that many States 
place jurisdiction for education in the hands of statewide 
elected officials other than the Governor. By no means does 
this Committee intend to interfere with or supersede these 
State decisions. It is not the Committee's intent to impose its 
will, or any one organizational structure, on States through 
this bill, particularly if such an imposition would violate 
State Constitutions.
    CAREERS allows Governors through the collaborative process 
to develop a single State plan and a single performance 
measurement system across all 4 block grants, as well as 
consolidating the reporting and data collection requirements of 
the 4 programs. While setting some parameters for design of the 
system infrastructure (building on what some of the most 
innovative States have already done), the CAREERS Act transfers 
authority for the actual design and operation of federally 
funded workforce development programs to States and local 
communities:
          Governors have final authority for decision-making 
        and submission of the State workforce development plan 
        (except in States with State constitutions that prevent 
        such authority);
          Governors have authority to withdraw funding or 
        redesignate administrative entities for local programs 
        that do not meet State developed performance measures--
        providing an increased role for the Governor both in 
        setting the performance standards and in enforcing such 
        standards at the local level;
          Governors have total authority to designate/
        redesignate workforce development areas, free from 
        population requirements as under current law;
          Governors have authority to set criteria for the 
        selection of local, employer-led, workforce development 
        boards, to biennially certify such boards, and have 
        approval authority over local plans--an increased role 
        over the makeup and function of local workforce 
        development boards;
          Governors have authority to set criteria for the 
        overall design of local one-stop career center systems, 
        and can design alternative strategies to the one-stop, 
        if such strategies achieve full integration of Federal, 
        State and local workforce development programs, and 
        meet with the approval of the Secretaries of Education 
        and Labor;
          Governors have the authority to establish a 
        certification mechanism to identify legitimate 
        providers of education and training who are eligible to 
        receive vouchers or skill grants or contracts under the 
        adult training and vocational rehabilitation systems--
        providing an increased role for the Governor in 
        certifying qualified providers; and
          Governors have the authority to establish substate 
        formulas for driving Federal dollars to local workforce 
        boards and to local schools under the adult training 
        and the youth titles of the bill--no longer a 
        prescriptive, federally directed formula.
    This legislation transforms our current system, or ``non-
system'' of Federal job training and employment assistance 
programs. We have developed a bill that significantly increases 
the role of the Governor in the overall design of all 
federally-funded workforce preparation programs, while 
establishing a necessary balance between the State and local 
levels. In his testimony before the Committee, Lt. Governor 
Paul Cellucci, of Massachusetts strongly recommended a block 
grant approach for funding workforce development programs, and 
explained that ``States should be expected to set policy for 
and oversee job-related and training activities, and to 
allocate the block grant funds to local boards.'' He further 
explained ``that's why we see the Regional Employment Boards in 
Massachusetts as an important infrastructure to have in 
place.'' H.R. 1617 appears to be consistent with this 
recommendation.
    Mr. Peter Calderone, Commissioner of Labor in the State of 
New Jersey, also expressed support for block grants which 
``best serve the needs of each particular State.'' Both 
Commissioner Calderone and Lt. Governor Cellucci testified that 
their States are building workforce development systems around 
local employer-led workforce investment, or regional employment 
boards. And both spoke of their efforts in the establishment of 
a one-stop delivery system within their respective States, with 
Commissioner Calderone describing one-stop career centers as 
the kind of delivery system that ``would offer workers and 
employers easy access and a direct route to the total array of 
available employment, education, and training information and 
services.'' Again, consistent with the direction in H.R. 1617.
    Committee Members also believe that programs at the local 
level will not be successful unless local communities are 
involved in the design and delivery of local programs. As much 
as we believe in a strong State role, we believe as strongly in 
the necessity for local communities to make job training 
decisions that are consistent with, and appropriate to, local 
needs. The Committee bill provides a great deal of authority to 
locally elected officials in the selection of Members of the 
local workforce development boards; in the approval of local 
workforce plans and budgets; and in joint oversight, with the 
boards, in the area at-risk youth, adult training, and 
vocational rehabilitation programs. As was stressed in 
testimony provided to the Subcommittee by representatives of 
the U.S. Conference of Mayors, including the Honorable William 
A. Johnson, Mayor of Rochester, New York, locally elected 
officials know their individual communities best and need the 
flexibility to design local programs based upon the needs that 
exist in their communities. In testimony provided by County 
Commissioner Randy Johnson, on behalf of the National 
Association of Counties, Mr. Johnson stated:

          Localities must be responsible for: developing shared 
        governance responsibilities between local elected 
        officials and representatives of the private sector; 
        developing and implementing locally based intake and 
        assessment procedures and practices that allow for 
        universal access to programs and services by those who 
        need them most; developing and implementing specific 
        workforce development programs that are responsive to 
        the particular needs of trainees and the business 
        community; and coordinating activities, including 
        waivers, and establishing locally based collaborative 
        efforts between the various educational, social 
        services and human resource programs within our 
        communities.

 the role of local employers and the establishment of local workforce 
                           development boards

    Perhaps the most convincing argument for placing such 
responsibility at the local level as seen by the Committee, 
however, is the vital role that local employers are intended to 
play under the CAREERS legislation.
    As stated throughout this report, the Committee sees the 
role of employers, at all levels--Federal, State and local--as 
essential to the success of our reform efforts in the area of 
workforce development. In fact, business must take a leadership 
role in the design, management, and evaluation of workforce 
training programs.
    As pointed out by James Dickerson, Chair of the Central 
Ozarks Private Industry Council in Rolla, Missouri, testifying 
on behalf of the National Association of Private Industry 
Councils: ``Our greatest challenge is to turn our publicly 
financed education and training institutions from supply-driven 
ones to market-driven ones.'' The full involvement of business 
in development of workforce development systems is essential if 
we are to establish a system that is truly market-driven, 
accountable, and one that provides the skills and education 
levels needed in the workforce.
    The National Alliance of Business in ``Toward a Workforce 
Investment System,'' pointed to a number of approaches designed 
to incorporate market requirements into a workforce investment 
system, including: ``planning education and training programs 
on the basis of up-to-date labor market information; setting 
local educational standards based on direct employer input, as 
has been done by the SCANS commission effort; and providing 
training vouchers or skill grants for use by individuals in 
purchasing the education and/or training services of their 
choice.'' CAREERS incorporates all of these elements.
    As the ultimate consumer of the products of the workforce 
development system, the employer community has a vital interest 
in the quality of the education, training and related services 
being provided, as well as the efficient utilization of 
resources. Private sector leaders, at both the State and local 
levels, play a key role in establishing a common framework that 
helps governmental entities rethink the categorical structure 
of workforce programs, to overcome turf issues and resource 
concerns.
    In providing reform recommendations to the Subcommittee, 
Mr. Dickerson from the National Association of Private Industry 
Councils explained that local workforce development boards must 
have real authority, add real value to the employment and 
training enterprise, or ``they will find more productive ways 
to support their communities.'' The Committee bill provides 
employers with this authority, purposely elevating the role of 
local workforce development boards over that currently provided 
to private industry councils under JTPA. Under the bill, local 
employer-led boards will have the authority to: develop local 
workforce development plans, setting goals and objectives for 
their workforce development areas (consistent with State 
workforce development plans); select and monitor the 
performance of local one-stop operators and program providers 
in the local system; design the local area's one-stop career 
center system, consistent with State-established criteria; and 
develop budgets and conduct oversight over the local system. 
The bill clearly establishes that local workforce development 
boards have the authority to elect the board chair from among 
its members, and develop bylaws and operating procedures that 
are consistent with the State plan. In ``Toward a Workforce 
Investment System,'' published by the National Alliance of 
Business, the point was well made that ``a system that is 
shaped by too many rules and regulations and that bogs down 
business volunteers with the minutia of program management 
drives the private sector away.'' As a result, the bill 
prohibits local boards from operating programs.

                         the role of educators

    The Committee also recognizes the importance of educators 
in the design and implementation of workforce development and 
literacy systems. We need the active involvement and 
participation of educators and other service providers, at the 
State and local levels, especially since successful workforce 
development efforts can only be built on strong education and 
training initiatives. Not to involve the education community in 
the development of a workforce training system would be 
counterproductive in our opinion.

                          state collaboration

    At the State level, as well as in local communities, the 
role of employers is key to success. It is the intent of the 
Committee that representatives of business and industry, 
appointed by the Governor, comprise a substantial number of the 
individuals involved in the State's collaborative process. In 
those leading-edge States who have already utilized a 
collaborative process through the establishment of broad-based, 
State Human Resource Investment councils (or workforce 
investment councils as some are called), the leadership 
provided by those bodies has been key to statewide system 
reform.
    While the Committee decided not to require the 
establishment of these councils, the spirit of collaboration 
behind the establishment of such councils in large part led 
Congress to utilize a collaborative process under the School-
to-Work Opportunities Act, during the last Congress. And it was 
this model, developed in a bipartisan manner, that the 
Committee adopted under the CAREERS Act, for State level 
consideration and development of State workforce development 
and literacy policies.
    The workforce development system must be designed in a way 
that enables the various stakeholders of the system to work 
collaboratively within a competitive environment. It is the 
hope that the collaboration required in this legislation will 
build support and acceptance of system-wide reform. While the 
Committee recognizes the Governor as taking the lead role in 
establishing the overall State workforce development and 
literacy system, Governors cannot be solely responsible for 
such reform efforts. To effect truly meaningful reform, all 
stakeholders must be integrally involved in this collaborative 
effort.

                     one-stop career center systems

    A key principle stressed by nearly all witnesses testifying 
before the Postsecondary Subcommittee during hearings on this 
issue, was the need for a workforce development system that is 
easily accessible and provides customer choice. Customers 
should have access to all available information and services in 
the system without regard to the point of entry, and access 
should be conveniently located within the community. Customer 
choice through good information on the labor market, provider 
performance, and the availability of vouchers or skill grants 
for training, where appropriate, should be paramount. Customers 
should have the option to select the best service providers 
available in their community and service providers should be 
accountable for providing high quality services and meeting 
high performance standards.
    H.R. 1617 requires States and local workforce development 
areas to establish one-stop career center systems where 
individuals would be provided with the services and delivery 
structure described above. The intent of requiring 
establishment of these systems was not meant to be 
prescriptive, as States and localities determine how best to 
develop such systems to meet their individual needs. The intent 
is, however, to require the integration of workforce delivery 
programs into a comprehensive, user friendly system, that is 
easily accessible, regardless of the point of entry--whether 
through a comprehensive, co-located one-stop center, or through 
an electronically-linked affiliated site. The intent is that 
the system also provide customer choice as described above. 
While the Committee bill does not require the establishment of 
one-stop centers, their establishment is encouraged. In fact, 
the bill encourages the establishment of networks of 
comprehensive and fully-integrated co-located one-stop career 
centers, combined with multiple affiliated sites that are 
linked through electronic and technological access points. 
Although a large number of States are moving in the direction 
of one-stop delivery of services, most communities do not yet 
have a single place for individuals to go to find information 
about available jobs, about what skills are needed to do a job 
or advance in a career, or how to find the training needed for 
such jobs. It is the hope that by the end of the authorization 
period, that all communities will have established such 
systems.

    performance measurement, accountability, and shared information

    In recommendations made to the Committee on reform of the 
U.S. workforce development system, the Business Roundtable 
(BRT) stressed:

          A quality assurance system, based on high standards 
        for program performance and skill attainments, is 
        essential for job training programs. * * * Performance 
        and skill standards-based accountability must become a 
        fundamental principle of any new workforce development 
        system. Training programs should provide the 
        competencies employers need and prepare workers for 
        jobs in the high performance workplace. It is critical 
        to benchmark current programs to determine their 
        effectiveness in achieving employability outcomes.

    The Roundtable went on to say:

          Program performance standards are essential for 
        administrators and service providers. Standards should 
        correspond to private sector total quality 
        requirements, including specifying well-defined 
        processes and capabilities and promoting continuous 
        improvement. Standards should permit realistic 
        measurement of program effectiveness in terms of key 
        outcomes, such as employment, earnings, and customer 
        satisfaction. Occupational skill standards, or 
        workplace competency standards, should drive program 
        design, be defined by customers and be established at 
        world-class levels. A starting point should be the 
        workplace readiness skills developed by the Labor 
        Secretary's Commission on Achieving Necessary Skills 
        (SCANS). Programs must make special efforts to achieve 
        standards endorsed by the National Skill Standards 
        Board.

    In line with these recommendations of the business 
community and elsewhere, H.R. 1617 contains accountability 
language that encourages States to meet world class standards, 
without establishing prescriptive, ``one-size-fits-all'' 
national standards. The bill requires States to establish their 
own, individual performance measurement systems, recognizing 
the individual characteristics and needs of the different 
States. Such systems must include goals, and benchmarks set by 
the State for measuring the continuing progress of its 
workforce development and literacy programs in meeting such 
goals, building on performance measures included for each of 
the 4 consolidation grants established or amended under this 
legislation. States are also encouraged to take into account 
post-program surveys measuring customer satisfaction of both 
employers and program participants in the establishment of such 
goals and indicators.
    At the national level, the Secretaries of Education and 
Labor, in collaboration with the States and with 
representatives of business and industry, employees, 
educational agencies, service providers, participants, and 
others, are required to develop technical definitions of each 
of the core indicators described in this Act (such as the 
definition of job placement and retention), that are to be used 
in measuring performance, and to identify world class levels of 
performance with respect to appropriate core indicators of 
performance. The bill states that where appropriate, such 
standards shall reflect industry-recognized skill standards and 
national education goals.
    Finally, the bill includes technical assistance and 
corrective action provisions for States and for local entities 
that continue to fail to meet the State-set performance 
standards.

                  amendments to the wagner-peyser act

    The U.S. Employment Service (ES), also known as the Job 
Service, was established by the Wagner-Peyser Act of 1933 
during the worst economic depression in the Nation's history. 
The Act established a nationwide network of State-operated, 
Federally-financed employment service offices to serve as a 
labor exchange to match available workers with available jobs. 
Currently the Employment Service is a joint Federal-State 
government administered job placement and referral system. The 
ES registers unemployed workers seeking employment, solicits 
job openings from employers, and refers job seekers to jobs. 
During the 1960s, ES was directed to give special attention to 
the needs of the poor among job seekers. Today, ES serves all 
individuals seeking employment, regardless of income.

                 federal funding associated with the es

    The total FY95 Federal appropriation for ES is $845 
million. Pursuant to the Social Security Act, these funds are 
drawn from the Unemployment Insurance Trust Fund, collected 
from employers under the Federal Unemployment Tax Act. In 
addition, for FY95, $120 million has been appropriated to the 
ES to provide grants for the establishment of one-stop career 
systems. However, because this Committee feels that due to the 
fact that the Wagner-Peyser Act is financed almost exclusively 
by employers through the Federal Unemployment Tax Act (FUTA), 
there is an obligation to ensure that these funds are used for 
their intended purpose which is to maintain a national system 
of employment services.
                      Services Provided by the ES

    In addition to job referral and placement, local ES offices 
may offer job seekers and employers a range of services and 
assistance--including testing, counseling, job search 
workshops, resume-writing instruction, interviewing techniques, 
job fairs, labor market information, mass screening, analysis 
for restructuring jobs, outplacement assistance, and 
specialized recruitment to meet affirmative action plans.
    The ES is also responsible for carrying out several Federal 
and State mandates. Specifically, certifying the need for alien 
workers; providing vouchers or skill grants to job seekers in 
connection with the Targeted Jobs Tax Credit (TJTC) program and 
certifying employer eligibility for the TJTC; recruiting 
domestic migrant and seasonal farmworkers and monitoring ES 
services to this group of workers for regulatory compliance; 
and certifying individual eligibility for such programs as 
Federal guaranteed loans and work programs.

                        Administration of the ES

    Currently, 54 State Employment Security Agencies (SESAs) 
and their network of over 1,700 local offices jointly 
administer the public Employment Service with the Department of 
Labor. In 1982, amendments to Wagner-Peyser gave State 
governments primary responsibility for ES program design and 
operation. At the Federal level, the ES is administered out of 
the Employment and Training Administration within the 
Department of Labor. The primary advocacy groups for this 
program include: the Interstate Conference of Employment 
Security Agencies (ICESA); and the American Federation of 
Federal, State, County, and Municipal Employees (AFSCME), who 
represent State ES workers.

                          Assessment of the ES

    A study released in 1993 by the Upjohn Institute of 
Employment Research found that the ES had a positive effect on 
shortening the period of unemployment for Unemployment 
Insurance (UI) claimants that were considered long-term 
unemployed. UI claimants who had been unemployed for 30 weeks 
or more returned to work 9 weeks sooner than they would have 
had they not used the ES. In comparison, UI claimants who had 
been unemployed for roughly 12 weeks only reduced their 
unemployment, at most, by 2 weeks. The authors concluded that 
the shift from a 2-to-9 week reduction in unemployment 
suggested that the ES is particularly effective in aiding a 
relatively small segment of the claimants who have trouble 
finding work on their own.
    Further, the study shows that most ES users accept jobs 
after exhausting UI benefits, suggesting that jobs obtained 
through the ES are preferable to remaining jobless, but do not 
compare favorably with jobs held prior to becoming unemployed. 
Thus, the study concludes that the ES primarily acts as a 
backstop to prevent large earnings losses.
    Over the past 6 years the GAO has released two different 
studies on the Employment Service. In 1989 they examined 
variations in local ES office performance and found significant 
variations in placement rate, permanent placement ratio, and 
placement wage ratio. Specifically, placement rate ranged from 
over 30 percent in some offices to below 10 percent in others. 
Similarly, the percentage of those placements that were in 
permanent jobs ranged among offices from 80 percent or more to 
less than 40%.
    A 1992 GAO report found that ES placement performance was 
better in States that guided ES program performance through (1) 
measurable goals reinforced by achievement awards and (2) 
annual on-site evaluations of local office operations. Even in 
areas of high unemployment, local office placement rates were 
80 percent higher in States that adopted both management 
practices compared with offices in States that did not use 
either practice. Further, the GAO study found better results in 
ES offices that: placed greater emphasis on meeting the needs 
of job seekers and employers, including consistent outreach to 
employers; who had more interaction with JTPA and other 
training programs; who were separated from local UI offices; 
and who offered self-service job information as well as 
services focused on individualized attention.
    In order for our U.S. employment/training system to be 
successful, we need a labor exchange function in each local 
community that is truly effective. This is increasingly 
important as many want to move toward an ``employment first'' 
workforce policy, where emphasis in all of our employment/
training programs is placed on employment for job-ready 
participants first, and training is only provided to those 
individuals who are determined to be in need of such training 
in order to become employable.
    Although ES provides services to millions of workers at a 
relatively low cost--with one study estimating the benefit-cost 
ratio at 1.8%--evaluations by the Department of Labor have 
found that ES accounts for only a small percent of total job 
placements in the American economy; a majority of job vacancies 
listed with the ES are relatively low paying, entry-level 
positions in domestic services, clerical occupations, and high 
turnover blue collar occupations; and the applicant pool of the 
ES consists primarily of persons with special labor market 
difficulties, limited work experience, and few vocational 
skills--underrepresenting workers from the ``mainstream'' labor 
force. As a result, employers tend not to utilize the system. 
However, many States are developing innovative practices to 
expand and improve their systems, for example, North Carolina 
and a handful of other States have pioneered placing their 
information on the INTERNET, greatly expanding the access to 
the information they provide. It is initiatives such as these 
that the CAREERS Act hopes to build upon and expand throughout 
the nation.

                        Labor Market Information

    Labor market information (LMI) is an essential structural 
element supporting all other programs and services under the 
CAREERS Act. The legislation builds on the foundation of 
existing national data programs to create a nationwide system 
for information that will be integrated from local to State to 
national levels and where data will be consistent across 
States, enabling Governors to compare the effectiveness of 
workforce development efforts and employers and jobseekers to 
make informed choices.

                               Background

    Labor market information, (LMI) as defined in a recent 
report commissioned by the Department of Labor, is ``The body 
of knowledge that describes employment, unemployment and the 
factors that relate to labor demand and supply. These factors 
include trends in industrial and occupational structure, wage 
levels, job requirements, and the demographics of the labor 
force and population. The many users of this information 
include employers, job seekers, policymakers and analysts, 
economic developers, economists and planners of employment, 
training and education programs.''
    The Manpower Development and Training Act of 1968 called 
for the creation of a comprehensive labor market information 
system to meet the needs of public and private users in 
recruitment, counseling, education, training, placement, job 
development and other activities.
    In the 1970's, there was an effort to meet the requirements 
set forth under MDTA. The LMI division of the Employment and 
Training Administration (ETA) funded labor market information 
intended to address State and local information needs. This 
emphasis was important--it was driven in part by an 
understanding that the ultimate decisions on how Federal funds 
are used to support human resource development programs are 
made at the State and local levels, and it made sense to 
support information that assisted in making these decisions. 
National data do not meet these needs, because labor markets by 
their nature are local in most instances.
    During the period from 1978 to 1982, funding for some data 
activities moved from ETA to the Bureau of Labor Statistics 
(BLS). For a short period, BLS continued to support some of the 
State and local information needs, such as processing of State 
occupational projections. (BLS also continued the State and 
area component of the Current Employment Statistics, Local Area 
Unemployment Statistics and Occupation Employment Statistics 
programs.)
    The National Occupational Information Coordinating 
Committee (NOICC) and its State counterparts (SOICCs) were 
created in 1976 and 1977. The main purpose of the NOICC/SOICC 
network was to coordinate and deliver occupational information. 
During the period from 1979 to 1981, Occupation Information 
Systems were developed, and some States began to put such 
systems into place.
    The NOICC/SOICC currently continues to be very much focused 
on the State and local customer. It is not, however, a 
developer of new information in the sense that it does not 
support data collection activities. Rather, it focuses on 
delivery and technical support, including training.
    From 1982 to 1992, support for State and local LMI 
decreased significantly in terms of funding and technical 
support. Because of funding limitations, BLS discontinued 
support for State occupational projections. The Federal-State 
cooperative data programs were driven to a large degree by 
national needs. ETA-LMI funding declined significantly during 
the 1980s. NOICC funding during the mid-1980s went down 
significantly, rose again, and then the Department of Labor 
proposed eliminating NOICC in the early 1990s. What has since 
developed is a fragmented and inconsistent patchwork of 
information programs. According to the ``Legislative Funding 
Guide,'' published by the Interstate Conference of Employment 
Security Agencies (ICESA), there are currently 26 statutory 
requirements for labor market information, including 35 labor 
market products.
    Within this context, the Department of Labor has recently 
focused increased attention upon labor market information. 
Currently, efforts are underway in the establishment of 
America's Labor Market Information System (ALMIS). This 
initiative is centered around four principal initiatives 
including: grants to all States for core products and services; 
creation of research and development consortia to develop and 
support LMI gathering and dissemination; creation and expansion 
of a job/talent/help wanted bank network to make labor exchange 
information more readily available to job seekers and 
employers; and, support for one-stop implementation States and 
common systems.
    The Committee assumes that the initiatives in establishing 
a comprehensive system of LMI under the CAREERS Act will build 
upon the work of these initiatives, the work of the NOICC/SOICC 
system, as well as those elements of the past efforts in this 
area which have proven to be successful.

 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

                        Need for the Legislation

    Our existing system to prepare young people for the future 
world of employment is not a system at all, but rather a 
collection of strategies, programs, and initiatives delivered 
by three levels of government and a confusing array of 
education, training, and social service institutions. There is 
no clear national vision or inter-institutional strategy in 
this area. The most significant programs serving the career-
related education, employment, and training needs of youth in 
this country are authorized under the Carl D. Perkins 
Vocational and Applied Technology Education Act, the Job 
Training Partnership Act, and the School-to-Work Opportunities 
Act--all with differing missions, different approaches to 
service delivery, and differing levels of success. However, the 
common thread between these programs is that they are intended 
to educate or train young people to prepare them for employment 
and self-sufficiency. In an effort to reform these programs, 
H.R. 1617 repeals these three statutes, and in their place, 
establishes a new comprehensive Youth Development and Career 
Preparation Consolidation grant program.
    As noted by David A. Gruber in his report for Jobs for the 
Future, entitled, ``Toward a Seamless System for Youth 
Development: A New Strategy for Integrating Resources, 
Programs, and Institutions,'' among the public schools, the 
postsecondary educational system, JTPA providers, social 
service organizations, and the employer community, especially 
after the changes begun under the School-to-Work efforts of the 
past several years, there exists an impressive institutional 
base and significant resources for serving young people more 
effectively. When we enacted the School-to-Work Opportunities 
Act last Congress, with bi-partisan support, we laid the 
groundwork for a coordinated approach to youth training 
initiatives. H.R. 1617 builds on this approach. Although this 
bill repeals the Carl Perkins Act, JTPA and the School-to-Work 
Opportunities Act, it builds on the school-to-work framework 
and incorporates its basic components while establishing a new 
Comprehensive Youth Development and Career Preparation 
Consolidation grant program.

            History of Federal Vocational Education Programs

    The Federal government has directly supported vocational 
education for close to 80 years. Beginning in 1917 with the 
Smith-Hughes Act, a permanent appropriation was allocated to 
States for limited program areas such as agriculture and home 
economics. It also detailed program requirements such as hours 
per week and hours per year to be spent on instruction.
    Current vocational education law can be traced to the 
Vocational Education Act of 1963 (VEA). This Act continued 
general support for high school vocational education but also 
directed funds for programs to serve special groups (i.e. 
disadvantaged students). In addition, the VEA increased 
requirements for planning and more strongly encouraged new 
programs. Funding for postsecondary vocational education and 
for workers' training and retraining programs was also 
instituted under the 1963 VEA.
    The 1968 and 1976 Amendments to the Vocational Education 
Act expanded many of the programs and ideas introduced in the 
1963 Act. The 1968 Amendments incorporated the Smith-Hughes Act 
into the VEA. The 1968 Amendments also required that Federal 
vocational education funds should be used for programs serving 
disabled students. The 1976 Amendments expanded requirements 
for State and local planning and evaluation. In 1984, the Carl 
D. Perkins Vocational Education Act amended and replaced the 
VEA. The Perkins Act, while similar to its predecessor, 
differed in regard to increased funding for special populations 
and program improvement. For example, the Perkins Act required 
that 57% of each States' basic grant be used for vocational 
education needs for special populations, such as disadvantaged 
and disabled students and the remaining 43% was required to be 
used for improving vocational education in general.
    The 1990 Amendments renamed the Perkins Act the Carl D. 
Perkins Vocational and Applied Technology Education Act. The 
1990 Amendments made several major changes to the Act requiring 
more integration of vocational and academic courses, 
eliminating specific dollar set-asides for select groups and 
created the Tech-Prep program. The 1990 Amendments began to 
focus vocational education more on broader skills combining 
academics and vocational skills.
    While the 1990 Amendments made changes in the system, we 
are now in 1995 at a crossroads with vocational education. It 
is time to advocate change and to chart a new course. As the 
National Assessment of Vocational Education (NAVE) Report to 
Congress states:

          We advocate that the new Perkins Act break with the 
        past. While many of the goals of the 1990 Act were set 
        in the right direction, the results have been 
        disappointing in many areas. We recommend a major 
        change in the nature of the Federal government's 
        involvement in vocational education. We propose a 
        radical new role for the Federal government in 
        supporting vocational education: fostering a truly 
        comprehensive system of preparation for work.
    History of Federal Job Training Programs for Disadvantaged Youth

    The Job Training Partnership Act (JTPA), first enacted in 
1982, is the authorizing statute for the Nation's programs with 
the primary purpose of providing employment and training 
assistance to disadvantaged and out-of-school youth. JTPA's 
title II-C, year-round program for disadvantaged youth provides 
direct training and training-related services to help prepare 
economically disadvantaged youth (ages 14-21) for participation 
in the workforce. The program requires an assessment of skills 
and service needs for each participant, the development of a 
service strategy to determine employment and achievement goals 
and appropriate services, and a review of participant progress. 
While progress has been made in recent years in serving harder-
to-serve youth, and providing longer-term interventions, the 
JTPA youth program has been criticized for providing short-term 
employment and training assistance that has not proven 
effective for at-risk youth. In fact, one of the few major 
Department of Labor-sponsored national studies on the JTPA 
system (conducted in the mid-1980's)--the Abt Study--found 
JTPA's youth programs to be ineffective, and in some cases, 
resulting in negative earnings outcomes for disadvantaged male 
youth.
    In addition to the title II-C Year-Round Youth Program, 
title II-B of JTPA, the Summer Youth Employment and Training 
Program, provides employment and training activities during the 
summer months for economically disadvantaged youth to 
strengthen basic educational skills, encourage school 
completion, provide work exposure, and enhance citizenship 
skills. This program also requires an assessment of skills and 
service needs for each participant, the development of a 
service strategy to determine employment and achievement goals 
and appropriate services, and a review of participant progress. 
Young people receive wages for work performed, and those who 
have been assessed as needing basic and remedial education or 
preemployment and work maturity skills training, must be 
provided such services. In the summer of 1993, the Summer Youth 
Employment Program provided summer jobs to 620,000 
disadvantaged youth.
    There has been a growing concern over the years that 
individuals served under JTPA's youth programs were less 
responsive to service interventions than their adult 
counterparts. The amendments to JTPA in 1992 separated the 
year-round youth program and the summer youth employment 
program, and focused services on harder-to-serve populations 
and increased numbers of out-of-school youth. However, JTPA's 
short-term approach for at-risk youth continues to raise 
significant concerns.
    In testimony provided to the Committee by Dan Bloom, on 
behalf of the Manpower Demonstration Research Corporation 
(MDRC), Mr. Bloom explained that during the past 20 years, 
after rigorous tests of programs and policies designed to 
improve the education attainment, employment, and the earnings 
of disadvantaged youth, the results have been pretty 
discouraging. However, several programs, as pointed out by 
Bloom, that combined sustained services, adult role models, and 
financial incentives succeeded in raising school completion 
rates among youth who are in school but who are at risk of 
dropping out. In fact, one small-scale demonstration program 
noted by Mr. Bloom, the Quantum Opportunities Programs, run by 
the Occupational Industrialization Centers of America, has 
achieved dramatic results through an intensive 4-year program, 
including education supports like tutoring, community college 
and college planning, sustained adult mentoring, and modest 
stipends.
    It has been more difficult to find promising second chance 
models for out-of-school youth. The MDRC has found positive 
results with the Job Corps program. The Center for Employment 
Training, (CET) program, headquartered in San Jose, California, 
and replicated in 40 cities throughout the country, has also 
achieved strong results for school dropouts by operating 
relatively short-term, but highly intensive hands-on training 
programs with high growth industries, and building close 
linkages with the local business community. MDRC's findings 
indicate that programs that integrate classroom-based 
instruction with experiential learning at the workplace can 
transform the education experience of young people, both in-
school and out-of-school, and can lead to career opportunities 
and postsecondary education. The linking of work and training 
also hold promise for school dropouts, as proven in the 
successful Youth Build program.
    Representatives from both the CET and the Youth Build 
programs testified before the Subcommittee on Postsecondary 
Education, Training and Life-Long Learning on what makes their 
programs successful in reaching at-risk, out-of-school youth. 
Russ Tershy, President of CET, testified that CET's success is 
due in large part to their emphasis on learning by action 
(contextual learning) that is tied to workbased learning. He 
further explained that CET challenges and has high expectations 
for even the hardest to serve individuals. That the program is 
tightly linked with industry, and hires teachers right out of 
industries, developing curricula and teaching students on up-
to-date training techniques and equipment. He stressed that 
CET's teaching is holistic, intensive, individualized, and 
self-paced. Cindy Dotson, testifying on behalf of the York 
Cripus Attucks YouthBuild program, also stressed the need to 
integrate workbased and academic learning. YouthBuild focuses 
on teaching out-of-school youth to achieve their GEDs, at the 
same time as working and learning on construction sites 
rehabilitating public buildings for the community, stressing 
community involvement and pride. Again, YouthBuild students 
work with local contractors (employers) to gain hands-on 
experience and to further their vocational education. With 
YouthBuild as with CET, the program is holistic.
    Testifying as to the success of work-based learning 
programs serving the needs of at-risk in-school youth, Mr. Neil 
Derrough and Ms. Brene Patrick of the San Diego Private 
Industry Council, stressed the importance of employer 
involvement, and strong ties between school-based and work-
based learning. Under the San Diego Private Industry Council's 
school-to-work program, JTPA's summer youth employment program 
has provided a valuable tool for providing work experience that 
is complementary to disadvantaged youths' school-based learning 
experiences. And Ms. Sharon Robinson, Director of OIC West in 
Menlo Park, California, testified about the success of their 
after-school SASSY program, encouraging and assisting at-risk 
youth to stay and to succeed in school through academic and 
vocational tutoring and complimentary supportive services.
    In particular, it appears that longer-term interventions, 
with the core components contained in school-to-work transition 
programs, such as integrated academic and work-based learning, 
a paid work experience, and a strong emphasis on mentoring--can 
have positive results with at-risk and disadvantaged youth. 
This sort of approach can also work with out-of-school youth, 
in an alternative education setting. Building on this 
assumption, the Committee has built the Youth Development and 
Career Preparation program around this model. While 
consolidated into a single block grant to States, 2 subsystems 
are envisioned at the State and local levels--one for in-school 
youth, and one for at-risk and out-of-school youth.

                   History of School-to-Work Programs

    The School-to-Work Opportunities Act, signed into law in 
1994, established a national framework for all States to create 
statewide systems that help young people move from school to 
jobs and further education. It is not a program. Rather, it was 
designed to help facilitate the creation of a national, high-
quality school-to-work transition system that enables students 
to identify and progress through well defined pathways that 
lead to productive and challenging employment. This was done 
through a joint effort between the Department of Labor and the 
Department of Education in administering grants to States for 
the development of highly structured systems that improve 
schools and move students into jobs and careers.
    The Act required components and goals of school-to-work 
transition systems which included:
          A work-based learning component--a program of job 
        training and work experience which included: (1) skills 
        to be mastered that lead to the award of a document 
        which certifies that the skills have been attained; (2) 
        work experience for students while they learn on the 
        job; (3) workplace mentoring; (4) instruction in 
        general workplace competencies; and (5) instruction in 
        a variety of elements of an industry;
          A school-based learning component which included: (1) 
        career exploration and counseling to help students to 
        identify, select, or reconsider their interests, goals, 
        and career majors; (2) a program of study that meets 
        high academic standards and meets the requirements 
        necessary to earn a skill certificate; (3) regularly 
        scheduled evaluations to identify academic strengths 
        and weaknesses; and
          A work and school connecting activities component 
        which required: (1) matching students with employers' 
        work-based learning opportunities; (2) a person to 
        serve as a liaison among employers, schools, teachers, 
        parents, and students; (3) technical assistance and 
        services for employers to help them design work-based 
        learning components; (4) training for teachers, 
        business mentors, and school counselors; (5) help for 
        students who complete school-to-work programs to find a 
        job or to continue their education; (6) linking youth 
        development activities under the Act with employer 
        strategies for upgrading worker skills; and (7) 
        collection and analyzing information about what happens 
        to students who participate in school-to-work programs.
    Efforts in the development of the school-to-work model 
began under the Bush Administration, and were continued under 
President Clinton with the support of a bi-partisan Congress. 
H.R. 1617 retains the core components of school-to-work. The 
Committee envisions the activities under this to be activities 
that are consistent with a school-to-work approach.

                          Direction of Reform

    Developing a highly skilled workforce is an issue of 
national priority. This Committee believes there is a Federal 
role in supporting State and community workforce preparation 
and education programs. There is nothing more important to the 
success of business than human capital. The need to develop the 
skills of the American workforce is critical to our success in 
the world marketplace.
    The Federal government has a vital interest in investing in 
education and employment assistance programs that develop a 
skilled workforce of the future. Every dollar invested in the 
skills of a future American worker through quality career 
preparation programs is returned to the Federal Treasury, to 
States, and to local communities by increased revenues from 
workers in higher wage jobs.
    Various studies, including the National Assessment of 
Vocational Education, have found that students who concentrate 
in occupational areas earn more after graduation than students 
enrolled in a general education track. They are also more 
likely to continue their education after high school, and 
continue to earn more than general track students throughout 
their careers. Studies show that vocational-technical students 
are less likely to drop out of school, thus saving the Federal 
government, as well as State and local governments, the 
additional costs incurred through higher welfare payments, 
unemployment benefits, retraining and remediation programs. 
Furthermore, policies to increase the years of schooling at 
mainstream educational institutions (high schools, vocational 
institutions, community colleges, and universities) for low- 
and moderate-income youth appear to have a high economic 
payoff. Card's 1994 survey in this area indicates that an 
additional year of schooling increases the future earnings for 
those from disadvantaged families by approximately 8 percent to 
12 percent per year. In his testimony before the Subcommittee, 
Dr. Lawrence Katz of Harvard University noted that ``These high 
returns to mainstream schooling combined with more 
disappointing results from interventions for out-of-school 
youth indicate that interventions to reduce high school dropout 
rates and school-to-work programs linked to community colleges 
and employer-training are fruitful areas for investment and 
further research and experimentation.''
    The NAVE report concurs:

          Technical and occupational skills are critical to 
        building a high-skill, high-wage American workforce. 
        Individuals with vocational training (especially at the 
        postsecondary level) who obtain related jobs enjoy 
        higher wages than their peers with a general secondary 
        education. On a broader scale, many of the firms that 
        have used highly skilled workers to transform their 
        enterprise to a high-performance work organization have 
        benefitted on their bottom line. A desire to meet 
        world-class levels of productivity and competitiveness 
        should propel us toward better vocational education, 
        not less. The definition of vocational education may 
        need to change, to embrace an integrated mixture of 
        cognitive, industry-related and occupationally specific 
        skills, but vocational education will remain a vital 
        part of this nation's preparation of individuals for 
        work.

    While there is a Federal role in helping to support 
creating a quality youth development and workforce preparation 
system, it must change from our past history. In order to meet 
the challenges presented by a global workforce and the goals of 
educational reform, change is a necessary event. As stated by 
Assistant Secretary Augusta Souza Kappner during the March 3, 
1995 hearing before the Subcommittee on Postsecondary 
Education, Training and Life-Long Learning: ``The change taking 
place in vocational education is directly related to the 
rapidly changing needs of today's economy. Jobs are requiring a 
higher level of academic and technical skills. Employers are 
telling us clearly that too many young people cannot meet the 
rigorous demands of today's workforce. To keep America 
competitive in the global economy, we must educate our young 
people to much higher standards and prepare them to be lifelong 
learners.''
    Vocational education and Federal training programs for 
youth, as we know them today must change--and must change 
dramatically. The education community must join with local 
business and community leaders to reinvigorate old programs. 
Vocational education has failed in efforts to adequately or 
consistently meet the needs of businesses and they must reach 
out to local employers and work with them. Employment and 
training programs for youth have not sufficiently focused on 
the education and skill needs of youth participants. Business 
and education must form partnerships to ensure that our 
nation's youth--our future leaders--are prepared to enter the 
working world and will succeed. The Committee envisions a 
partnership that strengthens our school systems, strengthens 
local businesses and strengthens local communities.
    NAVE outlined several principles critical to any reform 
initiative developed regarding workforce preparation for youth. 
Two of those principles were:

          First and foremost, the vocational/career-related 
        education should become an integral part of a reformed 
        American system of education and training. A 
        comprehensive system would provide all students with 
        access, multiple entry and exit points, clear education 
        pathways, quality program, high standards, information, 
        and linkage to the labor market.
          Vocational/career-related education should be high 
        quality: It should be competency-based, with industry 
        involvement. Industry-oriented skill standards should 
        be used as the mechanism for connecting vocational 
        education to the system of education and training. In 
        combination with academic and employability skills, 
        skill standards will provide all students with a 
        rigorous preparation for work and life.

    And these principles apply to the newly reformed system in 
CAREERS.
    The efforts begun over the past several years in the area 
of establishing school-to-work transition programs have 
attempted to move the system in the right direction. By 
repealing the School-to-Work Opportunities Act enacted last 
Congress, the Committee does not want to send the signal that 
it does not like that direction, or want these efforts to 
cease. Quite the contrary, school-to-work is what CAREERS is 
about in this newly reformed youth program. The Committee's 
intent however, is to develop a comprehensive system, where 
school-to-work, or school-to-career education and training is 
at the center for all youth. While the leveraging approach 
taken under the School-to-Work Act was a laudable approach, it 
has been determined by the Committee that there is no time to 
wait for the encouragement of such reforms in existing 
programs. Now is the time to force change in our major programs 
serving the career-related needs of youth today.
    The primary purpose of Title II, the Youth Development and 
Career Preparation Consolidation Grant, is to provide States 
and localities with maximum flexibility in designing career 
preparation programs that help youth attain both the academic 
and occupational skills necessary to succeed in a global 
economy. The focus must be on the students and competencies 
achieved, not the process. In preparing for a high-skilled, 
high-performance workplace, every young person must have access 
to high quality educational programs that meet employer 
standards and that take place in a variety of learning 
environments including school, the workplace and the community.
    At the core of this new system, for in-school, and for at-
risk (including out-of-school) youth alike, funding will be 
used for programs that:
          Integrate academic, vocational, and work-based 
        learning, stressing applied and contextual learning 
        through a coherent sequence of courses resulting in the 
        achievement of academic and occupational competencies;
          Involve employers in the design and implementation of 
        programs, including in the development of curriculum;
          Establish effective linkages between at-risk youth 
        programs, secondary, and postsecondary education;
          Provide work-based learning experiences with adult 
        mentoring, and to the extent practicable, that provide 
        an understanding of all aspects of an industry as tied 
        to the student or participant's career major; and
          Provide career exploration, career awareness, and 
        career guidance opportunities, beginning in the 
        earliest grades possible.
    In addition, the same high performance goals are provided 
for in-school and for at-risk youth. Such goals stress the 
importance of positive outcomes tied to high academic and 
skills attainment; retention in school or the return to an 
alternative education program resulting in a diploma or its 
equivalency, or a skill certificate; placement and retention in 
employment; or other positive outcomes.
    Development of a highly skilled workforce is an issue of 
national importance. The Federal investment should be a 
catalyst for change for State and local efforts. The CAREERS 
Act will have a significant impact on the vocational education 
system currently in place. The opportunity for flexibility, 
adaptation and change are essential to the continuous 
improvement of a comprehensive workforce development system.
    As Governor John R. McKernan, Jr. stated in testimony 
before this Committee:

          Let me say, first, that with the advent of the 104th 
        Congress, there is an unprecedented opportunity to 
        review, eliminate and consolidate ineffective 
        employment, training and education programs. We should 
        look ahead to our changing workforce needs and design a 
        new, comprehensive, innovative and flexible workforce 
        development system accountable to all the key 
        stakeholders. Current government programs have become 
        obsolete because they are not driven by results nor 
        accountable for success. Today's federally supported 
        training and education programs are largely isolated in 
        separate categorical programs and designed with no real 
        relationship to local labor market needs. The old way 
        of creating individual programs for specific needs and 
        population is no longer appropriate. Under a new 
        system, all workers employed, unemployed, and 
        disadvantaged, would have access to a comprehensive 
        system that delivers the education and training 
        demanded for jobs in the rapidly changing modern 
        workplace.

    We have consolidated and eliminated programs. We have to 
provide a foundation upon which States and localities can serve 
the roughly 75% of youth who do not complete a four year 
college degree, and those who are at-risk of dropping out or 
who have already dropped out of school. It is these students 
who are often forgotten. We want them to succeed. We want them 
to have productive lives and enjoy life. We are trying to 
prepare the youth of today for the jobs of tomorrow and trying 
desperately to give them the skills they will need to succeed. 
To quote Robert Maynard Hutchins, an American educator, ``The 
object of education is to prepare the young to educate 
themselves throughout their lives.''
    Our current system is fragmented. It is not serving our 
youth well and it is not serving business.

          Unlike many other industrialized nations, this 
        country still lacks a comprehensive system of workforce 
        preparation. Educational programs and institutions 
        operate in loosely coordinated, sometimes disconnected 
        ways, and individuals are left on their own to navigate 
        their way through them and into the labor market. (NAVE 
        Report, June, 1994)

    As pointed out in an article written for the National Youth 
Employment Coalition and the American Youth Policy Forum, Joan 
Wills, Director of the Center for Workforce Development at the 
Institute for Educational Leadership stated:

          The past decade has been a period in which U.S. 
        workforce preparation policymakers have been engaged in 
        a substantial amount of collective soul searching in an 
        effort to find more cost efficient ways to organize and 
        manage our governmental services * * *. We have learned 
        a great deal from this period which can help guide the 
        next generation of workforce preparation programs. Some 
        of the key lessons from the past which should be used 
        to help guide the future include: (1) for young people 
        short-term interventions are insufficient--multi-year 
        investment that begin early and are age and stage 
        appropriate are essential and adult mentors are 
        indispensable; (2) most individuals learn better 
        through active applied learning situations (for 
        example, it is often the case academic learning has 
        double the impact when it is job related; (3) the 
        quality of curriculum and the form of instruction can 
        be more efficient and effective if computer assisted 
        technologies are used) * * *; (4) career preparation 
        programs need to be organized as staged programs of 
        study based upon required knowledge of the workplace 
        which ignore the institutional boundaries where 
        learning takes place; (5) both youth and adults can 
        meet high expectations (standards) if the learning 
        environment promotes self-respect and responsibility; 
        (6) the knowledge and skills of the instructors and 
        other service staff is a key variable in the quality of 
        programs; (7) a program for every problem will not 
        promote positive youth and adult learning; (8) quality 
        information is essential for customers of workforce 
        preparation services to make prudent choices. Yet our 
        government education and labor market information 
        services is a patchwork of incomplete and disjointed 
        data with marginal quality; (9) the past mechanisms to 
        involve the employer community in the wide array of 
        workforce preparation programs have placed an undue 
        emphasis on corporate social responsibility activities 
        and insufficient attention on the central importance of 
        learning within the workplace and assisting in the 
        development of programs of study based on skill 
        standards; and (10) the current intergovernmental 
        planning, resource allocation process, management 
        information systems, case management procedures, 
        performance measures, and institutional incentives 
        utilized in most government-supported programs are 
        woefully inadequate and contribute substantially to the 
        fragmented non-system of workforce preparation 
        throughout the country.

    The solution is a seamless system that strengthens 
education and training. One that integrates academic, 
vocational and workbased learning, stressing high academic and 
skills attainments for all youth, involving employers with 
educators at all levels. Education and training should be 
married so that they complement each other and are thought of 
as ``one'' and not ``two''. Education is a life-long event. It 
does not stop the day a student graduates from school. 
Education and training are continual and necessary events in 
our adult lives. As Gunnar Myrdal, a Nobel prize-winning 
economist stated, ``Education has in America's whole history 
been the major hope for improving the individual and society.''

      TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANT

                                history

    Efforts by this Committee and its predecessor, the 
Committee on Education and Labor, to assist adults in securing 
stable, high paying jobs, extend as far back as the 1930's with 
the passage of the Fitzgerald Act, which to this day, provides 
the statutory language for the Federal involvement in 
apprenticeship training. The Job Training Partnership Act 
(JTPA), which is the primary legislation providing adult 
training services today, has its roots back to 1961, when 
Congress enacted the Manpower Development and Training Act 
(MDTA). This was President Kennedy's approach to addressing 
upward creep of unemployment and the impacts of automation 
which demanded higher skilled workers. MDTA assisted unemployed 
individuals in qualifying for existing jobs demanding specific 
skills. Eventually, amendments increased targeting to hard-to-
serve adult populations and established ``skill centers'' that 
provided remedial education and skill training.
    This program was followed by the Comprehensive Employment 
and Training Act (CETA) in 1973. CETA was established as a 
result of the Nixon Administration's widespread support for 
decentralization and decategorization of employment and 
training programs. CETA consolidated and coordinated training 
programs and initiated localized planning and implementation 
processes subject to broadly designated Federal criteria. CETA 
also instituted a public service employment component which 
eventually contributed to CETA's demise.
    In 1983 the Job Training Partnership Act (JTPA) was 
established by the Reagan Administration, replacing CETA with 
JTPA and leaving in place many of the basic features except for 
public service employment which was seen as resulting in 
widespread abuse of the program. State and local control was 
maintained and a new role was established for the private 
sector via Private Industry Councils (PIC) in order to provide 
oversight and input as to the type of training being provided. 
Amendments in 1992 increased targeting of resources to those 
most economically disadvantaged and tightened the overall 
accountability of program.
    Under the Bush Administration, a significant effort was 
made to overhaul the nation's job training program. ``Job 
Training 2000'' as it was known, pushed for many of the same 
elements which are currently included in the CAREERS Act. This 
included an increased role of business and industry, an 
emphasis on streamlined delivery of services through one-stop 
centers, and increased responsibility and choice for 
participants through the use of training vouchers.

                       adult categorical programs

    Over the years, the Job Training Partnership Act has become 
a ``tag-on'' for additional categorical training programs for 
adults. In addition to the Act's programs for economically 
disadvantaged adults (Title II-A); dislocated workers (Title 
III); disaster relief employment assistance (Title IV-J); 
microenterprise zones (Title IV-I); and the Jobs for Employable 
Dependent Individuals (JEDI) program (Title V); other 
amendments to JTPA over the years has also expanded the JTPA to 
include the Defense Conversion Assistance (DCA) to help workers 
dislocated as a result of reductions in defense spending; the 
Clean Air Employment Transition Assistance (CAETA) program to 
provide training, adjustment assistance, employment services 
and needs-related payments to workers affected by the 
compliance with the Clean Air Act; the 1991 Nontraditional 
Employment for Women Act, which amended JTPA to include 
requirements relating to the training, placing, and retraining 
of women in nontraditional employment; and the 1993 National 
Defense Authorization Act establishing the Defense 
Diversification Program (DDP) for certain discharged military 
personnel, terminated defense employees, and displaced 
employees of military contractors.
    This proliferation of programs and fragmentation of 
services to targeted groups has been the main thrust behind 
reforming the nations' system of job training programs. A draft 
paper of recommendations from the National Association of State 
Job Training Coordinating Council and Human Resource Investment 
Council Chairs, provides an excellent overview of the problems 
inherent with maintaining these fragmented programs and ways to 
improve the system--many of which are clearly stated within the 
CAREERS Act:

    Designing the next generation of a national workforce 
investment system first requires a major shift from a mind-set 
of curing the needs of clients to a vision of investing in the 
potential of individual workers that preserves the commitment 
to those individuals with the greatest needs. This requires:
          Moving from programs that stigmatize and classify 
        individuals as members of various marginal, dependent 
        populations to a system that respects individuals as 
        customers who have unique talents and capabilities and 
        the potential to take responsibility for their economic 
        well-being;
          Moving from an unemployment system designed in the 
        1930's to deal with temporary layoffs and minimal skill 
        development, to an employment and investment system 
        designed for the 21st century to deal with major 
        economic shifts resulting in permanent layoffs and 
        significant retraining needs;
          Moving from low-skill, short-term training programs 
        to a high skill training system that provides 
        continuous education and training opportunities leading 
        to skill advancements and economic security; and
          Moving from a patchwork of second-chance, 
        disconnected programs targeted to specific population 
        to a coherent, comprehensive, outcome-driven system 
        with universal access and eligibility that is part of a 
        mainstream system of life-long learning valued and used 
        by individuals and employers alike and mutually 
        supported by public and private resources.
                         building on what works

    There is a substantial amount of research and study to 
prove that a ``work-first'' approach seems to determine how 
successful or unsuccessful a particular job training and 
employment program will be. This approach, not surprisingly, is 
found to be successful across programs. This is true, 
regardless of who is being served--from mothers on welfare who 
have never held a job, to dislocated workers who held the same 
job for twenty years. There is ample evidence showing that job 
search assistance either by itself or coupled with other 
services such as on-the-job training, is highly successful.
    The success of a work-first approach for welfare mothers 
was highlighted in testimony before the Subcommittee on 
Postsecondary Education, Training and Life-Long Learning by 
Michael Genest, Deputy Director, Welfare Programs Division, 
California Department of Health and Human Services:

    * * * thanks to Ms. Gueron's evaluation in the MDRC report 
of our four California counties that were extensively studied, 
is that the GAIN Program (California's version of the Job 
Opportunities and Basic Skills (JOBS) established under Title 
IV of Aid to Families with Dependent Children), and I believe 
the other State's jobs programs, can only be successful when it 
is strongly focused on employment.

    He continued,

    I would cite Riverside County as evidence for that, and the 
MDRC report goes into some detail as to what caused that in 
Riverside county, but basically I think the main thing that 
sets Riverside apart and makes it the most effective welfare-
to-work program ever rigorously studied in this country is the 
management, the staff, the providers of service, and the 
participants, all keep their attention focused on that one goal 
of getting a job. I think that job focus is, more than 
anything, responsible for why Riverside County returned $2.84 
of savings for every taxpayer dollar of cost.

    Mr. Genest continued,

    The flip side of that, the other lesson that I think we 
have learned, is that stressing long-term education and long-
term training as opposed to stressing immediate job placement 
does not work. I would cite our Alameda County, which was also 
part of the MDRC report, as evidence of that. In Alameda County 
they truly did focus on long-term educational involvement to 
the exclusion of an emphasis on an immediate job, and that is 
why their program failed, and that is why it returned only 45 
cents in savings for every dollar of taxpayer investment, not 
an acceptable return on investment.

    The success of the work-first approach for unemployed and 
dislocated workers has also been documented in many studies. A 
recent report by the Department of Labor included the following 
summary regarding the use of work-first as part of a ``worker-
profiling'' system, discussed in greater detail later in this 
section:

          Job search assistance clients found a new job more 
        quickly, and receipt of Unemployment Insurance benefits 
        was reduced. Those receiving job search assistance 
        found new employment an average of one-half of a week 
        to 4 weeks sooner than similar individuals who did not 
        receive assistance. Most States averaged around a one 
        week reduction;
          The program was cost-effective for the government. In 
        each State experiment the savings in (UI) payments plus 
        the increase in tax receipts due to faster re-
        employment were more than enough to pay for program 
        costs. Savings to government averaged around two 
        dollars for every dollar invested in targeted job 
        search assistance; and
          Job search participants did not end up in more lower-
        wage jobs than non-participants. Some have argued that 
        mandatory job search leads to workers taking jobs that 
        do not pay as well as jobs they otherwise would have 
        found without the program. There was no evidence that 
        this was the case. In the two experiments where 
        earnings data was available, job search participants 
        not only found work more quickly, but hourly earnings 
        were similar to non-participant workers.

    A major national evaluation of the Job Training Partnership 
Act in 1992 concluded that the impacts of the program for 
adults varied according to the type of services provided: 
generally, short-term classroom training was the least 
successful, and a combination of on-the-job training and job 
search assistance produced the best results. Adults designated 
for either on-the-job training or job search assistance showed 
annual earnings gains of over $1,000 by the final year of the 
study. This represented gains of 13% for men and 17% for women.
    Although these programs maintain a heavy emphasis on work, 
this should in no way be construed to mean that there is no 
role for education and job training. On the contrary, the right 
training, for the right person, for the right job can be 
extremely beneficial both to the individual and to society as a 
whole. The Committee finds that one of the most successful ways 
to determine what services are most appropriate for an 
individual, is through an effective ``worker profiling'' 
system. This approach is currently being used by the Employment 
Services, and refers to the process by which individuals are 
screened using demographic and work history information to 
identify their risk of remaining unemployed long-term, and thus 
have the greatest need for re-employment services.
    For those who are found to be in need of training because 
they simply lack the skill to gain employment, there is also 
encouraging results by job training programs. In 1993, the 
National Commission for Employment Policy issued a report 
``Evaluating JTPA Programs for Economically Disadvantaged 
Adults: A Case Study of Utah and General Findings.'' This study 
is unique in that it utilized Unemployment Insurance (UI) 
earnings records as a measure to compare JTPA participants with 
non-participants. The results found that for women JTPA 
participants enjoyed a $1,000 gain, while men's earnings 
increased by $1,300 compared to those who did not enter JTPA.

                         vouchers/skill grants

    One of the ways this Committee hopes to make training even 
more successful is by expanding the use of vouchers or skill 
grants for training. These vouchers or skill grants are 
intended to increase the flexibility and responsibility of 
individuals in choosing education and training providers, but 
will also result in additional competition between services 
providers. A white paper released by the National Association 
of State Workforce Investment Policy Council Chairs, entitled 
``Advancing America's Workforce,'' expresses support for the 
use of vouchers or skill grants. In one of the guiding 
principles for the reform of the workforce investment system, 
the report states: ``Customers should have the option to select 
the best service providers available in their community, and 
service providers should be accountable to customers for 
delivering high quality services and meeting high performance 
standards.'' Support for vouchers or skill grants has also come 
from the National Commission for Employment Policy, in 
testimony before the Subcommittee on Postsecondary Education, 
Training and Life-Long Learning. The Commission's Chair, Mr. 
Anthony P. Carnevale stated:

          Bundling existing programs and sending them to the 
        states will work best if we also create new market-
        based incentives that empower recipients with choice 
        and enable them with information to help them choose 
        and thereby encourage the provision of the highest 
        quality services, provided with the most quality at the 
        lowest possible cost.

    The use of vouchers or skill grants for providing education 
and training is not a new idea. Currently local areas 
throughout the country are successfully experimenting with 
limited voucher programs using funds under the Job Training 
Partnership Act.

                       employer-provided training

    The Committee finds that there's simply not the capacity 
within Federal, State or local government to meet the workforce 
development needs of this nation. It is for this reason that 
businesses must continue their integral role in providing the 
training necessary to compete in an international economy. 
Although it is estimated that $40 billion to $50 billion 
annually is spent on the formal provision of training by 
American companies, a vast majority of this amount is spent by 
a relatively small number of major corporations. Small and mid-
size companies, for a variety of reasons, by and large have not 
implemented such programs. This is unfortunate because most of 
this nation's job growth is happening within small and mid-size 
businesses. It is also unfortunate because there's ample 
evidence to prove that this type of training is not only 
beneficial to employees, but also to employers. Several of 
these findings were recently highlighted in a U.S. Department 
of Labor report on job training:
          A survey of 157 small manufacturing firms in Michigan 
        who received training grants from the State government 
        estimated that the subsidies led the firms to roughly 
        triple the amount of training they provided to their 
        workers in the year they received the grant;
          The Michigan researchers also estimated that the 
        additional training provided by manufacturing firms 
        significantly reduced the rate at which output had to 
        be scrapped;
          A study of formal training programs in 155 
        manufacturing firms found that those firms introducing 
        training programs in 1983 had a productivity growth 
        rate over the next three year that was an average of 
        19% greater than firms which did not. Firms introducing 
        training programs generally began with a productivity 
        level below the industry average, but within three 
        years of introducing training they had brought their 
        productivity level up to industry standards;
          A number of studies also suggest that formal company-
        provided training can have significant positive effects 
        on the future earnings of workers who receive it. 
        Researchers have generally found that employer-provided 
        training increases worker earnings significantly, 
        although the exact amount of the increase depends on 
        such factors as the time since the training was 
        received, the amount of training received, and whether 
        or not the worker leaves the firm where the training 
        was provided; and
          Economists have estimated that the rate of return to 
        workers receiving this type of training is as high or 
        higher than the gains that result from a similar amount 
        of additional post-secondary education. Earnings gains 
        from employer-provided training have been found for 
        both more educated and less educated workers. These 
        studies isolate the effect of training on earnings by 
        controlling for family background, ability test scores, 
        education, and previous experience.
    Under the CAREERS Act, States will have the ability to use 
a portion of their funds to establish a system for employer 
loans, to assist employers in getting training programs up and 
running. Such public/private partnerships have proved to be 
very successful in States such as California. This was 
highlighted in testimony before this Committee from Mr. Kevin 
Wheeler, Director, National Semiconductor University, who 
testified on behalf of the American Society for Training and 
Development:

          The panel directs funding to training with the 
        greatest potential benefit to the California economy. 
        Key to the panels' success is its ability to forge 
        partnerships with other economic development entities; 
        its studies of the workforce of the future to determine 
        future skill and training needs; and its emphasis on 
        careful evaluation to assure ongoing improvement in the 
        program.

                            native americans

    The CAREERS Act consolidates seven existing programs for 
Native Americans as part of the overall adult consolidation 
grant. Funds for Native Americans are maintained at the Federal 
level and available to eligible tribes and service providers. 
The largest of these consolidated programs is the Job Training 
Partnership Act Section 401 program.
    The Section 401 program provides employment and training 
services for Indians, Alaskan Natives, and Hawaiian Natives. 
The program was originally included under the Comprehensive 
Employment and Training Act of 1973 and was later incorporated 
into the Job Training Partnership Act in 1982. At that time the 
Congress believed that such a program was essential to 
addressing the serious unemployment and economic conditions 
affecting Native Americans.
    The consolidation of programs for Native Americans under 
the CAREERS Act builds upon Public Law 102-477, the Indian 
Employment, Training and Related Services Demonstration Act, 
which has allowed several Native American tribes to consolidate 
a host of Federal programs into a single grant, thus allowing 
tribes to provide services in a much more efficient manner. The 
burden of multiple regulations, conflicting definitions, and 
endless management information requirements has presented an 
even larger problem for Native Americans given the relatively 
small size of grants received at the Tribal level. Under Public 
Law 102-477, these tribes have been able to streamline funds, 
unify definitions, and consolidate management information 
systems. The CAREERS Act hopes to build upon this success and 
ensure that these limited funds available to Native Americans 
are maximized.

                    migrant and seasonal farmworkers

    The CAREERS Act consolidates five existing programs for 
migrants and seasonal farmworkers as part of the overall adult 
consolidation grant. Funds for these workers are maintained at 
the Federal level and available to eligible service providers. 
The largest of these consolidated programs is the Job Training 
Partnership Act Section 402 program.
    The Section 402 program provides outreach, classroom 
training, on-the-job training and supportive services to 
eligible migrants and season workers. A 1994 evaluation of the 
program by the Department of Labor came to the following 
conclusions:

          The study team was impressed at the dedication of the 
        Sec. 402 program operators, and found that many 
        programs were effectively serving migrant and seasonal 
        farmworkers, populations that are among the hardest to 
        serve in the JTPA system. The programs have 
        considerable experience in delivering both employment 
        and training and supportive services to farmworkers, 
        who look to these agencies as a source of assistance 
        both when they are migrating and at home. Many programs 
        have adapted their service delivery needs of the 
        eligible populations in their areas, and continue to 
        adapt them as populations shift and directives from the 
        Department of Labor change.

    Given the relative success of the JTPA migrant program, it 
is the Committee's intent that any funds to provide services to 
migrants under the CAREERS Act will build upon its success.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
                 LIBRARY SERVICES AND TECHNOLOGY GRANT

            subtitle a--adult education and family literacy

    Public adult education is in many ways a Federal creation, 
beginning in 1964 when the Adult Basic Education Program was 
created by the Economic Opportunity Act. This initial law 
offered persons 18 and older opportunities to develop basic 
skills in reading, writing, language, and arithmetic.
    In 1966, Congress enacted the cornerstone of adult 
education, the Adult Education Act (AEA). This program is 
administered by the U.S. Department of Education and is the 
major source of Federal funds supporting State and local 
literacy programs.
    The purpose of the Adult Education Act is to provide 
educationally disadvantaged adults the opportunity to acquire 
basic literacy skills, benefit from job training programs, 
obtain and retain employment, and acquire a high school 
diploma. This is of particular importance in today's highly 
technological society, where the number of jobs available to 
individuals without a high school diploma or strong literacy 
skills are rapidly disappearing.
    In 1991, Congress again sought to improve existing Adult 
Education programs by passing the National Literacy Act. The 
Act established the National Institute for Literacy, which was 
set up to act as an interagency Institute to improve literacy 
services and to provide technical assistance and information to 
State and local adult education and literacy programs to enable 
them to improve the quality of services provided to 
participants.
    The overall growth in the adult education program has risen 
from 38,000 individuals served in 1965 to almost 30 million by 
1994. However, the extent of illiteracy in the United States is 
striking. The 1992 National Adult Literacy Survey, which 
measured the ability of individuals to read and understand 
words, to use documents effectively, and to perform tasks such 
as balancing a checkbook and totaling purchases, found that 20 
percent of adults had minimal basic skills. In fact, of the 
five levels of literacy used in the survey, almost 50 percent 
of participants were found to be in the bottom two levels of 
literacy. Forty-three percent of those in the lowest literacy 
level live in poverty, 17 percent were receiving food stamps 
and 70 percent were unemployed or under-employed. More than 
two-thirds of unwed parents, adults in poverty, school dropouts 
and arrestees have below average literacy levels.
    If our Nation intends to retain its position in the world 
marketplace, put individuals on welfare back to work and reduce 
crime, there will continue to be a great demand for adult 
education programs. Considering that the typical welfare 
recipient reads at an 8th grade level, much education will need 
to occur before a recipient will have the skills necessary to 
complete job training programs and obtain a job which will 
enable him or her to support their family without depending on 
Federal assistance programs.
    However, there are some problems with the current adult 
education and literacy programs. Although we have seen 
substantial growth in participation, measuring the success of 
adult education programs is difficult. Large numbers of 
participants drop out or do not achieve program goals. Part of 
the problem is that Federal programs and policies for adult 
education and literacy, duplicate, complicate, and run 
counterproductive to the ability of States and local providers 
to develop programs which meet the needs of participants. State 
and local literacy practitioners are discouraged by 
incompatible Federal funding streams, eligibility restrictions, 
and accountability requirements controlled by the Federal 
government. They are also frustrated by the maze of paperwork 
necessary to receive funds from existing Federal adult 
education and literacy programs. These problems alone justify 
the need for the reform proposed in this legislation.
    In developing the CAREERS bill, the Committee was well 
aware that the adult education and literacy delivery system is 
unlike the elementary, secondary, and postsecondary education 
systems in many important respects. This is a unique system 
characterized by a diverse group of providers, diverse students 
and limited resources. For example:
          For the most part, those served in adult education 
        are young adults. 58% are between the ages of 16-31. 
        Many of these young people have dropped out of school 
        and are trying to get back on the road to self 
        sufficiency and opportunity. A subgroup or this 
        population is clearly the young mother on AFDC who, 
        under the various welfare reform proposals, will be 
        required to find a job relatively quickly;
          Almost half the participants in this part of the 
        American educational system are working. In other 
        words, this is not a field that serves only the very 
        poor and those unattached to the workforce. Many 
        students are blue collar workers or dislocated workers 
        who understand that to get ahead and provide for a 
        family in 1995, it takes an education and the requisite 
        skills;
          Not all the participants in this system come to 
        programs solely to improve their employment prospects. 
        Many are looking to become citizens, to help their 
        children succeed in school, and to fulfill a variety of 
        other personal, economic, and social goals. Most of 
        these goals have serious implications for our national 
        well-being;
          Providers of services in this system are many and 
        varied. They include local education agencies, 
        community colleges, community-based organizations, 
        libraries, churches, and private businesses. The 
        diversity of providers is both a strength and a 
        challenge to building a high quality system. Services 
        are located in the communities where they are most 
        needed and easily accessible. But different programs 
        often are not coordinated and lack shared information 
        and resources to improve the quality of their services; 
        and
          The staffing of adult education and literacy programs 
        is significantly different from that of elementary, 
        secondary, and postsecondary education. The vast 
        majority of adult education staff are part time 
        professionals, working in isolation from the rest of 
        the educational system, with little training and 
        virtually no benefits. Only 25% of the teaching force 
        is full time. Almost 75% of all programs have 
        volunteers, most serving as tutors.
    Adult education services are absolutely critical to 
accomplishing our national goals for education, employment, 
welfare and citizenship. Literacy levels predict how long a 
displaced worker stays unemployed, the number of weeks worked 
and wages earned for the employed, whether a child will arrive 
at school ready to learn, and whether a citizen is registered 
to vote.
    Over the past ten years, the adult education system has 
been asked to step into a number of new roles. The welfare 
system has asked it to help prepare poor, unemployed adults for 
training and work. Employers have asked adult educators to 
upgrade the skills of their workers. Schools and parents have 
asked literacy programs to address the intergenerational nature 
of literacy and help parents become their children's first 
teachers. At the same time, there have been new expectations 
for accountability and results.
    The CAREERS Act helps ensure that the adult education and 
literacy system will continue to develop and grow through a 
separate stream of funding, the requirement that funding follow 
adults referred for education from the one-stop centers, and 
the requirements for accountability related to goals and 
performance measures. Through these provisions of the bill, and 
many others, CAREERS provides the structure for a reformed 
system of adult education and literacy that will serve the 
student and our nation well.

    Subtitle B--Library Services and Technology Consolidation Grant

    Several Federal programs and agencies provide assistance to 
elementary and secondary, college and university, and public 
libraries. Major programs include the Elementary and Secondary 
School Library Media Resources Program authorized under the 
Improving America's Schools Act of 1994 (P.L. 103-382), the 
Academic Library and Information Services provisions under 
Title II of the Higher Education Act of 1965, and the Library 
Services and Construction Act (LSCA). Other programs or 
agencies which impact libraries, either directly or indirectly, 
include the National Endowment for the Humanities, the National 
Commission on Libraries and Information Science, the White 
House Conference on Library and Information Services, and the 
Library of Congress.
    Of the major programs mentioned above, the Elementary and 
Secondary School Library Media Resources Program was authorized 
at a $200,000,000 level in 1994, but has received no funding to 
date.
    Funding for library programs under Title II of the Higher 
Education Act in 1995 was somewhat better--approximately $11.4 
million.
    On the other hand, the Library Services and Construction 
Act, which is the largest Federal program of assistance 
specifically to libraries, received $132.7 million in 1995. 
LSCA funding is used to operate programs of public library 
services (Title I of LSCA), public library construction and 
technology enhancement (Title II of LSCA), interlibrary 
cooperation and resource sharing (Title III of LSCA), library 
services for Native Americans and Native Hawaiians (Title IV of 
LSCA), and library literacy programs (Title VI of LSCA). As 
amended in 1990, the LSCA contains eight titles authorizing aid 
for many different, and in some cases, duplicative activities.
    Of all revenues for public libraries--Federal, State, 
local, and other sources--LSCA funds represent about 1.4 
percent. Yet, Federal LSCA funds are used for numerous and 
varied activities including services to populations with 
special needs, information-sharing networks, adult literacy 
services, specialized or new services, and the purchase of 
equipment for computer networks.
    Rather than continue to spend limited Federal dollars on 
multiple activities, the Committee believes it is more 
efficient to narrowly focus Federal assistance upon one area--
electronic technology. Accordingly, Subtitle B of Title IV of 
H.R. 1617 consolidates the major Federal library service 
programs into a single categorical grant which will be used to 
improve public access to information through electronic 
networks, and provide linkages among and between libraries and 
one-stop career center systems.

           TITLE V--AMENDMENTS TO REHABILITATION ACT OF 1973

                               Background
    The Rehabilitation Act of 1973 provides comprehensive 
vocational rehabilitation (VR) services designed to help 
individuals with physical and mental disabilities become 
employable and to achieve independence and integration into 
society. The Rehabilitation Act was originally enacted in 1920 
as a means of returning injured workers to their jobs. The 
program was expanded in 1943 to help meet the manpower shortage 
after the entry of the United States into World War II. 
Amendments in 1973 gave service priority to persons with severe 
disabilities if such persons had employment potential. The 1978 
amendments expanded the Act by adding a major new service 
category, comprehensive services for independent living, for 
persons with severe disabilities without current employment 
potential. Amendments in 1986 strengthened services to the 
severely disabled by authorizing employment services for 
persons unable to maintain competitive employment without 
special assistance.
    Amendments in 1992 reauthorized the Act for five years 
through FY 1997. Among other provisions, the law included 
amendments to establish a general presumption that persons with 
disabilities, including persons with severe disabilities, can 
benefit from VR services in terms of an employment outcome, 
unless the State VR agency can show evidence otherwise. This 
presumption allows some persons, who would not have otherwise 
been eligible, to enter the program. The amendments also 
required that eligibility for VR services be determined within 
60 days of application; increase client choice of VR services; 
and increased requirements for consumer control of 
rehabilitation policy and service delivery. Amendments in 1993 
made technical changes to the Act.

                            Need for Change

    The Committee believes that the vocational rehabilitation 
system needs to be significantly reformed to better meet the 
rehabilitation and employment training needs of individuals 
with disabilities, particularly those with severe disabilities.
    The public rehabilitation system has evolved over a 75 year 
history and has developed a degree of expertise and success in 
serving those individuals with the greatest needs. However, 
there are serious shortcomings in the centralized service 
delivery structure--shortcomings that are becoming more glaring 
as the need for rehabilitation among Americans with 
disabilities becomes more acute.

                New Demographic Trends/Growing Caseload

    In its 1993 study of the current rehabilitation system, the 
General Accounting Office pointed out emerging factors which 
are placing great strain on the centralized system:

          Effective vocational rehabilitation programs are 
        important for a number of reasons. First, a productive 
        and humane society is enhanced by the useful employment 
        of as many of its adult members as possible. Second, 
        statistics suggest that the population of Americans 
        with work disabilities may be increasing. Some scholars 
        have argued that recent reductions in the risk of death 
        from accidents and illnesses are associated with an 
        increasing risk of disability. And third, technological 
        developments such as the availability of assistive 
        devices and new behavioral training techniques have 
        made it possible for individuals who were previously 
        regarded as unemployable to enter the workplace.

    With these changes in the characteristics of the population 
needing services, additional strains are being placed on the 
system. From FY 1992 to FY 1993, the number of newly eligible 
persons increased by 24 percent, the highest intake level in 16 
years. Requirements added in the 1992 amendments have recently 
affected VR caseload trends. These included the presumption of 
benefits, and that VR agencies make eligibility determinations 
within 60 days of a person's application.

      Declining Success Rate for the Public Rehabilitation System

    This growing caseload of individuals with severe 
disabilities is being fed into a system that over the last 20 
years has demonstrated an unresponsiveness and inability to 
serve individuals with severe disabilities. From 1975 to 1993 
there has been a 40 percent decline in the total number of 
persons rehabilitated.
    Each year, a little over 1 million persons are served under 
the Federal-State Vocational Rehabilitation program. Of those 
served, about 200,000 were rehabilitated (cases were closed 
successfully) in a given year.
    For the VR system, a `rehabilitation' means a 60-day 
placement, although not necessarily a wage earning placement. 
Even by this very low standard, the system fails to 
rehabilitate 45 percent of its clients. Each year, 154,000 
severely disabled Americans are failed by the Public VR System.
    In addition to the failure rate for those that are not 
rehabilitated, there is a serious question about the long-term 
program benefits for those that are rehabilitated. The 1993 GAO 
Report on the vocational rehabilitation program noted,

          GAO concluded that evidence on VR results was mixed. 
        In contrast to the short-term gains typically reported 
        by the program, GAO's evaluation of long-term outcomes 
        founds that rehabilitants' gains in employment and 
        earnings from time of referral to their case-closure 
        years of 1980 faded after about 2 years. The fraction 
        working shrank steadily. By 1988, the last year 
        examined, 61 to 66 percent of rehabilitants (depending 
        on type of disability) had some earnings; however, this 
        was either no better than or below the pre-program 
        level (depending on type of disability), and only a 
        third had worked continuously since 1980.
    Also, when judged by the Social Security Administration's 
more challenging standard of 9 months job placement for SSI and 
SSDI clients, the VR agency only experienced a 7 percent 
success rate (about 6,000 of the 77,000 cases referred by SSA).
    The Committee concludes that the public rehabilitation 
system has not demonstrated enough overall success and 
expertise in serving the severely disabled to justify 
continuing the status quo.

             High Unemployment Rates for Disabled Americans

    Despite an investment of $2 billion per year, the 
unemployment rate for severely disabled Americans remains 
staggering. Out of 12.6 million severely disabled persons (male 
and female combined), only 2.9 million are employed (23.2%). 
While employment rates for persons with moderate disabilities 
are comparable with the non-disabled, employment rates for the 
severely disabled are drastically lower.
    It is hard to argue the current centralized system can not 
argue that the system is having a positive impact on 
employment. In fact, employment rates for individuals with 
disabilities have been constant (and may have dropped) during 
the life of the current Rehabilitation Act.
    Most Americans would be shocked to find out that disabled 
Americans suffer from such high unemployment, particularly 
after the passage of civil rights protections in the Americans 
With Disabilities Act. Maintaining a segregated system of 
rehabilitation and training for persons with disabilities will 
allow the public vocational rehabilitation system to remain 
insulated from scrutiny and accountability.
    Defenders of the status quo point to stories of individuals 
who have been truly helped by the system. In its oversight 
role, the Committee listens to more than just individual 
stories of success; it must look at larger trends and whether 
or not the system is working for most individuals who need 
help. We must also judge the rehabilitation system by the many 
people that are failed (45 percent of all participants) and ask 
if there is a better way.

                      Inefficient Use of Resources

    Rehabilitating an individual with a severe disability is an 
expensive proposition. Some would argue, and many State 
rehabilitation programs have argued in the past, that the high 
cost of helping an individual with a severe disability overcome 
the barrier to gainful employment is not justified.
    However, the Committee believes the cost of rehabilitation 
is justified, both because there will be long-term cost benefit 
to reducing individual dependence on public assistance, and 
because it enhances the quality and humanity of American 
society.
    Still, there is no justification for wasteful and 
inefficient spending by government rehabilitation programs. 
Funds that are inefficiently spent on bureaucracy are funds 
that are not available for critical goods and services to help 
individuals overcome barriers of disability.
    As Patrick W. McKenna, Director of the Maryland 
Rehabilitative Services, observed:

          The systems, procedures and required processes 
        imposed on providers of rehabilitation services are an 
        anachronism which somehow prevail despite the knowledge 
        that they are, in many respects, obstacles which limit 
        and compromise the effective and responsible delivery 
        of services for consumers. The public program of 
        vocational rehabilitation has created, over many 
        decades, a burdensome reliance on ``process'' which has 
        created an environment where value is placed on form 
        over substance.

    Of the current State spending on the rehabilitation system, 
the Rehabilitation Services Administration estimates that an 
average of 10.4 percent is spent on State administration of 
rehabilitation programs, 34.6 percent on counseling and 
placement, and about 50.8 percent on purchased services.
    The current system is too procedural and bureaucratic and 
soaks up resources that should be spent on goods and services. 
The Committee believes that the system needs to be streamlined, 
especially in areas of evaluation, assessments, and counseling, 
so that more resources can be devoted to securing services and 
goods needed by the consumer. An integrated system will allow a 
much greater efficiency in resources so that better, more 
client-centered services can be delivered.

                   Need for Competition/Market Forces

    For several years, consumer groups representing individuals 
with disabilities such as the National Federation of the Blind 
and the National Coalition for Independent Living, and others, 
have been asking for a better way.
    In testimony before the House Subcommittee on Select 
Education in 1986, James Gashel, Director of Governmental 
Affairs of the National Federation of the Blind testified,

          This sense of growing frustration with the current 
        system of vocational rehabilitation has led many in the 
        National Federation of the Blind to give thought to 
        alternative systems of services rather than using the 
        traditional vocational rehabilitation State agencies. 
        One plan would be to install a free market system where 
        clients could pick and choose among rehabilitation 
        agencies who would, in a sense, be competing for their 
        patronage. This would be a step beyond and outside of 
        the institutionalized State vocational rehabilitation 
        agency system. It would provide a rehabilitation 
        benefit in the sense of portable funding available to a 
        handicapped individual for use at any agency capable of 
        providing the services. Maybe we are ahead of our time 
        in proposing such a concept, or even thinking about it, 
        but we think Congress should consider it.

    Dr. Carolyn Weaver, resident scholar of the American 
Enterprise Institute echoes Mr. Gashel's sentiments on the 
benefits of competition:

          The public VR system would benefit from a healthy 
        dose of competition. Competition fosters 
        experimentation and innovation, both critical for 
        solving the kinds of information problems that plague 
        rehabilitation. Firms competing to attract new 
        customers would have the incentive to experiment with 
        new diagnostic and evaluation techniques, new methods 
        of case management or training and placement, and new 
        forms of administration and financing as they attempted 
        to supply what customers wanted at a price they were 
        willing to pay. Good ideas would tend to be rewarded 
        and, with easy access by new suppliers, bad ideas would 
        tend to be penalized.

                               Conclusion

    In the opinion of the Committee, and based on input from 
consumers over many years, the State run rehabilitation system 
is not nearly as efficient in the use of resources as it should 
be, is slow to respond to individual needs and aspirations, has 
very little accountability for outcomes, and allows very 
limited market forces of competition to improve the quality of 
services to individuals with disabilities.
    For these reasons, the Committee believes it is essential 
that, in the development of a Statewide Workforce Preparation 
System under the CAREERS Act, that vocational rehabilitation be 
a full partner in the system. This will allow individuals with 
disabilities to gain access to specialized rehabilitation and 
employment services through a new, locally-based, one-stop 
career center system.
                                Summary

    The following is a summary of the legislation as approved 
by this Committee:

             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

    In reporting H.R. 1617, the Committee on Economic and 
Educational Opportunities intends to transform the vast array 
of Federal job training, workforce, and education-related 
programs into a consolidated workforce development and literacy 
system. The bill takes a collection of fragmented and 
duplicative categorical programs and folds them into a high 
quality, comprehensive, and accountable Federal workforce 
development and literacy system--a system designed to meet the 
educational, employment, and training needs of the workforce 
and the competitiveness needs of employers, both now and into 
the future.
    Title I of the bill establishes an infrastructure around 
which States and local communities may build a comprehensive 
workforce development and literacy system. The purpose of this 
title is to establish a framework for Governors to utilize a 
collaborative process for comprehensive system planning and 
decision-making for the four consolidation grants (youth, adult 
training, adult education, and vocational rehabilitation) 
established under the Committee bill. This title requires the 
development of a single State plan and performance measurement 
system for the four consolidation grants. It further requires 
the designation of local workforce development areas; the 
establishment of local employer-led workforce development 
boards; the establishment of a statewide one-stop career center 
system for the delivery of employment and training assistance 
at the local level; the development of a common management 
information system for the collection and dissemination of data 
across the four grant programs (for reporting purposes); and 
the certification of eligible providers of education and 
training under the Adult Employment and Training programs and 
the Vocational Rehabilitation programs.

TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION--CONSOLIDATION GRANT

    Title II consolidates nearly 30 education and job training 
programs for youths into a single block grant to the States. 
The consolidation melds the strong points of the current Carl 
D. Perkins Vocational and Applied Technology Act, the School-
to-Work Opportunities Act and the Job Training Partnership Act 
(JTPA) youth programs into one comprehensive program.
    Funds flow from the Federal government to the Governor 
based on a formula which bears the same ratio as the average of 
funds they received in FY 1995 under Sections 101 and 101A of 
the Perkins Act and Sections 252 and 262 of JTPA. The intent of 
the formula is to keep the flow of new funds as close to the 
current flow as possible.
    The Youth Development and Career Preparation Consolidation 
Grant moves the focus of programs from the Federal and State 
levels to the local level--90% of funds under this grant must 
be sent to the local level. States retain 8% for State level 
activities and 2% for administrative purposes. The Governor, 
through the collaborative process, determines the substate 
formula for the 90% of funds which go to the local level; in 
addition, there is a Federal requirement that at least 40% of 
these funds be used to serve in-school youth and 40% of the 
funds must go to serve out-of-school/at-risk youth. The 
Governor, through the collaborative process, can use 10% of the 
funds at the local level for incentive grants or competitive 
awards, or the money can be distributed by formula. The 
remaining 10% of funds may be split in any way between the in-
school and at-risk/out-of-school youth programs, or the entire 
10% may be applied to one program or the other; however, the 
money must go out by formula. The 20% of discretionary funds 
cannot be used for any other purpose except for programs to 
serve in-school and at-risk/out-of-school youths.
    In establishing a substate formula, the Governor through 
the collaborative process, must take into account poverty rates 
and the proportion of the State's youth population within local 
communities. The Governor, through the collaborative process, 
may add other factors he or she considers appropriate, but must 
ensure an equitable distribution throughout the State. The bill 
further clarifies that such factors not be disproportionately 
weighted.
    A partnership between local educators and local workforce 
development boards will develop a plan to serve both in-school 
and out-of-school/at-risk youth. The plan is submitted to the 
Governor who, through the collaborative process, approves or 
disapproves the plan. Money flows to the local level after 
submission of the plan. In-school youth funds will flow to the 
schools and at-risk/out-of-school youth funds will go to local 
workforce development boards to be subcontracted for services. 
Minimum grant awards are established at $15,000 for local 
education agencies and local workforce development boards, and 
$50,000 for postsecondary institutions or consortium of 
institutions (including secondary-postsecondary consortia). A 
State may waive the minimum grant amount in any case where the 
eligible recipient is located in a rural, sparsely populated 
area and demonstrates that it is unable to enter into a 
consortium for purposes of providing services under this title.
    National programs are provided $25 million or 20% of total 
funding, whichever is less, for research and demonstration 
programs.

      TITLE III--ADULT EMPLOYMENT TRAINING AND CONSOLIDATION GRANT

    Title III consolidates existing Federal employment and job 
training programs for adults into a single block grant to the 
States. Governors, through a collaborative process, allocate 
the block grant funds to Local Workforce Development Boards, 
established within Workforce Development Areas in each State. 
Part of the funds under Title III would be held at the State 
and Federal levels to carry out activities such as rapid 
response, incumbent worker training, program innovation, 
incentive grants, and technical assistance.
    Funds available at the local level would be used to provide 
core services, intensive services, and education and training 
services. Core services include such activities as providing 
information on job opportunities, the labor market, and 
education and training providers. Intensive services include 
specialized assessments, counseling, and development of 
employability plans. Education and training services would be 
provided to individuals unable to obtain employment through 
either core or intensive services. Local workforce development 
boards are required to establish a process by which 
economically disadvantaged individuals and dislocated workers 
are given priority for intensive services and for education and 
training services, in those instances when funding is limited 
in a workforce development area.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
                 LIBRARY SERVICES AND TECHNOLOGY GRANT

    Title IV, Subtitle A of the bill consolidates several adult 
education and literacy programs into a single block grant to 
the States. Funds distributed to local adult education 
providers, through the States, are to be used to provide adult 
education and family literacy services to qualifying adults. 
Subtitle A also provides a framework to help ensure that adult 
education programs are closely aligned with federal job 
training programs.
    Title IV, Subtitle B consolidates several programs 
authorized under the Library Services and Construction Act and 
other Federal laws into a single categorical grant dedicated to 
improving public access to information through electronic 
networks, and to providing electronic linkages among libraries, 
and between libraries and one-stop career center systems.

         TITLE V--AMENDMENTS TO THE REHABILITATION ACT OF 1973

    Title V makes comprehensive changes to the Rehabilitation 
Act of 1973, a major Federal law which provides rehabilitation 
and employment training to adults with disabilities. Under the 
changes, vocational rehabilitation services will be provided 
primarily through locally-based one-stop career center systems. 
Private sector providers will be allowed to participate in the 
rehabilitation system, thereby increasing consumer choice in 
the selection of career objectives, and the goods and services 
to achieve those objectives.

                TITLE VI--REPEALERS AND OTHER AMENDMENTS

    Title VI repeals the existing authorization for numerous 
programs consolidated into the four block grants, and it sets 
forth October 1, 1996 as the effective date of the repeals.
              Explanation of the Bill and Committee Views

        TITLE I--INFRASTRUCTURE OF WORKFORCE PREPARATION SYSTEM

    For years, concerns have mounted regarding this nation's 
confusing array of career-related education, employment, and 
job training programs. As the U.S. General Accounting Office 
points out, there are as many as 163 different Federal 
programs, totaling $20 billion per year, which offer some form 
of education, job training or employment assistance for youth 
and adults. In addition to the excessive number of Federal 
programs, the quality of U.S. training programs varies 
significantly. At a time when the skill requirements of the 
U.S. workforce are at an all-time high, this country can no 
longer tolerate such an inefficient system--or ``non-system'' 
of workforce development.
    After careful consideration of this issue, including a 
comprehensive set of hearings, the Committee developed the 
Consolidated and Reformed Education, Employment, and 
Rehabilitation Systems Act (CAREERS Act). CAREERS consolidates 
(and eliminates) over 90 existing education, employment, and 
job training programs into 4 consolidation grants. This 
consolidation eliminates unnecessary duplication and 
fragmentation within programs, while redesigning programs 
serving youth, adults, the disabled, and individuals with basic 
skills deficiencies. The bill:
          Transfers authority for the design and operation of 
        programs to States and local communities, with limited 
        direction on the establishment of an infrastructure to 
        support State and local workforce development systems.
          Establishes a system which is market-driven, provides 
        customer choice, and is easily accessible, by:
                  Encouraging service delivery through a one-
                stop career center system; involving employers 
                in the design and implementation of systems; 
                encouraging the use of vouchers or skill grants 
                for receipt of training and educational 
                services;
                  Providing information on the performance of 
                local service providers as well as enhanced 
                labor market information;
                  and by establishing an enhanced performance 
                measurement system for workforce development 
                programs.
    Title I of the bill establishes an infrastructure around 
which States and local communities are intended to build a 
comprehensive workforce development and literacy system. While 
the ``CAREERS Act'' contains four consolidation grants to the 
States and to local communities, it is envisioned that these 
four grant programs will comprise a system. The transfer of 
responsibility and authority for the design and operation of 
programs to States and local communities is a major goal of 
reform. However, after careful study and input from testimony 
heard through the Committee's extensive hearing process, 
Members of the Committee decided to set some broad parameters 
for the design of the infrastructure in order to drive 
workforce development and literacy programs to peak 
performance.
    Title I of the bill requires that Governors, through a 
collaborative process, bring all relevant State agencies that 
are responsible for workforce development programs, and 
representatives of business and industry, education, locally-
elected officials, individuals with disabilities, community 
based organizations, representatives of employees, and others 
as appropriate, together to plan for the development of the 
workforce development and literacy system across the 4 
consolidation grants.
    It is the intent of the Committee that the Governor, along 
with the individuals and agencies involved in the collaborative 
process, develop a single State plan and performance 
measurement system for all four consolidation grants. In 
addition, the Governor, through the collaborative process, is 
intended to set overall policy guidance and criteria for: the 
designation of workforce development areas; the selection of 
local workforce development boards; establishment of a 
statewide one-stop delivery structure for the provision of 
employment and training assistance at the local level; 
development of substate formulas for driving program dollars to 
local communities under title II and title III of the bill; 
development of a common management information system for the 
collection and dissemination of information and data across the 
4 grant programs (for data collection and reporting purposes); 
and the certification of eligible providers of education and 
training under the Adult Employment and Training and the 
Vocational Rehabilitation programs. This consolidation of 
administrative, planning, reporting and data collection 
requirements, in addition to the actual consolidation of over 
90 Federal programs into the four consolidation grants, will 
dramatically reduce duplicative and costly planning, paperwork, 
and reporting requirements, resulting in significant savings.
    It is the intent of the Committee, through title I of the 
legislation, to establish a necessary balance between States 
and local communities for the design and operation of workforce 
development and literacy systems. Governors are given a great 
deal more flexibility and authority to provide policy guidance 
and to design integrated and innovative statewide workforce 
development and literacy systems. Local communities are 
provided with the flexibility and authority to design and to 
operate local workforce development and literacy programs that 
meet the employment, education and training needs of individual 
communities, consistent with the statewide policies set by the 
Governor through the collaborative process.

                           State Requirements

    Section 102 of the bill requires that in order for a State 
to receive a grant under one or more of the programs 
established under this Act, they must: establish a 
collaborative process; develop a State workforce development 
and literacy plan; and comply with the requirements of this 
Act. This section further clarifies that for the purposes of 
this Act, Workforce Development and Literacy Programs include: 
the Youth Workforce Preparation and Development Consolidation 
Grant established under title II; the Adult Employment and 
Training Consolidation Grant established under title III; the 
Adult Education, Family Literacy, and Library Technology 
Consolidation Grant, established under title IV; and the 
program amended by subtitle A of title V (relating to title I 
of the Rehabilitation Act of 1973).
    When developing this comprehensive reform of our U.S. 
workforce development and literacy programs, Members of the 
Committee considered many options, starting out with the 
consideration of the CAREERS Act legislation introduced by 
Committee Republicans last Congress, to the establishment of a 
single block grant to States for workforce development. The 
Committee started with the proposition that the current 
workforce preparation system simply did not work. There is too 
much waste and duplication. Clearly, if there is to be a 
Federal role in assisting States and communities in this area, 
as the Committee believes there is, it should be focused on a 
limited number of purposes that can truly make a difference. 
After careful deliberation, the Committee made a conscious 
decision to establish four consolidation grant programs for the 
purpose of establishing a workforce development and literacy 
system within each State because of the very different 
populations to be served, and the very different and important 
missions of each of these programs. It is the intent however, 
that these four programs comprise a true system within each 
State and local community for the purpose of preparing and 
educating individuals for careers, for assistance in the 
employment of such individuals, for assisting individuals with 
disabilities to become employed and independent, and for the 
purpose of making individuals literate.

                      State Collaborative Process

    Section 103 requires that the Governor of a State that 
desires to receive a grant under one or more of the workforce 
development and literacy programs, must certify to the 
Secretaries of Education and Labor that a collaborative process 
has been used in complying with the applicable provisions of 
this Act. This section further clarifies that the collaborative 
process must include, at a minimum, the Governor and 
representatives of: business and industry, local chief elected 
officials (representing both cities and counties), local 
educational agencies (including vocational educators), 
postsecondary institutions (including community and technical 
colleges), the State Rehabilitation Advisory Council, 
organizations representing individuals served by programs 
established under this Act (including community-based 
organizations), and employee representatives, all appointed by 
the Governor; and the lead State agency official or officials 
from the State educational agency (including officials 
representing vocational education, adult education and 
literacy, and libraries); and the State agencies responsible 
for economic development, employment security (and job training 
where different from the employment security agency), 
postsecondary education, vocational rehabilitation (and where 
applicable, the State agency providing vocational 
rehabilitation services for the blind), welfare, and the 
representative of the Veterans' Service assigned to the State.
    As a State's highest ranking elected official, the Governor 
is key to the establishment of an effective workforce 
preparation system in every State. As such, the Committee 
provides Governors with the lead role in establishing the 
overall State workforce development and literacy system within 
each State. However, Members of the Committee recognize that 
Governors alone cannot, and should not be solely responsible 
for development and operation of such programs if we are truly 
to effect meaningful reform in this area. The Committee-
reported bill places great emphasis on the establishment and 
utilization of a collaborative process, for purposes of 
establishing the State workforce development and literacy plan, 
as well as for making most major State-level decisions 
affecting the system. A similar collaborative process was 
established under last Congress' School-to-Work Opportunities 
Act, and has appeared to achieve a necessary balance in the 
design of school-to-work programs. While the Committee 
purposely did not include prescriptive requirements as to what 
the collaborative process must entail, or how it should work in 
every State, it is the Committee's intent that such process be 
open, active, participatory, and significant. The Committee 
feels very strongly that ``private sector'' representatives, 
particularly representatives of business and industry, be 
integrally and actively involved with the Governor and key 
State agency heads in the design of the State-wide system. The 
Committee recognizes the central role that employers must play 
in building an effective workforce development system, both at 
the State and the local levels. It is essential that business 
and industry be involved in the design of State and local 
workforce development programs, and in development of each 
State's labor market information system, in order that all 
workforce development and literacy programs meet the skill 
requirements of today's workplace. And it is imperative that a 
significant representation of individuals from business and 
industry participate in the State-level collaboration process 
to ensure that a broad range of industry concerns are 
understood and addressed in development of the workforce 
development and literacy system. Only through such an involved 
employer role will students, schools, and employment and 
training programs be continually aware of the changing demands 
and skill needs of the workplace. The Committee also recognizes 
that private sector involvement alone will not guarantee 
successful workforce development programs. Therefore, it is 
imperative that employees be involved in the collaborative 
process. For job training programs to work effectively, the 
Committee believes the collaborative process should seek to 
have everyone at the table. In the Committee's opinion, at the 
very least, that means employers and employees.
    In recognition of the fact that many States have already 
established State-level collaborative processes for the purpose 
of establishing workforce development systems, the Committee-
reported bill allows such pre-existing processes, that 
substantially meet the purposes of collaboration established 
under this section, to meet the collaboration requirements of 
the Act. Specifically, States may utilize workforce development 
councils (including State Human Resource Investment Councils 
established under the Job Training Partnership Act), for 
carrying out the collaborative process described under this 
section. Or, if a State has already established a collaborative 
process for the purpose of establishing a one-stop system or a 
school-to-work system, such process may meet the collaboration 
requirements if it is substantially similar to that required 
under this Act. While Committee Members did not want to go so 
far as to require that Governors establish State level 
workforce investment policy councils, the Committee recognizes 
the leadership that these bodies have provided in States where 
such councils exist, and therefore encourage their 
establishment and use in fulfilling the collaboration 
requirements provided under H.R. 1617, as determined 
appropriate by each individual Governor.

       Consolidated State Workforce Development and Literacy Plan

    Section 104 requires that the Governor of a State that 
desires to receive a grant, submit a single State Workforce 
Development and Literacy Plan for all 4 consolidated programs 
established under this Act, to the Secretaries of Education and 
Labor. Such State plan must include: a description of the 
collaborative process used in developing the plan; a statement 
of the goals of the State workforce development and literacy 
system, including an assessment of the workforce and literacy 
needs of the State, and the identification of progress 
indicators that the State will use to measure its progress in 
meeting such goals; a description of how the State will comply 
with the requirements of the Act; a description of how a State 
will participate in the National Labor Market Information 
system established under the Act; additional plan elements 
contained in titles II through V; a description of the measures 
that will be taken by the State to ensure coordination and 
avoid duplication among programs receiving assistance under 
this Act, including a description of common data collection, 
reporting processes, and the establishment of a common 
management information system across workforce development and 
literacy programs; a description of the process used by the 
State to provide an opportunity for public comment and input 
into the development of the plan; assurances that the State 
will provide for fiscal control accounting procedures that may 
be necessary to ensure the proper disbursement of, and 
accounting for, funds paid to the State under this Act; and a 
description of the sanctions which the State may impose 
(including restrictions from future participation or 
consideration for funding) in instances where recipients of 
funds under this Act fail to achieve agreed upon performance 
measures, fail to adhere to State mandated fiscal control and 
funds accounting procedures, or take or fail to take other 
actions required under the State plan, contracts, or other 
agreements.
    In recognition of the fact that the Governor is the chief 
elected official of the state, and is the individual who is 
ultimately accountable in the State for the overall workforce 
development system (except where such duties are assigned by 
State constitutions or statute to other constitutional bodies), 
the Committee-reported bill specifies that if after a 
reasonable effort is made, and agreement cannot be reached 
through the collaborative process in development of the State 
plan or in making decisions for the workforce development and 
literacy system, the Governor has final authority to make such 
decisions and to submit the plan. However, participants in the 
collaborative process, who are in disagreement with the plan, 
may submit their views with the plan, regarding the area for 
which they were selected for representation. Further 
recognizing that certain State constitutions and laws provide 
an individual or an agency other than the Governor with 
responsibility for education, employment, or training programs, 
this section clarifies that nothing in this Act shall be 
construed to negate or supersede the legal authority, under 
State law or other applicable law, of any State agency, State 
entity, or State public official over programs that are under 
the jurisdiction of the agency, entity, or official. This 
provision was offered as an amendment by Congressman Weldon to 
ensure that the Federal government did not override state 
constitutions.
    Finally, in order to avoid disruption in program operations 
under the newly reformed workforce development and literacy 
system, the bill provides that State plans remain in effect 
until the State submits to the Secretary modifications as the 
State determines necessary. In other words, once a State 
submits its workforce development and literacy plan, such plan 
is in effect through the 6 year authorization of the 4 
consolidation grant programs, until such time as the State 
modifies such plan. The Secretaries of Education and Labor are 
required to establish a common procedure for consideration of 
State Workforce Development and Literacy Plans.

           Establishment of Local Workforce Development Areas

    Section 105 requires that a Governor desiring to receive a 
grant under this Act, designate local geographic areas, called 
workforce development areas, for the purpose of planning for 
local workforce development and literacy systems, and for 
receipt of funding and operation of local programs for at-risk 
youth (established under Chapter 2 of title II), for adult 
employment and training (established under title III), and for 
vocational rehabilitation programs established under title I of 
the Rehabilitation Act of 1973 (as amended by Title V of this 
Act). In the designation of such areas, the Governor must work 
through the collaborative process, consult with local chief 
elected officials, and consider comments received through a 
public participation process (described in the State plan). 
Such areas must be designated, taking into consideration 
existing labor market areas, units of general local government, 
geographic areas served by local educational agencies and 
intermediate educational agencies, geographic areas served by 
postsecondary institutions and area vocational education 
schools, service delivery areas established under the Job 
Training Partnership Act, and the distance that individuals 
will need to travel to receive services.

          Establishment of Local Workforce Development Boards

    Section 106 requires Governors, through the collaborative 
process, to ensure the establishment of workforce development 
boards within each local workforce development area, and to 
establish criteria for use by local chief elected officials in 
the selection of members of such boards.
    During the development of the CAREERS Act, the Committee 
decided to drive responsibility for the actual design and 
operation of local workforce development programs to the local 
level. Further, there was a decision made to fully involve 
employers in the design of local workforce preparation 
programs. For this reason, local workforce development boards, 
with a majority representation of business and industry, are 
required in each workforce development area for the receipt of 
funding and design of the local workforce development system. 
Because the Job Training Partnership Act is repealed under this 
legislation, there is no assumption that private industry 
councils (PICs) as established under that Act will continue to 
exist, and as such, there is no presumptive designation of PICs 
as workforce development boards. While States may reconstitute 
existing private industry councils to serve as local workforce 
development boards in areas where the PIC is exceptionally 
strong, the Committee encourages Governors, the individuals 
involved in the collaborative process, and local chief elected 
officials to carefully consider such redesignation to determine 
whether or not existing private industry councils are capable 
of fulfilling the added responsibilities assigned to workforce 
development boards under this Act. The Committee urges 
Governors and other decision makers, to ensure change where 
change needs to occur, in order to have the strongest workforce 
development system possible.
    Specifically, workforce development boards must at a 
minimum, consist of a majority of members who are 
representatives of business and industry, including individuals 
who are owners of businesses, chief executives or chief 
operating officers of private business, and other business 
executives with optimum policy making authority in local 
businesses. These business representatives must be selected 
from among a list of nominees submitted by local business 
organizations and trade associations.
    In addition, the local board must include: an individual or 
individuals with disabilities, or their representatives who 
have special knowledge or expertise in the area of vocational 
rehabilitation; representatives of education, including local 
educational agencies and postsecondary institutions, selected 
from among individuals nominated by regional or local 
educational agencies, vocational education institutions, 
institutions of postsecondary institutions (including community 
colleges), or general organizations of such institutions within 
the workforce development area; and representatives of 
community-based organizations, employees (non-union or union), 
and veterans as nominated or recommended to the board through a 
process established by the Governor through the collaborative 
process. While the bill contains no further language regarding 
the types of individuals who must be represented from the 
above-listed categories, the Committee urges the selection of 
individuals with decision-making capability. For example, 
individuals representing local educational agencies are 
encouraged to be chosen from nominees including superintendents 
of schools or local school board members. Similarly, 
individuals representing postsecondary institutions are 
encouraged to be chosen from nominees including college 
presidents, and college board members or trustees.
    Recognizing that only 10 to 12 percent of this nation's 
private sector workforce is affiliated with a union, (15.5% of 
the U.S. workforce overall), it is important to make clear that 
an ``employee'', as referenced in section 106(c)(4), to sit on 
the Local Workforce Development Board, and as referenced in 
section 103 (b)(1)(G), to participate in the State 
collaborative process, need not be affiliated with a union, nor 
be a formal or elected representative of an employee group. For 
example, this ``employee'' may be selected solely based on his 
or her relevant broad background and expertise in a certain 
craft, occupation or employment area.
    Governors are provided the authority to biennially certify 
local workforce development boards in order to ensure 
compliance with the State's selection criteria and overall 
policies set for such boards. However, local boards are 
authorized to elect their own chairperson from among its 
members, and to establish bylaws and other operating procedures 
as consistent with the purposes of the Act, and with the State 
workforce development and literacy plan.
    Recognizing that some States, particularly very small and 
sparsely populated States, will be composed of only one 
workforce development area, the bill allows that the 
individuals comprising the Governor's collaborative process may 
be reconstituted to serve the functions of a local workforce 
development board for those States.
    Under the Committee-reported bill, the role of the local 
workforce development board is significantly expanded over the 
role currently provided for private industry councils under 
JTPA. The local board is ultimately responsible for development 
of a local strategic workforce development plan and 
identification of occupations in demand and the training needs 
of the local workforce development area. The board is 
responsible for budget and program oversight over at-risk youth 
programs established under chapter 2 of title II, adult 
employment and training programs established under title III, 
vocational rehabilitation programs established under title I of 
the Rehabilitation Act of 1973 (as amended by title V of this 
Act), and one-stop career center systems established under 
section 107 of the bill. Local boards are authorized to receive 
and disburse funds made available for carrying out the above-
listed programs, or may designate a fiscal agent (which may 
include the State through a mutual agreement between the local 
board and the State), for the purpose of disbursement of funds 
to one-stop centers and other service providers, as designated 
by the local board. The Board may employ its own staff, 
independent of local programs and service providers. However, 
due to the expanded responsibilities of the workforce board, as 
well as to attract higher level business representatives, 
boards may not operate programs established under this 
legislation. This is a significant change over current law.
    It is also important to clarify, that while some elements 
of the local workforce area model are similar to the model 
under the Job Training Partnership Act, the workforce 
development system under this Act is not intended to be a 
'generic' JTPA employment and training system.
    For example, JTPA has developed a reputation, whether 
deserved or not, as not properly accommodating the needs of the 
individuals with disabilities. In this new system, individuals 
with disabilities are intended to be served on an equal basis 
with other program participants and reasonable accommodations 
are made as required under existing Federal statutes. And in 
relation to services offered, this system is not intended to be 
a generic system in which all individuals receive the same 
service. Rather, it is intended to be an integrated delivery 
system of specialized services that meet specific needs of 
individuals.
    Under the Job Training Partnership Act, most of these 
activities are conducted jointly, or in partnership with the 
chief elected official or officials in the local area. CAREERS 
provides a significant role for chief elected officials in 
local workforce development systems, with such officials 
selecting the local board members; providing sign-off on local 
plans and local program budgets; and having joint oversight 
responsibilities with the local board. Local governments may 
also be designated by the board as the fiscal agent for local 
workforce development systems, and may compete to operate a 
one-stop delivery system. However, the role of employer-led 
workforce development boards was intentionally elevated, 
illustrating the Committee's recognition of the importance of 
employer buy-in and involvement in the design of the local 
system.
    With the increased responsibility bestowed upon local 
workforce development boards, the Committee felt it very 
important to provide strong conflict of interest language in 
the bill, which says that no member of a workforce development 
board may cast a vote or participate in the consideration of 
the provision of services that in any way provides financial 
benefit to such member. In addition, a Governor may enforce 
more rigorous conflict of interest standards, as determined 
appropriate.

            Establishment of One-Stop Career Center Systems

    Section 107 of the bill requires Governors to establish the 
criteria for, and ensure the establishment, by local workforce 
development boards, of a one-stop career center system within 
each local workforce development area. The Committee decided to 
require the one-stop approach to service delivery in order to 
encourage program integration and consolidation not only at the 
Federal level, but also at the State and local levels. The one-
stop delivery system was initially proposed by the Bush 
Administration under its Job Training 2000 legislative 
proposal, and was also included as an integral component of 
reform legislation introduced by Committee Republicans in the 
previous Congress. While the Committee does not intend to 
impose prescriptive program requirements upon States and 
localities for the design of a ``one-size-fits-all'' one-stop 
system, Members do urge States and local communities to design 
their own delivery structures around the ``one-stop'' model, 
with the intention of achieving full program integration, as 
well as providing easily accessible, single points of entry 
into the workforce development and literacy system for all 
individuals seeking out such services.
    Specifically, the bill requires the establishment of one-
stop career center systems in each local workforce development 
area, which at a minimum, must include and provide: common 
intake; preliminary assessment; integrated job search 
assistance; and to the extent practicable, as determined by the 
Governor, unified and linked computer systems (including labor 
market information), and at least one physical, co-located site 
which provides comprehensive and fully integrated workforce 
development services to any individual seeking such services. 
The Committee urges local workforce development areas to 
establish networks of comprehensive and fully-integrated co-
located one-stop career centers, combined with multiple 
affiliated sites that are linked through electronic and 
technological access points. However Members of the Committee 
recognize that the establishment of co-located centers is not 
necessarily appropriate for all workforce development areas, 
especially in rural communities.
    To ensure that all program participants are provided the 
most useful and timely information available, all one-stops 
career centers, and affiliated sites are encouraged provide 
program participants with access to information on the labor 
market, which is compiled pursuant to the Wagner-Peyser Act. 
Entities eligible for designation by local workforce 
development boards as one-stop career centers include: 
institutions of higher education; local educational agencies; 
area vocational education schools; local employment service 
offices; private nonprofit organizations, (including community-
based organizations); private for-profit entities; agencies of 
local governments; other interested organizations and entities 
of demonstrated effectiveness (including local chambers of 
commerce and other business organizations); or consortia of any 
of the above.
    The Committee believes it is important that a workforce 
board designate a variety of types of entities to serve as one-
stop career centers, and that private sector entities be given 
the opportunity to fully participate.
    One-stop career centers are intended to provide a range of 
``front-end'' or ``core'' services to individuals in the 
workforce development area, on a universal basis, which 
include: Outreach and intake for services provided under 
programs established under chapter 2 of title II, title III, 
title IV, and title I of the Rehabilitation Act of 1973; a 
preliminary assessment of the skill levels and need for 
services of individuals for such programs; information relating 
to local and State, and if appropriate, to regional or 
national, occupations in demand and skill requirements for such 
occupations; information relating to youth services, including 
information on at-risk youth workforce development programs 
authorized under title II, on school-to-work opportunities, and 
on youth apprenticeship opportunities; career counseling and 
planning; Job search assistance; information related to 
vocational rehabilitation services; information relating to 
federally funded education and job training programs, including 
student aid programs; information on, and assistance in 
accessing additional services through programs established or 
amended by this Act; information on the extent to which the 
services provided under titles II through IV, and title I of 
the Rehabilitation Act of 1973, meet or exceed the performance 
standards described in the State plan, and performance-based 
information on certified providers of education and training; 
information on industry-recognized skill standards and 
assessments; job listings for the local labor market; 
acceptance of applications for unemployment compensation; and 
other appropriate activities to assist individuals into 
employment. In the provision of core services, the Committee 
does not intend that core services must be offered in the order 
in which they are listed above, or that all core services must 
be provided to an individual with a disability before he or she 
can be referred for specialized vocational rehabilitation 
services. However, an individual with a disability can not be 
denied access to core services if that is all the individual 
wants or needs. The bill requires one-stop career centers to 
provide the aforementioned services on a nondiscriminatory 
basis. This requirement reaches only intentional discrimination 
against any individual on the basis of race, religion, color, 
national origin, gender, or disability, and does not extend to 
disparate impact situations. A one-stop center is also expected 
to serve as the point of distribution of vouchers or skill 
grants for education, training, and vocational rehabilitation 
services to eligible individuals. In addition to core services, 
one-stop career centers may provide customized workforce 
development services to employers on a fee-for-service basis, 
and may arrange to have core services provided to individuals 
with severe disabilities provided by certified providers 
through contract or through the use of vouchers or skill 
grants.
    Finally, while the Committee strongly advocates the 
building of local workforce development systems around a one-
stop service delivery model, Members of the Committee also 
recognize that States may come up with innovative alternatives 
to program integration which should be tried. As a result, the 
bill provides flexibility to States for the establishment of 
alternatives to the one-stop delivery design, allowing for 
alternative service delivery structures or procedures that 
result in the full integration of programs, with such proposals 
submitted to the Secretaries of Education and Labor for 
approval or disapproval.

  Certification of Education, Training, and Vocational Rehabilitation 
                           Service Providers
    Section 108 of the bill establishes a certification process 
for determining which providers of education and training 
services shall be eligible to receive funds under the adult 
employment and training programs (established under title III), 
or the vocational rehabilitation program established under 
title I of the Rehabilitation Act of 1973 (as amended by Title 
V of this Act), through the receipt of vouchers or skill 
grants, or otherwise. Because the CAREERS Act encourages the 
use of vouchers or skill grants for the provision of education 
and training under the above-listed programs, establishment of 
such a certification mechanism is essential in order to 
identify qualified providers of services, and to guard against 
``fly-by-night'' providers that may take advantage of the 
system or of program participants.
    Specifically, the bill establishes that providers are 
eligible if: they are currently eligible to participate in 
title IV of the Higher Education Act of 1965; or they are 
determined to be eligible under an alternative procedure 
developed by the Governor; and they provide performance-based 
information on non-degree programs, as required by the 
Governor.
    The alternative eligibility procedure established under the 
bill is established by the Governor, for providers and programs 
of education, training, and vocational rehabilitation services 
that are not eligible to participate in title IV of the Higher 
Education Act of 1965. The procedure must establish minimum 
acceptable levels of performance for such providers and/or 
programs, and take into account performance-based information 
that is to be submitted by such providers desiring to become 
eligible to participate. Because employers are in the best 
position to determine whether or not local programs provide the 
skills needed by local business and industry, local workforce 
development boards must also be utilized for the identification 
and certification of local providers.
    Performance-based information which the Governor may 
require from potential providers of non-degree education and 
training, includes: information relating to the percentage of 
students completing the programs conducted by the provider; the 
rates of licensure of graduates of the programs conducted by 
the provider; the percentage of graduates of the programs 
meeting skill standards and certification requirements endorsed 
by the National Skill Standards Board established under the 
Goals 2000: Educate America Act; the rates of placement and 
retention in employment, and earnings of the graduates of the 
programs conducted by the provider; the percentage of students 
who obtained employment in an occupation related to the program 
conducted by the provider; the warranties or guarantees 
provided by such provider relating to the skill levels or 
employment to be attained by students; and other information 
for providers of services under title I of the Rehabilitation 
Act of 1973 that reflects the goal of serving individuals with 
the most severe disabilities. The Governor must designate a 
State agency to collect, verify, and disseminate this 
performance-based information, along with a list of eligible 
providers, to local workforce development boards, who in turn, 
provides such information to program participants through the 
one-stop career center system. An institution or entity 
intentionally providing false information will be banned from 
program participation for no less than 2 years.
    The bill recognizes that the workforce development system 
must include the private sector as a provider of education and 
training services. Since 1980, private professional firms have 
developed extensive programs to serve the growing training 
needs of our rapidly changing economy and workforce. Research 
indicates that the training market in the information 
technology training industry alone totaled $2 billion in 1994, 
most of this provided by commercial firms. This section of 
CAREERS enables a wide variety of training and education 
providers to participate in workforce development programs. 
This expanded provider involvement allows program participants 
to use the programs' resources to seek through public, non-
profit or private providers, the training that will best enable 
them to enter or re-enter the workforce. By ensuring that one 
provider is not favored over another, this section provides 
maximum customer choice and easy access to services.

            Establishment of Management Information Systems

    Section 109 requires that States, to the extent practicable 
as determined by the Governor, use funds provided under this 
Act to establish a unified management information system (MIS) 
for all programs established or amended under titles II through 
V of this Act, in accordance with guidelines established 
jointly by the Secretaries of Education and Labor, in 
consultation with the Governors. While it is understood that 
States may need a considerable amount of time to fully 
establish such a common management information system, due to 
the expense of such a system, it is the hope of Committee 
Members that States will work toward such a goal over the 
course of the 6 year authorization. Such a common MIS system is 
key to total program integration, as well as being cost-
effective once established, allowing for common data 
collection, reporting, and performance information across all 
workforce development and literacy programs. The Committee 
Members expect that the development of this system will be 
based in large part on the efforts of the Department of Labor 
in the establishment of the Standardized Program Information 
Reporting (SPIR) system.

                   Performance Accountability System

    Section 110 of the bill requires Governors, through the 
collaborative process, to develop a statewide performance 
accountability system in each State receiving funding under 
this Act. In fact, performance accountability requirements are 
included under the State plan (section 104), under section 110, 
and under each of the consolidation grants established or 
amended under titles II through V of the legislation. 
Throughout this bill, there is a great deal of emphasis on 
accountability for results. In other words, we expect Federal 
taxpayer dollars to produce reasonable improvements to State 
and local workforce development systems.
    Throughout all of the hearings held on the issue of reform 
of our U.S. workforce development and literacy programs, 
witness after witness expressed the need for strong 
accountability within such programs under any system reform. 
The business community has probably been the most outspoken on 
this issue, stressing that U.S. workforce development programs 
must meet world class standards in order to provide the skills 
needed by U.S. employers today and in the future.
    Subsequently, Members of the Committee determined that the 
bill should require States to establish their own individual 
performance measurement systems, recognizing the individual 
characteristics and needs of the different States. Such systems 
must include goals, and benchmarks set by the State for 
measuring the continuing progress of its workforce development 
and literacy programs in meeting such goals. Under the bill, 
States must include as core indicators of performance, the 
performance measures established within each of titles II 
through V of the bill, for the individual consolidation grant 
programs. The bill encourages that such indicators take into 
account post-program surveys measuring customer satisfaction of 
both employers and program participants.
    The bill further requires States to identify the levels of 
performance, consistent with State goals, that are expected for 
local workforce development areas and other applicable local 
administrative entities, taking into account world class levels 
of performance, and developing baseline levels of performance 
upon which to measure continuous improvement. Governors may 
adjust the expected levels of performance for each local area 
taking into account economic, demographic, and geographic 
factors, and the characteristics of the population to be 
served. States, in turn, are required to report to the 
Secretaries of Education and Labor, the levels of performance 
achieved by local workforce development areas and other 
applicable local administrative entities, for each program 
year. And subsequently, the Secretaries are to make such 
information available to the general public and to disseminate 
State-by-State comparisons, and where appropriate, comparisons 
to other industrialized nations. States are encouraged to 
utilize unemployment insurance wage data records in the 
collection and reporting of such data, which has proven to be 
very cost-effective and efficient for such purposes.
    By allowing Governors to make adjustments in the expected 
levels of performance for programs under Title II, the 
Committee does not intend that States use this adjustment 
authority to reduce its services or lower its expectations for 
certain classes or groups of students. It is the Committee's 
intention that performance criteria be developed that are 
appropriate for all youth. Too often in the past, lower 
expectations for some young people resulted in their not being 
given the chance to achieve high standards. The Committee 
intends that all youth be given this chance.
    In order to develop comparability in measuring performance 
across States, the bill requires the Secretaries of Education 
and Labor, in collaboration with the States and with 
representatives of business and industry, employees, 
educational agencies, service providers, participants, and 
others, to develop technical definitions of each of the core 
indicators described in this Act, that are to be used in 
measuring performance. The Secretaries, in collaboration with 
the above-listed individuals and organizations, are also asked 
to identify world class levels of performance with respect to 
appropriate core indicators selected from among the performance 
measures described under the legislation. Where appropriate, 
such standards are intended to reflect industry-recognized 
skill standards and national education goals.
    Finally, the bill allows the Secretaries to provide 
technical assistance to States failing to meet performance 
goals set for themselves in any given year, including 
assistance in development of a performance improvement plan. If 
failure continues for a second consecutive year, the Secretary 
may reduce by not more than 5 percent, the amount of the grant 
that would be payable to the State under the affected program 
for the following year, with such penalty based on the degree 
of failure. Similarly, if a local workforce development area or 
applicable local entity fails to meet expected levels of 
performance, the Governor, through the collaborative process, 
may provide technical assistance to that entity, after the 
first year of failure. After a second consecutive year of such 
failure, the Governor may take corrective action, such as the 
withholding of funds, or the redesignation of a local 
administrative entity, or such other action as the Governor, 
through the collaborative process, determines appropriate, 
consistent with State law.
    The legislation also prohibits the displacement of any 
currently employed worker by program participants; prohibits 
the impairment of existing contracts for services or collective 
bargaining agreement; prohibits the replacement of existing 
laid-off workers, or workers terminated with the intention of 
filling the vacancy so created with a student; ensures 
protection of students under applicable Federal, State and 
local health and safety requirements; and clarifies that 
nothing in this Act shall be construed to modify or affect any 
Federal or State civil rights law.

Section B--Amendments to the Wagner-Peyser Act

    This Committee feels that because the Wagner-Peyser Act is 
financed almost exclusively by employers through the Federal 
Unemployment Tax Act (FUTA), there's an obligation to ensure 
that these funds are used for their intended purpose which is 
to maintain a national system of employment services. The 
amendments to the Wagner-Peyser Act ensure that it is fully 
coordinated with the one-stop delivery system proposed under 
the CAREERS Act.
    The Committee wants to stress the importance of the 
connection between the Employment Service (ES) and the 
Unemployment Insurance (UI) System. This linkage has been 
proven to move UI recipients back to work more quickly, thereby 
keeping unemployment taxes as low as possible.
    Amendments to the Wagner-Peyser Act reflect the need to 
have this statute be consistent with the changes and repeals of 
other job training programs under the CAREERS Act. 
Specifically, with the repeal of the Job Training Partnership 
Act, references to ``Private Industry Councils'' and ``Service 
Delivery Areas'' have been changed to ``Local Workforce 
Development Boards'' and ``Local Workforce Development Areas'' 
respectively, taking into account changes in the names and 
functions. This section also defines the term ``public 
employment service office'' to mean an office which provides 
public employment services to the general public under a one-
stop careers center system.
    In order to ensure coordination between the Employment 
Service Offices within the One-Stop system, the amendments 
clarify the role of the Secretary of Labor to oversee this 
process, as well as to establish accountability and performance 
measures for the Employment Service. The role of Governors is 
also enhanced under these amendments by providing them more 
authority over the funds provided under this Act. Currently, 
under Wagner-Peyser, funds go directly to the State 
legislature--and then, typically, directly to the State 
Employment Service Agency. This process has resulted in making 
it difficult for some Governors to ensure that the ES funds in 
their State are coordinated with the overall workforce 
development strategy. It is also intended that this flexibility 
will allow Governors to move towards the privatization of 
certain functions of the Employment services as they see fit.
    Under subsection (d) at least 25 percent of the funds 
available for this title, would have to be used for labor 
market information (LMI) purposes pursuant to Subtitle B. The 
Committee is recommending the 25% allocation for LMI 
activities, including funds appropriated for ES national 
activities and the current BLS Cooperative Statistics Program 
is the base upon which the 25% was calculated. The Committee 
anticipates that part of these funds will be used for Federal 
activities and contracts to States for the Cooperative 
Statistical Programs (CSP). Another part of the funds, after 
covering the costs of developing the design for State and local 
employment and consumer information, will be distributed to 
States for collection of this information according to the 
formula in Subtitle B. Analysis, dissemination, technical 
assistance, research and development are integral components of 
each data program and would be funded in accordance with the 
annual plan described in Title II of Wagner-Peyser.
    In order to reduce the burden upon States in submitting 
multiple plans, Subsection (f) provides for the ability of 
Governors to submit their State Wagner-Peyser plan as part of 
the unified Workforce Development and Literacy Plan established 
under Title I of the CAREERS Act. It is the Committee's 
intention that this will ensure even a greater amount of 
coordination between these systems. Subsection (g) eliminates 
the statutory authority of the Federal Advisory Council.
            Labor Market Information (LMI)
    Section 132 Part B, amends the Wagner-Peyser Act by adding 
a new ``Title II'' to this Act, establishing a coordinated 
system of labor market information.
    It is the intent of Section 21 of Title II, to make clear 
that the labor market information collected pursuant to this 
Act, should be locally-based and that specific counties, cities 
and towns, should have information that is relevant and useful 
to meet their needs. In addition, information should be 
accurate, up-to-date, easily accessible, and user friendly. The 
primary role of collecting LMI, is to serve the customers using 
the workforce development system, and most importantly, program 
participants, employers and program operators.
    This view was underscored in testimony before the Economic 
and Educational Opportunities Subcommittee on Postsecondary 
Education, Training and Lifelong Learning by James Dickerson, 
Chair of the Central Ozarks Private Industry Council, Inc., on 
behalf of the National Association of Private Industry 
Councils:

          NAPIC believes that an essential ingredient to an 
        effective workforce development system is timely and 
        useful labor market information. We need to upgrade 
        existing LMI if we want maximum impact for our training 
        investments. This task will require funds for research 
        and the testing of new data bases and user-friendly 
        technologies.

    Mr. Thomas Gallagher, Manager, Research and Planning, 
Wyoming Department of Employment also provided testimony to the 
same subcommittee on this topic:

          Employees use labor market information to make 
        objective business decisions. Workers use labor market 
        information to make rational choices about training 
        opportunities. Educators use it to decide whether or 
        not a new set of course offerings will lead to positive 
        labor market outcomes for students and employers while 
        elected officials use labor market information to 
        evaluate the socio-economic consequences of policy 
        choice. And yet, Federal responsibility for objective 
        statistical information about the labor market for the 
        nation, the States and local communities is dispersed 
        among a variety of Federal agencies. These agencies 
        lack a common agenda, duplicate effort, and find 
        service to communities if recognized at all to be 
        incidental to their routine operations. In this 
        environment the access of employers, students, workers, 
        policy makers, and educators to sound, objective and 
        pertinent information they need to make the right labor 
        market investment the first time is for the most part 
        denied. Labor market information directors have come to 
        consensus on the types of products local communities 
        need. I, and many others, also believe that we need to 
        organize the work of the Federal government into an 
        accountable, coherent program of effort, aimed at 
        meeting user need, and that has a rational and 
        efficient funding stream.

    The Committee finds that, despite widespread consensus 
about the kinds of data and information that should be included 
in an LMI system (and which are described in Section 22), 
current LMI activities are simply not organized well enough to 
produce them. Gaps in information, duplication of effort, and 
confusion or responsibilities can best be addressed by 
consolidating the currently fragmented governance structure for 
LMI.
    Consolidation at the Federal level underscores the 
responsibility of the Secretary of Labor, as made clear under 
Section 23, and recognizes the key role of the Bureau of Labor 
Statistics (BLS) in LMI. The Bureau, which maintains essential 
LMI programs, has the expertise to design data and develop the 
LMI system. Also, the agency's ongoing data mission will ensure 
a priority commitment to LMI. In addition, BLS fits the 
requirement that the agency charged with LMI responsibilities 
should be a neutral source, trusted by all education and 
training deliverers, and not itself a service deliverer. This 
requirement accords with the Committee's vision that LMI should 
be the common element integrating the various institutions that 
deliver workforce development services.
    The legislation creates a unique Federal-State partnership 
by engaging the State LMI director with BLS in joint planning 
for LMI as required under Section 24. This substantive role for 
the State will ensure attention to State and local data needs, 
responsiveness to consumer demands from employers and job 
seekers, and true cooperation between the Federal agency and 
State LMI agencies.
    In the States, the Governor will also have the 
responsibility, pursuant to Section 25, in naming a single 
agency to carry out LMI activities. This design will enable 
within-State consolidation paralleling at the Federal level. In 
naming the State's LMI agency, governors will need to maintain 
current linkages with the Unemployment Insurance programs.

 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

    Title II of the bill consolidates thirty categorical 
education and job training programs for youth into a single 
grant to the States. The consolidation melds the positive 
aspects of the current Carl D. Perkins Vocational and Applied 
Technology Act, School-to-Work Opportunities Act and the Job 
Training Partnership Act (JTPA) youth programs into one 
comprehensive program. Current youth job training programs are 
disjointed and often work at odds with each other. The CAREERS 
bill attempts to present a unified approach to serving the 
needs of the majority of youth who do not complete a 4-year 
college degree. The Youth Development and Career Preparation 
Consolidation Grant moves the focus of programs from the 
Federal to the State and local communities and schools. Ninety 
percent of funds under this grant must be sent to the local 
level with fifteen percent more funds flowing to schools under 
Title II than under the current Perkins Act, and 8 percent more 
than under JTPA's year-round youth program.
    The recognition that a strong education foundation and the 
obtainment of life-long learning skills is critical to the 
success of our Nation's youth is highlighted throughout the 
bill. As our Nation continues to focus on the global economy, 
the Committee reported bill provides a firm foundation for our 
schools and businesses to meet these emerging needs. If the 
United States is to remain competitive in a global economy, it 
is critical that our businesses and schools become partners in 
educating our youth.
    Section 201 of the bill states that the purpose of this 
title is to provide States and local communities with maximum 
flexibility to design youth programs that help individuals 
attain the academic and occupational skills needed to succeed 
in a global economy; best suit the needs of youth and business 
in local communities as well as the needs of the State; promote 
strong connections between in-school and at-risk/out-of-school 
youth programs and promote youth development and career 
preparation programs that provide opportunities for individuals 
to receive postsecondary education and occupational training; 
promote the formation of business and education partnerships; 
promote high academic and occupational standards; and promote 
quality vocational-technical education, including improved 
secondary and postsecondary programs by focusing on program 
improvement that help prepare students for further education 
and training and high wage jobs.
    The primary purpose of Title II, the Youth Development and 
Career Preparation Consolidation Grant, is to provide States 
and localities with maximum flexibility to design workforce 
preparation programs that help youth attain academic and 
occupational skills necessary to succeed in a global economy.
    The focus must be on the young people being served and the 
competencies achieved, not the process. In preparing for a 
high-skilled, high-performance workplace, youth must have 
access to high-quality education and career training that meet 
employer standards and take place in a variety of learning 
environments including school, the workplace and community. 
Basic academic skills are the underpinning for a competent 
workforce.
    In order to streamline the system, the Committee 
consolidated and eliminated duplicative and fragmented 
programs. The Committee has tried hard to provide a foundation 
upon which States and localities can serve the roughly 75% of 
youth who do not pursue or complete a four year college degree. 
The Committee is leaving behind the notion that one size fits 
all. The Committee is trying to prepare the youth of today for 
the jobs of tomorrow; and trying desperately to give them the 
skills they will need to succeed. To quote Robert Maynard 
Hutchins, an American educator, ``The object of education is to 
prepare the young to educate themselves throughout their 
lives.''
    Section 203 includes definitions applicable to the youth 
title of this bill.
    Section 211 allocates the amount of funds for national and 
State programs.
    Section 211(a) reserves $25 million or 20% of the total 
appropriation, whichever is less, for national programs to be 
administered by the Secretary of Education. These funds are for 
the Secretary to conduct general research on youth development 
and career preparation programs and to provide for 
demonstration programs. Funding for the National Center or 
Centers for Research on Youth Development and Career 
Preparation is provided for under this allocation. The figure 
for national programs represents approximately 1% of the 
current appropriation and approximates the amount of funding 
the Department of Education is currently receiving for these 
programs with a 20% reduction. Since the Committee is asking 
the States to take a reduction in funds, the Committee thinks 
it is only fair for the U.S. Department of Education to take a 
similar cut.
    Section 211(b) of the bill provides States with an amount 
of funding which bears the same ratio as the average of funds 
they received in FY 1995 under Sections 101 and 101A of the 
Carl D. Perkins Vocational and Applied Technology Education Act 
and Sections 252 and 262 of the Job Training Partnership Act. A 
small State minimum of \1/4\ of one percent is included in the 
language. The Committee intends to keep the flow of funds to 
the States as close to the current flow without any major 
disruption. A 20% reduction will be applied to the current 
level of funding for all States. It is the intent of the 
Committee that no one State will be harmed and that all States 
will share in our efforts to reduce the Federal budget.
    Section 211(c) requires the Governor to send 90% of funds 
to the local level. Of the remaining 10% of funds, 8% are for 
State programs and 2% is for administration. The Committee 
intends to send as much money to the local level as possible. 
The 1990 Perkins Amendments reduced the State held 
administrative funds from 7% to 5%. The Committee reported bill 
continues this effort by reducing the administrative funds to 
2% with the hope that more funds will reach down to the local 
level to serve our Nation's youth. An October 1994 GAO Report 
to Congress entitled ``Education Finance: Extent of Federal 
Funding in State Education Agencies'' (SEAs), found that State 
Education Agencies reserved a greater share of Federal dollars 
as compared to State funds for State-level operations even 
though Federal dollars comprised less than 10% of total 
funding. ``Total State funding received by the SEAs ($113.8 
billion) far exceeded total Federal funding received ($17.5 
billion)'' according to the GAO. The GAO found also that the 
Federal share of States' operating funds varied from State to 
State--from 6% in one State to 77% in another. The Federally 
funded staff also varied widely from 10% to 81% across States. 
The same GAO report also found that 10 programs comprised over 
half of State education agencies' Federal funding, with the 
Perkins Act being named as 1 of the 10. It is the intent of 
this Committee that Federal dollars should be used for purposes 
related to the education and development of youth and not to 
sustain bureaucracies. The Committee is alarmed at the high 
percentage of funds held by some States to operate programs and 
bureaucracies and it is the hope of this Committee that this 
practice will end and more money will reach children.
    Section 212 outlines the within State Allocation for the 
90% of funds flowing to the local level.
    Section 212(a) states that of the 90% of funds sent to the 
local level, 40% of the funds must be used for programs serving 
in-school youth and 40% of the funds must be used for programs 
to serve at-risk and out-of-school youth. The remaining 20% of 
the funds must flow to local programs, however, the Governor, 
through the collaborative process, has discretion as to how the 
funds are distributed to in-school or to at-risk programs.
    Mr. Hoekstra (R-MI) offered an amendment during full 
Committee consideration of the bill, which was accepted by 
voice vote, which has the intent of allowing the Governor, 
through the collaborative process, to use half of these 
discretionary funds for incentive grants, competitive awards, 
or other forms of distribution to local areas. The amendment 
offered at Committee only allows for 2% of the funds to be used 
at the Governor's discretion; however, the debate in the 
Committee clearly shows the intent was to allow a 50/50 split 
of the 20% of local funds. The Committee intends to correct the 
amendment language when the bill is considered by the full 
House of Representatives.
    In explaining his amendment, Mr. Hoekstra stated, ``What 
this amendment does in Title II, it leaves 10 percent for the 
Governor to allocate between the in-school and the at-risk 
programs, and then it allows 10 percent for the Governor to use 
for incentive grants, competitive processes or other ways to 
distribute those dollars.'' Mr. Hoekstra was trying to provide 
flexibility to the Governors and to encourage creativity and 
innovation among States. The Hoekstra amendment has the 
remaining 10% of funds going out by formula and these may be 
split in any way between the in-school and at-risk/out-of-
school youth programs. The entire 10% may, if the Governor 
decides, be applied to either the in-school or at-risk/out-of-
school programs. The 20% of discretionary funds cannot be used 
for any other purpose except for programs to serve in-school 
and at-risk/out-of-school youth. In dividing the funds with a 
40/40 split, the Committee intends to mirror current 
appropriations figures. The FY 1995 appropriation provided 
roughly $1.3 billion for the Perkins Act and for JTPA youth 
programs. The 20% discretionary funding allows Governors 
flexibility in determining priorities within their States.
    While it is the desire of everyone that all children should 
complete high school, the reality is that our schools have 
failed some of our Nation's youth and sending them back to 
institutions where they have already failed will almost ensure 
failure again. The Committee provides 40% of the locally driven 
funds to local workforce development boards who in turn must 
subcontract with local entities to provide services to these 
children who have fallen between the cracks--out-of school 
youth and youth at-risk of dropping out of school. It is our 
sincere hope that in those instances where our schools have 
failed, our communities will step in and succeed. By having a 
partnership between schools and the local workforce development 
board, we are trying to ensure that the importance of a high 
school diploma and further education is not lost, but 
strengthened. As previously stated, basic academic skills are 
the underpinning for a competent workforce. Title II programs 
must be linked to the academic world and academic reform 
efforts. The emphasis on broad basic academic skills must not 
be lost at the expense of skill-specific training.
    There is also a great concern for children at-risk of 
dropping out of school, so the Committee included these 
students under programs for at-risk youth. Because these young 
people have not yet dropped out of school, it is the 
Committee's hope to catch them before they do. A report by the 
National Association of State Directors of Vocational and 
Technical Education Consortium entitled ``National Partnership: 
Vocational Technical Education and Community-Based 
Organizations'' states:

          The forgotten half, students at-risk, children of the 
        underclass' are invisible labels that mark thousands of 
        young people who leave high school each year unprepared 
        for a future that includes an increasingly competitive 
        workplace. To survive in tomorrow's global economy, 
        America's youth must possess marketable skills.

    The Committee is committed to ensuring that these at-risk 
students are served. The Committee combined the at-risk and 
out-of-school youth together because they need creative 
solutions. As Russell Owens, Director of Government Relations, 
Occupational Industrialization Centers' of America, stated in 
the ``National Partnership report;'' ``We've got to be creative 
about how we provide people access to our services * * * that 
means we're going to have to coordinate and collaborate in ways 
that we've never coordinated and collaborated before.''
    During the full Committee consideration of the bill, Mr. 
Becerra offered an amendment to require that all of the 40% 
funding for at-risk youth programs go toward serving out-of-
school youth. The amendment was defeated in large part due to 
the fact that this amendment would have required States to use 
nearly one half of their funding for only 20% of the youth 
population, assuming that one in five students will drop out of 
school. Further, while it is the Committee's intent that a 
significant proportion of those served under the at-risk 
program are to be out-of-school youth, it is also the clear 
intent of the Members of this Committee that youth be 
encouraged to stay in school, and at a minimum, receive a high 
school diploma. For those who have already dropped out, the 
Committee intends that programs funded under this title 
encourage their return to school or to an alternative school 
setting for receipt of a high school diploma or its equivalent, 
as well as skills training and related work experience. The 
Committee hopes that as a result of this legislation, more 
young people, especially those at risk of dropping out of 
school, will indeed complete high school and go on to further 
education, training, or high skills employment.
    To quote the National Center on Education and the Economy, 
we must now ``turn high school, for many of our inner-city and 
rural poor children, into a place that connects them to hope 
and a reason to believe in themselves, to jobs that can lead 
somewhere, to adults who help them make their way, and to the 
skills that will give them a better life.''
    The 40% of funds that flow to schools to secondary and 
postsecondary in-school youth is aimed at the 75% of youth who 
do pursue or receive a college degree. According to the U.S. 
Department of Labor, 70% of jobs will require more than a high 
school degree by the year 2000. It is critical that we reach 
out and serve the vast majority of students who do not go on or 
complete their bachelor degree. As Governor McKernan testified:

          Companies, large and small, are facing the reality of 
        a new world economy in which change is constant and 
        accelerating, reaching every sector of our economy . . 
        . For workers in this emerging American economy, 
        knowledge and skills are potent determinants of their 
        economic success. Increasingly, jobs with a future and 
        suitable pay require education and training that many 
        current workers, employed, underemployed, and 
        unemployed, do not have. The link between education and 
        earnings has never been stronger.

    This Committee, with this legislation, is trying to focus 
on the majority of students who do not complete college, who do 
not have special needs, but are regular students who, for 
whatever reason, do not choose to go on to or complete college. 
The Committee believes there should be more students arriving 
at the workplace with basic communication and thinking skills. 
The National Assessment of Vocational Education agrees: ``First 
and foremost, vocational education should become an integral 
part of a reformed American system of education and training. A 
comprehensive system should provide all students with access, 
multiple entry and exit points, clear education pathways, 
quality programs, high standards, information, and linkage to 
the labor market.'' These are the goals that were set forth in 
the School-to-Work Opportunities Act last year for youth (both 
in-school and out). And these are the goals intended to be 
carried on through this reform legislation. It is the intent of 
this Committee that our students arrive at the workplace ready 
to learn with basic communications and thinking skills.
    Section 212(b) requires the Governor, through the 
collaborative process, to develop a substate formula taking 
into account local poverty rates, the proportion of the State's 
youth population residing within local communities and other 
factors the State considers appropriate. In establishing the 
formula, the Governor shall ensure that funds are equitably 
distributed throughout the State and that the factors described 
above do not receive disproportionate weighting. This language 
was added to the bill in an amendment offered at the 
Subcommittee on Postsecondary Education, Training and Life-Long 
Learning mark-up by Mr. Souder (R-IN). The language was a 
compromise between those who wanted a prescriptive formula 
dictated by the Federal government, such as is provided in 
current law, and those individuals who argued for full 
discretion for the Governor to establish the allocation of 
funds. The amendment by Mr. Souder outlines certain criteria to 
be included in a substate formula but allows the State total 
discretion in establishing additional formula factors and for 
designing exactly how the funds will flow. The only specific 
requirements are that the distribution of funds within the 
State be equitable and, that the formula factors not be 
disproportionately weighted. It is the hope of this Committee 
that by providing broad outlines of what our intent for a 
formula is, States will hold true to our intent and distribute 
funds fairly and to those most in need of Federal assistance. 
It is the clear intent of the Committee that funds be equitably 
distributed both geographically and proportionally, and 
although this section requires that Governors ensure funds are 
distributed equitably throughout the State, this Committee does 
not intend that the Department of Education regulate the 
extent, or meaning of the term ``equitable.''
    As Subcommittee Chairman Buck McKeon noted, ``Throughout 
consideration of this bill, our Committee attempted to strike 
the proper balance between giving States and communities the 
flexibility needed to operate these programs while ensuring 
accountability for Federal dollars. On a bipartisan basis, the 
Committee made a conscious decision to reject the overly 
prescriptive ways of the past; at the same time, the Committee 
rejected a no-strings attached revenue sharing approach.''
    Section 212(c) establishes minimum grant awards of $15,000 
for a local education agency or consortium of such agencies; 
$15,000 for subgrants made by local workforce development 
boards to serve at-risk/out-of-school youth; $50,000 to 
postsecondary institutions or consortium of such institutions; 
and allows secondary-postsecondary institutions to form 
consortia to receive grant funds with a minimum award of 
$50,000. This continues a practice established during the last 
reauthorization of the Perkins Act which tried to ensure that 
Federal dollars would have a significant impact and not be 
spread so thinly that localities would not be able to do 
anything substantive with the dollars.
    Section 212(d) prevents consortia from forming to receive 
funds and then separate immediately after receipt of the 
Federal dollars and dividing the funds between the entities. 
The provision requires that consortia must form for the 
purposes established under this title and must stay in a 
consortia arrangement for purposes of delivering services to 
youth under this title. The Committee intends to prevent 
institutions and groups to form solely for the purpose of 
receiving funds and make no effort at collaboration of 
services.
    Section 212(e) permits a State to grant a waiver for the 
minimum grant amount in cases where the eligible recipient is 
located in a rural, sparsely populated area; and demonstrates 
that they are unable to enter into a consortium for purposes of 
providing services under this title. This provision is to allow 
States with rural areas to provide funding to those areas 
without imposing a significant Federal burden. While clearly 
the intent of this Committee is to have the Federal dollars 
well spent and to have an impact, there is an understanding 
that consortia may not always be possible in those areas of our 
Nation which are more sparsely populated than the coastal 
areas.
    Section 221 outlines the requirements for the State Plan. 
In order to receive funds under this title, this section 
requires the State to submit additional information with the 
plan outlined in Title I. There is no requirement for a 
separate plan. Additional information that must be included in 
this comprehensive plan: how the State will adopt or develop 
model curricula and innovative instructional methodologies to 
be used in schools that integrate academic and vocational 
learning and promote career awareness; State plans for 
expansion of career exploration counseling for students in 
elementary and secondary schools and how the State will 
effectively demonstrate a system of career preparation for 
youth; how the State plans to integrate academic and vocational 
education and a description of how the State will promote 
collaboration between secondary and postsecondary occupational 
and academic programs and institutions; a description of how 
the State will develop academic and occupational skills of 
students providing challenging vocational-technical education 
standards and how the State will develop a process to issue 
skill certificates that are consistent with the skill standards 
endorsed by the National Skill Standards Board; a description 
of how the State will promote active involvement of business in 
planning, development and implementation of youth programs; and 
a description of how the State will coordinate Goals 2000 and 
Improving America's Schools Act and other State education 
improvement plans with this State plan.
    The current Perkins Act imposes 23 requirements for a 
separate plan to be submitted to the Department of Education. 
The JTPA imposes 12 prescriptive requirements for submission of 
a separate plan. CAREERS requires that only 6 additional items 
be included in a comprehensive plan for all titles of the bill. 
CAREERS effectively replaces the 2 separate plans and 35 
requirements with 6 items.
    As the majority of people testifying before the Committee 
on job training consolidation noted; our current system is 
fragmented. It is not serving our youth well and it is not 
serving business:

          Unlike many other industrialized nations, this 
        country still lacks a comprehensive system of workforce 
        preparation. Educational programs and institutions 
        operate in loosely coordinated, sometimes disconnected 
        ways, and individuals are left on their own to navigate 
        their way through them and into the labor market. (NAVE 
        Report--1994)

    The solution is a seamless system that strengthens 
education and training. By requiring one comprehensive plan and 
not separate categorical plans, we are moving one step closer 
to the seamless system.
    Section 222 contains the State programs and State 
activities that can be used for the 8% of funds held by the 
State.
    Section 222(a) grants general authority to the State to 
conduct State programs and activities.
    Section 222(b) requires that of the 8% of funds allotted 
for State activities, the State must use the funds for the 
development of performance standards and measures for programs; 
and program improvement and accountability. These are the only 
required uses of funds for State level activities. The National 
Center for Research in Vocational Education reports:

          Performance measures and standards should continue to 
        be used to gauge the success of programs and guide 
        their continuous improvement; these program measures 
        should incorporate newly developing academic and 
        occupational skills standards for individuals . . . By 
        requiring States to develop performance measures and 
        standards, the 1990 Amendments to the Carl Perkins Act 
        helped educational institutions shift from a concern 
        with inputs and process-related standards to outcomes . 
        . . New Federal legislation should therefore stress the 
        continued development of performance measures and 
        standards to improve accountability; however; it should 
        concentrate on local implementation of outcomes 
        measures to provide feedback to both students and 
        educational institutions in the interests of program 
        improvement.

    Section 222(c) outlines additional uses for the 8% of State 
held funds. These include: tech-prep programs; workforce 
preparation programs for single parents, displaced homemakers 
and single pregnant women; corrections vocational education; 
professional development activities regarding integration of 
vocational, academic and work-based curricula including support 
of public teacher-education programs to ensure vocational 
teachers stay current with industry needs; and in-service and 
preservice training of teachers in state-of-the-art programs 
and techniques; development, dissemination and field testing of 
curricula with a particular focus on curricula that integrate 
vocational, academic and work-based learning methodologies, 
curricula focusing on a coherent sequence of courses measuring 
academic and occupational skills, and curricula for work-based 
learning; leadership and instructional programs in technology 
education; data collection, including support for management 
information systems; one stop career centers; cooperative 
education and family and consumer science programs; creative 
use of technologies, including professional development in the 
use of such technologies for instructional purposes; support 
for vocational student organizations; and improving career 
guidance and counseling.
    Section 223 permits States to offer Incentive Awards. 
States are permitted to use money from the 8% of State-held 
funds to offer incentive awards to local communities. This is 
an optional use of funds for the State and not mandatory. The 
State has the discretion as to how to construct these awards 
with 3 requirements outlined for the disbursement: 1) 
performance goals exceeded; 2) outstanding workforce 
development system implemented at the local level; or 3) 
exemplary education services and activities provided for at-
risk youth. The intent of this section is to allow States to 
use a ``carrot'' approach rather than a ``stick'' method which 
has been unsuccessful and hard to enforce in prior attempts. It 
is our hope that States will use these awards to reward local 
communities that show significant progress in improving the 
performance of at-risk and out-of-school youth.
    Section 224 contains the core standards, performance goals 
and measures for this title.
    Section 224(a) requires each State to have in place, or 
develop and implement, a statewide system of core standards and 
measures of performance for programs serving youth under this 
title. The intent is to coordinate this system with other 
titles included under this Act. Each statewide system must: 
establish or have established, performance goals to measure the 
level of performance achieved by youth served under this title. 
The goals must evaluate the quality and effectiveness of 
services and activities under this title; goals must be 
expressed in an objective, quantifiable and measurable form; 
establish progress indicators that State and local recipients 
of funds will use to measure their progress toward these goals; 
and provide reports every 2 years to the public and to the 
Secretary of Education on the State's progress in achieving 
their goals.
    Section 224(b) requires that a statewide system of 
standards and measures be developed and include: measures of 
academic and occupational competency gains, including progress 
in achieving academic and occupational competency (including 
attainment of: challenging State academic standards, 
challenging vocational-technical education standards; and 
industry recognized occupational standards including basic 
workplace competencies as identified by the SCANS Commission 
and industry recognized skill standards as identified by the 
National Skills Standards Board, once established); retention 
in school or completion of secondary school or its equivalent; 
placement into additional training, postsecondary education, 
military service, registered apprenticeship or employment; and 
employment retention and earnings level; reduction of the drop-
out rate; and success of special populations, including 
nontraditional training and employment in meeting the 
performance standards established by the State. It is the 
intent of this section that common performance measures be 
established and used for both in-school and at-risk youth 
programs. The Committee further intends that the same high 
levels of academic and skills attainment are possible for 
youth, regardless of whether they are in or out of school.
    Section 224(c) states that the Governor, through the 
collaborative process, shall ensure that the performance goals 
are consistent with challenging State academic standards, 
industry recognized skill standards and State goals established 
under this title. Department of Education Assistant Secretary 
Augustus Souza Kappner stated in her testimony before the 
Subcommittee on Postsecondary Education, Training and Lifelong 
Learning on March 3, 1995; ``The change taking place in 
vocational education is directly related to the rapidly 
changing needs of today's economy. Jobs are requiring a higher 
level of academic and technical skills. Employers are telling 
us clearly that too many young people cannot meet the rigorous 
demands of today's workforce. To keep America competitive in 
the global economy, we must educate our young people to much 
higher standards and prepare them to be lifelong learners.'' It 
is the hope and intent of this Committee that States set high 
standards that challenge all youth--ones that invite them to 
attain higher academic, skill levels and achievements. Further, 
the Committee intends that only through attaining academic and 
occupational achievements will youth be able to meet the 
requirements demanded of a competitive workforce.
    Section 231 outlines provisions for Partnership Agreements.
    Section 231(a) states that in order to receive a grant at 
the local level, the local workforce development board and 
eligible institution(s) must form a partnership. The purpose of 
the partnership is to allow for collaborative planning between 
educators and business to determine the curricula our youth 
need to obtain high wage jobs, coordination of programs serving 
in-school and at-risk/out-of-school youth and allow for 
effective public participation. While previous legislation has 
stated that coordination must take place, Congress has found 
that very little true coordination occurs. By forcing providers 
to sit down together and draw up a plan for both in-school and 
at-risk youth before the receipt of funds, it is the 
Committee's hope that they will gain better cooperation, better 
coordination and a greater respect and understanding for what 
services each is providing. Our Nation's youth are a precious 
commodity and we must plan for their future with the utmost 
care. We should not allow ourselves to become bogged down in 
turf wars but should concentrate on the task at hand, which is 
educating our youth and preparing them for success in their 
adult years. A child should not be denied the American dream 
because adults argued who was better to serve the child. We are 
asking that businesses, community leaders, parents, and 
teachers become partners in developing a plan to continue the 
American dream.
    Section 231(b) notes that the partnership must develop and 
submit for approval to the Governor and State collaborative 
process, a comprehensive plan outlining how they are planning 
to serve both in-school and at-risk/out-of-school youth. The 
partnership must assure the involvement of parents, teachers 
and the local community, including community-based 
organizations, in the planning process. The Committee did not 
want to be so prescriptive as to tell local communities who 
exactly they should have on their boards. The Committee did 
believe it was crucial to have the input of parents, teachers, 
students and members of the local community in decisions and 
plans which they will have to play a large part. We therefore 
assure that they will be involved and have a voice.
    Section 232 outlines who receives the funds at the local 
level from the State.
    Section 232(a) states that funds directed to the local 
level from the State to serve in-school youth must go to 
schools and eligible institutions. Schools are an integral part 
of the community and the primary source of education for our 
Nation's youth. While everyone would agree that there is a need 
for change within our current school system, eliminating 
schools from the equation is not the solution. Schools should 
remain a principle partner; however the bill fosters a new 
relationship for school systems in that it requires a plan be 
developed with the local workforce development board prior to 
the receipt of funds. As the National Governors Association 
reports in ``Advancing America's Workforce;'' ``This nation 
does not have the luxury of time or resources to totally 
dismantle the current system and rebuild it from the ground up. 
Rather, by thinking strategically and drawing on the best 
practices from the current mix of public programs, with their 
broad range of providers, and the experiences of the private 
sector, it is possible to quicken the transition and 
consolidate and streamline these programs into a 'world-class' 
system.''
    Section 232(b) directs that funds to the local level from 
the State to serve out-of-school youth will be sent to the 
local workforce development board to be subgranted to eligible 
entities for programs to serve at-risk and out-of-school youth.
    Section 241 outlines the uses of funds for In-School Youth 
Programs.
    Section 241(a) requires institutions receiving funds under 
this title to use the monies to improve youth development and 
career-related education programs.
    Section 241(b) requires that funds received for in-school 
youth programs must be used for programs that are of such size, 
scope and quality as to be effective; integrate academic, 
vocational and work-based learning, stressing applied and 
contextual learning, through a coherent sequence of courses so 
youth achieve both academic and occupational competencies; 
involve employers in design and implementation of programs; 
establish effective linkages between at-risk/out-of-school 
youth programs at both the secondary and postsecondary levels; 
provide work-based learning experiences with adult mentoring 
where appropriate, and to the extent possible, with strong 
experiences in, and understanding of, all aspects of an 
industry appropriately tied to the student's career major; with 
accommodations to be made for rural areas so that they can meet 
this requirements; and provide career exploration, including 
opportunities in the practical arts and trades at an early age.
    Section 241(c) outlines additional uses of funds at the 
local level for in-school youth programs include: purchasing, 
leasing or upgrading equipment; in-service training of 
providers on the integration of academic and vocational 
education; tech-prep education programs; supplementary services 
that might be required by members of special populations; 
adaptation of equipment; apprenticeship programs; comprehensive 
mentoring programs; activities which enable program 
participants and their parents in decisions influencing 
programs; local education/business partnerships for developing 
and implementing youth programs; and support for vocational 
student organizations.
    Section 245 outlines the uses of funds for At-Risk Youth.
    Section 245(a) grants general authority for local workforce 
development boards to subgrant to providers for programs that 
serve at-risk and out-of-school youth.
    Section 245(b) lists requirements for uses of funds for 
programs that serve at-risk and out-of-school youth as: such 
size, scope and quality as to be effective; integrate academic, 
vocational and work-based learning, stressing applied and 
contextual learning, through a coherent sequence of courses so 
at-risk and out-of-school youth achieve both academic and 
occupational competencies; involve employers in design and 
implementation of programs; establish effective linkages 
between at-risk/out-of-school youth programs at both the 
secondary and postsecondary levels; provide work-based learning 
experiences, including experiences in the practical arts and 
trades, with accommodations to be made for rural areas so they 
can meet these requirements; provide adult mentoring as a core 
component of the program; provide objective assessment of 
academic levels, skill levels, and service needs of each 
participant in the program; and career exploration and 
counseling.
    Section 245(c) lists additional uses of funds as: tutoring 
and study skills training leading to completion of high school; 
alternative high school services; community service 
opportunities that are combined with training or education; 
paid work experience, including summer youth employment and 
other work experiences tied to education and training; drop-out 
prevention strategies and strategies to encourage out-of-school 
youth to reenter high school or alternative high school 
programs; preemployment and work maturity skills training; 
peer-centered activities encouraging responsible behaviors; and 
training related services for participants who have exhausted 
all other resources.
    Section 245(d) limits the amount of funds to be used for 
administrative purposes by local workforce development boards 
to 10%.
    Section 246 details who can serve as an At-Risk youth 
provider of services, encouraging the selection of providers 
with demonstrated effectiveness, or who will utilize 
methodologies that have prove effectiveness in serving at-risk 
and out-of-school youth. The Committee has found that despite 
more than thirty years of federally funded employment and 
training programs, there remains a limited record of success in 
providing effective job training assistance for disadvantaged 
youth. Nevertheless, during hearings on this subject, the 
Postsecondary Education, Training and Lifelong Learning 
Subcommittee heard encouraging testimony about exemplary 
programs that have been successful in serving at-risk youth. In 
particular, programs run by the Opportunities Industrialization 
Centers of America (OICs), which include the Quantum 
Opportunities Program (with sites around the country), and the 
SASSY program (operated in Menlo Park, California), have 
achieved dramatic results in keeping at-risk youth in school 
through intensive after-school educational support and adult 
mentoring. While more difficult to find, programs with 
demonstrated effectiveness in serving out-of-school youth 
include those run by the Center for Employment Training (CET), 
headquartered in San Jose, California, with sites replicated in 
40 cities throughout the country; and the nationally acclaimed 
Youth Build program, currently operating in 40 cities, with 
well over 100 new sites under development. Under these 
programs, school dropouts have met with high levels of success 
in academic and skills attainment, moving into unsubsidized, 
high wage jobs.
    While the Committee recognizes that States and local 
communities need flexibility in choosing the most appropriate 
training models for youth that meet their individual needs, it 
is the Committee's intent that, where possible, exemplary 
programs such as these, with proven effectiveness in serving 
at-risk youth, be replicated. The Committee also urges the 
Secretary to use resources available for the purpose of 
replication of model programs, under section 251 of the bill, 
to assist States and local communities in the design and 
implementation of highly successful modes such as described 
above.
    Section 246(a) does not permit local workforce boards to 
operate programs and requires that they subcontract to eligible 
providers. One of the criticisms heard by this Committee 
regarding the JTPA was that programs run by Private Industry 
Councils (PICs) were often some of the least effective. This 
provision prohibits local workforce development boards from 
running programs and will hopefully result in the delivery of 
better and more efficient programs for at-risk and out-of-
school youth.
    Section 246(b) lists eligible providers to receive 
contracts from the local workforce development board as: 
eligible institutions including local educational agencies, 
area vocational schools, intermediate educational agencies; 
postsecondary institutions including community colleges, State 
corrections educational agencies and any consortia of the 
aforementioned list; local government entities; private, 
nonprofit organizations including community based 
organizations; private, for-profit entities; one-stop career 
centers; or other organizations or entities that have a 
demonstrated effectiveness and have been approved by the local 
workforce development board to deliver such services to at-risk 
and out-of-school youth. Schools are eligible providers of 
services for at-risk and out-of-school youth and it is the hope 
of this Committee that they will be an active participant in 
providing services. Education is the key to future success and 
while our schools have failed in some instances, the value of a 
solid education and high school diploma should not be lost.
    Section 251 outlines national research activities.
    Section 251(a) permits the Secretary of Education to make 
grants and other agreements to carry out research, development, 
dissemination of materials, replication of model programs, 
demonstration programs, evaluation, capacity building and 
technical assistance activities in regard to services and 
activities administered under this title. Activities may 
include support for occupational and career information 
systems. The current Perkins Act lists 9 separate programs that 
must be carried out under the Demonstration Program section. 
The Committee has eliminated all of these set-asides and given 
the Secretary the flexibility to select programs he or she 
deems appropriate for demonstration programs. This is 
consistent with the Committee's desire to grant more 
flexibility and be less prescriptive in statutory language.
    Section 251(b) requires the Secretary to establish a system 
for disseminating information gathered though research and 
development efforts under this title.
    Section 252 contains provisions relating to the Annual 
Assessment and Data Collection of Vocational Education 
Programs.
    Section 252(a) requires the Office of Educational Research 
and Improvement (OERI) at the Department of Education to 
conduct a biennial assessment of services and activities funded 
under this title. This section also requires that independent 
studies and analyses be conducted through competitive awards. 
Language was included in the 1990 Perkins Act Amendments which 
encouraged, but did not mandate the Department of Education to 
conduct research through the OERI. It is the understanding of 
this Committee that the Office of Education Research and 
Improvement is the primary research arm of the Department of 
Education. The Committee is distressed at the lack of research 
concerning vocational education and would like to ensure that 
reliable information is available and plentiful prior to the 
next review of job training programs.
    Section 252(b) requires that the assessment shall examine 
the extent to which services this section and activities 
assisted under this title have achieved their intended purposes 
and results. This section requires analysis of the extent to 
which State and local services and activities have developed, 
implemented or improved systems established under this title; 
services and activities funded under this title have succeeded 
in preparing students, including members of special 
populations, for postsecondary education, further learning, or 
entry into high-skill, high wage careers; students 
participating in programs funded under this title have 
succeeded in meeting challenging State academic and industry-
based skill standards; and the system improvement, 
participation, local and State assessment, and accountability 
provisions of this title including the effectiveness of the 
performance goals and indicators established under this title 
are effective.
    Section 253 grants authority for the establishment of a 
National Center or Centers for Research:
    Section 253(a) gives authority to the Secretary of 
Education to establish a national center or centers for 
conducting applied research, development, dissemination and 
technical assistance activities focusing on improving the 
career preparation of youth. Eligible entities include 
institutions of higher education, other public or private 
nonprofit organizations or agencies, or any consortia of the 
aforementioned entities. The national center in existence on 
the date of enactment of this Act shall continue to receive 
assistance under the current terms of its contract but shall 
not be guaranteed continued assistance except through a new 
competitive award. Funding for the center or centers shall be 
provided from funds allocated for national programs by the 
Secretary of Education. The Secretary has the authority to 
contract for one or more centers upon the expiration of the 
contract with the University of California, Berkeley. The 
University of California, Berkeley, can compete for a new 
contract but shall not be given preference in the awarding of 
such contract. It is the belief of this Committee that an 
outside center is necessary and should be a high priority for 
the Secretary. Among other duties, the center provides 
technical assistance to States in developing standards and 
measures. It is the understanding of this Committee that the 
Department of Education does not have the capacity to provide 
these services currently so the center will be a valuable 
resource for States as we transform the job training system.
    Section 253(b) lists that required activities of the 
national center or centers include: activities that assist 
recipients of funds under this title to develop, implement and 
measure core standards and performance; research and 
development of activities that combine academic, vocational 
education and work-based learning; developing new models of 
remediation of basic academic skills; identifying ways to 
establish links among education and job training activities at 
the State and local level; new models for career guidance, 
career information and counseling services; longitudinal 
studies on programs funded under this title including an 
analysis of the effectiveness of youth development and career 
preparation programs in serving at-risk youth; and other 
activities that the Secretary of Education determines to be 
appropriate. This section requires also that the center or 
centers shall provide assistance to States and local recipients 
in developing and using systems of performance measures and 
standards. Technical assistance and outreach to practitioners 
or organizations in need of assistance is a required activity. 
Annual reports are due to the Secretary of Education and 
Secretary of Labor. The Secretary of Education shall then 
submit the report to the Senate Committee on Labor and Human 
Resources and the House Committee on Economic and Educational 
Opportunities. The Committee intends to have an outside source 
provide research to the Congress and Nation on the effects of 
the youth development and career preparation programs whether 
or not they are producing the intended results. The center or 
centers are also a primary resource for State and local 
officials in their development of standards and measures.
    Section 253(c) establishes a clearinghouse within the 
center or center(s) to provide data and information to Federal, 
State and local organizations and agencies.
     TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANTS

    During the extensive hearings this Committee held on the 
issue of job training, Members heard from witnesses 
representing a wide variety of groups including the private 
sector, elected officials, academics, government research 
agencies, program administrators, and training participants. 
Although the views expressed by these witnesses varied in many 
aspects regarding how best to improve the current system of 
adult employment and training programs, there was a common 
theme in their testimony--the need and urgency for the 
restructuring of our current fragmented job training programs 
into a coherent system with the capability of improving the 
skills of the nation's workforce in order to better compete in 
the world marketplace. Mr. Jere A. Jacobs, from Pacific Telesis 
Group (California's single largest private sector employer), 
provided testimony before the Subcommittee on Postsecondary 
Education, Training and Lifelong Learning:

          I tell you from experience that the (skills) gap is 
        readily apparent and growing between the skills needed 
        by employers and the deficit of skill in new job 
        seekers. At Pacific Telesis, we give an exam to 
        applicants for entry-level positions. About 60 percent 
        of the applicants fail this test, and all the 
        applicants have a high school diploma or post-secondary 
        education. A growing percentage of job applicants come 
        to us with minimal educational competencies or 
        workplace skills such as interpersonal and critical 
        thinking skills. Representatives of the banking 
        community have had similar experiences to the point 
        that they look for applicants who have earned a 
        Bachelor's Degree to have assurance that the applicants 
        have adequately mastered reading and writing.'' Mr. 
        Jacobs further added: ``Training for current employees 
        will always be largely a business responsibility. But, 
        the quality of workforce preparation and the efficiency 
        of labor market transitions are shared responsibilities 
        traditionally between the public and private sectors. 
        We must work together to design and support a workforce 
        development system that will serve all workers 
        throughout their careers. We call this a seamless 
        system of life-long learning.

    In developing Title III of this legislation, the Committee 
attempted to ensure the establishment of such a system of 
``life-long learning'' and employment assistance. This is 
reflected in a wide variety of authorized activities, which 
range from the provision of basic information on job openings 
and labor market information to job seekers, to the 
establishment of a system of skill grants for education and 
training. Title III further allows for the creation of 
incumbent worker training opportunities through workforce skill 
and development loans to employers, and encouragement to 
Governors to establish innovative programs for incumbent worker 
training through the use of State-held funds.

                         Program Authorization

    The authorization level, under section 302, for the Adult 
Employment and Training Consolidation Grant reflects the 
combined current FY 95 appropriation levels of all programs 
consolidated under this Title, reduced by approximately 20%. 
This reduction takes into account the level of savings which 
this Committee feels will be achieved through reductions in 
administrative costs and efficiencies in overall program 
delivery resulting from the consolidation of numerous existing 
programs, as well as simplifies and consolidated planning, 
reporting and data collection requirements. The funds 
consolidated under this part do not consist of authorizations 
made available under the Wagner-Peyser Act.

                        State Allotment of Funds

    Section 303 reflects the Committee's intent that the State 
allotment of funding, to the extent possible, remain consistent 
with the proportion of funds currently received by States under 
the existing programs being consolidated. In addition, the 
Committee is committed to ensuring that small States be 
provided the necessary resources to establish and maintain 
State and local infrastructures necessary to achieve the goals 
of this legislation. Therefore, this section includes a ``small 
State minimum'' for such purposes. Section 303 of the bill also 
provides the Secretary of Labor with 15% of the funds made 
available under this Title to carry out National activities. 
This amount is equal to roughly a 7% reduction from levels 
currently held at the National level for these purposes.

                          State Uses of Funds

    Section 304 outlines the uses of funds reserved for 
Governors. It is the Committee's intent that Governors will 
continue to provide funding for rapid response activities, 
however, unlike current requirements under Title III of JTPA, 
Governors will now have the ability to transfer the 
responsibilities of carrying out the actual provision of 
services, along with the funds, to the local workforce board in 
the affected area--thus relying on local expertise as opposed 
to requiring the deployment of State officials who may or may 
not have the ready knowledge and proper background to assist in 
these matters. In addition, Governors would be required to use 
a portion of their funds to provide assistance to areas that 
experience major dislocation. The Committee feels that this is 
a very important role to be held at the State level--
recognizing that major dislocations, natural disasters, and 
other unanticipated events which result in large-scale 
unemployment require the substantial infusion of additional 
funds and assistance that cannot be covered through locally-
driven formula funds.
    Further, under this section, Governors have the ability to 
carry out other activities to ensure a high quality and 
effective statewide workforce development system. These 
activities may include: capacity building and technical 
assistance; incentive grants and performance awards, also 
available at the Governor's discretion to further leverage 
local program performance; the funding of model programs, 
including innovative programs designed to meet the training and 
skills needs of incumbent workers; and additional assistance 
for the development of one-stops and support of a common 
management information system across the 4 consolidation 
grants.
    Governors are allowed to use up to \1/4\ of the 20% State 
reservation for administration. It is the view of this 
Committee that this 5% set aside of the total State allotment, 
is a suitable amount to carry out both the requirements of this 
Title, as well as to support discretionary activities.

                          Substate Allocation

    Under subsection (b) of this section, Governors allocate 
80% of funds allotted to them from the Federal level to local 
workforce development boards as established under Title I of 
this Act. While funding is required to be allocated to the 
local areas, the legislation does not impose a prescriptive, 
Federally determined substate formula. Of the funds that are 
earmarked for local distribution, 90 percent must be sent to 
local workforce development areas, based on a substate formula 
developed by the Governor, through the collaborative process, 
which takes into account poverty, unemployment, the population 
of adults within the State, and such other factors as 
determined appropriate by the Governor. Further, such formula 
must distribute funds equitably, within the State. This 
language was offered as an amendment during the Subcommittee 
consideration of the bill by Congressman Souder (R-IN). In 
addition, Congressman Hoekstra (R-MI) offered an amendment 
during the full Committee consideration of the bill which was 
accepted that 10 percent of the funds held for local 
distribution, may be distributed to local workforce development 
areas, at the discretion of the Governor. The Committee feels 
that these requirements are flexible enough to allow Governors 
latitude in the distribution of funds in a manner which meets 
the needs of each individual State. Although this section 
requires that Governors ensure funds are distributed equitably 
throughout the State, this Committee does not intend that the 
Department of Labor regulate the extent, or meaning of the term 
``equitable.''
                          program eligibility

    It is the intent of this legislation and the Committee to 
provide services on a universal basis, and to steer away from 
overly prescriptive Federal requirements defining eligibility 
for program participation. In fact, the legislation includes no 
eligibility criteria for the provision of any of the services 
authorized under this title, except that in times of limited 
funding, local workforce development boards are to establish a 
process by which dislocated workers and economically 
disadvantaged individuals are given priority for intensive 
education and training services under the adult employment and 
training program. Further, as required under Section 305 of 
this Title, this Committee believes the Federal government 
should know how States intend to serve dislocated workers and 
other individuals with barriers to employment, such as 
economically disadvantaged individuals, older workers, and 
displaced homemakers. Therefore, States are required in their 
State workforce development and literacy plans, to describe how 
they intend to serve these populations under the reformed 
program.
    Although the Committee intends to provide wide discretion 
to States and local communities on how services are provided 
and at what levels, it is necessary to provide some broad 
direction in how increasingly limited Federal funds are used. 
Under Section 306, it is made clear that funds available under 
Title III should be available to provide core services for 
adults in need of such services through the one-stop career 
system as described in Title I of CAREERS. For those 
individuals who are unable to obtain employment utilizing the 
core services, or are simply determined to be in need of more 
intensive services in order to gain employment, funds may be 
used to provide intensive services. Education and training 
services are to be provided to individuals, only after 
intensive job search assistance has been provided or 
assessments have determined that the individual is in need of 
such assistance in order to obtain employment. Under this 
approach, it is the Committee's intent that the adult 
employment and training program be based on a ``work first'' 
approach, allowing universal accessibility based on true need. 
In addition, the Committee feels that the limited funds 
authorized under title III should not substitute for 
alternative grant assistance for which an individual is 
eligible, such as Pell Grants or other student aid programs.
    In order to provide individuals participating in education 
and training programs under this title, with a responsibility 
and choice in selecting the program which best suits their 
needs, the Committee determined that such services be provided 
through the use of skill grants, with limited exceptions. These 
exceptions from the required use of skill grants include: the 
provision of on-the-job training, where employers provide the 
training; in localities where the local workforce development 
board determines there is an inadequate number of service 
providers to make skill grants a viable option (of special 
concern in rural areas); in cases where the local workforce 
development board determines that there are not certified 
providers of services capable of providing services for special 
participant populations; and in cases where the local workforce 
development board decides to enter into a direct training 
contract with a community-based organization serving special 
populations.
    While Committee Members support the use of skill grants 
under the adult training system, there is the full 
understanding that the success of the use of skill grants is 
contingent upon several important supporting elements, and that 
States and localities will need time to establish such 
supports. Specifically, States, in conjunction with local 
workforce development boards, will need to establish effective 
certification procedures for the identification of qualified 
providers of education and training, as required under section 
108 of the bill, that provide program participants with broad 
options, but at the same time guard against ``fly-by-night'' 
providers. Further, skill grants will only be successful if 
individuals eligible to receive them have a full range of 
accurate information on the quality of providers, including 
information on program costs; program completion; program 
graduates' rates of licensure, placement rates, wages at 
placement, receipt of skill standards and certification 
requirements (as endorsed by the National Skill Standards 
Board); and customer satisfaction information as available. 
Further, it is important that program participants have access 
to locally-based, accurate, and up-to-date labor market 
information to assist them in determining what occupations they 
should pursue. Such information is intended to be provided 
through the one-stop career center system, as established under 
this bill, including access to information in such convenient 
locations as public libraries, schools, and other public 
locations.
    The bill further allows for the provision of supportive 
services, such as transportation and child care assistance, 
that will enable individuals to participate in job search 
assistance and education and training programs. It is the 
Committee's intent that these services are provided on a 
limited basis, and only to those individuals who are unable to 
receive such services through other programs specifically 
designed to provide such services. Supportive services are 
currently allowed under current law have been used in only a 
very limited fashion. Similarly, the bill allows for limited 
needs based payments to individuals in need of support payments 
in order to complete long-term education and training programs. 
This bill in no way expands eligibility for income support. In 
fact, for dislocated workers who have exhausted unemployment 
insurance benefits, such additional needs based payments can 
only be provided after the exhaustion of UI eligibility, and 
the individual must have been enrolled in a training program by 
the 8th week after his or her initial employment termination.

                 performance measurement/accountability

    Consistent with the performance measurement language 
contained in other sections of the bill, title III includes 
language requiring that States establish performance goals and 
progress indicators or benchmarks that take into account: 
placement, retention, and earnings of program participants in 
unsubsidized employment, including retention and earnings at 6 
months, and at 1 year, respectively; the provision of services 
to dislocated workers, economically disadvantaged adults, older 
workers, individuals with disabilities, displaced homemakers, 
veterans, and other individuals with multiple barriers to 
employment, including individuals with basic skills 
deficiencies; and acquisition of skills certificates pursuant 
to a skill standards and skill certificate system endorsed by 
the National Skill Standards Board. Such standards are simple, 
easily measured, support the goals and purpose of this title, 
and are consistent with standards called for by numerous 
witnesses at the hearings held by the Committee on reform of 
the U.S. workforce development system.

                      subtitle B--federal programs

    While this Committee strongly supports moving funds to the 
State and local level, it is also felt that there are certain 
functions which due to their nature, are most efficiently done 
at the Federal level. These types of functions are more clearly 
spelled out under this Subtitle.
    This Committee feels that one of the more important Federal 
responsibilities, is the continued ability of the Secretary to 
provide assistance to those areas suffering major economic 
dislocations. Events such as military base closings, mass 
layoffs, plant closures, and major disasters, are prone to 
happen in any given State and at any given time, making it 
sensible that the Secretary of Labor be allowed to direct 
assistance to such areas from the Federal level.
    There are also other activities worthy of providing the 
Secretary the flexibility to carry out. Activities such as 
incentive grants, which have been shown to drive States to 
achieve high levels of success; research and evaluations, to 
ensure that the programs are working as they are intended and 
technical assistance, to make sure that State and local front 
line employees have the knowledge and expertise to properly 
carry out the programs; are some examples of what the Secretary 
should have the flexibility to carry out. In addition, the 
Secretary may carry out demonstrations which examine the 
effectiveness of targeting funds for intensive employment and 
training programs to ``empowerment zones''.
    Due to the limited amount of funds available for job 
training, section 314 would allow the Secretary to establish 
programs whereby limited Federal dollars would be combined with 
private sector funds in order to allow business to institute 
training programs moving toward life-long learning and 
increasing the ability of workers who are laid off or lose 
their job, to have the skills necessary to enter other 
employment.
    This idea has been strongly supported by employer groups. 
In testimony before the Economic and Educational Opportunities 
Subcommittee on Postsecondary Education, Training and Lifelong 
Learning, Mr. Kevin Wheeler, Director of the National 
Semiconductor University provided testimony on behalf of the 
American Society for Training and Development:

          (Congress) should establish a Federal matching grant 
        program for training that would provide matching grants 
        to local consortia of business, labor, education 
        institutions, and community and professional 
        organizations that develop training programs, quality 
        assurance processes, equipment utilization and other 
        workforce improvement initiatives.

                         demonstration projects

    It is the intent that the pilot and demonstration projects 
conducted by the Secretary of Labor for the purpose of 
developing and improving methods and techniques for addressing 
employment and training needs, may be conducted jointly with 
the Department of Defense, specifically through the Training 
and Simulation Technology Consortium, a not-for profit, Defense 
funded partnership of industry, government and academia.

                            native americans

    The Committee has provided for a continuation of services 
to Indians, Alaska Natives and Hawaiian Natives. Section 315 
addresses the unique relationship between these populations and 
the Federal government. Services are to be implemented in a 
manner consistent with overall Federal policy toward these 
groups.
    This section authorizes a wide range of services and 
support for a variety of types of service providers. In 
general, the Committee intends that available funds be 
distributed in such a way that the various Native American 
constituencies served by the special Indian education, 
employment and training programs continue to receive services 
proportional to those received in the past taking into account 
the overall reductions of Federal job training and employment 
funding.
    The authority provided to delegate a portion of the funds 
to strengthen Indian vocational education agencies, including 
United Tribes Technical College and the Crownpoint Institute of 
Technology, to the Secretary of Education recognizes the 
importance of these institutions.
    In order to ensure that these services are effective in 
addressing special Native American needs, the organizational 
unit in the Labor Department with responsibility for this 
section should have particular competence in the administration 
of programs for this service population and be staffed 
accordingly.
    The Committee points out that Indian, Alaska Native and 
Hawaiian Native Service providers are also eligible, consistent 
with other provisions in the bill, to receive funds under the 
various block grants administered by the States.

                   migrants and seasonal farmworkers

    The Congress recognizes that this program will be the main 
vehicle for public investments in meeting migrant and seasonal 
farmworkers' and their dependents' employment, training. 
education, development, and other supportive service needs. 
These investments assist farmworkers to obtain or retain stable 
employment, both within and outside of agriculture, to provide 
development and other educational assistance to enhance their 
employability, and to provide emergency assistance and other 
supportive services that will stabilized and improve their 
agricultural employment situation.
    The Committee is aware of the quality, innovation, and 
cost-effectiveness of services and assistance provided to 
farmworker grantees by the Association of Farmworker 
Opportunity Programs (AFOP) and encourages the Department to 
continue their activities, including technical assistance and 
training, development and implementation of a farmworker 
database and other information technologies and developments 
that can further improve the capabilities of grantees funded 
under Section 316. The Secretary must consult with farmworker 
organizations, such as AFOP and grantees prior to the 
promulgation of policies, rules, regulations, and performance 
standards or measures relating to migrant and seasonal 
farmworkers and farmworker programs.
    Due to the changing nature of agricultural employment both 
within and outside of the United States that affects the U.S. 
domestic farmworker population, Congress urges the Department 
to be responsive to these changes and periodically review and 
make necessary adjustments to ensure a quality program for 
migrant and seasonal farmworkers.
    The Secretary of Labor may also transfer authority to the 
Secretary of Education for the provision of high school 
equivalency and college assistance for migrant and seasonal 
farmworkers. The Committee believes high school equivalency and 
college assistance migrant programs are effective in assisting 
migrant students to receive the education they require to 
become productive members of society and to overcome the 
hardships they experienced due to their or their family's 
migration for purposes of employment. It is our expectation 
that these programs will continue to operate as they did prior 
to their repeal as individual programs. This transfer of 
authority does not prevent the conduct of these same activities 
through other grants awarded under Section 316. Additionally, 
the Secretary may award single purpose grants for the provision 
of technical assistance for job training programs for housing 
for migrant and seasonal farmworkers.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
                 LIBRARY SERVICES AND TECHNOLOGY GRANT

                    block grant provides flexibility

    The existing Adult Education law contains a number of set 
asides and caps which prevent States, as well as local 
providers, from addressing the most pressing adult education 
and literacy needs in individual States and local communities. 
For example, current law sets forth the following caps and set-
asides: a) not less than 10 percent of funds received by States 
are to be used for corrections education and education for 
other institutionalized individuals; b) not more than 20 
percent of their allotment is to be used for high school 
equivalency programs, and c) not less than 15 percent of funds 
they receive are to be used for experimental demonstrations and 
teacher training projects. H.R. 1617 eliminates these 
restrictions. The Committee believes that the needs of those 
currently served through the set-asides and reserves can be 
better met with a highly flexible, consolidated State grant. 
Section 432 of this legislation provides that no more than 3 
percent of funds may be used for State administration and 
reserves an additional 12 percent for other State activities, 
which include technology assistance, professional development 
and State Literacy Resource Centers. However, there are no 
restrictions on how local dollars are to be used and States can 
choose from a wide range of State activities. If a State 
determines to focus dollars on assisting students in receiving 
their high school equivalency diplomas, there is no longer any 
cap restriction on the amount of funds which can be used for 
this purpose.
           Focusing Our Efforts to Create a Literate Society

    According to a 1992 report entitled ``Study of Federal 
Funding Sources and Services for Adult Education,'' there were 
84 programs in 11 agencies identified as supporting adult 
education services between 1986 and 1988. Twenty-seven of these 
programs were categorized as primary programs in which adult 
education was explicitly stated as a priority objective in each 
program's authorizing legislation. Of these 27 programs, the 
dominant focus was basic skills and literacy.
    In addition, there are a variety of small literacy programs 
authorized under the Adult Education Act and the National 
Literacy Act which essentially provide services which can be 
provided through basic adult education programs operated in 
each State. For example, although there is currently a set 
aside under the Adult Education Act for incarcerated 
individuals, the National Literacy Act created yet another 
small program to address the needs of this population. It is 
the belief of the Committee that the populations served by 
these small programs can be more effectively served under the 
Adult Education Act, which is more far-reaching than smaller 
programs and has the ability to provide a wider range of 
services to a greater number of participants.
    The Committee has, therefore, consolidated the eight adult 
education and literacy programs under its jurisdiction into a 
single block grant to the States. The block grant will be 
focused upon adult basic education programs, adult secondary 
education programs, programs providing English literacy 
instruction and family literacy programs. The consolidation 
increases the flexibility of States and local providers, to 
design and fund programs which best meet the needs of 
participants.

                           eligible entities

    Section 432 outlines the entities eligible to receive funds 
under this Act. Eligible local service providers include: local 
educational agencies, correctional agencies, community-based 
organizations, public or private nonprofit agencies, 
institutions of higher education, and other institutions that 
the State determines have the ability to provide literacy 
services to adults and families are included in the list of 
eligible entities. In addition, the Committee has added 
libraries as an eligible local service provider. The Committee 
believes that libraries have served and continue to serve as an 
important resource for literacy services.

                            family literacy

    Family literacy programs have proven effective in reaching 
some of the most difficult to serve populations, including 
individuals with low literacy skills and those receiving 
welfare payments. In describing family literacy, Sharon 
Darling, President and Founder of the National Center for 
Family Literacy, in her appearance before the Subcommittee on 
Early Childhood, Youth and Families, stated, ``Family literacy 
is a very intensive approach to adult education and early 
childhood. It is a synergy of combining disciplines together, 
combining funding streams together that can affect change in 
the family for the short and long term.'' According to Betty 
Mohlenbrock, President of the Family Literacy Foundation in 
Solana Beach, California, ``the single best predictor of a 
child's future success in reading, and, consequently, in 
school, is if they have been read aloud to on a regular 
basis.'' Unfortunately, for many children, their parents are 
under-educated, have low literacy skills and lack the self-
esteem necessary to be their child's first teacher. As a 
result, these children lack a strong literacy experience, lack 
reading readiness, and enter school behind their peers. By 
working with the entire family, family literacy programs not 
only assist parents in building their literacy and education 
skills, but they also provide educational assistance to their 
children to ensure that they do not experience educational 
failure. Family literacy programs have demonstrated their 
effectiveness in bringing about change in the home. Parents 
begin to read to their children and support their child's 
education. Over the long term, children whose parents 
participate in the program are less likely to need special 
education or to be held back in school.
    Sharon Darling cited a recent study which indicated that 
even though 88 percent of the parents in this program (family 
literacy) were on welfare when enrolled, 66 percent of those 
parents now are either employed, participating in education and 
training programs, or have definite plans to continue their 
education. For these reasons, we have added family literacy as 
one of the uses of funds for which these block grant dollars 
can be used under Section 432.

                      strong links to job training

    One of the primary changes in this legislation is the new 
connection between job training and adult education systems. 
Too many individuals seeking job training find themselves 
unable to benefit from programs because they do not have the 
literacy skills necessary to benefit from training programs. 
According to Dr. Augusta Kappner, Assistant Secretary, Adult 
and Vocational Education, U.S. Department of Education:

          A significant proportion, sometimes as much as 50 
        percent of individuals who are in job training 
        programs, simply don't have a high enough level of 
        literacy skills to be able to benefit from those 
        specific job training programs . . . we have to find a 
        way to make sure that folks have the basic literacy 
        skills they need to be able to take advantage of the 
        occupational skills and to be able to change careers as 
        work changes.

    Increased employability is a priority outcome for adult 
basic education services--for both the individuals who need to 
strengthen their educational skills and for the communities in 
which they live and work. The ability of communities to attract 
and maintain high performance, high wage businesses and 
industries and the ability of individuals to obtain and retain 
good jobs at these workplaces have a common denominator: a 
strong educational foundation upon which responsive, flexible 
and high quality products and services can be built.
    The CAREERS bill eliminates current barriers to strong 
partnerships between education and job training programs and 
involves the education community in the development of a 
State's job training system. This acknowledgement, plus 
language in the bill giving a priority to funding local 
providers who coordinate with workforce development boards and 
one-stop centers, will address some of the current problems 
facing individuals with low literacy skills who are seeking 
training and employment. In addition, the bill provides for a 
transfer of funds to adult education providers for those 
individuals who seek job training assistance but who do not 
have the literacy skills required for participation. In the 
past, the adult education system has been asked to coordinate 
with a growing number of programs. However, funding has seldom 
followed participant referrals and participants are often 
turned away because the system does not have the capacity to 
meet the current demand for services. It is the view of the 
Committee that the current adult education system be 
strengthened in order to meet the job training demands under 
this legislation, as well as under welfare reform.

             using adult education funds for other purposes

    While the CAREERS bill closely ties adult education to the 
job training system, it acknowledges there are uses of adult 
education other than assisting individuals who need to increase 
their literacy skills for purposes of employment. Minnie Mae 
Robinson, a program participant from Grows Literacy Council, 
Apopka, Florida described for the Committee her experience with 
adult education. Ms. Robinson stated that she only attended 
school ``a little'' as a child because she had to work. She 
said that adult education meant a lot to her. She is no longer 
just a student, she helps counsel in her community and has 
written three books. She stated that the adult education 
program she attended gave her back her self-esteem. She pointed 
out that she had no self-esteem when she could not fill out a 
work sheet or write out a money order or a check. She said 
these things mean a lot to adults. She stated that she has now 
learned to do these things for herself and not have to go from 
house to house begging someone to fill out an application. Ms. 
Robinson is in her 70s and did not seek out adult education for 
purposes of employment. She did so to improve her ability to 
function in society and to help others.
    The legislation approved by the Committee recognizes that 
adult education and literacy programs play a key role in 
assisting individuals to achieve the literacy skills they need 
to apply for U. S. citizenship, to provide education to parents 
participating in family literacy programs, and to provide 
services to individuals like Ms. Robinson.
    According to the most recent National Evaluation of Adult 
Education Programs (1995) (NEAEP), the number of participants 
enrolling in English as a Second Language (ESL) programs is on 
the increase. In the 1992-1993 program year, 40 percent of 
program participants were enrolled in ESL classes. In 1980, ESL 
learners constituted just under 20 percent of enrollees. This 
grew to 31 percent in 1992 and 1993 and, according to the NEAEP 
study, 46 percent of new enrollees entered ESL instruction. Dr. 
Andrew Hartman, Director, National Institute for Literacy, 
pointed out that limiting adult education to providing services 
to individuals seeking assistance for employment services 
would, in actuality, constrain the flexibility of the States 
because they would not be able to use such funds for programs 
such as family literacy. The Committee felt, therefore, that it 
was important to allow the continued use of funds for programs 
serving limited English proficient individuals and family 
literacy.

             incentives to assist hard-to-serve individuals

    Although it is gratifying to learn that adult education and 
literacy programs are of great assistance to some individuals 
seeking their GED's, high school diplomas and literacy skills 
necessary for citizenship, these programs are still unable to 
demonstrate great success in assisting individuals with very 
low literacy skills, many of whom are in low paying jobs or 
receiving welfare benefits. The Committee recognizes that it is 
easier to serve individuals who need just a small amount of 
assistance; however, the Committee is also aware that the goal 
of reducing welfare rolls will not be met unless we are able to 
provide quality services to the neediest individuals. According 
to Mr. Rodgers Smith, Provost, Continuing Education Center, San 
Diego Community College District, San Diego, California:

          Beginning-level students cannot be ignored We know 
        that students must be at a high beginning or a low 
        intermediate level of either ESL or ABE (Adult Basic 
        Education) to become citizens or to benefit from job 
        training or to gain employment. We must give our 
        beginning students a chance to reach that level. If the 
        beginning-level students are ignored, this group could 
        remain dependent on welfare for a very long time.

    Therefore, Section 32 of the Committee bill requires States 
to set aside three percent of State dollars for an incentive 
program for local providers to improve services to this 
population. The Committee intends for rewards to be given to 
local providers after they demonstrate success in serving the 
target population rather than up front. In this way, they will 
be encouraged to develop ways to provide assistance to hard to 
serve populations with existing dollars and not rely on a 
constant influx of new dollars to provide such services.

                       measuring program success

    In addition to providing incentives to States and local 
providers to address the needs of individuals with low literacy 
skills, the Committee has set forth progress indicators in 
Section 434 which States can use to monitor the success of 
adult education and literacy programs funded under this Act. 
Cheryl L. Keenan, Director, Bureau of Adult Basic and Literacy 
Education for the Pennsylvania Department of Education, stated 
that adult education legislation must provide a strong base for 
accountability. She stated:

          Legislation should provide for a process by which 
        States could join together to build a national 
        framework of desired program outcomes that are closely 
        tied to the purposes and goals of this legislation. 
        This framework would enable States uniformly to report 
        the results of adult education so they could be 
        nationally demonstrated.

    While high school diplomas and GEDs are some of the more 
commonly used measures of program success, the Committee 
recognizes that there are other measures of program success, 
particularly for individuals with low literacy levels. As Dr. 
Augusta Kappner indicated in her testimony, ``the field is at a 
point where it needs to move from quality indicators and input 
measures, to real ways of measuring results and outcomes.'' The 
Committee agrees. By setting broad parameters for measuring 
program success, the Committee has allotted to States the 
responsibility for establishing their own statewide goals and 
benchmarks for achieving those goals. At the same time, we will 
be able to monitor whether or not programs funded under this 
Act are effectively serving the diverse educational needs of 
individuals no longer in school. The Committee expects States 
to use information collected from local providers to be used to 
improve programs and make decisions on the allocation of 
resources.

the national institute for literacy and state literacy resource centers

    Section 441 of the Committee bill established the national 
Institute for Literacy. The National Institute for Literacy 
(NIFL) is a critical part of the national effort to improve the 
nation's system of adult education and literacy. The research 
development, technical assistance, and information that the 
NIFL provides to State and local programs will be even more 
important as literacy providers work to meet the goals and 
performance standards required by this legislation. For 
example, the electronic information and communications network 
developed by the NIFL will provide the adult education and 
literacy field with up-to-date information both from national 
sources and other State and local programs. Since literacy and 
basic skills education for adults and families is vital to 
attaining many of the nation's economic and social goals, the 
NIFL must provide leadership in creating more effective and 
efficient literacy services.
    The Committee intends for the NIFL to be a national 
resource for Federal agencies, States, one-stop centers, and 
local employment and education programs as they implement the 
CAREERS Act. The interagency nature of the NIFL is a perfect 
fit for the coordinated, consolidated human resource 
development system that is the goal of this legislation. The 
Committee expects the NIFL to continue in this role of working 
across labor, education, and human service programs, and 
expects these Federal agencies to work closely with the NIFL to 
support its mission.
    The Committee did not provide a separate line item for 
State Literacy Resource Centers. While the Committee believes 
the Centers serve a meaningful purpose, it is important at this 
time to focus as many dollars as possible on providing services 
at the local level. However, in view of the fact that these 
State centers provide an important link between States and 
local programs and the National Institute for Literacy and may 
not be continued without some type of Federal support, the 
Committee has included language in Section 432 and Section 442 
of the bill allowing individual States and the Department of 
Education to fund these centers out of the funds they receive 
under this Act.
          library service and consolidation grants technology

    The Committee recognizes the valuable role America's 
libraries have played in ensuring that all Americans have equal 
access to information. When the Library Services and 
Construction Act was first authorized in 1956, the goal of this 
program was to ensure that all Americans had access to 
libraries and the information they contain. The Committee is 
pleased to note that today, 96 percent of all Americans have 
access to libraries.
    However, this nation is currently undergoing a 
technological revolution and recently, we have witnessed a 
tremendous proliferation in new sources of information. This 
trend will not only continue, but is certain to accelerate. It 
is clear that America's libraries will need to take advantage 
of these new technologies if they are to continue to ensure 
that all Americans have equal access to information.
    A 1994 study conducted by the U.S. National Commission on 
Libraries and Information Science found that only 20.9 percent 
of America's 9,050 public libraries had any involvement with 
the Internet. Of these, only 13 percent reported that they 
offered patrons access to the Internet. It is clear that the 
time has come for a shift in Federal library policy, and that 
shift must be toward helping this country's libraries, and 
ultimately the American public, gain access to the technologies 
and information they will need as we move into the 21st 
century.
    The Committee reported bill will do just that. It 
consolidates the Library Services and Construction Act, the 
Academic Library and Information Services provisions in Title 
II of the Higher Education Act of 1965, and the Elementary and 
Secondary School Library Media Resources program from the 
Elementary and Secondary Education Act into one Federal 
libraries program focused on helping all libraries acquire 
cutting edge technologies.
    Library Services Technology Consolidation grants will 
provide for library service to citizens through the use of new 
information technologies. They will help bring America's 
libraries, public, elementary and secondary schools, and 
academics, into the 21st century. They will help libraries form 
electronic linkages with one another to better share resources, 
and they will give all Americans access to new and better 
sources of information, such as the Internet. In addition, 
libraries will use these funds to forge connections with one-
stop career centers, providing a unique resource for those who 
wish to find or improve careers.
    Central to this mission is the philosophy that access to 
electronic information resources must be both democratic and 
egalitarian. Libraries and Librarians must be well equipped to 
help patrons navigate the information superhighway and provide 
access to the wealth of information available; government 
information, library resources, education and job information. 
For millions of Americans, the library will become the on-ramp 
to the information superhighway.
    The Committee is pleased to note that some communities are 
already beginning to assimilate these new technologies. For 
example, Beverly Choltco-Devlin, Director of the Morrisville 
Public Library in Upstate New York talks of ``the wondrous and 
miraculous'' experience of adult literacy students in using the 
Internet to interact with new adult learners across the country 
and around the world. She notes that this successful program 
was inspired by the experience of a 51 year old dairy farmer 
who somehow got through the ninth grade with only a first grade 
reading level. Clearly, in rural or isolated areas, this new 
ability to communicate provides a powerful incentive for 
literacy.
    However, communities across this country will need help to 
tap into these new resources. Just as the Library Services and 
Construction Act provided access to libraries for millions of 
Americans, Library Services Technology Consolidation grants 
will give Americans equal access to the information sources of 
the 21st Century.

                   TITLE V--VOCATIONAL REHABILITATION

                                overview

    Title V includes amendments to the Rehabilitation Act of 
1973. It is the intent of the Committee to maintain the values 
and protections that are currently embodied in title I of the 
Rehabilitation Act, but to draw a distinction between these 
values and protections and the current State-controlled 
delivery system of services.
    The changes to title I of the Rehabilitation Act would 
promote the following positive improvements in the delivery of 
vocational rehabilitation services to individuals with 
disabilities:
          Individuals with disabilities would have much greater 
        choice over development of career objectives and the 
        choice of services to support those objectives;
          The system would encourage the participation of 
        private service providers and, through competition, 
        would yield improved outcomes;
          To the maximum extent possible, specialized service 
        delivery would be integrated with other employment 
        programs to create a more efficient use of Federal 
        resources;
          Integrated service systems would ensure that all 
        individuals with disabilities would receive at least 
        core services, and would not be volleyed back and forth 
        between the adult training and vocational 
        rehabilitation systems, which now happens; and
          Vocational rehabilitation funds would be specially 
        targeted and protected to meet the needs of disabled 
        individuals.

                           transition period

    Chapter 1, Section 501 creates a transition period for 
State systems to integrate into the new local-delivery system 
under the Consolidated and Reformed Employment, Education and 
Rehabilitation Systems Act.
    The Committee recognizes that there will be significant 
restructuring of the adult job training system, and the adult 
training system has not traditionally been responsive to the 
needs of individuals with disabilities. For this reason, a 
simultaneous transition from a State-run rehabilitation system 
to a locally-controlled system while the new one-stop systems 
are being established would not be the best approach.
    Under the Committee's plan, the collaborative process, the 
development of local workforce development boards and one-stop 
career center systems would take place in Fiscal Year 1996. 
During the development of these systems, individuals with 
disabilities would be involved both at the State level and at 
the local level. This would ensure that, during the initial 
development of these new systems, the rehabilitation needs of 
individuals with disabilities will be anticipated.
    During Fiscal Year 1996, the bill would require the 
Secretary of Education, operating through the Commissioner of 
the Rehabilitation Services Administration, to develop 
administrative policies for implementing the changes to title 
I. During this year, the Commissioner would work with the 
Secretary of Education and the Secretary of Labor to develop 
the national performance indicators for vocational 
rehabilitation required by the Bill. The Commissioner would 
also provide policy guidance to the States to guide them 
through implementation of the new system requirements.
    During fiscal years 1997 and 1998, the Secretary will begin 
to implement the amendment with a special focus on facilitating 
the transition from a State-controlled system to a locally-
controlled, consumer-directed system. The steps to be taken 
include establishing guidelines for approving providers, 
establishing guidelines for use of skill grants, training 
management and staff of the one-stop centers to effectively 
meet the needs of consumers with disabilities, and establishing 
guidelines for the one-stop centers, including encouraging the 
participation of community-based providers that had previously 
received funds under the Projects with Industry, Supported 
Employment, and Javits Wagner O'Day programs.
    The Committee intends that the new amendments take effect 
not later than the first day of fiscal year 1999, and that, 
prior to this time, the current title I of the Rehabilitation 
Act will remain in force, except that the Commissioner will 
take steps to move toward the FY 1999 implementation deadline.

         revision of title i of the rehabilitation act of 1973

    Chapter 2, includes the Revision of title I of the 
Rehabilitation Act of 1973.

                       client assistance program

    Section 511 transfers the Client Assistance Program to 
title V of the Act. The Committee recognizes the unique focus 
of the Client Assistance program in assisting individuals with 
disabilities to obtain needed VR services, as opposed to 
challenging systemic barriers, which is authorized under the 
Protection and Advocacy of Individual Rights (PAIR) program. 
The CAP program is moved to title V because the Committee 
believes that title V, relating to civil rights and in which 
the PAIR program is placed, is a more appropriate placement.

                                purpose

    Section 100. Purpose. The Committee believes that the 
revised title I has a threefold purpose: 1) assisting States in 
offering individualized, specialized employment, training, and 
rehabilitation services to individuals with disabilities, 2) 
maximizing individual control over vocational and career 
choices; and 3) assuring equality of opportunity, full 
participation, independent living and economic self 
sufficiency.

                             formula grants

    Section 101 lays out criteria for Formula Grants to States. 
Subsection (d) provides that such sums as may be necessary for 
each fiscal year 1999 through 2002 are authorized. Although the 
CAREERS Act authorizes programs from fiscal year 1996 through 
2002, the amendments to the Rehabilitation Act do not take 
effect until fiscal year 1999. The paragraph also provides that 
each State will not receive less than was appropriated in the 
previous fiscal year, plus the amount of the ``Consumer Price 
Index Additional.'' These provisions are identical to current 
law.
    Under H.R. 1617, title I of the Rehabilitation would 
maintain its budgetary status as a mandatory program, and its 
annual increases in funding would reflect the increase of the 
consumer price index. Titles II-VII, however, are no longer 
mandatory but reflect the discretionary status that the 
Committee has historically believed was the status of these 
programs.

                 state allocations of responsibilities

    Section 102 establishes allocations within each State for 
administrative responsibilities. The Committee intends that the 
State will retain 20 percent of funds under title I of the 
Rehabilitation Act, both to carry out statewide activities, and 
to provide direct services to individuals with disabilities 
under certain circumstances. In certain circumstances, such as 
in serving individuals with blindness and other low-incidence 
disabilities, or when the individual is still hospitalized or 
in medical therapy, the State could take on responsibilities 
normally associated with the one-stop career system, providing 
eligibility determinations, assessments of vocational 
rehabilitation need, and vocational rehabilitation services, 
directly to the disabled individual. In this case, the State 
would need to comply with standards for choice, use of skill 
grants, and participation of private providers that the one-
stop career systems follow.
    Also, the geography and rural nature of certain States may 
create extraordinary challenges in providing services to 
individuals with disabilities through local workforce systems. 
In such areas, traditional market forces may not respond to 
providing needed specialized services to individuals with 
severe disabilities. The State, again, may have a proper role 
in providing direct services.
    This section also clarifies that 80 percent of the 
vocational rehabilitation funds will be expended by the local 
workforce development board, working through the one-stop 
career center system to provide education and training services 
to individuals with severe disabilities.

                         state responsibilities

    Section 103 lays out the responsibilities of the State 
Administrative Agent.
    Subsection (a) allows a Governor to designate an 
administrative agent to administer the vocational 
rehabilitation program, and at the Governor's discretion, a 
separate agent to administer vocational rehabilitation services 
to individuals who are blind.
    Subsection (b) lays out the responsibility of the State 
administrative agent. Under H.R. 1617, States would experience 
a changing role in vocational rehabilitation. Instead of being 
the primary provider of direct services, States would be 
responsible for establishing certain statewide criteria to 
assure a minimum degree of services within the State, serve in 
a quality oversight and monitoring function, and also serve as 
a source of training and technical assistance to the one-stop 
career systems within a State.
    Subsection (b)(1) clarifies that all activities under this 
section shall be carried out through the collaborative process 
established under section 103 of the CAREERS Act.

           order of selection/priority on severe disabilities

    Subsection (b)(2) is similar to the provision of current 
law that requires each State to establish an ``order of 
selection'' for first providing vocational rehabilitation 
services to those individuals with the most severe 
disabilities, if the State is unable to provide vocational 
rehabilitation services to all eligible disabled individuals. 
The Committee has chosen to retain the ``order of selection'' 
requirement so that individuals with the most severe 
disabilities will continue to receive priority for services. 
Individuals with severe disabilities have an employment rate 
drastically below that of individuals with moderate 
disabilities (23 percent employment for the severely disabled 
compared to around 80 percent for the moderately disabled). In 
addition, the Federal government carries the primary financial 
responsibility for providing assistance to individuals under 
the Social Security Disability Insurance (SSDI) and 
Supplemental Security Income (SSI) programs, which provide cash 
and medical assistance to individuals with severe disabilities. 
For these reasons, the Committee believes the Federal priority 
continues to be toward facilitating employment of individuals 
with severe disabilities.
    The Committee has not created a definition of ``most severe 
disability,'' instead allowing States to determine their own 
prioritization system for delivering services.

                           choice of services

    Subsection (b)(3) requires the State to establish 
guidelines so that individuals with disabilities eligible for 
services and having been assessed for rehabilitation needs will 
have the choice of receiving services from a provider 
designated by the one-stop career center or chosen by the 
individual. The Committee recognizes that, in certain 
circumstances, the one-stop career center may have established 
referral relationships with certain providers. The Committee 
intends that the individual be given the choice of securing the 
designated services from the provider with whom the center has 
a referral arrangement, or from another approved provider that 
the individual chooses.
                      statewide/regional providers

    For certain specialized services for individuals with 
disabilities, the Committee recognizes that there may not be 
enough providers of services within a local workforce delivery 
area to provide an individual with an adequate choice of 
services. In some cases, there may only be one qualified 
provider of a particular service within a State. For this 
reason, providers are approved on a statewide basis so an 
individual can choose a provider elsewhere within the State to 
provide the service. In addition, there may be circumstances 
where it is necessary to approve providers outside of a State 
when a particular service is only available on a regional or 
national basis.

                 community-based provider participation

    Subsection (b)(4) requires the State to encourage the 
participation of community-based private providers, with 
special consideration to providers who have participated in the 
Projects with Industry and Supported Employment programs, or 
under the Javits-Wagner O-Day Act.
    The Committee believes that one of the major reforms 
necessary in vocational rehabilitation is to allow and 
encourage much greater participation of private providers in a 
competitive market for service delivery. State rehabilitation 
managers argue that, in many States, a high percentage of 
direct services are contracted out to private providers. While 
this is probably more efficient than providing such services 
in-house, it does not take full advantage of the competitive 
nature of an open market. The reformed system will allow direct 
competition among providers for the customer's business, 
empowered through the use of service vouchers.
    Upon full implementation of the amendments in H.R. 1617 in 
FY 1999, the Projects with Industry and Supported Employment 
Demonstration programs will be repealed. Projects with Industry 
and Supported Employment have made enormous contributions to 
the development of rehabilitation services over the last 
decade, and it is time that their contributions be fully 
integrated into the State grant system. Because the reforms of 
H.R. 1617 will create a public-private partnership with strong 
outcome orientation, the demonstration-style Projects with 
Industry program is no longer necessary. In addition, the 
concept of Supported Employment has been successfully 
demonstrated as a vital component of helping individuals with 
severe disabilities obtain integrated employment. This program, 
too, is no longer necessary as a distinct component, and should 
be merged into the State grant program. To facilitate current 
providers under these programs, as well as providers under the 
Javits Wagner O-Day Act, the State shall make special efforts 
to encourage their participation as providers in the new 
rehabilitation system. The Committee expects this new system to 
use projects with industry and supported employment as a model 
to provide vocational rehabilitation services giving consumers 
the most choice in determining their career.

                              eligibility

    Subsection (b)(5) provides that the State will establish 
procedures to guide eligibility determinations. Under the Order 
of Selection criteria established by the State, individuals 
entering the one-stop career system will have eligibility 
determinations conducted for services.
    Subsection (b)(6) relates to standards to govern the 
assessment of an individual's need for rehabilitation within a 
State. The State plays an important role in assuring local 
areas are given clear guidance about how assessments shall be 
conducted. Under H.R. 1617, States will establish a methodology 
so that, based on a consumer's degree of rehabilitation needs, 
there will also be established a monetary value of goods and 
services available to the consumer. These standards are 
designed to prevent unreasonable disparities in the level of 
services available to individuals with similar degrees of 
rehabilitation need.
    The Committee is concerned, that under current practices, 
there is little uniformity within a State of the level of 
services for which an individual is eligible. Such a 
methodology, specifically geared to measure the individual 
degree of rehabilitation needs for an individual, will assist 
in ensuring equity of services throughout the State.
                            impartial review

    Subsection (b)(7) provides that the State will establish 
procedures through which an impartial review may be requested 
and obtained.
    The Committee believes that, under the reformed system 
established by H.R. 1617, there will be much greater 
accountability for actual services rendered to an individual. 
First of all, for vouchers, there will be a direct contract 
arrangement between the one-stop center and the provider. In 
addition, payments to providers will be made on a 
``performance'' basis. That is, when a provider agrees to 
provide a service, a portion of the full payment will be 
withheld until the services have been successfully delivered. 
Both of these reforms bring greater accountability to the 
provider.
    Under H.R. 1617, eligibility determinations and assessments 
of vocational rehabilitation needs will be the primary 
responsibility of the one-stop career systems. The impartial 
review, utilizing an impartial hearing officer, will determine 
whether the standards for eligibility and assessment of 
vocational rehabilitation needs, and development of 
individualized rehabilitation plans were correctly applied to 
the individual. The Rehabilitation Act does not convey an 
individual entitlement to services, but participants in the 
program must receive fair and equitable treatment under the 
program. As part of establishing guidelines for the impartial 
review, the State will establish a minimum number of days 
during which the impartial review must be conducted. Rather 
than establish a particular number of days at the Federal 
level, the Committee believes it is appropriate to grant States 
flexibility in establishing this time period, and expects the 
State will apply it uniformly throughout the State.

                   standards for qualified personnel

    Subsection (b)(8) relates to the State ensuring that 
services at the one-stop career center system, whether they be 
core services or vocational rehabilitation services, be 
delivered by personnel qualified to provide them. This is one 
of the most important roles to be played by the State.
    The Committee expects that every one-stop center or 
affiliated center will provide core services and will be linked 
into the other one-stop centers. This does not necessary imply 
that every one-stop center will provide specialized services 
for all elements of the workforce population. In fact, it may 
be necessary and practical to establish one or more one-stop 
career centers in each area that specialize in vocational 
rehabilitation and accommodating individuals with disabilities.
    However, each one-stop center must have the capability and 
training to recognize the vocational potential of an individual 
with a disability, and provide core services in an 
accommodating format, which include referral for eligibility 
determination for vocational rehabilitation services.
    Concern has been expressed that H.R. 1617 creates a 
``generic'' job training system in which the needs of 
individuals with disabilities can not be accommodated. The term 
``generic'' is a misnomer. H.R. 1617 represents an integrated 
system of specialized job training and employment services 
aimed at distinct populations with distinct needs. Several 
elements are in place to ensure specialization of services at 
the one-stop delivery system. One of the keys to success of the 
system is the State's oversight to ensure that qualified 
personnel are available in the one-stop career centers.

                            transition plan

    Subsection (b)(9) contains language from the current law 
requiring the vocational rehabilitation agency to enter into an 
agreement with the State agency responsible for development of 
special education plans for students covered under the 
Individuals with Disabilities Education Act. This 
``transition'' language is tracked in H.R. 1617.

              coordination with independent living council

    Subsection (b)(10) requires the State to coordinate 
activities with the Statewide Independent Living Council. It is 
vital that strong linkages between independent living and 
vocational rehabilitation are built and maintained. These 
programs represent a continuum of services and opportunities 
for individuals with severe disabilities. For most individuals 
with severe disabilities, the first step toward working in an 
integrated employment setting is gaining the skills to live 
independently.

                         interagency agreements

    Subsection (b)(11) requires the State to establish other 
interagency agreements with agencies administering public 
assistance and other programs for individuals with 
disabilities. Because there are a broad array of services 
available to individuals with disabilities, both Federally 
funded and State funded, effective cooperation and coordination 
is essential.

                    training of management and staff

    Subsection (b)(12) relates to the requirement that the 
State establish policies requiring qualified personnel to 
deliver core services and vocational rehabilitation services. 
This paragraph requires that the State undertake training of 
management and staff of the local boards, the one-stop career 
centers, and the providers of services.

                          technical assistance

    Subsection (b)(13) requires the State to provide technical 
assistance to local workforce development boards, one-stop 
career centers, and providers regarding effective provision of 
vocational rehabilitation services and development of 
individualized rehabilitation and employment plans. The 
Committee recognizes that local providers will need to have 
access to high quality information about providing effective 
rehabilitation services to a highly diverse population.
    Under the system envisioned by H.R. 1617, the State would 
continue to play a key role in serving as a conduit of 
information and technical assistance to local areas, one-stop 
centers, and providers. The State can set up toll-free hotlines 
to serve as a clearinghouse function to local areas, and the 
State can also deploy specialists on-site to assist in the 
development of rehabilitation and employment plans, and to 
share information about how services can be delivered in the 
most efficient way possible.

                     voucher system/consumer choice

    Subsection (c) establishes the availability of a voucher 
system for purchasing vocational rehabilitation services. Under 
H.R. 1617, an individual who has been determined eligible for 
services and has an assessment of vocational rehabilitation 
needs conducted will be given the opportunity to purchase goods 
and services through vouchers.
    The Committee believes that offering the use of vouchers is 
a vital component of creating a truly consumer-controlled 
system. It is very easy to claim that an individual is given 
choice in deciding what type of career he will pursue, but 
until a tangible decision is delegated to the individual, 
choice has not really happened. This element of decision-making 
is a key change from the current vocational rehabilitation 
system, and is a first step to empowering the individual to 
making a lifetime of decisions and choices about his career and 
personal life.
    Patrick W. McKenna, Director of Client Services, Maryland 
Division of Rehabilitation Services, noted in his vocational 
rehabilitation article of the 1995 copy of the Switzer 
Monograph the following:

          ``Consumer choice'' at its best reflects the basic 
        need of each individual to participate as fully as 
        possible in his or her own destiny; values the need to 
        assess the quality of services; recognizes that 
        informed consent is essential if any intervention is 
        going to be successful; and explicitly recognizes the 
        need to preserve mutual respect between a consumer and 
        a provider of services.

    The Committee believes that, when individuals have choice 
and control of resources to support that choice, it allows the 
private market to emerge that will meet this consumer demand.
    It is not credible for advocates for the current system to 
argue that ``there simply aren't enough private providers to 
meet the specialized needs of individuals with disabilities.'' 
Across the nation, where they have been allowed to participate 
in the public rehabilitation system, thousands of private and 
community-based organizations have emerged that provide high 
quality, responsive services to individuals with severe 
disabilities. The only States where a private market does not 
exist are the States that have chosen to provide all services 
through government employees and facilities and have carefully 
excluded private providers from participating.
    Carolyn L. Weaver, Resident Scholar, of the American 
Enterprise Institute quoted in the November 1, 1994 volume of 
the Journal of Disability the following:

          The rapid growth of the private rehabilitation 
        sector, which has been spurred by changes in workers' 
        compensation laws and the increased likelihood of 
        surviving once-fatal injuries and illnesses, is 
        testimony to the responsiveness of markets. Firms 
        emerge to meet customers' demands for rehabilitation 
        services and adapt what they offer to the changing 
        demands of their customers.

    This subsection also requires that the vouchers allow the 
individual to choose from among providers designated under the 
statewide provider approval system referred to in title I of 
the CAREERS Act. This system of provider approval is intended 
to create an assurance of quality among providers. While 
reviewing a current provider's performance is important in the 
approval process, the Committee believes it is important that 
new providers also be granted participation approval, on a 
provisional basis if necessary, so that the private market can 
emerge in a natural way to respond to the new consumer demand 
for choice and high quality services.
    Regarding the use of vouchers versus contracts, Weaver says 
in the November 1, 1994 volume of the Journal of Disability the 
following:

          The idea behind vouchers is to give people the 
        purchasing power they need to gain access to private-
        sector rehabilitation and the freedom to choose among 
        competing suppliers; competition among firms attempting 
        to attract new customers would then create--even among 
        the least innovative of public or private firms--
        incentives to develop innovative rehabilitation 
        programs at minimum costs. Firms unable to attract 
        customers would have to revise their programs, improve 
        their services, and/or develop more effective 
        management, or be taken over by more effective firms. 
        Real economic competition--and real protection for 
        consumers against quality deterioration and cost 
        increases--are more likely to be achieved with a 
        voucher system than with the contracting option.

    The provision also requires that the State establish 
guidelines so that the voucher for a service is set at a fair 
market value. The Committee is concerned that, in an attempt to 
make the use of vouchers unattractive to the consumer, a State 
could establish voucher amounts that are below what is a fair 
market value. This result would make it difficult for providers 
to accept the vouchers, and thus the goal of increased consumer 
choice would be thwarted.
    Because the stakes are so high for the individual with a 
disability in vocational rehabilitation, it is important that 
individuals be served well and are given adequate resources to 
achieve their rehabilitation and employment goals. Trying to 
cut corners by squeezing and shaving the amount of vouchers 
could actually foster greater long-term dependence and costs to 
the Federal government. On the other hand, vouchers must be set 
at a reasonable level that does not create undue profits for a 
provider or create incentives to steer individuals into a 
certain type of service or therapy, rather than what is needed 
or wanted by the individual.
    To provide an equitable distribution of services, it is 
necessary to create some uniform standards for assessments and 
vouchers for services. These functions are intended to empower 
individuals in making choices about their lives. However, any 
time there are standards established for the purpose of 
accountability and uniformity, there is the danger of creating 
an unresponsive, ineffective system that can not adapt to an 
individual's unique circumstances. The Committee intends that 
vocational rehabilitation embody a highly individualized 
approach that responds to individual needs in a flexible 
manner, and that a voucher system serves to enable that 
flexibility and creativity, not inhibit it.
    Finally, this subsection provides that the aggregate amount 
of vouchers available to an individual will reasonably relate 
to the degree of rehabilitation needs identified for the 
individual during his or her assessment. A fixed cap on 
services may not be appropriate for individuals who are 
disabled, since there is a wide range of disabling conditions 
and of needs for services. Depending on what training and 
services an individual has already received, his need for 
vocational rehabilitation may be drastically less than another 
individual with an almost identical disability and severity of 
disability.
    This diversity of need requires a voucher system that will 
be flexible and adjust to an individual's needs, while still 
assuring a degree of uniformity throughout the State. To 
accomplish this goal, H.R. 1617 requires each State to 
establish a methodology for calculating an aggregate amount of 
vouchers available to an individual. This aggregate amount must 
bear relation to his identified degree of rehabilitation need.
    The Committee intends that, when an assessment of 
vocational rehabilitation need is conducted and an aggregate 
amount of service vouchers is identified, that all or part of 
this amount will be reserved from current year funds. If some 
services are anticipated in the following year, at the time the 
next year funds become available, the individual currently in 
the program would receive a priority for reserving funds.

                       Optional State Activities

    Subsection (d) also outlines activities which the State may 
engage in, at its discretion.
    First, the State may disseminate information to local areas 
relating to emerging research regarding vocational 
rehabilitation services. Second, the State may conduct 
demonstration projects within the State to test alternative 
approaches to delivering vocational rehabilitation services. If 
a State conducts such demonstration projects, it shall also 
provide the findings from such demonstration projects to the 
Commissioner, and as appropriate within the State.

            Core Standards, Performance Goals, and Measures

    Subsection (103)(e) designates standards for Core 
Standards, Performance Goals, and Measures. Under this 
requirement, each State will develop and implement a statewide 
system of core standards and measures of performance for 
vocational rehabilitation programs utilizing the national 
performance indicators developed by the Secretary of Education. 
The standards will include measures of placement, retention and 
earnings in integrated employment, both at 6 months and one 
year, and the percentage of individuals served who had severe 
disabilities, including recipients of Social Security 
Disability Insurance (SSDI) and Supplemental Security Income 
(SSI).
    Under the current vocational rehabilitation system, a 
successful placement is considered to be 60 days in an 
employment outcome. Measuring employment, retention and 
earnings at 6 months and one year will give a much more 
accurate picture of the long-term effect of the vocational 
rehabilitation program.
    Including the factors of the percentage of participants 
served who had severe disabilities, particularly those under 
the SSI and SSDI programs, is an important balancing factor 
against focusing on employment outcomes alone. Without placing 
equal weight on the severity of disability, vocational 
rehabilitation could again shift to a system that serves 
individuals with less severe disabilities who can obtain an 
employment outcome more quickly and at lower cost.
    This subsection also encourages the State to build its 
indicators upon indicators established by the Secretary of 
Education for the current title I of the Rehabilitation Act 
program and the Projects with Industry program.

                 Local Boards, One-Stop Career Centers

    Section 104 establishing Responsibilities for Local Boards 
and One-stop Career Centers relating to Vocational 
Rehabilitation.
    Subsections (a)(1) and (a)(2) clarify that the local one-
stop centers will act under the guidance of local workforce 
development boards, and that the one-stop career centers will 
make determinations of eligibility for vocational 
rehabilitation services, provide vocational rehabilitation 
services, and also conduct outreach and intake activities for 
individuals who are not able to directly access the one-stop 
career centers because of the nature of their disability.
    The Committee wants to make clear that one-stop career 
centers are not only physical facilities to which individuals 
with disabilities may come. One-stop career centers are part of 
an integrated system of services. The system must conduct 
outreach and intake activities, particularly to individuals 
with severe disabilities that might not be able to physically 
access a center.
    In the case of adult onset of disability, such as 
blindness, an individual may not even believe he or she can 
become employable. Also, the individuals may not know that the 
One-Stop System can accommodate individuals with disabilities. 
It is essential that the One-Stop system develop close working 
relationships with local and statewide consumer advocacy groups 
so that individuals can be drawn into the One-Stop center 
system.
    It may also be necessary to provide certain services 
directly in the individual's home, not necessarily in a center-
based setting.
    Subsection (a)(3) clarifies that services may be provided 
in a variety of settings and environments.

            Definition of Vocational Rehabilitation Services

    Subsection (b) provides a broad definition of vocational 
rehabilitation services. These are services necessary to render 
an individual employable and achieve an employment outcome, and 
which are provided in response to the individual's disability, 
but do not duplicate core services under title I of the CAREERS 
Act. Many services currently available under the Rehabilitation 
Act could seem to duplicate core services under the CAREERS 
Act. The Committee believes that some similarity between core 
services and vocational rehabilitation services is reasonable, 
but that individuals with disabilities who could be served 
through the core services not be referred for vocational 
rehabilitation services unnecessarily. Without proper 
safeguards to prevent duplication of services, vocational 
rehabilitation could be seen as an attractive source to save 
funds in the delivery of core services. Thus, services offered 
under vocational rehabilitation must be directly related to the 
individual's disability and may not duplicate core services.
    Subsection (c) also includes a detailed listing of services 
that must be offered as vocational rehabilitation services. 
This list is very similar to current law, but not as detailed 
in all areas.

               Supported Employment and Extended Services

    Subsection (d) requires the one-stop career center to 
establish relationships with community-based providers, 
including arrangements regarding supported employment services 
and extended services, periodic reviews of individuals placed 
in extended employment, and services to provide movement from 
extended employment to integrated employment.
    The Committee intends that the growing trend toward 
emphasizing long-term supportive services for individuals with 
disabilities be continued, and that special arrangements with 
community providers for such services be made. In the context 
of long-term supportive services, a contract between the one-
stop center and the provider may be more practical than a 
service voucher, except that the choice of the individual in 
the selection of the provider must still prevail.

                     Core Services Supplementation

    Subsection (f) establishes criteria in which some resources 
from vocational rehabilitation can supplement the provision of 
core services. This amount set aside for core services will be 
based on the number of individuals eligible for vocational 
rehabilitation services that are in the local workforce 
development area and the cost of training employees of the one-
stop career center to provide high quality services.
    In deciding how much shall be dedicated for the purpose, 
the Committee decided against designating a maximum percentage, 
because a maximum percentage could easily become a minimum, 
whether or not it is needed. The Committee intends for local 
workforce development boards to establish, based on current 
usage of the vocational rehabilitation system, the number of 
individuals eligible for specialized vocational rehabilitation 
system it expects to utilize the one-stop system. This factor, 
as well as the expected costs of training personnel to provide 
one-stop core services in a disability responsive manner, will 
help guide the board in deciding how much funding to dedicate.
    The Committee is concerned that a local workforce 
development board might try to divert an unreasonable amount of 
funds to support core services for individuals who are not 
disabled. The Committee does not wish to create a tracking 
requirement to ensure that the vocational rehabilitation funds 
always serve individuals with disabilities, but the intent of 
the provision is to supplement core services for such 
individuals. If, over the course of time, Congress learns that 
excessive vocational rehabilitation resources have been 
diverted to support core services, the Committee may consider 
giving more direct direction on how these funds are allocated.

                          Performance Payments

    Subsection (g) establishes guidelines for performance 
payments. The performance payment concept is intended to 
provide direct accountability for the successful provision of 
services. By withholding part of a payment until the service is 
completed according to prior agreement, the service provider 
has a direct incentive to fulfill the agreement. In some 
demonstration programs, performance payment systems have 
withheld the entire payment until completion of the service. 
While this approach may be too extreme in many cases, local 
areas should use the performance payment authority to the 
maximum extent possible to hold providers accountable to high 
performance standards.
    H.R. 1617 establishes that for general services, such as 
services that relate to short-term or intermediate vocational 
rehabilitation objectives, the service must be carried out in 
reasonable accordance with the outcome previously arranged with 
the provider. The Committee encourages local workforce 
development boards to include a verification of customer 
satisfaction as part of that arrangement. This would again 
strengthen the role of the consumer in determining the outcome 
of his or her vocational rehabilitation program.
    In the case of education, training and placement services, 
performance payments are tied to more specific outcome 
objectives. These are successful completion of an employment 
and training program, and job placement and retention for at 
least 90 days. The Committee intends that services that have a 
direct employment outcome as the reasonable expectation of the 
service to be held to tangible outcomes of program completion 
and direct employment. Even if a local workforce development 
board withholds only five percent of the program costs until 
these objectives are met, it sends a strong signal of 
accountability to the service provider.

                       Eligibility Determination

    Section 105 (a) lays out the criteria by which an 
individual with a disability is determined eligible for 
vocational rehabilitation services. These criteria are almost 
identical to the criteria in the current law. First, an 
individual is eligible if she meets the definition of 
disability under section 7(8)(A) of the Rehabilitation Act and 
also requires vocational rehabilitation services to become 
gainfully employed. Eligibility is also granted if the 
individual has a disability or is blind as determined under the 
Social Security Disability Insurance or Supplemental Security 
Income programs of the Social Security Act.
    To clarify the meaning of 7(8) that an individual must be 
``employable,'' paragraph (3) provides that an individual will 
be presumed to be able to benefit in terms of an employment 
outcome unless the one-stop career center system can 
demonstrate by clear and convincing evidence otherwise. This 
language also tracks the provision of current law that was 
inserted in the 1992 amendments. Prior to these amendments, 
individuals with severe disabilities were often determined to 
be unable to benefit from a program and were denied 
eligibility. This important change moved the Rehabilitation Act 
more in line with the realities of emerging technology and 
services, such as supported employment, that allow individuals 
with disabilities who in prior years would have been 
unemployable to now retain long-term employment.
    Subsection (b) establishes the process by which an 
eligibility determination is made. First, after an individual 
makes a request for determination of eligibility, a qualified 
rehabilitation adviser will be made available, and an initial 
interview will be conducted followed by an assessment. H.R. 
1617 reduces from 60 days to 30 days the length of time which 
is allowed to render an eligibility determination. Utilizing a 
locally-based system, eligibility determinations should be 
conducted much more expeditiously than under the current 
system. It is the Committee's intent that all procedural 
components of the system happen as quickly as possible on 
behalf of the consumer, from eligibility, to an assessment of 
vocational rehabilitation needs, development of a 
rehabilitation and employment plan, to purchase of goods and 
services through vouchers.
    As under current law, if an individual is determined not to 
be eligible, they will be provided a written statement of the 
reason why they are not eligible, the availability of an 
impartial review, and services under the Client Assistance 
Program.

     Assessment, Development of Rehabilitation and Employment Plan

    If the individual is eligible for services, based on the 
State's order of selection criteria, the individual will have 
his need for vocational rehabilitation assessed. Next he will, 
with assistance of qualified staff from the one-stop center, 
develop a personalized rehabilitation and employment plan. This 
plan should be developed in consultation and with mutual 
agreement between the individual and the staff. The plan, as 
under current law, must be consistent with the unique 
strengths, resources, abilities and capabilities of the 
individual. This language was intended to strengthen the 
individual's control over the development of the vocational 
rehabilitation plan. The Committee wants to ensure that the 
vocational rehabilitation system makes a final and complete 
move away from a paternalistic approach in which, well-meaning 
counselors once told individuals with disabilities what they 
were and were not capable of doing on a vocational basis, and 
directed the individual into a particular career path that did 
not reflect the aspirations of the individual.
    As Lawrence C. Gloeckler, Director of New York State 
Rehabilitation Services, quoted the following in the 1995 copy 
of the Switzer Monograph:

          Too often, counselors only offer limited options from 
        among those services or providers that they have found 
        to be convenient and comfortable in the past. They may 
        not think creatively beyond the traditional offerings 
        that they have grown accustomed to using.

    The role of the counselor has been changing over the last 
ten to fifteen years in parallel with the development of the 
independent living philosophy. Specialists with experience and 
knowledge of rehabilitation are a valuable resource to 
individuals with disabilities. But the knowledge of services 
must be matched with an understanding of the needs and rights 
of individuals with disabilities to determine their own goals 
and career objectives.
    The Committee envisions a continued interaction between the 
individual with a disability and a rehabilitation specialist. 
High-calibre counselors in the current system will have no 
problem transitioning over to a new, consumer driven system. 
However, it is the Committee's intent that current State 
employees not simply be grandfathered over to a new system.
    Finally, the individualized rehabilitation and employment 
plan does not need to be developed if the individual signs a 
waiver stating the plan is not necessary. This language tracks 
language in the independent living section of the 
Rehabilitation Act.
    The Committee believes that the provision of vocational 
rehabilitation services should be streamlined to the greatest 
degree possible, while maintaining important components to 
assure choice and successful delivery of services. For certain 
individuals who have been assessed for vocational 
rehabilitation needs, they may have a clear vocational 
rehabilitation goal in mind and only need voucher approval to 
secure the services. These individuals should not be burdened 
or delayed with development of a detailed written plan.
    Most clients will benefit from the process of working with 
a qualified specialist to develop a personal rehabilitation and 
employment plan. Because the needs of vocational rehabilitation 
may be complex and require multiple intermediate steps, a 
written plan can be very beneficial.
    Unfortunately, the well intentioned purpose of the current 
law's Individualized Written Rehabilitation Plan (IWRP) has 
evolved into a very detailed, process-oriented document that 
essentially serves as a legal contract between the 
Rehabilitation agency and the individual. The IWRP often serves 
as the primary vehicle through which legal remedies are 
pursued.
    However, with the changes in H.R. 1617 that bring more 
control and accountability directly into the hands of the 
consumer, the written plan can be used as a broad planning 
document, rather than a detailed legal contract. As such, plan 
development will be faster and will focus more on the 
individual's goals than making sure the document is legally 
enforceable.
    Subsection (c) includes a rule of construction clarifying 
that nothing in title I of the Rehabilitation Act creates an 
individual entitlement.

                 State Rehabilitation Advisory Council

    Section 106 creates the State Rehabilitation Advisory 
Council. This section simplifies current law significantly, 
removing some of the prescriptiveness of which individuals must 
serve on the Council. However, the functions of the councils 
essentially remain the same.
    The Committee believes that the Council has an important 
role to play in the development of a new vocational 
rehabilitation system that is locally controlled, consumer 
driven and choice oriented. The Council will participate in the 
Governor's collaborative process for developing a Statewide 
Workforce Preparation System. As a representative of consumers 
of vocational rehabilitation, the Council will continue to 
monitor how individuals with disabilities are being served by 
the vocational rehabilitation systems of the local workforce 
areas. The Committee believes that the Council must not become 
a ``de facto'' arm of the State administrative agent. There 
needs to be objectivity and independence between the two 
entities.
    This section also allows the Governor to appoint a parallel 
advisory council for the blind, at the Governor's discretion.

                               Allotment

    Section 107 defines the allotment formula for title I. This 
allotment formula is identical to the formula of current law, 
with only minor conforming changes.
                Other Changes to the Rehabilitation Act

    Section 521 of CAREERS makes changes to other sections of 
the Rehabilitation Act.
    First, this section repeals section 303, a general 
vocational rehabilitation services demonstration authority, 
repeals section 304, Loan Guarantees for Community 
Rehabilitation Programs, and in section 311, by striking 
subsection (f), a provision that relates to the relationship 
between titles III and titles VIII. This section also repeals 
section 312, the Migratory Worker program, and Section 316, the 
Special Recreation program authority.
    This section also repeals Title VIII of the Rehabilitation 
Act but transfers four programs from the current title VIII to 
title III. These include the Transportation Services Grant 
authority (section 802(a)), the Client Choice demonstration 
authority (802(g)), the Parent Information and Training 
authority (803(c)), and the Braille training projects authority 
(803(b)).
    Section 311(c), which authorized supported employment 
demonstration projects, will be repealed effective October 1, 
1998. The repeal of this program is delayed to be concurrent 
with the full implementation of the new title I provisions.
    Section 522 makes several changes to title VI of the 
Rehabilitation Act. First, the section repeals Part A of title 
VI--Community Service Employment Pilot Programs for Individuals 
with Disabilities, Part C--Supported Employment Services for 
Individuals with Severe Disabilities, and Part D--Business 
Opportunities for Individuals with Disabilities, effective upon 
enactment.
    Effective October 1, 1998, the Projects with Industry 
Program would be repealed. The repeal of this program is 
delayed to be concurrent with the full implementation of the 
new title I provisions.

                      Section-by-Section Analysis

    Section 1 contains the short title of the bill.
    Section 2 contains the Table of Contents of the bill.
    Section 3--Findings and Purpose:
    Subsection 3(a) contains the findings of the Act.
    Subsection 3(b) states that the purpose of the Act is to 
transform the vast array of federal workforce development and 
literacy programs from a collection of fragmented and 
duplicative categorical programs into a streamlined system 
designed to meet the education, employment, and training needs 
of the workforce and employers.
    Section 4 sets forth the authorization of appropriations 
for fiscal years 1996, 1998, 1999, 2000, 2001, and 2002 for the 
four block grants created in the Act.
    Section 5 includes definitions for the following terms: 
adult, adult education, area vocational education school, at-
risk youth, career exploration and guidance counseling, case 
management, chief elected official, community-based 
organization, dislocated workers, earnings, economic 
development agencies, economically disadvantaged, employed, 
English literacy program, excess number, governor, individual 
of limited English proficiency, individuals with disabilities, 
institution of higher education, intermediate educational 
agency, job search assistance, labor market area, literacy, 
local educational agency, native Americans, on-the-job 
training, out-of-school youth, postsecondary educational 
institution, preemployment skills training, job readiness 
skills training, public assistance, rapid response, registered 
apprenticeship, school dropout, skill certificate, state, state 
educational agency, state library administrative agency, 
supportive services, unemployed, unit of general local 
government, veteran, work experience, workplace mentor, and 
youth.

             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

    Section 101. This section declares that the purpose of 
title I is to provide for the establishment of an 
infrastructure within States on which to build a comprehensive 
system of workforce development and literacy.

              Subtitle A--State and Local Responsibilities

    Section 102(a) of section 102 requires that in order for a 
State to receive a grant under one or more of the programs 
established under this Act, that they must: establish a 
collaborative process; develop a State workforce development 
and literacy plan; and comply with the requirements of this 
Act.
    Section 102(b) clarifies that for the purposes of this Act, 
Workforce Development and Literacy Programs include: the Youth 
Workforce Preparation and Development Consolidation Grant 
established under title II; the Adult Employment and Training 
Consolidation Grant established under title III; the Adult 
Education, Family Literacy, and Library Technology 
Consolidation Grant, established under title IV; and the 
program amended by subtitle A of title V (relating to title I 
of the Rehabilitation Act of 1973) and defines ``Workforce 
Development and Literacy programs''.
    Section 103(a) requires that the Governor of a State that 
desires to receive a grant under one or more of the workforce 
development and literacy programs, must certify to the 
Secretaries of Education and Labor that a collaborative process 
has been used in complying with the applicable provisions of 
this Act.
    Section 103(b) clarifies that the collaborative process 
must include, at a minimum, the Governor and representatives 
of: business and industry, local chief elected officials 
(representing both cities and counties), local educational 
agencies (including vocational educators), postsecondary 
institutions (including community and technical colleges), the 
State rehabilitation advisory council, and organizations 
representing individuals served by programs established under 
this Act (including community-based organizations), all 
appointed by the Governor; and the lead State agency official 
or officials from the State educational agency (including 
officials representing vocational education, adult education 
and literacy, and libraries); and the State agencies 
responsible for economic development, employment security (and 
job training where different from the employment security 
agency), postsecondary education, vocational rehabilitation 
(and where applicable, the State agency providing vocational 
rehabilitation services for the blind), welfare, and the 
representative of the Veterans' Service assigned to the State.
    Section 103(c) clarifies that a State may use an existing 
council or entity for the purpose of collaboration, that 
substantially meets the purposes of subsection (b). This 
subsection further clarifies that if prior to the date of 
enactment, a State has developed a collaborative process for 
the purpose of establishing a one-stop system or a school-to-
work system, that such collaborative process may be used to 
meet the collaboration requirements under this Act if it is 
substantially similar to the process described under this 
section.
    Section 104(a) requires that the Governor of a State that 
desires to receive a grant, submit a single State Workforce 
Development and Literacy Plan for all 4 consolidated programs 
established under this Act, to the Secretaries of Education and 
Labor.
    Section 104(b) requires that the State plan include: a 
description of the collaborative process used in developing the 
plan; a statement of the goals of the State workforce 
development and literacy system, including an assessment of the 
workforce and literacy needs of the State, and the 
identification of progress indicators that the State will use 
to measure its progress in meeting such goals; a description of 
how the State will comply with the requirements of the Act; a 
description of how a State will participate in the National 
Labor Market Information system established under the Act; 
additional plan elements contained in titles II through V; a 
description of the measures that will be taken by the State to 
ensure coordination and avoid duplication among programs 
receiving assistance under this Act, including a description of 
common data collection, reporting processes, and the 
establishment of a common management information system across 
workforce development and literacy programs; a description of 
the process used by the State to provide an opportunity for 
public comment and input into the development of the plan; 
assurances that the State will provide for fiscal control 
accounting procedures that may be necessary to ensure the 
proper disbursement of, and accounting for, funds paid to the 
State under this Act; and a description of the sanctions which 
the State may impose (including restrictions from future 
participation or consideration for funding) in instances where 
recipients of funds under this Act fail to achieve agreed upon 
performance measures, fail to adhere to State mandated fiscal 
control and funds accounting procedures, or take or fail to 
take other actions required under the State plan, contracts, or 
other agreements.
    Section 104(c) clarifies that if after a reasonable effort, 
agreement cannot be reached through the collaborative process 
in the development of the State plan or in making decisions for 
the workforce development and literacy system, the Governor 
shall have final authority to make decisions and submit the 
plan. However, participants in the collaborative process, who 
are in disagreement with the plan, may submit their views with 
regard to the area in which such participant was selected for 
representation. This subsection further clarifies that nothing 
in this Act shall be construed to negate or supersede the legal 
authority, under State law or other applicable law, of any 
State agency, State entity, or State public official over 
programs that are under the jurisdiction of the agency, entity, 
or official. Nothing in this Act shall be construed to 
interfere with the authority of such agency, entity, or 
official to enter into a contract under any provision of law.
    Section 104(d) provides that such State plans remain in 
effect until the State submits to the Secretary modifications 
as the State determines necessary. Subsection (e) requires the 
Secretaries of Education and Labor to establish a common 
procedure for consideration of State Workforce Development and 
Literacy Plans.
    Section 104(e) establishes the process for allocation of 
responsibilities of Secretaries of Labor and Education.
    Section 105 requires that a Governor that desires to 
receive a grant under one or more of the workforce development 
and literacy programs shall, through the collaborative process, 
and after consultation with local chief elected officials, and 
consideration of comments received through the public 
participation process described in the State plan, shall 
publish a proposed designation of local workforce development 
areas within the State. This section specifies that such areas 
be designated taking into consideration existing labor market 
areas, units of general local government, geographic areas 
served by local educational agencies and intermediate 
educational agencies, geographic areas served by postsecondary 
institutions and area vocational education schools, service 
delivery areas established under the Job Training Partnership 
Act, and the distance that individuals will need to travel to 
receive services.
    Section 106 (a) and (b) require Governors, through the 
collaborative process, to ensure the establishment of workforce 
development boards within each workforce development area, and 
to establish criteria for use by local chief elected officials 
in the selection of members of such boards.
    Section 106(c) requires, at a minimum, that a local 
workforce development board consist of: a majority of members 
who are representatives of business and industry, including 
individuals who are owners of businesses, chief executives or 
chief operating officers of private business, and other 
business executives with optimum policymaking authority in 
local businesses, selected from among a list of nominees 
submitted by local business organizations and trade 
associations; an individual or individuals with disabilities, 
or their representatives who have special knowledge or 
expertise in the area of vocational rehabilitation; 
representatives of education, including local educational 
agencies and postsecondary institutions, selected from among 
individuals nominated by regional or local educational 
agencies, vocational education institutions, institutions of 
postsecondary institutions (including community colleges), or 
general organizations of such institutions within the workforce 
development area; and representatives of community-based 
organizations, employees, and veterans as nominated or 
recommended to the board through a process establish by the 
Governor through the collaborative process.
    Section 106(d) clarifies that in the selection of board 
members in a workforce development area that is comprised of 
only one unit of general local government, the chief elected 
official of such unit shall select the members of the local 
workforce development board for such area, in accordance with 
the State criteria. In the case of a workforce development area 
that is comprised of more than one unit of general local 
government, the chief elected official of each such unit shall 
select the members of the local workforce development board for 
such area in accordance with an agreement entered into by such 
officials, in accordance with the State criteria. In the 
absence of such agreement (in the case of multiple units of 
local government), appointments shall be made by the Governor, 
through the collaborative process. This subsection further 
clarifies that the Governor shall biennially certify one local 
workforce development board for each workforce development 
area.
    Section 106(e) outlines the duties of Local Workforce 
Development Boards, which include: the development of a local 
workforce development plan; the identification of occupations 
in demand and the training needs of the local workforce 
development area; and budget and program oversight 
responsibilities over programs established under chapter 2 of 
title II, title III, and title I of the Rehabilitation Act of 
1973, and one-stop career center systems established or 
designated under section 107, (with local plans and budgets 
subject to the approval of the appropriate chief elected 
official or officials in the workforce development area). This 
subsection further clarifies that the local workforce 
development board may receive and disburse funds made available 
for carrying out programs authorized under chapter 2 of title 
II, title III, and title I of the Rehabilitation Act of 1973 of 
this Act, or may designate a fiscal agent (which may include 
the State through a mutual agreement between the local board 
and the State), for the purpose of disbursement of funds to 
one-stop centers and other service providers, as designated by 
the local board. The Board may employ its own staff, 
independent of local programs and service providers. However, 
it may not operate programs established under this Act. This 
section also contains conflict of interest language which says 
that no member of a workforce development board may cast a vote 
or participate in the consideration of the provision of 
services by that member (or any organization which that member 
directly represents) or on any matter that would provide direct 
financial benefit to such member. In addition, a Governor may 
enforce more rigorous conflict of interest standards, as 
determined appropriate. This subsection further clarifies that 
the board shall elect its own chairperson from among members of 
the board, and may adopt bylaws and other operating procedures 
as consistent with the purposes of the Act, and with the State 
workforce development and literacy plan.
    Section 107 (a) and (b) require the Governor of a State 
which desires to receive a grant under this Act, to establish 
the criteria for, and ensure the establishment, by local 
workforce development boards, of a one-stop career center 
system within each local workforce development area.
    Section 107(c) requires that, at a minimum, one-stop career 
center systems must include: common intake; preliminary 
assessment; integrated job search assistance; and to the extent 
practicable, as determined by the Governor, unified and linked 
computer systems (including labor market information), and at 
least one physical, co-located site which provides 
comprehensive and fully integrated workforce development 
services to any individual seeking such services. Local 
workforce development areas are encouraged to establish a 
network of comprehensive and fully-integrated co-located one-
stop career centers, combined with multiple affiliated sites 
that are linked through electronic and technological access 
points.
    Section 107(d) requires that information pertaining to the 
labor market which is compiled pursuant to the Wagner-Peyser 
Act, shall be available, to the extent practicable, through 
integrated electronic networks, at all one-stop career centers 
and affiliated sites.
    Section 107(e) establishes that any entity or consortium of 
entities located in the workforce development area may be 
designated by the local workforce development board to operate 
a one-stop career center or to participate in a one-stop career 
center system. Such entities may include: Institutions of 
higher education; local educational agencies; area vocational 
education schools; local employment service offices; private 
nonprofit organizations, (including community-based 
organizations); private for-profit entities; agencies of local 
governments; and other interested organizations and entities of 
demonstrated effectiveness (including local chambers of 
commerce and other business organizations), consistent with 
State criteria established pursuant to subsection (b).
    Section 107(f) lists the duties of one-stop career centers. 
Such duties include the provision of core services which are to 
be provided to individuals in the workforce development area, 
on a universal basis, which include: Outreach and intake for 
services provided under programs established under chapter 2 of 
title II, title III, title IV, and title I of the 
Rehabilitation Act of 1973; a preliminary assessment of the 
skill levels and the need for services of individuals for such 
programs; information relating to local and State, and if 
appropriate, to regional or national, occupations in demand and 
skill requirements for such occupations; information relating 
to youth services, including information on at-risk youth 
workforce development programs authorized under title II, on 
school-to-work opportunities, and on youth apprenticeship 
opportunities; career counseling and planning; Job search 
assistance; information related to vocational rehabilitation 
services; information relating to federally funded education 
and job training programs, including student aid programs; 
information on, and assistance in accessing additional services 
through programs established or amended by this Act; 
information on the extent to which the services provided under 
titles II through IV, and title I of the Vocational 
Rehabilitation Act of 1973, meet or exceed the performance 
standards described in the State plan, and the performance-
based information provided by the State to local workforce 
development boards on certified providers of education and 
training; information on industry-recognized skill standards 
and assessments; job listings for local labor market 
opportunities; acceptance of applications for unemployment 
compensation; and other appropriate activities to assist 
individuals into employment. A one-stop center shall also serve 
as the point of distribution of vouchers or skill grants for 
education, training, and vocational rehabilitation services to 
eligible individuals. In addition to core services, one-stop 
career centers may provide customized workforce development 
service to employers on a fee-for-service basis, and may 
arrange to have core services provided to individuals with 
severe disabilities provided by certified providers through 
contract or through the use of vouchers or skill grants.
    Section 107(g) allows the one-stop career centers to 
provide customized workforce development services to employers.
    Section 107(h) allows the Governor to develop alternative 
procedures to the one-stop career center system.
    Section 108 establishes a certification process for 
determining which providers of education and training services 
shall be eligible to receive funds under title III, or title I 
of the Vocational Rehabilitation Act of 1973, through the 
receipt of vouchers or skill grants, or otherwise. 
Specifically, subsection (a) clarifies that providers are 
eligible if: they are currently eligible to participate in 
title IV of the Higher Education Act of 1965; or they are 
determined to be eligible under an alternative procedure 
developed by the Governor, described in subsection (b); and 
they provide performance-based information on non-degree 
programs, as required by the Governor as described in 
subsection (c).
    Section 108(b) establishes an alternative eligibility 
procedure, requiring that the Governor establish such a 
procedure to determine eligibility for providers of education, 
training, and vocational rehabilitation services in any State 
desiring to receive funds under title III of this Act and title 
I of the Vocational Rehabilitation Act of 1973, but that are 
not eligible to participate in title IV of the Higher Education 
Act of 1965. Such procedure shall establish minimum acceptable 
levels of performance for such providers, and shall utilize 
local workforce development boards, for the identification and 
certification of providers of education, training, and 
vocational rehabilitation services. This section further 
stipulates that if the participation of an institution of 
higher education in any of the programs is terminated, such 
institution shall not be eligible to receive funds under this 
Act for a period of not less than two years.
    Section 108(c) identifies performance-based information 
that is to be submitted by providers of education and training 
services desiring to be eligible under this section. Such 
information may include information relating to the percentage 
of students completing the programs conducted by the provider; 
the rates of licensure of graduates of the programs conducted 
by the provider; the percentage of graduates of the programs 
meeting skill standards and certification requirements endorsed 
by the National Skill Standards Board established under the 
Goals 2000: Educate America Act; the rates of placement and 
retention in employment, and earnings of the graduates of the 
programs conducted by the provider; the percentage of students 
who obtained employment in an occupation related to the program 
conducted by the provider; the warranties or guarantees 
provided by such provider relating to the skill levels or 
employment to be attained by students; and other information 
for providers of services under title I of the Rehabilitation 
Act of 1973 that reflects the goal of serving individuals with 
the most severe disabilities.
    Section 108(d) requires the Governor to designate a State 
agency to collect, verify, and disseminate the performance-
based information submitted pursuant to subsection (c). This 
subsection further establishes: a procedure by which providers 
of education and training submit the performance based 
information to such State agency; requires that the list of 
eligible providers be provided by the State agency to local 
workforce development boards; that an institution or entity 
intentionally providing false information will be banned from 
program participation for 2 years; and allows the State agency 
to provide technical assistance.
    Section 108(e) clarifies that providers of on-the-job 
training are not subject to the requirements of this section, 
but that local workforce development boards collect information 
regarding the performance of such providers.
    Section 109 requires that States, to the extent practicable 
as determined by the Governor, use funds provided under this 
Act to establish a unified management information system for 
all programs established or amended under titles II through V 
of this Act, that is in accordance with guidelines established 
jointly by the Secretaries of Education and Labor, in 
consultation with the Governors and establishes requirements 
for each united management information system.
    Section 110(a) states that each State receiving funds under 
this Act, shall develop, or have developed, a statewide 
performance accountability system.
    Section 110(b) requires that each State identify indicators 
of performance for each of the programs established under 
titles II through IV of this Act, and title I of the Vocational 
Rehabilitation Act of 1973, consistent with State goals as 
described in the State plan, that at a minimum, include core 
indicators described in titles II through V of this Act. Such 
indicators should also take into account post-program surveys 
measuring customer satisfaction of both employers and program 
participants. This subsection further requires that the 
Secretaries of Education and Labor, in collaboration with the 
States and with representative of business and industry, 
employees, educational agencies, service providers, 
participants, and others, promulgate technical definitions of 
each of the core indicators described in this Act, and shall be 
used in measuring performance.
    Section 110(c), paragraph requires each State to identify 
the level of performance, consistent with State goals, that is 
expected for local workforce development areas and other 
applicable local administrative entities, taking in account 
world class levels identified pursuant to paragraph (2) of this 
subsection, and develop baseline levels of performance upon 
which to measure continuous improvement. This subsection 
clarifies that the Governor may adjust the expected level of 
performance for each local area taking into account economic, 
demographic, and geographic factors, and the characteristics of 
the population to be served. Paragraph (2) requires the 
Secretaries of Education and Labor, in collaboration with the 
States and with representative of business and industry, 
employees, educational agencies, service providers, 
participants, and others, to identify world class levels of 
performance with respect to appropriate core indicators 
selected from among the core indicators described under this 
Act. Where appropriate, such standards shall reflect industry-
recognized skill standards and national education goals.
    Section 110(d) requires States to report to the Secretaries 
of Education and Labor, the levels of performance achieved by 
local workforce development areas and other applicable local 
administrative entities with respect to the indicators 
established by the State for each program year. The Secretaries 
are required to make such information available to the general 
public and to disseminate State-by-State comparisons, and where 
appropriate, comparisons to other industrialized nations. 
States are encouraged to utilize unemployment insurance wage 
data records in the collection and reporting of such data.
    Section 110(e) requires that the Governor, through the 
collaborative process, establish criteria for determining 
whether or not local workforce development areas or other 
applicable local administrative entities have met expected 
levels of performance. This subsection further specifies that 
if a State fails to meet expected levels of performance for any 
program year, the Secretaries may provide technical assistance, 
including assistance in development of a performance 
improvement plan. If such failure continues for a second 
consecutive year, the Secretary may reduce by not more than 5 
percent, the amount of the grant that would be payable to the 
State under the affected program for the following year, with 
such penalty based on the degree of failure. Under this 
subsection, if a local workforce development area or applicable 
local entity fails to meet expected levels of performance, the 
Governor, through the collaborative process, may provide 
technical assistance in after the first year of failure. After 
a second consecutive year of such failure, the Governor may 
take corrective action, such as the withholding of funds, or 
the redesignation of a local administrative entity, or such 
other action as the Governor, through the collaborative 
process, determined appropriate, consistent with State law.

                Subtitle B--Amends the Wagner-Peyser Act

    Section 131(a) amends the definitions to reflect the repeal 
of the Job Training Partnership Act and to conform to 
definitions and terms in the CAREERS Act.
    Section 131(b) amends the duties of the Federal government 
by requiring the Secretary of Labor to assist in the 
coordination and development of a nationwide system of labor 
exchange services for the general public provided through the 
one-stop career center system; to assist in the development of 
performance standards, benchmarks, and continuous improvement 
models for such nationwide system which ensures private sector 
satisfaction and meets the demands of job seekers; and to 
ensure the continued services for individuals receiving 
unemployment compensation.
    Section 131(c) requires the Governor of a State to 
designate a State agency to carry out this Act through the 
collaborative process described in title I of the CAREERS Act.
    Section 131(d) requires that 25% of the funds appropriated 
for this Act go towards establishing a system of labor market 
information.
    Section 131(e) conforms with repeal of JTPA.
    Section 131(f) amends the State plan requirements to 
require the State to submit a planning information consistent 
with the unified State workforce development and literacy plan 
authorized under title I of the CAREERS Act.
    Section 131(g) eliminates the Federal Advisory Council.
    Section 131(h) includes conforming amendments.
    Section 132 amends the Wagner-Peyser Act to establish a new 
``title II'' creating a national labor market information 
system:

          Section 21 states that the purpose of this title is 
        to ensure a comprehensive and coordinated system of 
        labor market information which will provide locally 
        based, accurate, up-to-date, easily accessible, and 
        user friendly labor market information through a 
        cooperative Federal, State, and local governance 
        structure which includes partnerships with the private 
        sector at all levels.
          Section 22 Requires the Secretary of Labor, in 
        accordance with the provisions of title, to oversee the 
        development, maintenance, and continuous improvement of 
        a nationwide system of labor market information using 
        data from all available and appropriate sources. 
        Subsection (1) specifies the types of statistical data 
        to be collected and disseminated. Subsection (2) 
        specifies the types of State and local employment and 
        consumer information to be collected and disseminated. 
        Subsection (3) describes the types of technical 
        standards to be established to ensure consistency of 
        the data and information. Subsection (4) outlines the 
        types and extent to which such data should be analyzed. 
        Subsection (5) outlines the dissemination mechanisms 
        for data and analysis. Subsection (6) establishes a 
        requirement to provide technical assistance to States 
        for the development of this system. Subsection (7) 
        established programs of research and demonstration, 
        which may be carried out by States and other public or 
        private entities, on ways to improve the products and 
        processes authorized in this title; and subsection (8) 
        requires the development of objective performance 
        measures, which will allow for the continuous 
        monitoring of the progress of the labor market 
        information system at national, State, and local 
        levels.
          Section 23 lists the Federal responsibilities under 
        this Title. Subsection (a) clarifies that the Nation's 
        labor market information system shall be planned, 
        administered, overseen, and evaluated by a cooperative 
        governance structure involving the Federal Government 
        and the States. Subsection (b) outlines the duties of 
        the Secretary of Labor which includes the 
        reconciliation of data collection among the agencies 
        within the Department of Labor; the assigning of 
        responsibilities to assist the Bureau of Labor 
        Statistics; working with other Federal departments and 
        agencies to support this system. Subsection (c) 
        requires the Secretary of Labor, in collaboration with 
        the Bureau of Labor Statistics and with the assistance 
        of other agencies in the Department, to carry out 
        additional duties with respect to function of the 
        collection and dissemination of labor market 
        information.
          Section 24(a) requires that the Secretary of Labor, 
        working through the Bureau of Labor Statistics and in 
        consultation with other appropriate agencies, to 
        prepare an annual plan to be the operational mechanism 
        for achieving a cooperative Federal/State governance 
        structure for labor market information. Subsection (b) 
        requires the Secretary to involve the States with the 
        Bureau of Labor Statistics in a cooperative manner in 
        the development of the plan. Subsection (c) allows that 
        State representatives serving on this board be allowed 
        to be employees of the Department for purposes of the 
        development of the annual plan and to meet the 
        provisions of Office of Management and Budget Circular 
        A-11.
          Section 25 outlines the Governor's responsibilities. 
        Subsection (a) requires the Governor of each State to 
        designate a single State agency to be the agency 
        responsible for the management and oversight of a 
        statewide comprehensive labor market information system 
        and for the State's participation in the cooperative 
        Federal/State governance structure for the nationwide 
        labor market information system. Subsection (b) 
        outlines the duties of the State agency which includes 
        the development, maintenance, and continuous 
        improvement of a comprehensive labor market information 
        system; ensure the performance of contract and grant 
        responsibilities for data collection, analysis, and 
        dissemination; conduct such other data collection, 
        analysis, and dissemination activities as will ensure 
        comprehensive State and local labor market information; 
        actively seek the participation of other State and 
        local agencies, with particular attention to State 
        education, economic development, human services, and 
        welfare agencies, in data collection, analysis, and 
        dissemination activities in order to ensure 
        complementarily and compatibility among data; and 
        participate in the development of the national annual 
        plan. Subsection (c) is a rule of construction to make 
        clear that nothing in this Act shall be construed as 
        limiting the State agency's ability to conduct 
        additional data collection, analysis, and dissemination 
        activities with State funds or with Federal funds from 
        sources other than this Act.

                       Subtitle C--Worker Rights

    Section 141 prohibits the displacement of any currently 
employed worker by program participants; prohibits the 
impairment of existing contracts for services or collective 
bargaining agreement; prohibits the replacement of existing 
laid-off workers, or workers terminated with the intention of 
filling the vacancy so created with a student; ensures 
protection of students under applicable Federal, State and 
local health and safety requirements; and clarifies that 
nothing in this act shall be construed to modify or affect any 
Federal or State Civil Rights laws.

 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

    Section 201 states that the purpose of this title is to 
design youth development and career preparation programs that 
provide States and local communities with maximum flexibility 
to design youth programs that help individuals attain the 
academic and occupational skills needed to succeed in a global 
economy; best suits the needs of youth and business in local 
communities as well as the needs of the State; promote strong 
connections between in-school and at-risk/out-of-school youth 
programs to ensure that youth are prepared for good jobs and 
further education opportunities and promote youth development 
and career preparation programs that provide opportunities for 
individuals to receive postsecondary education and occupational 
training; promote the formation of business and education 
partnerships; promote high academic and occupational standards; 
and promote quality vocational-technical education, including 
improved secondary and postsecondary programs by focusing on 
program improvement that help prepare students for further 
education and training and high wage jobs.
    Section 202 includes definitions applicable to the youth 
title of this bill.
    Section 211(a) reserves $25 million or 20% of the total 
appropriation, whichever is less, for national programs to be 
administered by the Secretary of Education.
    Section 211(b) provides States with an amount of funding 
which bears the same ratio as the average of funds they 
received in FY 1995 under Section 101 and 101A of the Carl D. 
Perkins Vocational and Applied Technology Education Act and 
Section 252 and 262 of the Job Training Partnership Act. Small 
state minimum of \1/4\ percent included in language.
    Section 211(c) requires Governor to send 90% of funds to 
local level. Of remaining 10% of funds, 8% are for State 
programs and 2% is for administration.
    Section 212(a) of the 90% of funds sent to the local level, 
40% of the funds must be used for programs serving in-school 
youth and 40% of the funds must be used for programs to serve 
at-risk and out-of-school youth. The Governor and collaborative 
process have discretion over the remaining 20% of funds flowing 
to the local level; however, the money must be used to serve 
either in-school or at-risk/out-of-school youth in combination 
with the 40% mandatory use of funds. The Governor, through the 
collaborative process, can use 10% of the remainder to the 
local level for incentive grants, competitive awards, or the 
money can be distributed by formula. The remaining funds may be 
split in any way between the in-school and at-risk/out-of-
school youth programs, or may be applied to one or the other 
programs; however, the money must go out by formula. The 20% of 
discretionary funds cannot be used for any other purpose except 
for programs to serve in-school and at-risk/out-of-school 
youth.
    Section 212(b) requires the Governor, through the 
collaborative process, to develop a formula taking into account 
local poverty rates, the proportion of the State's youth 
population residing within local communities and other factors 
considered appropriate. In establishing the formula, the 
Governor shall ensure that funds are equitably distributed 
throughout the State and that the factors described above do 
not receive disproportionate weighting.
    Section 212(c) establishes minimum grant awards of $15,000 
for a local education agency or consortium of such agencies; 
$15,000 for subgrants made by local workforce development 
boards to serve at-risk/out-of-school youth; $50,000 to 
postsecondary institutions or consortium of such institutions; 
and allows secondary-postsecondary institutions to form 
consortia to receive grant funds with a minimum award of 
$50,000.
    Section 212(d) prevents consortium from forming to receive 
funds and then separate immediately after and dividing the 
funds. Requires that consortia must form for the purposes 
established under this title and to stay in a consortia 
arrangement for purposes of delivering services to youth under 
this title.
    Section 212(e) permits a State to grant a waiver for the 
minimum grant amount in cases where the eligible recipient is 
located in a rural, sparsely populated area; and demonstrates 
that they are unable to enter into a consortium for purposes of 
providing services under this title.
    Section 221 contains the State Plan. In order to receive 
funds under this title, requires State to submit additional 
information with infrastructure plan. Additional information 
that must be included: how State will adopt or develop model 
curricula and innovative instructional methodologies, to be 
used in schools, that integrate academic and vocational 
learning and promote career awareness; State plans for 
expansion of career exploration counseling for students in 
elementary and secondary schools and how State will effectively 
demonstrate system of career preparation for youth; how State 
plans to integrate academic and vocational education and 
description of how State will promote collaboration between 
secondary and postsecondary occupational and academic programs 
and institutions; description of how State will develop 
academic and occupational skills of students providing 
challenging vocational-technical education standards and how 
State will develop a process to issue skill certificates that 
are consistent with the skill standards endorsed by the 
National Skill Standards Board; description of how State will 
promote active involvement of business in planning, development 
and implementation of youth programs; and description of how 
State will coordinate Goals 2000 and Improving America's 
Schools Act and other State education improvement plans.
    Section 222(a) grants general authority to State to conduct 
State programs and activities.
    Section 222(b) requires that of the 8% of funds allotted 
for state activities, the State must use the funds for the 
development of performance standards and measures for programs; 
and program improvement and accountability.
    Section 222(c) additional uses of the 8% state funds 
include: tech-prep programs; workforce preparation programs for 
single parents, displaced homemakers and single pregnant women; 
corrections vocational education; professional development 
activities regarding integration of vocational, academic and 
work-based curricula including support of public teacher-
education programs to ensure vocational teachers stay current 
with industry needs; and in-service and pre-service training of 
teachers in state-of-the-art programs and techniques; 
development, dissemination and field testing of curricula with 
a particular focus on curricula that integrate vocational, 
academic and work-based learning methodologies, curricula 
focusing on a coherent sequence of courses measuring academic 
and occupational skills, and curricula for work-based learning; 
leadership and instructional programs in technology education; 
data collection, including support for management information 
systems; 1-stop career centers; cooperative education and 
family and consumer science programs; creative use of 
technologies, including professional development in the use of 
such technologies for instructional purposes; support for 
vocational student organizations; and improving career guidance 
and counseling.
    Section 223 contains the Incentive Awards. States are 
permitted to use money from the 8% of state-held funds to offer 
incentive awards to local communities. State has discretion as 
to how to construct awards with requirements for awards being 
performance goals exceeded; outstanding workforce development 
system implemented at the local level; or provided exemplary 
education services and activities for at-risk youth.
    Section 224(a) each State is required to have in place, or 
develop and implement, a statewide system of core standards and 
measures of performance for programs serving youth under this 
title. The intent is to coordinate this system with other 
titles included under this Act. Each statewide system must: 
establish or have established, performance goals to measure the 
level of performance achieved by youth served under this title. 
The goals must evaluate the quality and effectiveness of 
services and activities under this title; goals must be 
expressed in an objective, quantifiable and measurable form; 
establish progress indicators that State and local recipients 
of funds will use to measure their progress toward these goals; 
and provide reports every 2 years to the public and to the 
Secretary of Education on the State's progress in achieving 
their goals.
    Section 224(b) requires statewide system of standards and 
measures be developed and include: measures of academic and 
occupational competency gains, including progress in achieving 
academic and occupational competency (including attainment of: 
challenging State academic standards, challenging vocational-
technical education standards; and industry recognized 
occupational standards including basic workplace competencies 
and industry recognized skill standards); retention in school 
or completion of secondary school or equivalent; placement into 
additional training, postsecondary education, military service, 
registered apprenticeship or employment; and employment 
retention and earnings level; reduction of drop-out rate; and 
success of special populations, including nontraditional 
training and employment in meeting the performance standards 
established by the State.
    Section 224(c) the Governor, through the collaborative 
process, shall ensure that the performance goals are consistent 
with challenging State academic standards, industry recognized 
skill standards and State goals established under this title.
    Section 231(a) in order to receive a grant at the local 
level, the local workforce development board and eligible 
institution(s) must form a partnership. The purpose of the 
partnership is to allow for collaborative planning, 
coordination of programs serving in-school and at-risk/out-of-
school youth and allow for effective public participation.
    Section 231(b) the partnership must develop and submit for 
approval to the Governor and State collaborative process, a 
comprehensive plan outlining how they are planning to serve 
both in-school and at-risk/out-of-school youth. The partnership 
must assure the involvement of parents, teachers and the local 
community in the planning process.
    Section 232(a) funds directed to the local level from the 
State to serve in-school youth must go to schools and eligible 
institutions.
    Section 232(b) funds directed to the local level from the 
State to serve out-of-school youth will be sent to the local 
workforce development board to be subgranted to eligible 
entities for programs to serve at-risk and out-of-school youth.
    Section 241(a) requires institutions receiving funds under 
this title to use the monies to improve youth development and 
career-related education programs.
    Section 241(b) requires that funds received for in-school 
youth programs must be used for programs that are of such size, 
scope and quality as to be effective; integrate academic, 
vocational and work-based learning, stressing applied and 
contextual learning, through a coherent sequence of course so 
youth achieve both academic and occupational competencies; 
involve employers in design and implementation of programs; 
establish effective linkages between at-risk/out-of-school 
youth programs at both the secondary and postsecondary levels; 
provide work-based learning experiences with adult mentoring 
where appropriate, and to the extent possible, with strong 
experiences in, and understanding of, all aspects of an 
industry appropriately tied to the student's career major; with 
accommodations to be made for rural areas so that they can meet 
this requirements; and provide career exploration, including 
opportunities in the practical arts and trades at an early age.
    Section 241(c) additional uses of funds at the local level 
for in-school youth programs include: purchasing, leasing or 
upgrading equipment; in-service training of providers on the 
integration of academic and vocational education; tech-prep 
education programs; supplementary services that might be 
required by members of special populations; adaptation of 
equipment; apprenticeship programs; comprehensive mentoring 
programs; activities which enable program participants and 
their parents in decisions influencing programs; local 
education/business partnerships for developing and implementing 
youth programs; and support for vocational student 
organizations.
    Section 245(a) general authority for local workforce 
development boards to subgrant to providers for programs that 
serve at-risk and out-of-school youth.
    Section 245(b) lists requirements for uses of funds for 
programs that serve at-risk and out-of-school youth as: such 
size, scope and quality as to be effective; integrate academic, 
vocational and work-based learning, stressing applied and 
contextual learning, through a coherent sequence of course so 
at-risk and out-of-school youth achieve both academic and 
occupational competencies; involve employers in design and 
implementation of programs; establish effective linkages 
between at-risk/out-of-school youth programs at both the 
secondary and postsecondary levels; provide work-based learning 
experiences, including experiences in the practical arts and 
trades, with accommodations to be made for rural areas so they 
can meet these requirements; provide adult mentoring as a core 
component of the program; provide objective assessment of 
academic level, skill level, and service needs of each 
participant in the program; and career exploration and 
counseling.
    Section 245(c) lists additional uses of funds as: tutoring 
and study skills training leading to completion of high school; 
alternative high school services; community service 
opportunities that are combined with training or education; 
paid work experience; drop-out prevention strategies and 
strategies to encourage out-of-school youth to reenter high 
school or alternative high school programs; preemployment and 
work maturity skills training; peer-centered activities 
encouraging responsible behaviors; and training related 
services for participants who have exhausted all other 
resources.
    Section 245(d) limits the amount of funds to be used for 
administrative purposes by local workforce development boards 
to 10%.
    Section 246(a) provision does not permit local workforce 
boards to operate programs and requires that they subcontract 
to eligible providers.
    Section 246(b) lists eligible providers to receive 
contracts from the local workforce development board as: 
eligible institutions including local educational agencies, 
area vocational schools, intermediate educational agencies; 
postsecondary institutions including community colleges, State 
corrections educational agency and any consortia of the 
aforementioned list; local government entities; private, 
nonprofit organizations including community based 
organizations; private, for-profit entities; 1-stop career 
center; or other organizations or entities that have a 
demonstrated effectiveness and have been approved by the local 
workforce development board to deliver such services to at-risk 
and out-of-school youth.
    Section 251(a) permits Secretary of Education to make 
grants and other agreements to carry out research, development, 
dissemination of materials, replication of model programs, 
demonstration programs, evaluation, capacity building and 
technical assistance activities in regard to services and 
activities administered under this title. Activities may 
include support for occupational and career information 
systems.
    Section 251(b) requires Secretary to establish a system for 
disseminating information gathered though research and 
development efforts under this title.
    Section 252(a) requires Office of Educational Research and 
Improvement at the Department of Education to conduct a 
biennial assessment of services and activities funded under 
this title. Requires that independent studies and analyses be 
conducted through competitive awards.
    Section 252(b) assessment shall examine the extent to which 
services and activities assisted under this title have achieved 
their intended purposes and results. Requires analysis of the 
extent to which State and local services and activities have 
developed, implemented or improved systems established under 
this title; services and activities funded under this title 
have succeeded in preparing students, including members of 
special populations, for postsecondary education, further 
learning, or entry into high-skill, high wage careers; students 
participating in programs funded under this title have 
succeeded in meeting challenging State academic and industry-
based skill standards; and the system improvement, 
participation, local and State assessment, and accountability 
provisions of this title including the effectiveness of the 
performance goals and indicators established under this title 
are effective.
    Section 253(a) gives authority to Secretary of Education to 
establish national center or centers for conducting applied 
research, development, dissemination and technical assistance 
activities focusing on improving the career preparation of 
youth. Eligible entities include institutions of higher 
education, other public or private nonprofit organizations or 
agencies, or any consortia of the aforementioned entities. The 
national center in existence on the date of enactment of this 
Act shall continue to receive assistance under the current 
terms of its contract but shall not be guaranteed continued 
assistance except through a new competitive award. Funding for 
the center or centers shall be provided from funds allocated 
for national programs.
    Section 253(b) required activities of the national center 
or centers include: activities that assist recipients of funds 
under this to develop, implement and measure core standards and 
performance; research and development of activities that 
combine academic, vocational education and work-based learning; 
developing new models of remediation of basic academic skills; 
identifying ways to establish links among education and job 
training activities at the State and local level; new models 
for career guidance, career information and counseling 
services; longitudinal studies on programs funds under this 
title including an analysis of the effectiveness of youth 
development and career preparation programs in serving at-risk 
youth; and other activities that the Secretary of Education 
determines to be appropriate. Requires also that the center or 
centers shall provide assistance to States and local recipients 
in developing and using systems of performance measures and 
standards. Technical assistance and outreach to practitioners 
or organizations in need of assistance is a required activity. 
Annual reports are due to the Secretary of Education and 
Secretary of Labor. The Secretary of Education shall then 
submit the report to the Senate Committee on Labor and Human 
Resources and the House Committee on Economic and Educational 
Opportunities.
    Section 253(c) establishes a clearinghouse within the 
center or center(s) to provide data and information to federal, 
state and local organizations and agencies.

      TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANT

              Subtitle A--State and Local Responsibilities

    Section 301 states that the purpose of this title is to 
establish an efficient, high-quality, and equitable system of 
employment and training designed to move adults into productive 
private sector employment.
    Section 302 section establishes that each State submitting 
a State Workforce Development and Literacy Plan to the 
Secretary of Labor under this title, shall receive an amount 
consistent with their allotment as determined under section 
303.
    Section 303 requires that 85% of the funds appropriated for 
the adult employment and training grant be allotted to States, 
and that 15% be reserved by the Secretary of Labor for Federal 
Programs. This section establishes a set aside for the 
territories, set at not more than one-quarter of one percent of 
the 85% of the funds for the States. This section also 
establishes the formula by which funds are allotted to States, 
based on a proportionate share of funds as States currently 
receive under JTPA's title II-A economically disadvantaged, and 
title III dislocated worker programs. A small State minimum is 
set under this section, at one-quarter of one percent of the 
total State allotment.
    Section 304(a) specifies that the Governor may reserve not 
more than 20 percent of the amount allotted to the State for a 
fiscal year, for statewide activities for employment, job 
training, and related assistance for adults. Such activities 
shall include rapid response activities, and additional 
assistance to areas that experience disasters, mass layoffs or 
plant closings, or other events which precipitate substantial 
increases in the number of unemployed workers, to be expended 
in accordance with the local plan of the relevant workforce 
development area. In addition, discretionary activities such as 
capacity building and technical assistance, incentives for 
program coordination, performance awards, research and 
demonstrations, implementation of innovative incumbent worker 
training programs, additional assistance for the development 
and implementation of the one-stop delivery system, and support 
for a common management information system are allowable uses 
of funds. Of this 20 percent, States are limited to not more 
than 5 percent of the State's total allotment for purposes of 
administration.
    Section 304(b) establishes the within State allocation of 
funds under this title. Specifically, the Governor of the 
State, based upon an allocation formula established by the 
Governor, through the collaborative process, shall allocate not 
less than 80 percent of the State's allotment to workforce 
development areas for the purpose of providing employment, job 
training, and related assistance for adults. Such within State 
allocation formula is developed through the collaborative 
process, after consultation with local chief elected officials 
in the local workforce development area, and shall take into 
account: poverty rates; unemployment rates; and the proportion 
of the State's adult population residing within each local 
workforce development area; and such other factors as 
considered appropriate. In addition, the formula must ensure 
that funds are distributed equitably throughout the State, and 
that none of the above-listed factors receive disproportionate 
weighting. This section also allows the Governor to distribute 
10 percent of the State's portion set aside for the within 
State distribution, to be allotted by means other than the 
established formula.
    Section 305. States must provide 2 additional State plan 
requirements to their State Workforce Development and Literacy 
Plan, as established under title I. Specifically, they must 
describe how they will serve the employment and training needs 
of dislocated workers, the economically disadvantaged, older 
workers, veterans, individuals with disabilities, and other 
adults with multiple barriers to employment, and they must 
describe how they will provide rapid response to mass layoffs 
and plant closings.
    Section 306(a) outlines the allowable uses of funds under 
title III. Specifically, it requires that local programs 
provide: Core services to adults through one-stop career 
centers in accordance with section 107; intensive services to 
adults who are unable to obtain employment through core 
services and who have been determined to be in need of more 
intensive services in order to gain employment; and education 
and training to adults who are unable to obtain employment 
through core services and who are in need of education and 
training services in order to gain employment as a result of 
determinations made through preliminary assessments or through 
the provision of intensive services. Additional services may 
also be provided with funds under title III, including 
supportive services and limited needs-related payments.
    Section 306(b) specifies that intensive services must be 
provided directly through one-stop career centers or through 
contract through such centers with service providers approved 
by the local workforce development board. Intensive services 
may include: comprehensive and specialized assessments of the 
skill levels and service needs of adults; development of an 
individual employment plan, to identify the employment goals, 
appropriate achievement objectives, and the appropriate 
combination of services for the adult to achieve the employment 
goal; group or individual counseling and career planning; case 
management for adults receiving education and training 
services; and follow up counseling for adults placed in 
training or employment, for up to 1 year.
    Section 306(c) specifies that education and training 
services be provided through education and training providers 
certified in accordance with section 108, and that such 
services be provided through skill grants except in cases where 
such services are on-the-job training provided by an employer; 
the local workforce development board determines there are an 
insufficient number of certified providers of education and 
training services in the workforce development area to 
accomplish the purpose of a skill grant system; the local 
workforce development board determines that the certified 
providers of education and training in the workforce 
development area are unable to provide effective services to 
special participant populations; or the local workforce 
development board decides to enter into a direct training 
contract with a community based organization serving special 
populations. Further, it is required that education and 
training be directly linked to occupations for which there is a 
demand in the local workforce development area, or in another 
area to which an adult participant is willing to relocate. In 
addition, this section clarifies that performance-based 
payments are allowable under this title. Education and training 
services may include basic skills training, occupational skills 
training, on-the-job training, programs that combine workplace 
training with related instruction, training programs operated 
by the private sector, skill upgrading and retraining, 
entrepreneurial training, employability training to enhance 
basic workplace competencies, and customized training conducted 
with a commitment by an employer or group of employers to 
employ an individual upon successful completion of the 
training.
    Section 306(d) states that supportive services may be 
provided for individuals who are receiving assistance under 
this title, and who are unable to receive such services through 
other programs providing such services. Needs-related payments 
may be provided to adults who are unemployed and who do not 
qualify for (or have ceased to qualify for) unemployment 
compensation for the purpose of enabling such adults to 
participate in education and training programs. However for 
those individuals who have exhausted unemployment insurance 
benefits, such eligibility for receipt of needs-related 
payments is contingent upon that worker's enrollment in 
education or training by the end of the 8th week of the 
worker's initial unemployment compensation benefit period, or, 
if later, by the end of the 8th week after the worker is 
informed that a short-term layoff will in fact exceed 6 months.
    Section 306(e) gives priority to dislocated workers and 
economically disadvantaged individuals, for receipt of 
intensive and education and training services in the event that 
funds are limited within a workforce development area.
    Section 306(f) clarifies that nothing in this section shall 
be construed to establish a right for a participant to bring an 
action to obtain services under a program established under 
this section.
    Section 306(g) limits administrative funds provided under 
this title to a local workforce development board to 10%.
    Section 307 requires that States establish performance 
measurement systems and indicators of performance, based on the 
following outcomes for adults in employment and training 
programs: Placement, retention, and earnings (at placement, 6 
months, and 1 year post-program termination); acquisition of 
skill certificates recognized by the National Skill Standards 
Board; and a measure of the provision of services to dislocated 
workers, the economically disadvantaged, older workers, 
individuals with disabilities, and other individuals with 
multiple barriers to employment. Such measures must be 
consistent with the State's goals and objectives, and 
benchmarking process described in the State plan required under 
section 104, and must be expressed in an objective, 
quantifiable, and measurable form. Further, States are required 
to provide biennial reports to the public and to the Secretary 
on the States progress in achieving its goals.

                      Subtitle B--Federal Programs

    Section 311(a) authorizes the Secretary to award national 
discretionary grants to address major economic dislocations 
that result from plant closures, base closures, or mass 
layoffs. Sets forth the application process. Lists the eligible 
entities to receive the grants.
    Section 311(b) allows the Secretary to provide awards to 
States to assist in the implementation of exemplary statewide 
workforce development system designs; and for the achievement 
of exceptional performance in the statewide workforce 
development system.
    Section 312(a) allows the Secretary of Labor to provide 
assistance to the Governor of any State that has suffered an 
emergency or a major disaster.
    Section 312(b) includes the allowable use of funds.
    Section 313(a) sets up a process for the Secretary to carry 
out research, demonstrations, evaluations, and capacity 
building.
    Section 313(b) describes the types of activities to be 
carried out with respect to research, demonstrations, and 
evaluations, including effectiveness of programs and a national 
partnership and special training, capacity building and 
technical assistance.
    Section 314(a) allows the Secretary to establish a program 
of workforce skills and development loans to assist in 
providing skills upgrading for non-managerial employees which 
may be provided to employers; representatives of employees; 
business associations; trade organizations; and consortiums 
consisting of more than 1 of these entities, or institutions of 
higher education along with 1 or more of the eligible entities.
    Section 314(b) provides that funds may be used to establish 
a loan guarantee program to assist in providing skills 
upgrading for non-managerial employees and requires States to 
meet certain requirements in carrying out this program such as: 
establishing a reserve fund to guarantee the payment of 
principal and interest on loans made by financial institutions; 
establishing criteria for loan guarantees including a payment 
of an insurance premium; assurance that funds will go toward 
skills upgrading for mid- and lower-level employees (both of 
which are defined).
    Section 314(c) prohibits funds be used to pay wages or 
other benefits. Also requires that the State reimburse funds to 
financial institutions that have provided loans to eligible 
entities that have defaulted on their loan. This subsection 
makes clear that the United States Government has no obligation 
or guarantees for these funds; limits the authority of a State 
to extend loan guarantees, and requires interest received from 
such fund to go back into the fund.
    Section 314(d) requires that the Federal share of funds 
provided under this section may not exceed 50 percent of the 
total cost of the program and that the State share shall be 
provided from non-Federal sources and may be in cash or in-
kind.
    Section 315(a) requires the Secretary of Labor to provide 
assistance to eligible entities to provide employment, 
training, vocational rehabilitation, library services, and 
education assistance for Native Americans.
    Section 315(b) allows the Secretary of Labor to transfer 
authority for vocational education activated to the Secretary 
of Education.
    Section 315(c) makes clear that funds made available under 
this part may be used in accordance with the Indian Employment, 
Training and Related Services Demonstration Act (Public Law 
102-477), which allows the consolidation of funds.
    Section 315(d) requires the Secretary to consult with 
Indian, Alaska Native and Hawaiian Native groups in 
establishing regulations to carry out this section.
    Section 316(a) requires the Secretary of Labor to provide 
assistance to eligible entities to provide employment, 
training, and education assistance for migrant and seasonal 
farm workers.
    Section 316(b) describes the eligible entities and the 
allowable activities.
    Section 316(c) allows for the transfer of authority for 
education activities to the Secretary of Education.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
                 LIBRARY SERVICES AND TECHNOLOGY GRANT

    Section 401 sets forth the findings in this Title.
    Section 402 contains definitions related to Title IV, 
including Correctional Education Agency, Educationally 
Disadvantaged Adult, Family Literacy Services, and Secretary.

  Subtitle A--Adult Education and Family Literacy Consolidation Grant

    Section 411 sets forth the purposes of this Subtitle.

Chapter 1--Funding

    Section 421 sets forth amounts to be reserved at the 
National level for the National Institute for Literacy, and 
National Leadership Activities.
    Section 422 establishes the formula for distributing funds 
to the States and defines the term ``qualifying adult'' for use 
in determining the allotment of funds.

Chapter 2--Grants to States

    Section 431 sets forth requirements which States must meet 
in order to qualify for grants under this Title.
    Section 432 outlines the purposes for which States can use 
funds received under this Title. Three percent of such funds 
are to be used for grants to local providers who are successful 
in providing services to specific target populations; at least 
85 percent of funds are to be used for grants to local service 
providers; not more than 3 percent of funds are to be used for 
administrative expenses, and up to an additional 12 percent of 
funds may be used for other State activities, such as 
professional development programs, technology assistance to 
local providers and State Literacy Resource Centers.
    Outlines the purposes for which local service providers can 
use funds received under this title, including, adult basic 
education, adult secondary education, English literacy 
instruction, and family literacy services.
    Section 433 sets forth additional requirements States must 
meet in order to qualify to receive funds under this Title.
    Section 434 outlines the categories for which States will 
measure performance of programs, services and activities 
carried out by each local service provider.

Chapter 3--National programs

    Section 441 establishes the National Institute for 
Literacy. Sets forth the duties of the Institute, including the 
provision of national leadership for the improvement and 
expansions of the system for delivery of literacy services and 
assisting States in developing levels of performance. Outlines 
authorized activities, including the establishment of a 
national electronic database of information and the 
coordination of literacy and basic skill services across 
Federal agencies and at the State and local level. Establishes 
a National Institute for Literacy Advisory Board consisting of 
10 individuals appointed by the President with the advice and 
consent of the Senate and establishes the duties, terms and 
general operating procedures for the Board.
    Section 442 allows the Secretary to establish and carry out 
a program of national leadership and evaluation activities. 
Sets forth activities for which funds may be used.
    Section 451 sets forth the purposes of the Library Services 
and Technology Consolidation Grant which are to consolidate 
programs, improve access to information through electronic 
networks and to provide linkages among and between libraries 
and one-stop career center systems.
    Section 452(a) authorizes $110 million for libraries for 
each of fiscal years 1997, 1998, 1999, 2000, 2001 and 2002.
    Section 452(b) provides for advance notice of funding.
    Section 453(a)(1) sets forth the allocation formula for 
distribution of the Library Services and Technology 
Consolidation Grant to the States.
    Section 453(a)(1)(A) provides, pursuant to the allocation 
formula, an initial allotment of $40,000 to Guam, American 
Samoa, the Commonwealth of the Northern Mariana Islands, and 
the Virgin Islands.
    Section 453(a)(1)(B) provides, pursuant to the allocation 
formula, an initial allotment of $200,000 to each of the 
States.
    Section 453(a)(2) provides for a ratable reduction if funds 
are insufficient to pay all of the allotments.
    Section 453(b)(1) provides for a second allotment to each 
State based upon the population of the State to the population 
of all States.
    Section 453(b)(2) provides that population determinations, 
for purposes of the second allotment to each state, will be 
based upon the most recent census data available to the 
Secretary of Education, and the Secretary shall use, if 
available, the annual interim current census data of the 
Secretary of Commerce.
    Section 454(a) sets forth the prerequisites a State must 
meet to receive a library grant.
    Section 454(a)(1) requires a State to submit an annual 
application, approved by the Secretary, to receive a grant.
    Section 454(a)(2) requires a State to submit a written 
agreement to the Secretary providing for transfer of funds to 
the State library administrative agency. The agreement will 
also assure that the State library administrative agency will 
carry out activities in accordance with the subtitle, that 
State and local sources will supply 25% matching funds, and 
that the agency has fiscal and legal authority and capability 
to administer the program.
    Section 454(b) (1) and (2) provide that the grants to each 
state will equal the lesser of: (1) the initial and subsequent 
allotment; or (2) 75 percent of the total costs of carrying out 
the activities under subsection 454(a)(2)(B).
    Section 455(a) sets forth as allowable uses of funds the 
electronic connection of libraries with one-stop centers and 
local service providers under Subtitle A of Title IV of the 
bill, the establishment of linkages among libraries, assistance 
in accessing information, the encouragement of consortia and 
sharing of resources, the acquisition or sharing of computer 
systems and telecommunications technologies, and the 
improvement of library and information services for individuals 
who have difficulty using a library or who need special library 
materials or services.
    Section 455(b) provides a limit of 3 percent of a State's 
grant for planning, administration, evaluations, and 
interagency coordination.
    Section 456(a) requires a State to submit an application to 
receive a grant and sets forth the items to be included in the 
application.
    Section 456(b)(1) requires the Secretary to approve each 
application that satisfies the requirements of Section 456(a).
    Section 456(b)(2) sets forth the rights of a State upon 
disapproval of an application.

         TITLE V--AMENDMENTS TO THE REHABILITATION ACT OF 1973

       Subtitle A--Vocational Rehabilitation Consolidation Grant

Chapter 1--Transition period

    Section 501 would require the Secretary of Education, 
acting through the Commissioner of the Rehabilitation Services 
Administration, to administer the amendment so that: During 
fiscal year 1996, the Secretary shall develop administrative 
policies for implementing the amendment; during fiscal years 
1997 and 1998, the Secretary shall begin implementing the new 
policies; by the first day of fiscal year 1999, the amendment 
is fully implemented. Further, the Secretary shall ensure that 
before the beginning of FY 1999, the state took action to 
encourage the participation of certain service providers, 
established the voucher system for the title, trained staff of 
the one-stop in addressing the needs of disabled individuals, 
and made arrangements for the establishment of one-stop 
centers. This section also clarifies, that during 1996 through 
1998, the provisions of title I of the Rehabilitation Act of 
1973 that were in effect at enactment will continue to be in 
effect, subject to transition requirements. This section also 
clarifies that individuals currently receiving services should 
not have those services unnecessarily disrupted.

Chapter 2--Revision of title I of Rehabilitation Act of 1973

    Section 511 is a comprehensive revision of the 
Rehabilitation Act of 1973. It would transfer the Client 
Assistance program from section 112 to a new section 510 of 
title V, and would amend title I to include the following 
sections:

              Title I--Vocational Rehabilitation Services

          Section 100 establishes the purpose of the title--to 
        assist States in making available to individuals with 
        disabilities a program of employment, training, and 
        rehabilitation services that is consistent with their 
        strengths, resources, priorities, concerns, abilities, 
        and capabilities; that maximizes individuals' control 
        over their vocational and career choices, and is in 
        accordance with the goal of assuring equality of 
        opportunity, full participation, independent living, 
        and economic self-sufficiency for such individuals.
          Section 101 would establish formula grants for States 
        receiving funds under this title. Subsection (a) 
        establishes that, for fiscal 1999 or any subsequent 
        fiscal year, the State receiving funds shall receive an 
        allotment determined for the State under section 107.
          Subsection 101(b) designates the Secretary of 
        Education, acting through the Commissioner of the 
        Rehabilitation Services Administration, to administer 
        the program.
          Subsection 101(c) clarifies that the purpose must be 
        carried out in accordance with the other requirements 
        of the title.
          Subsection 101(d) provides that there are authorized 
        to be appropriated such sums as may be necessary for 
        each of the fiscal years 1999 through 2002, and that 
        each year's appropriation must be adjusted by the 
        previous year's Consumer Price Index, as published by 
        the Secretary of Labor. It further provides that, if 
        legislation has not been enacted to extend the 
        authorization, then the authorization is automatically 
        extended for one additional year.
          Section 102 allocates administrative responsibilities 
        within a State. Subsection (a)(1) allows the State, 
        subject to subsection (b), to reserve not more than 20 
        percent of the grant for carrying out State 
        responsibilities under the title. Subsection (a)(2) 
        requires that not less than 80 percent of the grant 
        will be designated for carrying out the 
        responsibilities of local workforce development boards 
        and one-stop career centers.
          Section 102(b) allows a State to use funds under 
        subsection (a)(1) to carry out certain responsibilities 
        that otherwise would be carried out by local workforce 
        development boards or one-stop career centers if it is 
        necessary to make available goods and services that 
        cannot be provided through the local workforce board, 
        or to meet needs of individuals who cannot utilize the 
        one-stop career centers, or to address other issues of 
        equitable distribution of services, including the 
        provision of services for individuals in rural areas.
          Section (c) identifies the terms ``State 
        administrative agent'', ``local workforce development 
        area'', ``local workforce development board'', and 
        ``one-stop career center'' with the meanings given in 
        title I of the Consolidated and Reformed Education, 
        Employment, and Rehabilitation Systems Act.
          Section 103 designates the responsibilities of the 
        State Administrative Agent. Subsection (a) allows that, 
        in carrying out the requirement to designate an 
        administrative agent to carry out this title, a 
        Governor may designate one State administrative agent 
        to be responsible for carrying out this title for 
        individuals who are blind, and a different State 
        administrative agent to carry out the remaining 
        responsibilities in this title.
          Section (b) designates State responsibilities. 
        Subsection (b)(1) specifies that the title will be 
        carried out in accordance with the collaborative 
        process established under section 103 of the 
        Consolidated and Reformed Education, Employment, and 
        Rehabilitation Systems Act.
          Section (b)(2) requires the State to provide an 
        explanation of how it will provide vocational 
        rehabilitation services to all eligible individuals 
        within all workforce delivery areas within the State, 
        and if it is not able to do so, the justification for 
        the order to be followed in selecting individuals to 
        whom the services will be provided. This order of 
        selection under subparagraph (B) will be determined on 
        the basis of serving first those individuals with the 
        most severe disabilities, in accordance with State 
        criteria.
          Section (b)(3) requires the State to establish 
        guidelines to provide the eligible individual with 
        choice of receiving the services from a provider 
        designated by the one-stop career center or from a 
        provider selected by the individual with the use of 
        vouchers.
          Section (b)(4) requires the State to encourage the 
        participation in the State program of community-based 
        private providers, with special consideration given to 
        providers who have received funds under the projects 
        with industry or supported employment programs or 
        employment and training services under the Javits-
        Wagner-O'Day Act.
          Section (b)(5) requires the State to establish 
        provisions to govern eligibility determinations, based 
        on the criteria for eligibility found in this title.
          Section (b)(6) requires the State to establish 
        provisions to govern assessments of rehabilitation 
        need, including a methodology that will be uniformly 
        applied to prevent substantial disparities among 
        individuals with comparable circumstances in the 
        monetary value of the services to be provided based on 
        the assessments.
          Section (b)(7)(A) requires the State to establish 
        procedures through which an individual may request and 
        obtain an impartial review, utilizing an impartial 
        hearing officer, of whether standards in the title have 
        been correctly applied by the one-stop career center.
          Section (b)(7)(B) requires the State to designate a 
        number of days within which the review will be 
        conducted.
          Section (b)(7)(C) provides that there may be informal 
        methods of dispute resolution utilized, if agreed to by 
        both parties, and that impartial review is not 
        precluded if the informal alternatives do not yield a 
        final disposition of the matter.
          Section (b)(8) requires the State to ensure that 
        vocational rehabilitation services and core services 
        are provided by personnel qualified to provide the 
        services.
          Section (b)(9) requires that State to establish 
        interagency agreements with state education officials 
        responsible for educating students disabilities. The 
        plans, policies, and procedures must facilitate the 
        transition from the provision of a free appropriate 
        public education under the responsibility of an 
        educational agency to the provision of vocational 
        rehabilitation services under this title.
          Section (b)(10) requires the State administrative 
        agent to cooperate with the Statewide Independent 
        Living Council and independent living centers within 
        the State.
          Section (b)(11) requires the State administrative 
        agent to cooperation with on an interagency basis, and 
        coordinate the utilization of the services and 
        facilities of, the State agencies administering 
        programs for individuals with disabilities.
          Section (b)(12) requires the State to provide for the 
        appropriate training of the management and staff of the 
        one-stop career centers regarding effective services to 
        individuals with disabilities.
          Section (b)(13) requires the State to provide 
        technical assistance to local boards, one-stop career 
        centers, and providers regarding vocational 
        rehabilitation services, including development of 
        individualized rehabilitation and employment plans.
          Section (c) establishes the availability of vouchers 
        for services. Subsection (c)(1) requires the State to 
        establish a voucher system. Subsection (c)(2) provides 
        that an eligible individual who has been assessed for 
        rehabilitation needs will receive vocational 
        rehabilitation services through the use of vouchers, at 
        the choice of the individual. Subsection (c)(3) 
        provides that the individual can use the vouchers to 
        purchase services from among a list of approved 
        providers. Subsection (c)(4) ensures that the monetary 
        value of a voucher is calculated at a fair market 
        value. Subsection (c)(5) provides that, when 
        practicable, each workforce development area will have 
        available within it a broad range of services.
          Section (d) lists additional State options. 
        Subsection (d)(1), a State may disseminate research 
        findings, and under Subsection (d)(2), a State may 
        conduct demonstration projects regarding improvements 
        with respect to vocational rehabilitation services.
          Section (e) addresses core standards, performance 
        goals, and measures. Subsection (e)(1) requires the 
        State to develop and implement a statewide system of 
        standards and performance measures for the programs 
        under this title. Subsection (e)(2) provides that the 
        statewide system will establish performance goals and 
        evaluate the services and activities under this title, 
        create objective, measurable goals, and performance 
        indicators, and provide biennial reports on the State's 
        program. Subsection (e)(3) specifies that the State's 
        measures will include: placement, retention, and 
        earnings in integrated employment, including retention 
        and earnings at 6 months and 1 year; the percentage of 
        individuals served with severe disabilities, including 
        SSI and SSDI recipients; and other relevant measures 
        included in PWI standards and indicators and State 
        grant evaluation standards and indicators developed by 
        the Department of Education.
          Section 104 designates the Responsibilities for Local 
        Boards and Service Centers. Subsection (a) designates 
        the provision of vocational rehabilitation services. 
        Subsection (a)(1) provides that local responsibilities 
        will be carried out by the one-stop career centers in 
        the State, acting under the guidance of the local 
        workforce development board. Subsection (a)(2) provides 
        that, under the State's order of selection criteria, 
        the one-stop career center will make eligibility 
        determinations, provide vocational rehabilitation 
        services, and conduct outreach and intake activities 
        for individuals with severe disabilities who are not 
        able to access the one-stop career center system. 
        Subsection (a)(3) provides that the one-stop center 
        will make vocational rehabilitation services available 
        at a variety of locations, and as appropriate, in a 
        variety of environments.
          Section (b) defines ``vocational rehabilitation 
        services'' as goods or services that are necessary to 
        render an individual employable and achieve an 
        employment outcome, and that directly relate to the 
        individual's disability and do not substantially 
        duplicate the core services offered by the one-stop 
        career center.
          Section (c) provides that vocational rehabilitation 
        services offered through the one-stop centers will 
        include: (1) an assessment of the vocational 
        rehabilitation needs; (2) Development of an 
        individualized rehabilitation and employment plan to 
        identify employment goals, intermediate objectives, and 
        a combination of goods and services to achieve the 
        individual's employment goals; (3) Counseling, 
        guidance, and work-related placement services for 
        individuals with disabilities; (4) Vocational and other 
        training services for individuals with disabilities; 
        (5) Rehabilitation technology services; (6) Supported 
        employment services; (7) Physical and mental 
        restoration services; (8) Interpreter services for 
        individuals who are deaf, and reader services for 
        individuals who are blind; (9) Rehabilitation teaching 
        services and orientation and mobility services for 
        individuals who are blind; (10) Referral and other 
        services designed to assist individuals with 
        disabilities in securing needed services from other 
        agencies; (11) Transportation services; (12) 
        Telecommunications, sensory, and other technological 
        aids and devices; (13) on-the-job and other related 
        personal assistance services.
          Section (d) provides that the one-stop career center 
        will provide for necessary arrangements with community-
        based providers regarding supported employment services 
        and extended services, periodic reviews of individuals 
        placed in extended employment, and services to promote 
        movement from extended employment to integrated 
        employment.
          Section (e) allows a one-stop center to provide 
        additional vocational rehabilitation services as the 
        center determines to be appropriate.
          Section (f)(1) provides that a workforce board shall 
        reserve some funds under this title to supplement the 
        provision of core services at the one-stop career 
        center. Subsection (c)(2) clarifies that the amount of 
        vocational rehabilitation funds reserved to supplement 
        core services will be based on the number of eligible 
        individuals with disabilities in the local workforce 
        development area, and the costs of training employees 
        of the one-stop career centers to address disability 
        needs.
          Section (g) establishes criteria for development by 
        the Local Board of performance payments regarding 
        vouchers. The Board will ensure that a provider does 
        not receive full payment until the delivery of the 
        services involved is completed, and for employment, 
        training and placement services, the full payment is 
        not made until the individual has successfully 
        completed the training and been employed for 90 days.
          Section (h) provides that the State will not pay for 
        training services in institutions of higher education, 
        or medical services, unless significant efforts have 
        been made to secure payments from other sources. The 
        provision makes an exception to this requirement if 
        making such efforts would delay services to someone who 
        is at extreme medical risk, or who would lose a job 
        placement due to the delay.
          Section 105 describes criteria for determining an 
        individual's eligibility for services. Subsection (a) 
        provides that the individual cannot receive vocational 
        rehabilitation services under this title unless the 
        individual meets the Act's definition of an individual 
        with a disability, and the individual requires 
        vocational rehabilitation services to prepare for, 
        enter, engage in, or retain gainful employment.
          Section (a)(2) clarifies that, if the individual has 
        a disability or is blind as determined pursuant to 
        title II or title XVI of the Social Security Act, the 
        individual will be considered to have a disability 
        under this title.
          Section (a)(3) provides that it will be presumed that 
        an individual can benefit in terms of an employment 
        outcome from vocational rehabilitation services, unless 
        the one-stop career center provides clear and 
        convincing evidence otherwise.
          Section (b) establishes the process by which 
        eligibility will be determined. Under paragraph (1), 
        once the individual makes a request for an eligibility 
        determination, a qualified rehabilitation adviser will 
        be made available, an initial interview will be 
        conducted, followed by an initial assessment, and a 
        final determination will be made within 30 days. The 
        determination of eligibility will be based on the 
        review of existing data and the preliminary assessment. 
        If it is determined that the individual is not an 
        eligible individual, the individual will be provided a 
        written statement explaining the basis of the 
        determination, the availability of an impartial review, 
        and the availability of services under the client 
        assistance program.
          If, under subsection (b)(2), it is determined that 
        the individual is an eligible individual, the needs of 
        the individual for vocational rehabilitation services 
        will be assessed, and an individual rehabilitation and 
        employment plan will be developed for the individual 
        and mutually agreed upon by the individual and an 
        appropriate staff member of the one-stop career center. 
        A plan is considered to be individualized if it is 
        consistent with the unique strengths, resources, 
        priorities, concerns, abilities, and capabilities of 
        the individual. The subsection also allows the 
        individual to forego developing a plan if the 
        individual signs a waiver.
          Section (c) clarifies that the title does not create 
        an individual entitlement to services.
          Section (d) defines the term ``eligible individual.''
          Section 106 establishes criteria for the State 
        Rehabilitation Advisory Council. Subsection (a)(1) 
        provides that the State will establish a State 
        Rehabilitation Advisory Council. Subsection (a)(2) 
        establishes that the Council will include: 
        Representatives of organizations within the State 
        providing services to individuals with disabilities; 
        Representatives of business, industry, and labor; 
        Representatives of disability advocacy groups 
        representing a cross section of disability; The State 
        administrative agent as an ex officio member; and other 
        members of the Council as appointed by the Governor. 
        Subsection (a) also requires that a majority of Council 
        members will be individuals with disabilities, and not 
        employed by the designated State administrative agent. 
        The subsection also provides for appointment of a 
        chairperson, length of terms, and procedures to fill 
        vacancies on the council.
          Section (b) enumerates the functions of the council 
        as the following: Advise the collaborative process, and 
        the State administrative agent, in the preparation of 
        the State workforce development and literacy plan; 
        conduct a review and analysis of the effectiveness of 
        the delivery of core services and vocational 
        rehabilitation services to individuals with 
        disabilities within the State; Prepare and submit an 
        annual report to the collaborative process or 
        appropriate State administrative agent and the 
        Commissioner on the status of vocational rehabilitation 
        programs operated within the State; and coordinate with 
        other councils within the State established to address 
        the needs of individuals with disabilities.
          Section (c) clarifies the resources available to the 
        Council by the State administrative agent, and that the 
        council may hire staff and other personnel as 
        necessary. The subsection also provides for resolution 
        of disagreements by the governor between the Council 
        and the State administrative agent.
          Section (d) provides a protection against conflict of 
        interest by members the Council.
          Section (e) authorizes the Council to convene 
        meetings and forums or hearings.
          Section (f) allows the use of funds to reimburse 
        members of the Council for reasonable and necessary 
        expenses.
          Section (g) clarifies that a governor may designate a 
        separate council to carry out functions with respect to 
        vocational rehabilitation services for individuals who 
        are blind.
          Section 107 describes the amount of the allotment, as 
        in effect under current law.

       Subtitle B--Other Amendments to Rehabilitation Act of 1973

    Section 521 makes amendments regarding training and 
demonstration projects within the Rehabilitation Act. 
Subsection 521(a) amends the Rehabilitation Act of 1973, 
effective October 1, 1995, by striking section 303, section 
304, section 311(f), section 312; and section 316. The 
subsection also transfers subsection 802(a) to title III and 
redesignate it as section 311(f). The subsection further 
transfers subsection 802(g) to title III as section 311(g), 
transfers section 803(c) to title III and redesignates it as 
Section 311(h), and transfers section 803(b) to title III and 
redesignates it as section 302(j). Finally, the subsection 
strikes the remaining provisions of title VIII.
    Section (b) would take effect October 1, 1998 and would 
amend section 311 of the Rehabilitation Act of 1973, by 
striking subsection (c), and redesignating subsections (d) 
through (g) as subsections (c) through (f), respectively.
    Section 522 would take effect October 1, 1995, and would 
amend title VI to: strike part A; strike part C; strike part D; 
and retain the projects with industry program.
    Section (b), effective October 1, 1998, would repeal the 
Projects With Industry in title VI.
    Section (c) contains conforming amendments.

                TITLE VI--REPEALERS AND OTHER AMENDMENTS

    Section 601 repeals the Carl D. Perkins Vocational and 
Applied Technology Education Act (20 U.S.C. 2301 et seq.).
    Section 602 repeals the School-to-Work Opportunities Act of 
1994 (20 U.S.C. 6101 et seq.).
    Section 603(a) repeals the Adult Education Act (20 U.S.C. 
1201 et seq.).
    Section 603(b)(1) makes technical and conforming changes to 
the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
6301 et seq.) (ESEA) by replacing the words ``Adult Education 
Act'' with ``title IV of the CAREERS Act.'' This subsection 
also replaces the words ``section 312(2) of the Adult Education 
Act'' in Section 9161(2) of ESEA with ``section 5 of the 
CAREERS Act.''
    Section 603(b)(2) makes technical and conforming changes to 
the Technology for Education Act of 1994 by replacing ``section 
312 of the Adult Education Act'' with ``section 5 of the 
CAREERS Act.''
    Section 604 repeals the National Literacy Act of 1991, 
except for section 101.
    Section 605(a) repeals the Library Services and 
Construction Act (20 U.S.C. 351 et seq.).
    Section 605(b) makes technical and conforming changes to 
the Technology for Education Act of 1994 (20 U.S.C. 6801 et 
seq.). This subsection replaces the words ``section 3 of the 
Library Services and Construction Act'' with ``section 5 of the 
CAREERS Act.''
    Section 606 repeals sections 3601 through 3605 of the 
Technology for Education Act of 1994 (20 U.S.C. 7001 et seq.).
    Section 607 repeals the Job Training Partnership Act (29 
U.S.C. 1501), (except sections 421 through 439 relating to the 
Job Corps and section 441 relating to the Veterans' employment 
program), including:
          (1) Title II(a) relating to the Adult Training 
        Program.
          (2) Title II(b) relating to the Summer Youth Program.
          (3) Title II(c) relating to the Year Round Youth 
        Program.
          (4) Title III relating to Employment and Training 
        Assistance for Dislocated Workers.
          (5) Title IV relating to Federal Administered 
        Programs.
          (6) Title V relating to Jobs for Employable 
        Individuals Incentive Bonus Program.
          (7) Title VI relating to Miscellaneous provisions.
          (8) Title VII relating to the State Human Resource 
        Investment Council.
    Section 608(a) repeals section 702 of the Stewart B. 
McKinney Homeless Assistance Act (42 U.S.C. 11421).
    Section 608(b)(1) repeals subtitle C of Title VII of the 
Stewart B. McKinney Homeless Assistance Act, except section 
738.
    Section 608(b)(2) makes technical and conforming changes to 
the table of contents of the Stewart B. McKinney Homeless 
Assistance Act.
    Section 609 sets an effective date of October 1, 1996, for 
this title.

                  Oversight Findings of the Committee

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives and clause 2(b)(1) of 
rule X of the Rules of the House of Representatives, the 
Committee's oversight findings and recommendations are 
reflected in the body of this report.

                     Inflationary Impact Statement

    In compliance with clause 2(l)(4) of Rule XI of the Rules 
of the House of Representatives, the Committee estimates that 
the enactment into law of H.R. 1617 will have no significant 
inflationary impact on prices and costs in the operation of the 
national economy. It is the judgment of the Committee that the 
inflationary impact of this legislation as a component of the 
federal budget is negligible.

                    Government Reform and Oversight

    With respect to the requirement of clause 2(l)(3)(D) of 
Rule XI of the Rules of the House of Representatives, the 
Committee has received no report of oversight findings and 
recommendations from the Committee on Government Reform and 
Oversight on the subject of H.R. 1617.

                           Committee Estimate

    Clause 7 of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs which would be incurred in carrying out 
H.R. 1617. However, clause 7(d) of that rule provides that this 
requirement does not apply when the Committee has included in 
its report a timely submitted cost estimate of the bill 
prepared by the Director of the Congressional Budget Office 
under section 403 of the Congressional Budget Act of 1974.

                Application of Law to Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch. This bill provides funds to States for programs and 
services to eligible recipients; the bill does not prohibit 
legislative branch employees from otherwise being eligible for 
such services.

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget & Impoundment 
Control Act requires a statement of whether the provisions of 
the reported bill include unfunded mandates; the bill provides 
funds for administration of the programs authorized under this 
bill at the state and local level and as such does not contain 
any unfunded mandates.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirement of clause 2(l)(3)(B) of 
rule XI of the House of Representatives and section 308(a) of 
the Congressional Budget Act of 1974 and with respect to 
requirements of clause 2(l)(3)(C) of rule XI of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for H.R. 1617 from the Director of the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 19, 1995.
Hon. William F. Goodling,
Chairman, Committee on Economic and Educational Opportunities, House of 
        Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed H.R. 1617, the Consolidated and Reformed Education, 
Employment, and Rehabilitation Systems (CAREERS) Act as ordered 
reported by the House Committee on Economic and Educational 
Opportunities on May 24, 1995.
    Enactment of H.R. 1617 would affect direct spending. 
Therefore, pay-as-you-go procedures would apply to the bill.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Christi 
Hawley and Deborah Kalcevic.
            Sincerely,
                                                   June E. O'Neill.

               congressional budget office cost estimate

    1. Bill number: H.R. 1617.
    2. Bill title: Consolidated and Reformed Education, 
Employment, and Rehabilitation Systems (CAREERS) Act.
    3. Bill status: As ordered reported by the House Committee 
on Economic and Educational Opportunities on May 24, 1995.
    4. Bill purpose: H.R 1617 would repeal the authorizations 
of appropriations for many education, job training, and 
vocational rehabilitation programs. This bill also would modify 
other education and labor programs for the purpose of 
consolidating and reforming workforce development and literacy 
programs. In place of the programs repealed, four new 
consolidated state grant programs would be established 
beginning in 1997, and a substantially revised and consolidated 
vocational rehabilitation state grant program would be phased 
in by 1999. The four new consolidated state grants created by 
the bill would be: the Youth Workforce Preparation and 
Development Consolidation Grant; the Adult Employment and 
Training Consolidation Grant; the Adult Education and Family 
Literacy Consolidation Grant; and the Library Technology 
Consolidation Grant.
    5. Estimated cost to the Federal Government: Most of the 
spending that would occur under H.R. 1617 would be subject to 
the availability of appropriated funds. For purposes of this 
estimate, CBO assumes that the bill will be enacted by the end 
of this fiscal year, and that the funds authorized by the bill 
for the 1996-2000 period will be appropriated. In general, the 
effective dates stated in the bill are fiscal year 1997 for 
Titles I, II, III, IV, and VI, and fiscal year 1996 for Title 
V. Estimated outlays are based on historical spending patterns 
of programs administered by the Department of Education and the 
Department of Labor that are similar in nature to the block 
grants created by the bill.
    This bill also would affect direct spending by mandating 
that programs currently authorized under Titles II-VII of the 
Rehabilitation Act of 1973 be subject to annual appropriation 
action. Currently, these programs are considered mandatory 
spending under the Budget Enforcement Act.
    The following table summarizes the estimated budgetary 
impact of the bill, with discretionary authorizations adjusted 
for inflation where such sums as necessary are authorized. 
Total direct spending under this bill would be $11.2 billion in 
outlays over five years from 1996 to 2000, compared with $12.7 
billion under current law. The authorizations of appropriations 
total $34.2 billion for the same five-year period. Table 1 
(attached) provides details on the costs and savings associated 
with individual provisions.

        PROJECTED SPENDING UNDER H.R. 1617--INCLUDING INFLATION ADJUSTMENT FOR UNSPECIFIED AUTHORIZATIONS       
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000  
----------------------------------------------------------------------------------------------------------------
                DIRECT SPENDING                                                                                 
Projected spending under current law:                                                                           
    Estimated budget authority................      2,361      2,408      2,483      2,551      2,627      2,707
    Estimated outlays.........................      2,343      2,391      2,464      2,532      2,607      2,685
Proposed changes:                                                                                               
    Estimated budget authority................         --       -301       -311       -322       -333       -345
    Estimated outlays.........................         --       -232       -297       -319       -330       -342
Direct spending under H.R. 1617:                                                                                
    Estimated budget authority................      2,361      2,106      2,172      2,228      2,294      2,362
    Estimated outlays.........................      2,343      2,160      2,167      2,213      2,277      2,344
                                                                                                                
        AUTHORIZATION OF APPROPRIATIONS                                                                         
Spending under current law:                                                                                     
    Estimated authorizations..................      7,174      7,407      5,967      6,180      6,393      6,469
    Estimated outlays.........................      6,590      6,983      7,108      6,264      6,172      6,337
Proposed changes:                                                                                               
    Estimated authorizations..................         --        297        377        501        230        383
    Estimated outlays.........................         --        229        392        504        287        265
Authorization appropriations under H.R. 1617:                                                                   
    Authorization level.......................      7,174      7,704      6,344      6,680      6,623      6,851
    Estimated outlays.........................      6,590      7,212      7,501      6,768      6,459     6,602 
----------------------------------------------------------------------------------------------------------------
Components may not sum to totals due to rounding.                                                               
Note:--Authorizations of Education programs assume a one-year extension as provided under the General Education 
  Provisions Act (GEPA).                                                                                        

    The following table shows spending under H.R. 1617 without 
adjustments for inflation where such sums as necessary as 
authorized. When inflation is not considered, estimated direct 
spending is the same as in the above tables, but the 
authorizations of appropriations total is $32.3 billion over 
the 1996-2000 period. The details on the costs and savings 
associated with individual provisions are shown in Table 2 
(attached).

         PROJECTED SPENDING UNDER H.R. 1617--WITH NO INFLATION ADJUSTMENT FOR UNSPECIFIED AUTHORIZATIONS        
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000  
----------------------------------------------------------------------------------------------------------------
                DIRECT SPENDING                                                                                 
                                                                                                                
Project spending under current law:                                                                             
    Estimated budget authority................      2,361      2,408      2,483      2,551      2,627      2,707
    Estimated outlays.........................      2,343      2,391     2,464,      2,532      2,607      2,685
Proposed changes:                                                                                               
    Estimated budget authority................  .........       -301       -311       -322       -333       -345
    Estimated outlays.........................  .........       -232       -297       -319       -330       -342
Direct spending under H.R. 1617:                                                                                
    Estimated budget authority................      2,361      2,106      2,172      2,228      2,294      2,362
    Estimated outlays.........................      2,343      2,160      2,167      2,213      2,277      2,344
                                                                                                                
        AUTHORIZATION OF APPROPRIATIONS                                                                         
                                                                                                                
Spending under current law:                                                                                     
    Estimated authorizations..................      7,174      7,169      5,585      5,585      5,585      5,460
    Estimated outlays.........................      6,589      6,966      6,916      5,907      5,614      5,570
Proposed changes:                                                                                               
    Estimated authorizations..................  .........        287        662        772        524        649
    Estimated outlays.........................  .........        221        386        711        568        549
Authorization of appropriations under H.R.                                                                      
 1617:                                                                                                          
    Authorization level.......................      7,174      7,456      6,247      6,357      6,110      6,110
    Estimated outlays.........................      6,589      7,187      7,301      6,618      6,183      6,119
----------------------------------------------------------------------------------------------------------------
Components may not sum to totals due to rounding.                                                               
Note.--Authorizations of Education programs assume a one-year extension as provided under the General Education 
  Provisions Act (GEPA).                                                                                        

    The costs of this bill fall within budget function 500.
    6. Basis of estimate:

Direct spending

    H.R. 1617 would mandate that numerous categorical 
vocational rehabilitation programs authorized under Titles II-
VII of the Rehabilitation Act be subject to annual 
appropriations action. Currently, these programs, which 
received a total of $291 million in appropriations for fiscal 
year 1995, are considered mandatory spending under the Budget 
Enforcement Act. Establishing these programs as discretionary 
grant programs as of fiscal year 1996 would reduce direct 
spending outlays by $232 million in 1996, and by $1.5 billion 
over the 1996-2000 period. Most of these programs would remain 
in place but would be subject to appropriations action. 
Therefore, the spending would become subject to control under 
the discretionary spending limits. In addition to requiring 
that these programs be subject to annual appropriations, this 
bill would repeal the authorization of appropriations for 
several of these programs. Beginning in fiscal year 1996, the 
authorizations would be repealed for recreational programs, 
migratory worker programs, innovation and expansion programs, 
loan guarantee programs, and demonstration and training 
programs authorized under Title VIII. Beginning in fiscal year 
1999, the authorizations would be repealed for the supported 
employment grants and the project with industry program.
    Funds for the basic state grants for vocational 
rehabilitation services are considered mandatory spending under 
the Budget Enforcement Act. H.R. 1617 would make substantial 
changes to this program. Current state requirements for the use 
of the funds and the operations of the program would be reduced 
and streamlined. Similar to the new grants established in 
Titles II-IV, vocational rehabilitation training would be 
coordinated through the new one-stop career center system 
established in Title I. In addition, states would be required 
to establish a voucher system for training services. In 1995, 
the basic state grant program was funded at $2.1 billion. The 
revised program authorized under H.R. 1617 would retain the 
current legislative language for the program's funding 
mechanism. Each year's authorized funding level would be the 
preceding year's appropriation level adjusted for projected 
inflation. Because this funding level would not be altered, 
there would be no direct spending effect from the programmatic 
changes. The new program structure is effective for fiscal year 
1999.

Authorizations of appropriations

    Titles II, III, and IV would establish four new 
consolidation grants to states. Each of the four grants would 
serve a particular population or need--youth, adults, families, 
or libraries. If the programs are funded at the authorized 
levels, new budget authority for these grants would total 
nearly $5 billion in fiscal year 1997, the first year in which 
these grants are authorized.
    Title VI would repeal several existing job training and 
education programs. Budget authority savings from these repeals 
relative to current authorization levels without inflation 
adjustments would be 
nearly $4.5 billion in fiscal year 1997, the year in which 
these repeals take effect (see Table 2, attached). After 
accounting for the new authorizations provided by the bill, the 
total 1997 authorization levels for these types of programs 
under H.R. 1617 would be $662 million more than the estimated 
authorized levels under current law without discretionary 
inflation. Two factors account for this increase. One is the 
provisions of Title V that switches close to $300 million for 
vocation rehabilitation programs from mandatory to 
discretionary spending. The other is the fact that many of the 
programs repealed are not authorized past fiscal year 1996, and 
thus, spending for those programs in 1997 and beyond is not 
included in the comparison.
    The effect of the bill becomes more clear when authorized 
levels for 1997 and beyond are compared to 1995 funding levels. 
On this basis, the bill would result in a net reduction in 
budget authority of $1.2 billion for fiscal year 1997 and $1.1 
billion a year over the 1998-2000 period. Table 3 (attached) 
shows the changes proposed in H.R. 1617 relative to the 1995 
funding levels.
    Title II. This title would create a Youth Development and 
Career Preparation Consolidation Grant. The purpose of the 
grant is to provide states and local communities with funding 
and flexibility in designing workforce preparation programs. 
The grant program would be authorized at $2.3 billion for 
fiscal year 1997 and such sums as necessary for each fiscal 
year 1998-2002. Funds are to be appropriated on a forward-
funded, or program-year basis; funds would become available 
July 1 of the year for which funds were appropriated. Because 
both the vocational education and JTPA youth programs are 
currently funded in this manner, estimated outlays reflect the 
spending patterns of the current programs.
    Title III. This title would establish an Adult Employment 
and Training Consolidation Grant. The purpose of the grant is 
to fund a system of employment, job training, and related 
services designed to help adults gain private sector 
employment. The bill would authorize this program at $2.3 
billion for fiscal year 1997 and such sums as necessary for 
each fiscal year 1998-2002. As with the program authorized by 
Title II, these grants are to be forward-funded, an arrangement 
similar to the one currently used by existing JTPA employment 
and training programs for adults and dislocated workers. 
Therefore, estimated outlays reflect the spending patterns of 
the current programs.
    Title IV. This title would create two new grant programs: 
one for adult education and family literacy and one for library 
services and technology. An Adult Education and Family Literacy 
Consolidation Grant program would be established to provide 
adults with basic educational and literacy skills, as well as 
to fund the National Institute on Literacy. The authorization 
of appropriations for this grant would be $280 million for 
fiscal year 1997 and such sums as necessary for each fiscal 
year from 1998 to 2002. This grant would be forward-funded, 
similar to existing adult education and literacy programs. 
Consequently, estimated outlays reflect spending patterns of 
current programs.
    A Library Services and Technology Consolidation Grant 
program also would be established. The purpose of this grant 
would be to consolidate federal library service programs, 
improve public access to information through electronic 
networks, and provide linkages among and between libraries and 
one-stop career center systems. This program would be 
authorized at $110 million for each of the fiscal years 1997 
through 2002. The Library Services and Technology Consolidation 
Grant program would be advance-funded; funds appropriated in 
one fiscal year would not become available for obligation until 
the following year. In contrast, existing library services 
grants are funded on a current-year basis. Estimated outlays 
for the new grant program reflect the assumption that outlays 
in the second year would be similar to the current program's 
pattern over the first two years.
    Title V. As discussed above under direct spending, H.R. 
1617 would mandate that the categorical vocational 
rehabilitation programs authorized under Titles II-VII of the 
rehabilitation Act be subject to annual appropriations action. 
The current authorization of appropriations expires at the end 
of 1998 for the special demonstration programs, supported 
employment projects, projects with industry, client assistance, 
supported employment grants, protection and advocacy, and the 
National Institute on Disability. The training grants are 
permanently authorized. Estimated authorization levels reflect 
the 1995 appropriations, and estimated outlays reflect the 
current programs' spending patterns.
    Title VI. This title would repeal certain existing 
education and job training programs beginning in fiscal year 
1997. Programs repealed under this title include the Vocational 
Education Programs, the School-to-Work Opportunities Act, the 
Adult Education Act, the National Literacy Act, the Library 
Services Construction Act, the Technology for Education Act, 
and the Job Training Partnership Act (except for the Job Corps 
and Veterans portions). Many of the programs that are repealed 
are authorized but have not received an appropriation. In other 
instances, authorizations expire prior to the repeal date. 
Overall, savings from repealing these programs as measured from 
the authorized level are significantly less than the savings as 
measured from baseline projections.
    7. Pay-as-you-go considerations: Section 252 of the 
Balanced Budget and Emergency Deficit Control Act of 1985 sets 
up pay-as-you-go procedures for legislation affecting direct 
spending or receipts through 1998. The pay-as-you-go effects of 
the bill are as follows:

------------------------------------------------------------------------
                                 1995       1996       1997       1998  
------------------------------------------------------------------------
Change in outlays...........  .........       -232       -297       -319
Change in receipts..........      (\1\)      (\1\)      (\1\)      (\1\)
------------------------------------------------------------------------
Not applicable.                                                         

    8. Estimated cost to state and local governments: H.R. 1617 
would require certain actions by the states in order for them 
to receive funding under any of the block grant programs it 
would establish. Many of the processes required in the act are 
similar to current requirements. However, application and 
reporting requirements, as well as funding streams, are 
consolidated under this bill, which could provide for 
administrative efficiencies at the state level.
    This bill would have the effect of reducing federal funding 
for education and job training programs by about $1.1 billion 
per year, as measured from the fiscal year 1995 spending 
levels. No state match of resources or maintenance of effort is 
required for a state to receive funds under titles I, II, and 
III of the CAREERS Act. Some states may choose to devote 
additional state funds to continue current service levels; 
others could maintain their current efforts; and still others 
could choose to reduce current state spending for education and 
job training.
    Title IV requires a state match of 25 percent on programs 
relating to adult education and family literacy services. This 
match is similar to that required under current law for adult 
education state grants. Title V retains the current state 
matching requirements for vocational rehabilitation services.
    H.R. 1617 would require the governors to establish 
statewide criteria for workforce development boards to 
designate one-stop career center systems. These one-stop career 
centers would include common intake, preliminary assessment, 
and integrated job search assistance. Any entity or consortium 
of entities located in the workforce development area may be 
designated to operate a one-stop career center. Some states 
already have received preliminary grants for the development of 
one-stop career centers. Other states may incur some 
incremental costs for establishing such centers.
    The bill also would establish a performance accountability 
system that would require states to establish indicators, which 
would take into account specific attributes of the local 
workforce development areas. If a state is found to have poor 
performance according to the criteria it establishes, it must 
receive technical guidance from the Department of Labor or the 
Department of Education, as appropriate. If the state is found 
to have poor performance for a second consecutive year, the 
state may receive up to a 5 percent reduction in its grant 
funds. At the local level, governors would be permitted to 
sanction workforce development boards that are found to have 
poor performance for two consecutive years. These sanctions may 
include withholding funds or redesignation of the workforce 
development board.
    Under H.R. 1617, funding to states for vocational 
rehabilitation programs would be maintained at about the 1995 
level.
    9. Estimate comparison: None.
    10. Previous CBO estimate: None.
    11. Estimate prepared by: Christi Hawley and Deborah 
Kalcevic
    12. Estimate approved by: Robert A. Sunshine, for Paul N. 
Van de Water, Assistant Director for Budget Analysis.

         TABLE 1.--PROJECTED SPENDING UNDER H.R. 1617 INCLUDING INFLATION FOR UNSPECIFIED AUTHORIZATIONS        
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000  
----------------------------------------------------------------------------------------------------------------
                DIRECT SPENDING                                                                                 
                                                                                                                
Projected spending under current law:                                                                           
    Estimated budget authority................      2,361      2,408      2,483      2,551      2,627      2,707
    Outlays...................................      2,343      2,391      2,464      2,532      2,607      2,685
               PROPOSED CHANGES                                                                                 
Vocational Rehabilitation Act Programs:                                                                         
    Estimated budget authority................  .........       -301       -311       -322       -333       -345
    Outlays...................................  .........       -232       -297       -319       -330       -342
Direct spending under H.R. 1617:                                                                                
    Estimated budget authority................      2,361      2,106      2,172      2,228      2,294      2,362
    Outlays...................................      2,343      2,160      2,167      2,213      2,277      2,344
                                                                                                                
        AUTHORIZATION OF APPROPRIATIONS                                                                         
                                                                                                                
Authorizations under current law:                                                                               
    Estimated authorization...................      7,174      7,407      5,967      6,180      6,393      6,469
    Outlays...................................      6,590      6,983      7,108      6,264      6,172      6,337
                                                                                                                
               PROPOSED CHANGES                                                                                 
                                                                                                                
           Titles IHV: New Programs                                                                             
                                                                                                                
Youth development and career preparation                                                                        
 consolidation grant:                                                                                           
    Estimated authorization...................  .........  .........      2,308      2,390      2,472      2,559
    Outlays...................................  .........  .........        146      1,796      2,354      2,459
Adult employment and training consolidation                                                                     
 grant:                                                                                                         
    Estimated authorization...................  .........  .........      2,263      2,344      2,424      2,509
    Outlays...................................  .........  .........         83      1,831      2,269      2,410
Adult education and family literacy                                                                             
 consolidation grant:                                                                                           
    Estimated authorization...................  .........  .........        280        290        300        310
    Outlays...................................  .........  .........         34        225        284        299
Library services and technology consolidation                                                                   
 grant:                                                                                                         
    Estimated authorization...................  .........  .........  .........        110        110        110
    Outlays...................................  .........  .........  .........         85        110        110
      Subtotal, Titles II-IV:                                                                                   
        Estimated authorization...............  .........  .........      4,852      5,134      5,307      5,489
        Outlays...............................  .........  .........        263      3,938      5,017      5,278
                                                                                                                
Title V: Vocational Rehabilitation act Changes                                                                  
                                                                                                                
    Estimated authorization...................  .........        297        307        318         45         47
    Outlays...................................  .........        229        293        315        108         57
                                                                                                                
           Title VI: Program Repeals                                                                            
                                                                                                                
Carl Perkins Vocational Education and Applied                                                                   
 Technology Education Act:                                                                                      
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
School to Work Opportunities Act:                                                                               
    Estimated authorization...................  .........  .........       -267       -277       -286       -148
    Outlays...................................  .........  .........        -32       -215       -270       -267
Adult Education Act:                                                                                            
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
National Literacy Act:                                                                                          
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Library Services and Construction Act:                                                                          
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Technology for Education Act, Part F:                                                                           
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Job Training Partnership Act, except Job Corps                                                                  
 and Veterans:                                                                                                  
    Estimated authorization...................  .........  .........     -4,504     -4,665     -4,825     -4,994
    Outlays...................................  .........  .........       -130     -3,526     -4,556     -4,792
Stewart B. McKinney Homeless Programs for                                                                       
 Literacy Training and Job Training:                                                                            
    Estimated authorization...................  .........  .........        -10        -11        -11        -11
    Outlays...................................  .........  .........         -1         -8        -10        -11
                                               =================================================================
      Subtotal, Title VI:                                                                                       
        Estimated authorization...............  .........  .........     -4,781     -4,952     -5,122     -5,153
        Outlays...............................  .........  .........       -163     -3,748     -4,837     -5,070
                                               =================================================================
      Total change:                                                                                             
        Estimated authorization...............  .........        297        377        501        230        383
        Outlays...............................  .........        229        392        504        287        265
Authorizations under H.R. 1617:                                                                                 
    Estimated authorization...................      7,174      7,704      6,344      6,680      6,623      6,851
    Outlays...................................      6,590      7,212      7,501      6,768      6,459      6,602
----------------------------------------------------------------------------------------------------------------
Components may not sum to totals due to rounding.                                                               
                                                                                                                
Note: Authorizations of education programs assume a one-year extension as provided under the General Education  
  Provisions Act.                                                                                               


         TABLE 2.--PROJECTED SPENDING UNDER H.R. 1617 INCLUDING INFLATION FOR UNSPECIFIED AUTHORIZATIONS        
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000  
----------------------------------------------------------------------------------------------------------------
                DIRECT SPENDING                                                                                 
                                                                                                                
Projected spending under current law:                                                                           
    Estimated budget authority................      2,361      2,408      2,483      2,551      2,627      2,707
    Outlays...................................      2,343      2,391      2,464      2,532      2,607      2,685
                                                                                                                
               PROPOSED CHANGES                                                                                 
                                                                                                                
Vocational Rehabilitation Act Programs:                                                                         
    Estimated budget authority................  .........       -301       -311       -322       -333       -345
    Outlays...................................  .........       -232       -297       -319       -330       -342
Direct spending under H.R. 1617:                                                                                
    Estimated budget authority................      2,361      2,106      2,172      2,228      2,294      2,362
    Outlays...................................      2,343      2,160      2,167      2,213      2,277      2,344
                                                                                                                
        AUTHORIZATION OF APPROPRIATIONS                                                                         
                                                                                                                
Authorizations under current law:                                                                               
    Estimated authorization...................      7,174      7,169      5,585      5,585      5,585      5,460
    Outlays...................................      6,589      6,966      6,916      5,907      5,614      5,570
                                                                                                                
               PROPOSED CHANGES                                                                                 
                                                                                                                
          Titles II-IV: New Programs                                                                            
                                                                                                                
Youth development and career preparation                                                                        
 consolidation grant:                                                                                           
    Estimated authorization...................  .........  .........      2,308      2,308      2,308      2,308
    Outlays...................................  .........  .........        146      1,791      2,285      2,308
Adult employment and training consolidation                                                                     
 grant:                                                                                                         
    Estimated authorization...................  .........  .........      2,263      2,263      2,263      2,263
    Outlays...................................  .........  .........         83      1,828      2,201      2,263
Adult education and family literacy                                                                             
 consolidation grant:                                                                                           
    Estimated authorization...................  .........  .........        280        280        280        280
    Outlays...................................  .........  .........         34        224        274        280
Library services and technology consolidation                                                                   
 grant:                                                                                                         
    Estimated authorization...................  .........  .........  .........        110        110        110
    Outlays...................................  .........  .........  .........         85        110        110
                                               =================================================================
      Subtotal, Titles II-IV:                                                                                   
        Estimated authorization...............  .........  .........      4,852      4,962      4,962      4,962
        Outlays...............................  .........  .........        263      3,928      4,871      4,962
                                                                                                                
Title V: Vocational Rehabilitation Act Changes                                                                  
                                                                                                                
    Estimated authorization...................  .........        287        287        287         40         40
    Outlays...................................  .........        221        276        287         97         50
                                                                                                                
           Title VI: Program Repeals                                                                            
                                                                                                                
Carl Perkins Vocational Education and Applied                                                                   
 Technology Education Act:                                                                                      
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
School to Work Opportunities Act:                                                                               
    Estimated authorization...................  .........  .........       -250       -250       -250       -125
    Outlays...................................  .........  .........        -30       -200       -245       -235
Adult Education Act:                                                                                            
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
National Literacy Act:                                                                                          
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Library Services and Construction Act:                                                                          
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Technology for Education Act, Part F:                                                                           
    Estimated authorization...................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Job Training Partnership Act, Except Job Corps                                                                  
 and Veterans:                                                                                                  
    Estimated authorization...................  .........  .........     -4,218     -4,218     -4,218     -4,218
    Outlays...................................  .........  .........       -121     -3,297     -4,145     -4,218
Stewart B. McKinney Homeless Programs for                                                                       
 Literacy Training and Job Training:                                                                            
    Estimated authorization...................  .........  .........         -9         -9         -9         -9
    Outlays...................................  .........  .........         -1         -8         -9         -9
                                               =================================================================
      Subtotal, Title VI:                                                                                       
        Estimated authorization...............  .........  .........     -4,477     -4,477     -4,477     -4,352
        Outlays...............................  .........  .........       -153     -3,504     -4,399     -4,462
                                               =================================================================
      Total change:                                                                                             
        Estimated authorization...............  .........        287        662        772        524        649
        Outlays...............................  .........        221        386        711        568        549
Authorizations under H.R. 1617:                                                                                 
    Estimated authorization...................      7,174      7,456      6,247      6,357      6,110      6,110
    Outlays...................................      6,589      7,187      7,301      6,618      6,183      6,119
----------------------------------------------------------------------------------------------------------------
Components may not sum to totals due to rounding.                                                               
                                                                                                                
Note: Authorizations of education programs assume a one-year extension as provided under the General Education  
  Provisions Act.                                                                                               


 TABLE 3.--PROJECTED DISCRETIONARY SPENDING CHANGES INCLUDED IN H.R. 1617 ESTIMATED RELATIVE TO THE CBO FEBRUARY
1995 BASELINE WITHOUT DISCRETIONARY INFLATION (WODI) ADJUSTMENTS AND EXCLUDING PROGRAMS AUTHORIZED UNDER TITLE V
                                                       \1\                                                      
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000  
----------------------------------------------------------------------------------------------------------------
            DISCRETIONARY SPENDING                                                                              
                                                                                                                
Current programs included in CBO baseline                                                                       
 without discretionary inflation:                                                                               
    Budget authority..........................      7,174      7,174      7,174      7,174      7,174      7,174
    Outlays...................................      6,589      6,966      7,142      7,171      7,174      7,174
                                                                                                                
               PROPOSED CHANGES                                                                                 
                                                                                                                
          Titles II-IV: New Programs                                                                            
                                                                                                                
Youth development and career preparation                                                                        
 consolidation grant:                                                                                           
    Budget authority..........................  .........  .........      2,308      2,308      2,308      2,308
    Outlays...................................  .........  .........        146      1,791      2,285      2,308
Adult employment and training consolidation                                                                     
 grant:                                                                                                         
    Budget authority..........................  .........  .........      2,263      2,263      2,263      2,263
    Outlays...................................  .........  .........         83      1,828      2,201      2,263
Adult education and family literacy                                                                             
 consolidation grant:                                                                                           
    Budget authority..........................  .........  .........        280        280        280        280
    Outlays...................................  .........  .........         34        224        274        280
Library services and technology consolidation                                                                   
 grant:                                                                                                         
    Budget authority..........................  .........  .........  .........        110        110        110
    Outlays...................................  .........  .........  .........         85        110        110
      Subtotal, Titles II-IV:                                                                                   
        Budget authority......................  .........  .........      4,852      4,962      4,962      4,962
        Outlays...............................  .........  .........        263      3,928      4,871      4,962
                                                                                                                
Title V: Vocational Rehabilitation Act Changes                                                                  
                                                                                                                
    Budget authority..........................  .........      (\1\)      (\1\)      (\1\)      (\1\)      (\1\)
    Outlays...................................  .........      (\1\)      (\1\)      (\1\)      (\1\)      (\1\)
                                                                                                                
           Title VI: Program Repeals                                                                            
                                                                                                                
Carl Perkins Vocational Education and Applied                                                                   
 Technology Education Act:                                                                                      
    Budget authority..........................  .........  .........     -1,171     -1,171     -1,171     -1,171
    Outlays...................................  .........  .........       -141       -937     -1,148     -1,171
School to Work Opportunities Act:                                                                               
    Budget authority..........................  .........  .........       -250       -250       -250       -250
    Outlays...................................  .........  .........        -30       -200       -245       -250
Adult Education Act:                                                                                            
    Budget authority..........................  .........  .........       -269       -269       -269       -269
    Outlays...................................  .........  .........        -32       -215       -264       -269
National Literacy Act:                                                                                          
    Budget authority..........................  .........  .........         -5         -5         -5         -5
    Outlays...................................  .........  .........         -1         -4         -5         -5
Library Services and Construction Act:                                                                          
    Budget authority..........................  .........  .........       -133       -133       -133       -133
    Outlays...................................  .........  .........        -48        -98       -133       -133
Technology for Education Act, Part F:                                                                           
    Budget authority..........................  .........  .........          0          0          0          0
    Outlays...................................  .........  .........          0          0          0          0
Job Training Partnership Act, except Job                                                                        
 Corps:                                                                                                         
    Budget authority..........................  .........  .........     -4,218     -4,218     -4,218     -4,218
    Outlays...................................  .........  .........       -121     -3,297     -4,145     -4,218
Stewart B. McKinney Homeless Programs for                                                                       
 Literacy Training and Job Training:                                                                            
    Budget authority..........................  .........  .........        -15        -15        -15        -15
    Outlays...................................  .........  .........         -2        -12        -14        -15
      Subtotal, Title VI:                                                                                       
        Budget authority......................  .........  .........     -6,060     -6,060     -6,060     -6,060
        Outlays...............................  .........  .........       -375     -4,763     -5,953     -6,061
      Total change:                                                                                             
        Budget authority......................  .........  .........     -1,208     -1,098     -1,098     -1,098
        Outlays...............................  .........  .........       -112       -835     -1,082     -1,099
Current Programs Included in CBO Baseline                                                                       
 Without Discretionary Inflation Revised for                                                                    
 H.R. 1617:                                                                                                     
    Budget authority..........................      7,174      7,174      5,966      6,076      6,076      6,076
    Outlays...................................      6,589      6,966      7,030      6,336      6,092      6,075
----------------------------------------------------------------------------------------------------------------
Components may not sum to totals due to rounding.                                                               
                                                                                                                
\1\ The title V Vocational Rehabilitation Act changes switch the curernt programs from the direct category to   
  the discretionary category but do not, for the most part, alter the programs. Therefore, vocational           
  rehabilitation programs have not been included in this table designed to show program increases and decreases.

             Motion to Order Reported H.R. 1617, as Amended

    The bill H.R. 1617 as amended was ordered reported 
favorably to the House by a vote of 29 ayes to 5 noes, on May 
24, 1995.
    The roll call vote is as follows:
        AYES                          NOES
Chairman Goodling                   Mr. Miller
Mr. Petri                           Mr. Owens
Mrs. Roukema                        Mr. Payne
Mr. Gunderson                       Mrs. Mink
Mr. Fawell                          Mr. Becerra
Mr. Ballenger
Mr. Barrett
Mr. Cunningham
Mr. Hoekstra
Mr. McKeon
Mr. Castle
Mr. Johnson
Mr. Talent
Mr. Hutchinson
Mr. Riggs
Mr. Graham
Mr. Weldon
Mr. Funderburk
Mr. Souder
Mr. Clay
Mr. Kildee
Mr. Williams
Mr. Martinez
Mr. Andrews
Mr. Reed
Mr. Roemer
Mr. Scott
Mr. Green
Ms. Woolsey

Motion to Adopt the Goodling Amendment in the Nature of a Substitute as 
                                Amended

    The Goodling substitute to the bill H.R. 1617 was adopted 
with amendments by voice vote on May 24, 1995. The substitute 
makes a number of technical and clarifying changes to the bill, 
including: changes to several of the definitions included in 
Title I; a clarification that representatives of community 
colleges, employees, and veterans are part of the State 
collaborative process; a clarification that representatives of 
education, community-based organizations, employees, and 
veterans will serve on local workforce development boards; 
changes in the Youth title, reflecting input from the education 
community and others; additional language ensuring that 
vocational rehabilitation services are provided as an integral 
part of this legislation; and number of clarifying changes, 
highlighting the important role of the Governor, and the 
collaborative process at the State level, in the overall design 
of the workforce development and literacy system within each 
State.
                          Votes on Amendments

    The Committee defeated an amendment (13 ayes to 22 noes) 
offered by Mr. Owens as a substitute to Title V of the bill 
relating to Title I of the Rehabilitation Act of 1973. The 
Owens amendment would amend the State plan requirement section 
of the Rehabilitation Act to include, among others, the 
following provisions: requires the State to designate an agency 
to be responsible for vocational rehabilitation; requires the 
State to describe how it will provide vocational rehabilitation 
services through and in coordination with the one-stop career 
centers under the CAREERS Act; requires the State to describe a 
comprehensive system of personnel development within the State 
(including national or State certification and licensing 
requirements); requires development of an individualized 
written rehabilitation program for each participant; requires 
the State to collect data as required by the Commissioner of 
the Rehabilitation Service Administration; requires the State 
to provide for information and referral programs; requires the 
State to conduct public meetings and provide for public 
comment; and establishes a State Rehabilitation Advisory 
Council. The substitute also would require the State to spend 
1.5 percent of its allotment for activities to improve quality 
of vocational rehabilitation services and coordination of 
services with the one-stop career center system in the CAREERS 
Act. The Substitute also would repeal part C of Title I, 
relating to development of strategic plans by the State.
    The roll call vote is as follows:

        AYES                          NOES
Mr. Williams                        Chairman Goodling
Mr. Martinez                        Mr. Petri
Mr. Owens                           Mrs. Roukema
Mr. Sawyer                          Mr. Gunderson
Mr. Payne                           Mr. Fawell
Mrs. Mink                           Mr. Ballenger
Mr. Andrews                         Mr. Barrett
Mr. Reed                            Mr. Cunningham
Mr. Roemer                          Mr. Hoekstra
Mr. Becerra                         Mr. McKeon
Mr. Scott                           Mr. Castle
Mr. Green                           Mr. Johnson
Mr. Reynolds                        Mr. Talent
                                    Mr. Hutchinson
                                    Mr. Knollenberg
                                    Mr. Riggs
                                    Mr. Graham
                                    Mr. Weldon
                                    Mr. Funderburk
                                    Mr. Souder
                                    Mr. McIntosh
                                    Mr. Norwood

    The Committee defeated an amendment (16 ayes to 19 noes) 
offered by Mr. Green of Texas to strike Title V of the bill, 
relating to provision of vocational rehabilitation services to 
individuals with disabilities.

        AYES                          NOES
Mr. Williams                        Chairman Goodling
Mr. Martinez                        Mr. Petri
Mr. Owens                           Mrs. Roukema
Mr. Sawyer                          Mr. Fawell
Mr. Payne                           Mr. Ballenger
Mrs. Mink                           Mr. Barrett
Mr. Andrews                         Mr. Cunningham
Mr. Reed                            Mr. Hoekstra
Mr. Roemer                          Mr. McKeon
Mr. Engel                           Mr. Castle
Mr. Becerra                         Mr. Johnson
Mr. Scott                           Mr. Talent
Mr. Green                           Mr. Hutchinson
Ms. Woolsey                         Mr. Knollenberg
Mr. Romero-Barcelo                  Mr. Riggs
Mr. Reynolds                        Mr. Graham
                                    Mr. Funderburk
                                    Mr. Souder
                                    Mr. McIntosh

    The Committee defeated an amendment (12 ayes to 19 noes) 
offered by Mrs. Mink to Title II of the bill. The amendment 
targeted the 20% of the locally driven youth funds that the 
Governor, through the collaborative process, has discretion to 
apply to the in-school or at-risk/out-of-school youth programs. 
Mrs. Mink's amendment would have required the State provide 
competitive grants with the funds for the purpose of providing 
programs to single parents, displaced homemakers and single 
pregnant women and for programs that eliminate sex bias.
    The roll call vote is as follows:
        AYES                          NOES
Mr. Kildee                          Chairman Goodling
Mr. Martinez                        Mr. Petri
Mr. Owens                           Mrs. Roukema
Mr. Sawyer                          Mr. Gunderson
Mr. Payne                           Mr. Fawell
Mrs. Mink                           Mr. Ballenger
Mr. Andrews                         Mr. Barrett
Mr. Reed                            Mr. Cunningham
Mr. Roemer                          Mr. Hoekstra
Mr. Scott                           Mr. McKeon
Mr. Green                           Mr. Talent
Ms. Woolsey                         Mr. Greenwood
                                    Mr. Knollenberg
                                    Mr. Riggs
                                    Mr. Graham
                                    Mr. Weldon
                                    Mr. Funderburk
                                    Mr. Souder
                                    Mr. McIntosh

    The Committee adopted an amendment (20 ayes to 9 noes) 
offered by Mr. Riggs and Mrs. Roukema to add a new section on 
performance and accountability in Title I, requiring the 
following: that the Secretaries of Education and Labor, in 
collaboration with States and with business, employees, 
educational agencies, service providers, etc., establish 
technical definitions of ``core indicators,'' as established 
within each of the consolidation grants under the bill, to 
ensure comparability of performance data across States; that 
the Secretaries, through this ``collaborative process'', 
identify world class levels of performance with respect to 
appropriate core indicators, selected from among those 
described in Titles II-V of the bill, in order to encourage 
high levels of performance and advance the Nation's 
competitiveness; that States would be required to identify 
indicators of performance for each of the programs established 
under this Act, and for Title I of the Vocational 
Rehabilitation Act of 1973, which at a minimum take into 
account the core indicators included in the bill, and which 
take into account (but are not required to meet) the national 
indicators previously described; that Governors establish 
uniform criteria for determining performance of local 
providers, and establishing that Governors are authorized to 
provide technical assistance to locals who do not meet expected 
levels of performance after one year, and to take appropriate 
corrective action, which may include the withholding of funds 
or the redesignation of service providers, for failure to meet 
expected levels performance after a 2nd year of such failure; 
and that the Secretaries take similar corrective action as 
described above in dealing with States who fail to meet their 
own performance criteria, including the imposition of up to 5% 
of the State's subsequent year's funding from the program in 
which they failed in meeting performance goals.
    The roll call vote is as follows:

        AYES                          NOES
Chairman Goodling                   Mr. Hoekstra
Mr. Petri                           Mr. Talent
Mrs. Roukema                        Mr. Hutchinson
Mr. Cunningham                      Mr. Graham
Mr. McKeon                          Mr. Funderburk
Mr. Castle                          Mr. Souder
Mr. Knollenberg                     Mr. McIntosh
Mr. Riggs                           Mr. Owens
Mr. Weldon                          Mrs. Mink
Mr. Kildee
Mr. Williams
Mr. Martinez
Mr. Sawyer
Mr. Reed
Mr. Roemer
Mr. Engel
Mr. Becerra
Mr. Scott
Mr. Green
Ms. Woolsey

    The Committee defeated an amendment (12 ayes to 20 noes) 
offered by Ms. Woolsey to increase authorization levels for 
each of the consolidation grants established under Titles II, 
III, and IV of H.R. 1617, to the levels proposed by the 
Administration in its FY 1996 budget, equalling $2.905 billion 
for Title II, $3.225 billion for Title III, and $597 million 
for Title IV in FY 1997, and such sums thereafter.
    The roll call vote is as follows:

        AYES                          NOES
Mr. Kildee                          Chairman Goodling
Mr. Williams                        Mr. Petri
Mr. Martinez                        Mrs. Roukema
Mr. Owens                           Mr. Fawell
Mr. Sawyer                          Mr. Barrett
Mr. Reed                            Mr. Cunningham
Mr. Roemer                          Mr. Hoekstra
Mr. Becerra                         Mr. McKeon
Mr. Scott                           Mr. Castle
Mr. Green                           Mr. Johnson
Ms. Woolsey                         Mr. Talent
Mr. Reynolds                        Mr. Hutchinson
                                    Mr. Knollenberg
                                    Mr. Riggs
                                    Mr. Graham
                                    Mr. Weldon
                                    Mr. Funderburk
                                    Mr. Souder
                                    Mr. McIntosh
                                    Mr. Norwood

    The Committee defeated an amendment (12 ayes to 20 noes) 
offered by Mr. Becerra to Title II which would have changed the 
definition of ``at-risk'' youth to include only out-of-school 
youth.
    The roll call vote is as follows:

        AYES                          NOES
Mr. Miller                          Chairman Goodling
Mr. Kildee                          Mr. Petri
Mr. Williams                        Mrs. Roukema
Mr. Martinez                        Mr. Ballenger
Mr. Owens                           Mr. Barrett
Mr. Andrews                         Mr. Cunningham
Mr. Reed                            Mr. Hoekstra
Mr. Becerra                         Mr. McKeon
Mr. Scott                           Mr. Castle
Mr. Green                           Mr. Johnson
Ms. Woolsey                         Mr. Talent
Mr. Reynolds                        Mr. Hutchinson
                                    Mr. Riggs
                                    Mr. Graham
                                    Mr. Weldon
                                    Mr. Funderburk
                                    Mr. Souder
                                    Mr. McIntosh
                                    Mr. Sawyer
                                    Mr. Roemer

                             Correspondence

                     Congress of the United States,
                                  House of Representatives,
                                      Washington, DC, June 8, 1995.
Hon. William Goodling,
Chairman, Economic and Educational Opportunities Committee, Washington, 
        DC.
    Dear Mr. Chairman: I was unavoidably detained during final 
passage of H.R. 1617, the CAREERS bill, on May 24, 1995 and was 
unable to cast my vote.
    Had I been present, I would have voted ``no''. Please enter 
my statement into the record. Thank you for consideration.
            Sincerely,
                                            Eliot L. Engel,
                                                Member of Congress.
                                ------                                

                     Congress of the United States,
                                  House of Representatives,
                                      Washington, DC, May 25, 1995.
Chairman William Goodling,
Committee on Economic and Educational Opportunities, Washington, DC.
    Dear Chairman Goodling: Due to a meeting of the Committee 
on Standards, I was unable to be present for the final vote on 
reporting H.R. 1617 out of the Committee on Economic and 
Educational Opportunities.
    I would like to note for the record that if I had been 
present, I would have voted, ``aye''.
            Sincerely,
                                          Thomas C. Sawyer,
                                                Member of Congress.
         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                          ACT OF JUNE 6, 1933

             (Commonly Known as the ``Wagner-Peyser Act'')

          * * * * * * *

AN ACT To provide for the establishment of a national employment system 
 and for cooperation with the States in the promotion of such system, 
                         and for other purposes

          * * * * * * *
  Sec. 2. For purposes of this Act--
          (1) the term ``chief elected official or officials'' 
        has the same meaning given that term under the [Job 
        Training Partnership Act] Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act;
          [(2) the term ``private industry council'' has the 
        same meaning given that term under the Job Training 
        Partnership Act;]
          (2) the term ``local workforce development board'' 
        means a local workforce development board established 
        under title I of the Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act;
          (3) the term ``Secretary'' means the Secretary of 
        Labor;
          [(4) the term ``service delivery area'' has the same 
        meaning given that term under the Job Training 
        Partnership Act; and]
          (4) the term ``local workforce development area'' 
        means a local workforce development area established 
        under title I of the Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act;
          (5) the term ``State'' means any of the several 
        States, the District of Columbia, the Commonwealth of 
        Puerto Rico, Guam, and the Virgin Islands[.];
          (6) the term ``local public service office'' means an 
        office which provides employment services to the 
        general public under a one-stop career center system; 
        and
          (7) the term ``one-stop career center system'' means 
        a one-stop career center system established under title 
        I of the Consolidated and Reformed Education, 
        Employment, and Rehabilitation Systems Act.

                 TITLE I--GENERAL PROGRAM REQUIREMENTS
  Sec. 3. [(a) The United States Employment Service shall 
assist in coordinating the State public employment services 
throughout the country and in increasing their usefulness by 
developing and prescribing minimum standards of efficiency, 
assisting them in meeting problems peculiar to their 
localities, promoting uniformity in their administrative and 
statistical procedure, furnishing and publishing information as 
to opportunities for employment and other information of value 
in the operation of the system, and maintaining a system for 
clearing labor between the States.] (a) The Secretary of Labor 
shall, pursuant to title II of the Wagner-Peyser Act--
          (1) assist in the coordination and development of a 
        nationwide system of labor exchange services for the 
        general public, provided through the one-stop career 
        center system, in coordination with the public 
        employment services;
          (2) assist in the development of performance 
        standards, benchmarks, and continuous improvement 
        models for such nationwide system which ensures private 
        sector satisfaction and meets the demands of 
        jobseekers; and
          (3) ensure the continued services for individuals 
        receiving unemployment compensation.
  Sec. 4. In order to obtain the benefits of appropriations 
apportioned under section 5, [a State shall, through its 
legislature] the Governor of a State, through the collaborative 
process described in title I of the Consolidated and Reformed 
Education, Employment, and Rehabilitation Systems Act, accept 
the provisions of this Act and designate or authorize the 
creation of a State agency vested with all powers necessary to 
cooperate with the [United States Employment Service] Secretary 
of Labor under this Act.
  Sec. 5. (a) There is authorized to be appropriated, out of 
any money in the Treasury not otherwise appropriated, such 
amounts from time to time as the Congress may deem necessary to 
carry out the purposes of this Act, of which not less than 25 
percent shall be for carrying out both section 14 and title II 
of this Act.
          * * * * * * *
  Sec. 7. (a) * * *
  (b) Ten percent of the sums allotted to each State pursuant 
to section 6 shall be reserved for use in accordance with this 
subsection by the Governor of each such State to provide--
          (1) * * *
          (2) services for groups with special needs, carried 
        out pursuant to joint agreements between the employment 
        service and the appropriate [private industry council] 
        local workforce development board and chief elected 
        official or officials or other public agencies or 
        private nonprofit organizations; and
          * * * * * * *
  (c)(1) Funds made available to States under this section may 
be used to provide additional funds under an applicable program 
if--
          (A) * * *
  (2) For purposes of this subsection, the term ``applicable 
program'' means any program under [any of the following 
provisions of law:
          [(A) The Carl D. Perkins Vocational and Applied 
        Technology Education Act.
          [(B) Section 123, title II, and title III of the Job 
        Training Partnership Act.] Consolidated and Reformed 
        Education, Employment, and Rehabilitation Systems Act.
  (d) In addition to the services and activities otherwise 
authorized by this Act, the [United States Employment Service] 
Secretary of Labor or any State agency designated under this 
Act may perform such other services and activities as shall be 
specified in contracts for payment or reimbursement of the 
costs thereof made with the Secretary of Labor or with any 
Federal, State, or local public agency, or administrative 
entity under the [Job Training Partnership Act] Consolidated 
and Reformed Education, Employment, and Rehabilitation Systems 
Act, or private nonprofit organization.
  Sec. 8. [(a) Any State desiring to receive the benefits of 
this Act shall, by the agency designated to cooperate with the 
United States Employment Service, submit to the Secretary of 
Labor detailed plans for carrying out the provisions of this 
Act within such State.] (a) Any State desiring to receive 
assistance under this Act shall submit to the Secretary, as 
part of the State workforce development and literacy plan 
authorized under title I of the Consolidated and Reformed 
Education, Employment, and Rehabilitation Systems Act, detailed 
plans for carrying out the provisions of this Act within such 
State.
  [(b) Prior to submission of such plans to the Secretary--
          [(1) the employment service shall develop jointly 
        with each appropriate private industry council and 
        chief elected official or officials for the service 
        delivery area (designated under the Job Training 
        Partnership Act) those components of such plans 
        applicable to such area;
          [(2) such plans shall be developed taking into 
        consideration proposals developed jointly by the 
        appropriate private industry council and chief elected 
        official or officials in the service delivery area 
        affected;
          [(3) such plans shall be transmitted to the State job 
        training coordinating council (established under such 
        Act) which shall certify such plans if it determines 
        (A) that the components of such plans have been jointly 
        agreed to by the employment service and appropriate 
        private industry council and chief elected official or 
        officials; and (B) that such plans are consistent with 
        the Governor's coordination and special services plan 
        under the Job Training Partnership Act;
          [(4) if the State job training coordinating council 
        does not certify that such plans meet the requirements 
        of clauses (A) and (B) of paragraph (3), such plans 
        shall be returned to the employment service for a 
        period of thirty days for it to consider, jointly with 
        the appropriate private industry council and chief 
        elected official or officials, the council's 
        recommendations for modifying such plans; and
          [(5) if the employment service and the appropriate 
        private industry council and chief elected official or 
        officials fail to reach agreement upon such components 
        of such plans to be submitted finally to the Secretary, 
        such plans submitted by the State agency shall be 
        accompanied by such proposed modifications as may be 
        recommended by any appropriate disagreeing private 
        industry council and chief elected official or 
        officials affected, and the State job training 
        coordinating council shall transmit to the Secretary 
        its recommendations for resolution thereof.
  [(c) The Governor of the State shall be afforded the 
opportunity to review and transmit to the Secretary proposed 
modifications of such plans submitted.]
  [(d)] (b) Such plans shall include provision for the 
promotion and development of employment opportunities for 
handicapped persons and for job counseling and placement of 
such persons, and for the designation of at least one person in 
each State or Federal employment office, whose duties shall 
include the effectuation of such purposes. In those States 
where a State board, department, or agency exists which is 
charged with the administration of State laws for vocational 
rehabilitation of physically handicapped persons, such plans 
shall include provision for cooperation between such board, 
department, or agency and the agency designated to cooperate 
with the United States Employment Service under this Act.
  [(e) If such plans are in conformity with the provisions of 
this Act and reasonably appropriate and adequate to carry out 
its purposes, they shall be approved by the Secretary of Labor 
and due notice of such approval shall be given to the State 
agency.]
          * * * * * * *
  [Sec. 11. (a) The Director shall establish a Federal Advisory 
Council composed of men and women representing employers and 
employees in equal numbers and the public for the purpose of 
formulating policies and discussing problems relating to 
employment and insuring impartiality, neutrality, and freedom 
from political influence in the solution of such problems. 
Members of such council shall be selected from time to time in 
such manner as the Director shall prescribe and shall serve 
without compensation, but when attending meetings of the 
council they shall be allowed necessary traveling and 
subsistence expenses, or per diem allowance in lieu thereof, 
within the limitations prescribed by law for civilian employees 
in the executive branch of the Government. The council shall 
have access to all files and records of the United States 
Employment Service. The Director shall also require the 
organization of similar State advisory councils composed of men 
and women representing employers and employees in equal numbers 
and the public. Nothing in this section shall be construed to 
prohibit the Governor from carrying out functions of such State 
advisory council through the State job training coordinating 
council in accordance with section 122(c) of the Job Training 
Partnership Act.
  [(b) In carrying out the provisions of this Act the Director 
is authorized and directed to provide for the giving of notice 
of strikes or lockouts to applicants before they are referred 
to employment.]
  Sec. 12. [The Director, with the approval of the Secretary of 
Labor,] The Secretary of Labor is hereby authorized to make 
such rules and regulations as may be necessary to carry out the 
provisions of this Act.
          * * * * * * *
                   TITLE II--LABOR MARKET INFORMATION

SEC. 21. PURPOSE.

  The purpose of this title is to ensure a comprehensive and 
coordinated system of labor market information which will 
provide locally based, accurate, up-to-date, easily accessible, 
and user friendly labor market information through a 
cooperative Federal, State, and local governance structure 
which includes partnerships with the private sector at all 
levels.

SEC. 22. SYSTEM CONTENT.

  The Secretary of Labor, in accordance with the provisions of 
this title, shall oversee the development, maintenance, and 
continuous improvement of a nationwide system of labor market 
information using data from all available and appropriate 
sources, which shall include--
          (1) statistical data from survey and projection 
        programs and data from administrative reporting 
        systems, which, taken together, shall enumerate, 
        estimate, and project the supply and demand for labor 
        at national, State, and local levels in a timely 
        manner, including data on--
                  (A) the demographic characteristics, as 
                defined in title I of the Careers Act, 
                socioeconomic characteristics, and current 
                employment status of the population, including 
                self-employed, part-time, and seasonal workers, 
                and individuals with severe disabilities;
                  (B) job vacancies, education and training 
                requirements, skills, wages, benefits, working 
                conditions, and industrial distribution of 
                occupations, as well as current and projected 
                employment opportunities and trends by industry 
                and occupation;
                  (C) the educational attainment, training, 
                skills, skill levels, and occupations of the 
                population by demographic characteristics such 
                as unemployment insurance wage data records;
                  (D) information maintained in a longitudinal 
                manner on the quarterly earnings, establishment 
                and industry affiliation, and geographic 
                location of employment for all individuals for 
                whom such information is collected by the 
                States; and
                  (E) the incidence, industrial and 
                geographical location, and number of workers 
                displaced by permanent layoffs and plant 
                closings;
          (2) State and local employment and consumer 
        information on--
                  (A) job openings, locations, hiring 
                requirements, and application procedures, as 
                well as profiles of employers in the local 
                labor market describing the nature of work 
                performed, employment requirements, wages, 
                benefits, and hiring patterns;
                  (B) job seekers, including their education 
                and training, skills, skill levels, employment 
                experience, and employment goals; and
                  (C) education courses, training programs, job 
                placement programs, and vocational 
                rehabilitation programs (where appropriate), 
                including--
                          (i) performance information, such as 
                        the ratio of program completion, 
                        acquisition of industry-recognized 
                        skill standards, job placement, 
                        earnings, and the level of satisfaction 
                        of the participants and their 
                        employers; and
                          (ii) descriptive information, such as 
                        eligibility requirements, costs, 
                        financial support, or other supportive 
                        services, and other appropriate 
                        information which may be available with 
                        these courses and programs;
          (3) technical standards for data and information that 
        will--
                  (A) ensure compatibility and additivity of 
                data and information from local to State and 
                national levels;
                  (B) support standardization and aggregation 
                of data and information from the administrative 
                reporting systems of employment-related 
                programs; and
                  (C) include--
                          (i) classification and coding systems 
                        for industries, occupations, skills, 
                        programs, and courses;
                          (ii) nationally standardized 
                        definitions of terms;
                          (iii) a common system for designating 
                        geographic areas;
                          (iv) quality control mechanisms for 
                        data collection and analysis; and
                          (v) common schedules for data 
                        collection and dissemination;
          (4) analysis of data and information for uses 
        including--
                  (A) national, State, and local economic 
                policymaking;
                  (B) the implementation of Federal policies, 
                including the allocation of Federal funds to 
                States and localities and the facilitation of 
                job search and hiring in local labor markets;
                  (C) national, State, and local program 
                planning and evaluation; and
                  (D) research on labor market dynamics;
          (5) dissemination mechanisms for data and analysis, 
        including mechanisms which may be standardized among 
        the States and technical standards in the design of 
        automated data bases, and the design of user interfaces 
        and communications protocols;
          (6) programs of technical assistance for States and 
        localities in the development, maintenance, and 
        utilization of data, analysis, and dissemination 
        mechanisms, including assistance in adopting and 
        utilizing automated systems and improving the access, 
        through electronic and other means, of youth, adults, 
        and employers to labor market information for 
        localities, States, and the Nation;
          (7) programs of research and demonstration, which may 
        be carried out by States and other public or private 
        entities, on ways to improve the products and processes 
        authorized in this title; and
          (8) objective performance measures, which will allow 
        for the continuous monitoring of the progress of the 
        labor market information system at national, State, and 
        local levels.

SEC. 23. FEDERAL RESPONSIBILITIES.

  (a) In General.--The Nation's labor market information system 
shall be planned, administered, overseen, and evaluated by a 
cooperative governance structure involving the Federal 
Government and the States.
  (b) Duties.--The Secretary, with respect to data collection, 
analysis, and dissemination of labor market information, shall 
carry out the following duties:
          (1) Ensure that all statistical and administrative 
        data collection activities within the Department of 
        Labor, including the Employment and Training 
        Administration, Veterans' Employment and Training 
        Service, Employment Standards Administration, and 
        Occupational Health and Safety Administration, are 
        consistent with those of the Bureau of Labor 
        Statistics.
          (2) Assign responsibilities, as appropriate, to 
        agencies such as the Employment and Training 
        Administration to work with the Bureau of Labor 
        Statistics in the collection, analysis and, 
        particularly, in the dissemination of labor market 
        information, and in the provision of training and 
        technical assistance to users of information, including 
        the States, employers, youth, and adults.
          (3) In cooperation with other Federal agencies, 
        including but not limited to the Departments of 
        Commerce, Defense, Treasury, Education, Health and 
        Human Services, Agriculture, Veterans' Affairs, and the 
        Office of Management and Budget, establish and maintain 
        mechanisms for ensuring complementarity and 
        nonduplication in the development and operation of 
        statistical and administrative data collection 
        activities, in order to ensure a comprehensive labor 
        market information system.
          (4) Actively seek the participation of other Federal 
        agencies, particularly the National Center for 
        Education Statistics and the Division of Adult and 
        Vocational Education, and the Rehabilitation Services 
        Administration of the Department of Education, the 
        Veterans' Employment and Training Service of the 
        Department of Labor and the Department of Veterans' 
        Affairs with respect to vocational rehabilitation 
        programs in the design and provision of standardized 
        information to the States to support section 22(2), and 
        in the dissemination of labor market information.
          (5) Establish confidentiality standards for the labor 
        market information system at national, State, and local 
        levels, including such provisions as may be necessary, 
        to be taken in coordination with the States, to ensure 
        that privacy and confidentiality protections are 
        guaranteed with respect to individuals and firm data.
  (c) Additional Duties.--The Secretary, in collaboration with 
the Bureau of Labor Statistics, with the assistance of other 
agencies of the Department where appropriate, shall--
          (1) establish and maintain, with the cooperation of 
        the States, elements of the system described in 
        sections 22(1) and 22(3);
          (2) develop and promulgate standards, definitions, 
        formats, collection methodologies, and other necessary 
        system elements for the use of the States in their 
        assembling and presentation of the employment 
        information specified in section 22(2);
          (3) eliminate gaps and duplication in statistical 
        undertakings, with the systemization of wage surveys as 
        an early priority;
          (4) recommend any needed improvements in 
        administrative reporting systems to support the 
        development of labor market information from their 
        data; and
          (5) ensure that--
                  (A) data are sufficiently timely and locally 
                detailed for uses including those specified in 
                section 22(4);
                  (B) administrative records are standardized 
                to facilitate the aggregation of data from 
                local to State and national levels and to 
                support the creation of new statistical series 
                from program records; and
                  (C) paperwork and reporting requirements on 
                employers and individuals are reduced.

SEC. 24. ANNUAL PLAN.

  (a) In General.--The Secretary of Labor, working through the 
Bureau of Labor Statistics, and in consultation with other 
appropriate Federal agencies, shall prepare an annual plan, 
which shall be the operational mechanism for achieving a 
cooperative Federal/State governance structure for labor market 
information. The annual plan shall provide the verbal 
justification for the Department of Labor's budget request to 
Congress by describing the activities of the Bureau, other 
agencies of the Department of Labor, and other Federal agencies 
with regard to data collection, analysis, and dissemination of 
labor market information for fiscal years succeeding the fiscal 
year in which the plan is developed and shall include--
          (1) the results of a periodic review of users' needs, 
        including the identification of new employment issues 
        and the attendant emergence of new needs, on the part 
        of Congress, the States, employers, youth, and adults, 
        for data, analysis, and dissemination;
          (2) an evaluation, including the results of objective 
        measures, of the performance of the labor market 
        information system in meeting these needs and the steps 
        to be taken to overcome deficiencies;
          (3) a summary of ongoing data programs and activities 
        under section 22 and a description of the development 
        of new data programs, analytical techniques, 
        definitions and standards, dissemination mechanisms, 
        training and technical assistance, governance 
        mechanisms, and funding processes to meet new needs; 
        and
          (4) the results of an annual review of the costs to 
        the States of meeting contract requirements for data 
        production under this title, including a description of 
        how the Secretary's requested budget will cover these 
        costs.
  (b) Cooperation With the States.--The Secretary shall involve 
the States with the Bureau of Labor Statistics in a cooperative 
manner in the development of the plan by--
          (1) establishing procedures and mechanisms for 
        holding formal and periodic consultations on products 
        and administration of the system, at least once each 
        quarter, with representatives of the States from each 
        of the 10 Federal regions of the Department of Labor, 
        elected by and from among the State directors of labor 
        market information, according to a process set forth by 
        the Secretary; and
          (2) incorporating in the annual plan, for its 
        submission to Congress, the results of these 
        consultations, including any supplementary or 
        dissenting views from representatives of the States.
  (c) Representatives of States Deemed To Be Federal 
Employees.--For purposes of the development of the annual plan 
and to meet the provisions of Office of Management and Budget 
Circular A-11, the representatives of the States, elected in 
accordance with subsection (b)(1), shall be considered to be 
employees of the Department of Labor.

SEC. 25. GOVERNOR'S RESPONSIBILITIES.

  (a) Designation of State Agency.--The Governor of each State 
shall designate a single State agency to be the agency 
responsible for the management and oversight of a statewide 
comprehensive labor market information system and for the 
State's participation in the cooperative Federal/State 
governance structure for the nationwide labor market 
information system.
  (b) Duties.--In order to receive Federal financial assistance 
under this Act, the State agency shall--
          (1) develop, maintain, and continuously improve a 
        comprehensive labor market information system, which 
        shall--
                  (A) include all the elements specified in 
                section 22; and
                  (B) be responsive to the needs of the State 
                and its localities for planning and evaluative 
                data, including employment and economic 
                analyses and projections, as required by this 
                Act, the Consolidated and Reformed Education, 
                Employment, and Rehabilitation Systems Act, the 
                Social Security Act, and other provisions of 
                law under which Congress has required the use 
                of labor market information;
          (2) ensure the performance of contract and grant 
        responsibilities for data collection, analysis, and 
        dissemination;
          (3) conduct such other data collection, analysis, and 
        dissemination activities as will ensure comprehensive 
        State and local labor market information;
          (4) actively seek the participation of other State 
        and local agencies, with particular attention to State 
        education, economic development, human services, and 
        welfare agencies, in data collection, analysis, and 
        dissemination activities in order to ensure 
        complementarity and compatibility among data; and
          (5) participate in the development of the national 
        annual plan.
  (c) Rule of Construction.--Nothing in this Act shall be 
construed as limiting the State agency's ability to conduct 
additional data collection, analysis, and dissemination 
activities with State funds or with Federal funds from sources 
other than this Act.
                              ----------                              

                       REHABILITATION ACT OF 1973

  Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That this 
Act, with the following table of contents, may be cited as the 
``Rehabilitation Act of 1973'':
                            TABLE OF CONTENTS

Sec. 2. Declaration of purpose.
Sec. 3. Rehabilitation Services Administration.
Sec. 3A. Availability of funds.
     * * * * * * *

              [TITLE I--VOCATIONAL REHABILITATION SERVICES

                       [Part A--General Provisions

[Sec. 100. Declaration of policy; authorization of appropriations.
[Sec. 101. State plans.
[Sec. 102. Individualized written rehabilitation program.
[Sec. 103. Scope of vocational rehabilitation services.
[Sec. 104. Non-Federal share for construction.
[Sec. 105. State Rehabilitation Advisory Council.
[Sec. 106. Evaluation standards and performance indicators.
[Sec. 107. Monitoring and review.
[Sec. 108. Expenditure of certain amounts.
[Sec. 109. Training of employers with respect to Americans with 
          Disabilities Act of 1990.

            [Part B--Basic Vocational Rehabilitation Services

[Sec. 110. State allotments.
[Sec. 111. Payments to States.
[Sec. 112. Client assistance program.

                [Part C--Innovation and Expansion Grants

[Sec. 120. State eligibility.
[Sec. 121. Contents of strategic plans.
[Sec. 122. Process for developing strategic plans.
[Sec. 123. Use of funds.
[Sec. 124. Allotments among States.

       [Part D--American Indian Vocational Rehabilitation Services

[Sec. 130. Vocational rehabilitation services grants.

     [Part E--Vocational Rehabilitation Services Client Information

[Sec. 140. Review of data collection and reporting system.
[Sec. 141. Exchange of data.]
               TITLE I--VOCATIONAL REHABILITATION SERVICES

Sec. 100. Purpose.
Sec. 101. Formula Grants.
Sec. 102. Allocation Within State of Administrative Responsibilities.
Sec. 103. Responsibilities of State Administrative Agent.
Sec. 104. Responsibilities for Local Boards and Service Centers.
Sec. 105. Eligible Individual.
Sec. 106. State Rehabilitation Advisory Council.
Sec. 107. Amount of Allotment.
     * * * * * * *

             TITLE III--TRAINING AND DEMONSTRATION PROJECTS

     Part A--Training Programs and Community Rehabilitation Programs

Sec. 301. Declaration of purpose.
Sec. 302. Training.
[Sec. 303. Vocational rehabilitation services for individuals with 
          disabilities.
[Sec. 304. Loan guarantees for community rehabilitation programs.]
     * * * * * * *
[Sec. 312. Migratory workers.]
     * * * * * * *
[Sec. 316. Special recreational programs.]
     * * * * * * *

                      TITLE V--RIGHTS AND ADVOCACY

     * * * * * * *
Sec. 510. Client assistance program.
  TITLE VI--EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH DISABILITIES

Sec. 601. Short title.

  [Part A--Community Service Employment Programs for Individuals With 
                              Disabilities

[Sec. 611. Establishment of program.
[Sec. 612. Administration.
[Sec. 613. Participants not Federal employees.
[Sec. 614. Interagency cooperation.
[Sec. 615. Equitable distribution of assistance.
[Sec. 616. Definitions.
[Sec. 617. Authorization of appropriations.

                    [Part B--Projects With Industry]

Sec. 621. Projects with industry.
Sec. 622. Authorization of appropriations.
Sec. 623. Authorization of appropriations.

   [Part C--Supported Employment Services for Individuals With Severe 
                              Disabilities

[Sec. 631. Purpose.
[Sec. 632. Allotments.
[Sec. 633. Availability of services.
[Sec. 634. Eligibility.
[Sec. 635. State plan.
[Sec. 636. Restriction.
[Sec. 637. Savings provision.
[Sec. 638. Authorization of appropriations.

    [Part D--Business Opportunities for Individuals With Disabilities

[Sec. 641. Business opportunities for individuals with disabilities.]
     * * * * * * *

        [TITLE VIII--SPECIAL DEMONSTRATIONS AND TRAINING PROJECTS

[Sec. 801. Authorization of appropriations.
[Sec. 802. Demonstration activities.
[Sec. 803. Training activities.]
     * * * * * * *
                         availability of funds


  Sec. 3A. Notwithstanding any other provision of law, funding 
to carry out titles II through VII for any fiscal year is 
available only to such extent as is provided, or in such 
amounts as are provided, in appropriations Acts.
          * * * * * * *
              [TITLE I--VOCATIONAL REHABILITATION SERVICES

                      [Part A--General Provisions

        [declaration of policy; authorization of appropriations

  [Sec. 100. (a)(1) Congress finds that--
          [(A) work--
                  [(i) is a valued activity, both for 
                individuals and society; and
                  [(ii) fulfills the need of an individual to 
                be productive, promotes independence, enhances 
                self-esteem, and allows for participation in 
                the mainstream of life in America;
          [(B) as a group, individuals with disabilities 
        experience staggering levels of unemployment and 
        poverty;
          [(C) individuals with disabilities, including 
        individuals with the most severe disabilities, have 
        demonstrated their ability to achieve gainful 
        employment in integrated settings if appropriate 
        services and supports are provided;
          [(D) reasons for the significant number of 
        individuals with disabilities not working, or working 
        at a level not commensurate with their abilities and 
        capabilities, include--
                  [(i) discrimination;
                  [(ii) lack of accessible and available 
                transportation;
                  [(iii) fear of losing health coverage under 
                the medicare and medicaid programs under titles 
                XVIII and XIX of the Social Security Act (42 
                U.S.C. 1395 et seq. and 1396 et seq.) or fear 
                of losing existing private health insurance; 
                and
                  [(iv) lack of education, training, and 
                supports to meet job qualification standards 
                necessary to enter or retain or advance in 
                employment;
          [(E) enforcement of title V and of the Americans with 
        Disabilities Act of 1990 (42 U.S.C. 12101 et seq.) 
        holds the promise of ending discrimination for 
        individuals with disabilities; and
          [(F) the provision of vocational rehabilitation 
        services can enable individuals with disabilities, 
        including individuals with the most severe 
        disabilities, to pursue meaningful careers by securing 
        gainful employment commensurate with their abilities 
        and capabilities.
  [(2) The purpose of this title is to assist States in 
operating a comprehensive, coordinated, effective, efficient, 
and accountable program of vocational rehabilitation that is 
designed to assess, plan, develop, and provide vocational 
rehabilitation services for individuals with disabilities, 
consistent with their strengths, resources, priorities, 
concerns, abilities, and capabilities, so that such individuals 
may prepare for and engage in gainful employment.
  [(3) It is the policy of the United States that such a 
program shall be carried out in a manner consistent with the 
following principles:
          [(A) Individuals with disabilities, including 
        individuals with the most severe disabilities, are 
        generally presumed to be capable of engaging in gainful 
        employment and the provision of individualized 
        vocational rehabilitation services can improve their 
        ability to become gainfully employed.
          [(B) Individuals with disabilities must be provided 
        the opportunities to obtain gainful employment in 
        integrated settings.
          [(C) Individuals with disabilities must be active 
        participants in their own rehabilitation programs, 
        including making meaningful and informed choices about 
        the selection of their vocational goals and objectives 
        and the vocational rehabilitation services they 
        receive.
          [(D) Families and natural supports can play an 
        important role in the success of a vocational 
        rehabilitation program, if the individual with a 
        disability requests, desires, or needs such supports.
          [(E) Qualified vocational rehabilitation counselors, 
        other qualified rehabilitation personnel, and other 
        qualified personnel facilitate the accomplishment of 
        the employment goals and objectives of an individual.
          [(F) Individuals with disabilities and their 
        advocates are full partners in the vocational 
        rehabilitation program and must be involved on a 
        regular basis and in a meaningful manner with respect 
        to policy development and implementation.
          [(G) Accountability measures must facilitate and not 
        impede the accomplishment of the goals and objectives 
        of the program, including providing vocational 
        rehabilitation services to, among others, individuals 
        with the most severe disabilities.
  [(b)(1) For the purpose of making grants to States under part 
B (other than grants under section 112) to assist States in 
meeting the costs of vocational rehabilitation services 
provided in accordance with State plans under section 101, 
there are authorized to be appropriated such sums as may be 
necessary for fiscal years 1993 through 1997, except that the 
amount to be appropriated for a fiscal year shall not be less 
than the amount of the appropriation under this subsection for 
the immediately preceding fiscal year, plus the amount of the 
Consumer Price Index addition determined under subsection (c) 
for the immediately preceding fiscal year.
  [(2) There are authorized to be appropriated to carry out 
part C such sums as may be necessary for fiscal years 1993 
through 1997.
  [(c)(1) No later than November 15 of each fiscal year 
(beginning with the fiscal year 1979), the Secretary of Labor 
shall publish in the Federal Register the percentage change in 
the Consumer Price Index published for October of the preceding 
fiscal year and October of the fiscal year in which such 
publication is made.
  [(2)(A) If in any fiscal year the percentage change published 
under paragraph (1) indicates an increase in the Consumer Price 
Index, then the amount to be appropriated under subsection (b) 
for the subsequent fiscal year shall be at least the amount 
appropriated for the fiscal year in which the publication is 
made under paragraph (1) increased by such percentage change.
  [(B) If in any fiscal year the percentage change published 
under paragraph (1) does not indicate an increase in the 
Consumer Price Index, then the amount to be appropriated under 
subsection (b) for the subsequent fiscal year shall be at least 
the amount appropriated for the fiscal year in which the 
publication is made under paragraph (1).
  [(3) For purposes of this section, the term ``Consumer Price 
Index'' means the Consumer Price Index for All Urban Consumers, 
published monthly by the Bureau of Labor Statistics.
  [(d)(1)(A) Unless the Congress in the regular session which 
ends prior to the beginning of the terminal fiscal year--
          [(i) of the authorization of appropriations for the 
        program authorized by the State grant program under 
        part B of this title; or
          [(ii) of the duration of the program authorized by 
        the State grant program under part B of this title;
has passed legislation which would have the effect of extending 
the authorization or duration (as the case may be) of such 
program, such authorization is automatically extended for one 
additional year for the program authorized by this title.
  [(B) The amount authorized to be appropriated for the 
additional fiscal year described in subparagraph (A) shall be 
an amount equal to the amount appropriated for such program for 
fiscal year 1997, plus the amount of the Consumer Price Index 
addition determined under subsection (c) for the immediately 
preceding fiscal year.
  [(2)(A) For the purposes of subdivision (i) of paragraph (1), 
the Congress shall not have been deemed to have passed 
legislation unless such legislation becomes law.
  [(B) In any case where the Commissioner is required under an 
applicable statute to carry out certain acts or make certain 
determinations which are necessary for the continuation of the 
program authorized by this title, if such acts or 
determinations are required during the terminal year of such 
program, such acts and determinations shall be required during 
any fiscal year in which that part of paragraph (1) of this 
subsection which follows subdivision (ii) of paragraph (1) is 
in operation.

                              [state plans

  [Sec. 101. (a) In order to be eligible to participate in 
programs under this title, a State shall submit to the 
Commissioner a State plan for vocational rehabilitation 
services for a 3-year period, or shall submit the plan on such 
date, and at such regular intervals, as the Secretary may 
determine to be appropriate to coincide with the intervals at 
which the State submits State plans under other Federal laws, 
such as part B of the Individuals with Disabilities Education 
Act (20 U.S.C. 1411 et seq.). In order to be eligible to 
participate in programs under this title, a State, upon the 
request of the Commissioner, shall make such annual revisions 
in the plan as may be necessary. Each such plan shall--
  [(1)(A) designate a State agency as the sole State agency to 
administer the plan, or to supervise its administration by a 
local agency, except that (i) where, under the State's law, the 
State agency for individuals who are blind or other agency 
which provides assistance or services to adults who are blind 
is authorized to provide vocational rehabilitation services to 
such individuals, such agency may be designated as the sole 
State agency to administer the part of the plan under which 
vocational rehabilitation services are provided for individuals 
who are blind (or to supervise the administration of such part 
by a local agency) and a separate State agency may be 
designated as the sole State agency with respect to the rest of 
the State plan, (ii) the Commissioner, upon the request of a 
State, may authorize such agency to share funding and 
administrative responsibility with another agency of the State 
or with a local agency in order to permit such agencies to 
carry out a joint program to provide services to individuals 
with disabilities, and may waive compliance with respect to 
vocational rehabilitation services furnished under such 
programs with the requirement of paragraph (4) of this 
subsection that the plan be in effect in all political 
subdivisions of that State, and (iii) in the case of American 
Samoa, the appropriate State agency shall be the Governor of 
American Samoa;
  [(B) provide that the State agency so designated to 
administer or supervise the administration of the State plan, 
or (if there are two State agencies designated under 
subparagraph (A) of this paragraph) to supervise or administer 
the part of the State plan that does not relate to services for 
individuals who are blind, shall be (i) a State agency 
primarily concerned with vocational rehabilitation, or 
vocational and other rehabilitation, of individuals with 
disabilities, (ii) the State agency administering or 
supervising the administration of education or vocational 
education in the State, or (iii) a State agency which includes 
at least two other major organizational units each of which 
administers one or more of the major public education, public 
health, public welfare, or labor programs of the State;
  [(2) provide, except in the case of agencies described in 
paragraph (1)(B)(i)--
          [(A) that the State agency designated pursuant to 
        paragraph (1) (or each State agency if two are so 
        designated) shall include a vocational rehabilitation 
        bureau, division, or other organizational unit which 
        (i) is primarily concerned with vocational 
        rehabilitation, or vocational and other rehabilitation, 
        of individuals with disabilities, and is responsible 
        for the vocational rehabilitation program of such State 
        agency, (ii) has a full-time director, and (iii) has a 
        staff employed on such rehabilitation work of such 
        organizational unit all or substantially all of whom 
        are employed full time on such work; and
          [(B)(i) that such unit shall be located at an 
        organizational level and shall have an organizational 
        status within such State agency comparable to that of 
        other major organizational units of such agency, or 
        (ii) in the case of an agency described in paragraph 
        (1)(B)(ii), either that such unit shall be so located 
        and have such status, or that the director of such unit 
        shall be the executive officer of such State agency; 
        except that, in the case of a State which has 
        designated only one State agency pursuant to paragraph 
        (1) of this subsection, such State may, if it so 
        desires, assign responsibility for the part of the plan 
        under which vocational rehabilitation services are 
        provided for the blind to one organizational unit of 
        such agency, and assign responsibility for the rest of 
        the plan to another organizational unit of such agency, 
        with the provisions of this paragraph applying 
        separately to each of such units;
  [(3) provide for financial participation by the State, or if 
the State so elects, by the State and local agencies to meet 
the amount of the non-Federal share;
  [(4) provide that the plan shall be in effect in all 
political subdivisions, except that in the case of any activity 
which, in the judgment of the Commissioner, is likely to assist 
in promoting the vocational rehabilitation of substantially 
larger numbers of individuals with disabilities or groups of 
individuals with disabilities the Commissioner may waive 
compliance with the requirement herein that the plan be in 
effect in all political subdivisions of the State to the extent 
and for such period as may be provided in accordance with 
regulations prescribed by the Commissioner, but only if the 
non-Federal share of the cost of such vocational rehabilitation 
services is met from funds made available by a local agency 
(including, to the extent permitted by such regulations, funds 
contributed to such agency by a private agency, organization, 
or individual);
  [(5)(A) contain the plans, policies, and methods to be 
followed in carrying out the State plan and in its 
administration and supervision, including the results of a 
comprehensive, Statewide assessment of the rehabilitation needs 
of individuals with severe disabilities residing within the 
State and the State's response to the assessment, a description 
of the method to be used to expand and improve services to 
individuals with the most severe disabilities including 
individuals served under part C of title VI of this Act, and a 
description of the method to be used to utilize community 
rehabilitation programs to the maximum extent feasible, an 
explanation of the methods by which the State will provide 
vocational rehabilitation services to all individuals with 
disabilities within the State who are eligible for such 
services, and, in the event that vocational rehabilitation 
services cannot be provided to all eligible individuals with 
disabilities who apply for such services, (i) show and provide 
the justification for the order to be followed in selecting 
individuals to whom vocational rehabilitation services will be 
provided, and (ii) show the outcomes and service goals, and the 
time within which they may be achieved, for the rehabilitation 
of such individuals, which order of selection for the provision 
of vocational rehabilitation services shall be determined on 
the basis of serving first those individuals with the most 
severe disabilities in accordance with criteria established by 
the State, and shall be consistent with priorities in such 
order of selection so determined, and outcome and service goals 
for serving individuals with disabilities, established in 
regulations prescribed by the Commissioner;
  [(B) provide satisfactory assurances to the Commissioner that 
the State has studied and considered a broad variety of means 
for providing services to individuals with the most severe 
disabilities, including the use of funds under part C of title 
VI to supplement funds under part B of this title to pay for 
the cost of services leading to supported employment; and
  [(C) describe--
          [(i) how a broad range of rehabilitation technology 
        services will be provided at each stage of the 
        rehabilitation process;
          [(ii) how a broad range of such rehabilitation 
        technology services will be provided on a statewide 
        basis; and
          [(iii) the training that will be provided to 
        vocational rehabilitation counselors, client assistance 
        personnel, and other related services personnel;
  [(6)(A) provide for such methods of administration, other 
than methods relating to the establishment and maintenance of 
personnel standards, as are found by the Commissioner to be 
necessary for the proper and efficient administration of the 
plan (including a requirement that the State agency and 
facilities in receipt of assistance under this title shall take 
affirmative action to employ and advance in employment 
qualified individuals with disabilities covered under, and on 
the same terms and conditions as set forth in, section 503); 
and
  [(B) provide satisfactory assurances that facilities used in 
connection with the delivery of services assisted under the 
plan will comply with the Act of August 12, 1968, commonly 
known as the Architectural Barriers Act of 1968, with section 
504 of this Act, and with the Americans with Disabilities Act 
of 1990;
  [(7)(A) include a description (consistent with the purposes 
of this Act) of a comprehensive system of personnel 
development, which shall include--
          [(i) a description of the procedures and activities 
        the State agency will undertake to ensure an adequate 
        supply of qualified State rehabilitation professionals 
        and paraprofessionals for the designated State unit, 
        including the development and maintenance of a system 
        for determining, on an annual basis--
                  [(I) the number and type of personnel that 
                are employed by the State agency in the 
                provision of vocational rehabilitation 
                services, including ratios of counselors to 
                clients; and
                  [(II) the number and type of personnel needed 
                by the State, and a projection of the numbers 
                of such personnel that will be needed in 5 
                years, based on projections of the number of 
                individuals to be served, the number of such 
                personnel who are expected to retire or leave 
                the field, and other relevant factors;
          [(ii) where appropriate, a description of the manner 
        in which activities will be undertaken through this 
        section to coordinate the system of personnel 
        development with personnel development under the 
        Individuals with Disabilities Education Act (20 U.S.C. 
        1400 et seq.);
          [(iii) a description of the development and 
        maintenance of a system of determining, on an annual 
        basis, information on the institutions of higher 
        education within the State that are preparing 
        rehabilitation professionals, including--
                  [(I) the numbers of students enrolled in such 
                programs; and
                  [(II) the number who graduated with 
                certification or licensure, or with credentials 
                to qualify for certification or licensure, 
                during the past year;
          [(iv) a description of the development, updating, and 
        implementation of a plan that--
                  [(I) will address the current and projected 
                vocational rehabilitation services personnel 
                training needs for the designated State unit; 
                and
                  [(II) provides for the coordination and 
                facilitation of efforts between the designated 
                State unit and institutions of higher education 
                (as defined in section 1201(a) of the Higher 
                Education Act of 1965 (20 U.S.C. 1141(a))) and 
                professional associations to recruit, prepare 
                and retain qualified personnel, including 
                personnel from minority backgrounds, and 
                personnel who are individuals with 
                disabilities; and
          [(v) a description of the procedures and activities 
        the State agency will undertake to ensure that all 
        personnel employed by the designated State unit are 
        appropriately and adequately trained and prepared, 
        including--
                  [(I) a system for the continuing education of 
                rehabilitation professionals and 
                paraprofessionals within the designated State 
                unit, particularly with respect to 
                rehabilitation technology; and
                  [(II) procedures for acquiring and 
                disseminating to rehabilitation professionals 
                and paraprofessionals within the designated 
                State unit significant knowledge from research 
                and other sources, including procedures for 
                providing training regarding the amendments to 
                the Rehabilitation Act of 1973 made by the 
                Rehabilitation Act Amendments of 1992;
  [(B) set forth policies and procedures relating to the 
establishment and maintenance of standards to ensure that 
personnel, including professionals and paraprofessionals, 
needed within the State agency to carry out this part are 
appropriately and adequately prepared and trained, including--
          [(i) the establishment and maintenance of standards 
        that are consistent with any national or State approved 
        or recognized certification, licensing, registration, 
        or other comparable requirements that apply to the area 
        in which such personnel are providing vocational 
        rehabilitation services; and
          [(ii) to the extent such standards are not based on 
        the highest requirements in the State applicable to a 
        specific profession or discipline, the steps the State 
        is taking to require the retraining or hiring of 
        personnel within the designated State unit that meet 
        appropriate professional requirements in the State; and
  [(C) contain provisions relating to the establishment and 
maintenance of minimum standards to ensure the availability of 
personnel within the designated State unit, to the maximum 
extent feasible, trained to communicate in the native language 
or mode of communication of the client;
  [(8) provide, at a minimum, for the provision of the 
vocational rehabilitation services specified in paragraphs (1) 
through (3) and paragraph (12) of section 103(a), and for the 
provision of such other services as are specified under such 
section after a determination that comparable services and 
benefits are not available under any other program, except that 
such a determination shall not be required--
          [(A) if the determination would delay the provision 
        of such services to any individual at extreme medical 
        risk; or
          [(B) prior to the provision of such services if an 
        immediate job placement would be lost due to a delay in 
        the provision of such comparable benefits;
  [(9) provide that--
          [(A) to the maximum extent appropriate, and 
        consistent with the requirements of this Act, existing 
        information available from other programs and providers 
        (particularly information used by education officials 
        and the Social Security Administration) and information 
        that can be provided by the individual with a 
        disability or the family of the individual shall be 
        used for purposes of determining eligibility for 
        vocational rehabilitation services and for choosing 
        rehabilitation goals, objectives, and services;
          [(B) an individualized written rehabilitation program 
        meeting the requirements of section 102 will be 
        developed for each individual with a disability 
        eligible for vocational rehabilitation services under 
        this Act;
          [(C) such services will be provided under the plan in 
        accordance with such program; and
          [(D) records of the characteristics of each applicant 
        will be kept, specifying, as to those individuals who 
        apply for services under this title and are determined 
        not to be eligible therefor, the reasons for such 
        determinations in such detail as required by the 
        Commissioner in order for the Commissioner to analyze 
        and evaluate annually the reasons for and numbers of 
        such ineligibility determinations as part of the 
        Commissioner's responsibilities under section 13, and 
        that the State agency will at least annually categorize 
        and analyze such reasons and numbers and report this 
        information to the Commissioner and will, not later 
        than 12 months after each such determination, review 
        each such ineligibility determination in accordance 
        with the criteria set forth in section 102;
  [(10)(A) provide that the State agency will make such reports 
in such form, containing such information (including the data 
described in subparagraph (D) of paragraph (9) of this 
subsection, periodic estimates of the population of individuals 
with disabilities eligible for services under this Act in such 
State, specifications of the number of such individuals who 
will be served with funds provided under this Act and the 
outcomes and service goals to be achieved for such individuals 
in each priority category specified in accordance with 
paragraph (5) of this subsection, and the service costs for 
each such category), and at such time as the Commissioner may 
require to carry out the functions of the Commissioner under 
this title, and comply with such provisions as are necessary to 
assure the correctness and verification of such reports; and
  [(B) provide that reports under subparagraph (A) will include 
information on--
          [(i) the number of such individuals who are evaluated 
        and the number rehabilitated;
          [(ii) the costs of administration, counseling, 
        provision of direct services, development of community 
        rehabilitation programs, and other functions carried 
        out under this Act; and
          [(iii) the utilization by such individuals of other 
        programs pursuant to paragraph (11);
  [(11)(A) provide for interagency cooperation with, and the 
utilization of the services and facilities of, the State 
agencies administering the State's public assistance programs, 
other programs for individuals with disabilities, veterans 
programs, community mental health programs, manpower programs, 
and public employment offices, and the Social Security 
Administration of the Department of Health and Human Services, 
the Department of Veterans Affairs, and other Federal, State, 
and local public agencies providing services related to the 
rehabilitation of individuals with disabilities (specifically 
including arrangements for the coordination of services to 
individuals eligible for services under this Act, the 
Individuals with Disabilities Education Act (20 U.S.C. 1400 et 
seq.), the Carl D. Perkins Vocational and Applied Technology 
Education Act (20 U.S.C. 2301 et seq.), and the Act entitled 
``An Act to create a Committee on Purchases of Blind-made 
Products, and for other purposes'', approved June 25, 1938 
(commonly known as the Wagner-O'Day Act; 41 U.S.C. 46 et seq.);
  [(B) provide that cooperation under subparagraph (A) shall 
include, to the extent practicable, means for providing 
training to staff of the agencies described in subparagraph (A) 
as to the availability and benefits of, and eligibility 
standards for, vocational rehabilitation services, in order to 
enhance the opportunity of individuals receiving the services 
described in subparagraph (A) to obtain vocational 
rehabilitation services; and
  [(C) in providing for interagency cooperation under 
subparagraph (A), provide for such cooperation by means 
including, if appropriate--
          [(i) establishing interagency working groups; and
          [(ii) entering into formal interagency cooperative 
        agreements that--
                  [(I) identify policies, practices, and 
                procedures that can be coordinated among the 
                agencies (particularly definitions, standards 
                for eligibility, the joint sharing and use of 
                evaluations and assessments, and procedures for 
                making referrals);
                  [(II) identify available resources and define 
                the financial responsibility of each agency for 
                paying for necessary services (consistent with 
                State law) and procedures for resolving 
                disputes between agencies; and
                  [(III) include all additional components 
                necessary to ensure meaningful cooperation and 
                coordination;
  [(12)(A) provide satisfactory assurances to the Commissioner 
that, in the provision of vocational rehabilitation services, 
maximum utilization shall be made of public or other vocational 
or technical training programs or other appropriate resources 
in the community; and
  [(B) provide (as appropriate) for entering into agreements 
with the operators of community rehabilitation programs for the 
provision of services for the rehabilitation of individuals 
with disabilities;
  [(13)(A) provide that vocational rehabilitation services 
provided under the State plan shall be available to any civil 
employee of the United States who is disabled while in the 
performance of the employee's duty on the same terms and 
conditions as apply to other persons, and
  [(B) provide that special considerations will be given to the 
rehabilitation under this Act of an individual with a 
disability whose disability was sustained in the line of duty 
while such individual was performing as a public safety officer 
if the proximate cause of such disability was a criminal act, 
apparent criminal act, or hazardous condition resulting 
directly from the officer's performance of duties in direct 
connection with the enforcement, execution, and administration 
of law or fire prevention, firefighting, or related public 
safety activities;
  [(14) provide that no residence requirement will be imposed 
which excludes from services under the plan any individual who 
is present in the State;
  [(15) provide for continuing statewide studies of the needs 
of individuals with disabilities and how these needs may be 
most effectively met, including--
          [(A) a full needs assessment for serving individuals 
        with severe disabilities;
          [(B) an assessment of the capacity and effectiveness 
        of community rehabilitation programs, plans for 
        improving such programs, and policies for the use 
        thereof by the State agency;
          [(C) review of the efficacy of the criteria employed 
        with respect to ineligibility determinations described 
        in paragraph (9)(C) of this subsection with a view 
        toward the relative need for services to significant 
        segments of the population of individuals with 
        disabilities and the need for expansion of services to 
        those individuals with the most severe disabilities; 
        and
          [(D) outreach procedures to identify and serve 
        individuals with disabilities who are minorities and 
        individuals with disabilities who have been unserved or 
        underserved by the vocational rehabilitation system;
  [(16) provide for--
          [(A)(i) at least annual review and reevaluation of 
        the status of each individual with a disability placed 
        in an extended employment setting in a community 
        rehabilitation program (including a workshop) or other 
        employment under section 14(c) of the Fair Labor 
        Standards Act (29 U.S.C. 214(c)), to determine the 
        interests, priorities, and needs of the individual for 
        employment, or training for competitive employment, in 
        an integrated setting in the labor market; and
          [(ii) input into the review and reevaluation by the 
        individual with a disability, or, in an appropriate 
        case, a parent, a family member, a guardian, an 
        advocate, or an authorized representative, of the 
        individual, if the individual requests, desires, or 
        needs assistance;
          [(B) maximum efforts, including the identification of 
        vocational rehabilitation services, reasonable 
        accommodations, and other support services, to enable 
        such an individual to benefit from training or to be 
        placed in employment in an integrated setting; and
          [(C) services designed to promote movement from 
        extended employment to integrated employment, including 
        supported employment, independent living, and community 
        participation;
  [(17) provide that if, under special circumstances, the State 
plan includes provisions for the construction of facilities for 
community rehabilitation programs--
          [(A) the Federal share of the cost of construction 
        thereof for a fiscal year will not exceed an amount 
        equal to 10 per centum of the State's allotment for 
        such year,
          [(B) the provision of section 306 shall be applicable 
        to such construction and such provisions shall be 
        deemed to apply to such construction, and
          [(C) there shall be compliance with regulations the 
        Commissioner shall prescribe designed to assure that no 
        State will reduce its efforts in providing other 
        vocational rehabilitation services (other than for the 
        establishment of facilities for community 
        rehabilitation programs) because its plan includes such 
        provisions for construction;
  [(18) provide satisfactory assurances to the Commissioner 
that the State agency designated pursuant to paragraph (1) (or 
each State agency if two are so designated) and any sole local 
agency administering the plan in a political subdivision of the 
State will take into account, in connection with matters of 
general policy arising in the administration of the plan, the 
views of individuals and groups thereof who are recipients of 
vocational rehabilitation services (or, in appropriate cases, 
their parents or guardians), personnel working in the field of 
vocational rehabilitation, providers of vocational 
rehabilitation services, and the Director of the client 
assistance program under section 112;
  [(19) provide satisfactory assurances to the Commissioner 
that the continuing studies required under paragraph (15) of 
this subsection, as well as an annual evaluation of the 
effectiveness of the program in meeting the goals and 
priorities set forth in the plan, will form the basis for the 
submission, from time to time as the Commissioner may require, 
of appropriate amendments to the plan, and for developing and 
updating the strategic plan required under part C;
  [(20) provide satisfactory assurances to the Commissioner 
that, as appropriate, the State shall actively consult with 
Indian tribes and tribal organizations and native Hawaiian 
organizations in the development of the State plan, and that, 
except as otherwise provided in section 130, the State shall 
provide vocational rehabilitation services to American Indians 
who are individuals with disabilities residing in the State to 
the same extent as the State provides such services to other 
significant segments of the population of individuals with 
disabilities residing in the State;
  [(21) provide that the State agency has the authority to 
enter into contracts with profitmaking organizations for the 
purpose of providing on-the-job training and related programs 
for individuals with disabilities under part B of title VI upon 
a determination by such agency that such profitmaking 
organizations are better qualified to provide such 
rehabilitation services than nonprofit agencies and 
organizations;
  [(22) provide for the establishment and maintenance of 
information and referral programs (the staff of which shall 
include, to the maximum extent feasible, interpreters for 
individuals who are deaf) in sufficient numbers to assure that 
individuals with disabilities within the State are afforded 
accurate vocational rehabilitation information and appropriate 
referrals to other Federal and State programs and activities 
which would benefit them;
  [(23)(A) provide satisfactory assurances that in the 
formulation of policies governing the provision of the 
rehabilitation services consistent with the State plan, and any 
revisions, that the State agency conducts public meetings 
throughout the State, after appropriate and sufficient notice, 
to allow interested groups and organizations and all segments 
of the public an opportunity to comment on the State plan 
before development of the plan by the State, (B) include a 
summary of such comments and the State agency's response to 
such comments, and (C) provide satisfactory assurances that the 
State agency will consult with the Director of the client 
assistance program under section 112 in the formulation of 
policies governing the provision of vocational rehabilitation 
services consistent with the State plan and other revisions;
  [(24) contain plans, policies, and procedures to be followed 
(including entering into a formal interagency cooperative 
agreement, in accordance with paragraph (11)(C)(ii), with 
education officials responsible for the provision of a free 
appropriate public education to students who are individuals 
with disabilities) that are designed to--
          [(A) facilitate the development and accomplishment 
        of--
                  [(i) long-term rehabilitation goals;
                  [(ii) intermediate rehabilitation objectives; 
                and
                  [(iii) goals and objectives related to 
                enabling a student to live independently before 
                the student leaves a school setting,
        to the extent the goals and objectives described in 
        clauses (i) through (iii) are included in an 
        individualized education program of the student, 
        including the specification of plans for coordination 
        with the educational agencies in the provision of 
        transition services;
          [(B) facilitate the transition from the provision of 
        a free appropriate public education under the 
        responsibility of an educational agency to the 
        provision of vocational rehabilitation services under 
        the responsibility of the designated State unit, 
        including the specification of plans for coordination 
        with educational agencies in the provision of 
        transition services authorized under section 103(a)(14) 
        to an individual, consistent with the individualized 
        written rehabilitation program of the individual; and
          [(C) provide that such plans, policies, and 
        procedures will address--
                  [(i) provisions for determining State lead 
                agencies and qualified personnel responsible 
                for transition services;
                  [(ii) procedures for outreach to and 
                identification of youth in need of such 
                services; and
                  [(iii) a timeframe for evaluation and 
                followup of youth who have received such 
                services;
  [(25) provide assurances satisfactory to the Secretary that 
the State has an acceptable plan for carrying out part C of 
title VI, including the use of funds under that part to 
supplement funds under part B of this title for the cost of 
services leading to supported employment;
  [(26) describe the manner in which on-the-job or other 
related personal assistance services will be provided to assist 
individuals with disabilities while the individuals are 
receiving vocational rehabilitation services;
  [(27) describe the manner in which cooperative agreements 
with private nonprofit vocational rehabilitation service 
providers will be established;
  [(28) identify the needs and utilization of community 
rehabilitation programs under the Act commonly known as the 
Wagner-O'Day Act (41 U.S.C. 46 et seq.);
  [(29) describe the manner in which individuals with 
disabilities will be given choice and increased control in 
determining their vocational rehabilitation goals and 
objectives;
  [(30) describe the manner in which students who are 
individuals with disabilities and who are not in special 
education programs can access and receive vocational 
rehabilitation services, where appropriate;
  [(31) describe the manner in which assistive technology 
devices and services will be provided, or worksite assessments 
will be made as part of the assessment for determining 
eligibility and vocational rehabilitation needs of an 
individual;
  [(32) describe the manner in which the State will modify the 
policies and procedures of the State based on consumer 
satisfaction surveys conducted by the State Rehabilitation 
Advisory Council or independent commission described in 
paragraph (36);
  [(33) provide for coordination and working relationships with 
the Statewide Independent Living Council established under 
section 705 and independent living centers within the State;
  [(34) provide satisfactory assurances to the Commissioner 
that the State--
          [(A) has developed and implemented a strategic plan 
        for expanding and improving vocational rehabilitation 
        services for individuals with disabilities on a 
        statewide basis in accordance with part C of this 
        title; and
          [(B) will use at least 1.5 percent of the allotment 
        of the State under section 110 for the uses described 
        in section 123;
  [(35)(A) describe how the system for evaluating the 
performance of rehabilitation counselors, coordinators, and 
other personnel used in the State facilitates the 
accomplishment of the purpose and policy of this title, 
including the policy of serving, among others, individuals with 
the most severe disabilities; and
  [(B) provide satisfactory assurances that the system in no 
way impedes such accomplishment; and
  [(36) provide satisfactory assurances to the Commissioner 
that--
          [(A)(i) the State has established a State 
        Rehabilitation Advisory Council that meets the criteria 
        set forth in section 105;
          [(ii) the designated State agency and the designated 
        State unit seek and seriously consider on a regular and 
        ongoing basis advice from the Council regarding the 
        development and implementation of the State plan and 
        the strategic plan and amendments to the plans, and 
        other policies and procedures of general applicability 
        pertaining to the provision of vocational 
        rehabilitation services in the State;
          [(iii) the designated State agency includes, in its 
        State plan or an amendment to the plan, a summary of 
        advice provided by the Council, including 
        recommendations from the annual report of the Council, 
        the survey of consumer satisfaction, and other reports 
        prepared by the Council, and the response of the 
        designated State agency to such advice and 
        recommendations (including explanations with respect to 
        advice and recommendations that were rejected); and
          [(iv) the designated State unit transmits to the 
        Council--
                  [(I) all plans, reports, and other 
                information required under the Act to be 
                submitted to the Commissioner;
                  [(II) all policies, practices, and procedures 
                of general applicability provided to or used by 
                rehabilitation personnel; and
                  [(III) copies of due process hearing 
                decisions, which shall be transmitted in such a 
                manner as to preserve the confidentiality of 
                the participants in the hearings;
          [(B) an independent commission--
                  [(i) is responsible under State law for 
                operating, or overseeing the operation of, the 
                vocational rehabilitation program in the State;
                  [(ii) is consumer-controlled by persons who--
                          [(I) are individuals with physical or 
                        mental impairments that substantially 
                        limit major life activities; and
                          [(II) represent individuals with a 
                        broad range of disabilities;
                  [(iii) includes individuals representing 
                family members, advocates, and authorized 
                representatives of individuals with mental 
                impairments; and
                  [(iv) undertakes the function set forth in 
                section 105(c)(3); or
          [(C) in the case of a State that, under section 
        101(a)(1)(A)(i), designates a State agency to 
        administer the part of the State plan under which 
        vocational rehabilitation services are provided for 
        individuals who are blind and designates a separate 
        State agency to administer the remainder of the State 
        plan--
                          [(i) an independent commission is 
                        responsible under State law for 
                        operating, or overseeing the operation 
                        of, the vocational rehabilitation 
                        programs of both such agencies and 
                        meets the requirements of clauses (ii) 
                        and (iv) of subparagraph (B);
                          [(ii)(I) an independent commission is 
                        responsible under State law for 
                        operating, or overseeing the operation 
                        of, the vocational rehabilitation 
                        program in the State for individuals 
                        who are blind, is consumer-controlled 
                        by and represents individuals who are 
                        blind, and undertakes the function set 
                        forth in section 105(c)(3); and
                          [(II) an independent commission is 
                        responsible under State law for 
                        operating, or overseeing the operation 
                        of, the vocational rehabilitation 
                        program in the State for all 
                        individuals with disabilities except 
                        for individuals who are blind and meets 
                        the requirements of clauses (ii) and 
                        (iv) of subparagraph (B); or
                          [(iii)(I) an independent commission 
                        is responsible under State law for 
                        operating, or overseeing the operation 
                        of, the vocational rehabilitation 
                        program in the State for individuals 
                        who are blind, is consumer-controlled 
                        by and represents individuals who are 
                        blind, and undertakes the function set 
                        forth in section 105(c)(3); and
                          [(II) the State has established a 
                        State Rehabilitation Advisory Council 
                        that meets the criteria set forth in 
                        section 105 and carries out the duties 
                        of such a Council with respect to 
                        functions for, and services provided 
                        to, individuals with disabilities 
                        except for individuals who are blind.
  [(b) The Commissioner shall approve any plan which the 
Commissioner finds fulfills the conditions specified in 
subsection (a) of this section, and shall disapprove any plan 
which does not fulfill such conditions. Prior to such 
disapproval, the Commissioner shall notify a State of the 
intention to disapprove its plan, and shall afford such State 
reasonable notice and opportunity for hearing.

             [individualized written rehabilitation program

  [Sec. 102. (a)(1) An individual is eligible for assistance 
under this title if the individual--
          [(A) is an individual with a disability under section 
        7(8)(A); and
          [(B) requires vocational rehabilitation services to 
        prepare for, enter, engage in, or retain gainful 
        employment.
  [(2) An individual who has a disability or is blind as 
determined pursuant to title II or title XVI of the Social 
Security Act (42 U.S.C. 401 et seq. and 1381 et seq.) shall be 
considered to have--
          [(A) a physical or mental impairment which for such 
        individual constitutes or results in a substantial 
        impediment to employment under section 7(8)(A)(i); and
          [(B) a severe physical or mental impairment which 
        seriously limits one or more functional capacities in 
        terms of an employment outcome under section 
        7(15)(A)(i).
  [(3) Determinations made by officials of other agencies, 
particularly the education officials described in section 
101(a)(24), regarding whether an individual satisfies one or 
more factors relating to whether an individual is an individual 
with a disability under section 7(8)(A) or an individual with a 
severe disability under section 7(15)(A), shall be used (to the 
extent appropriate and available and consistent with the 
requirements under this Act) for making such determinations 
under this Act.
  [(4)(A) It shall be presumed that an individual can benefit 
in terms of an employment outcome from vocational 
rehabilitation services under section 7(8)(A)(ii), unless the 
designated State unit can demonstrate by clear and convincing 
evidence that such individual is incapable of benefiting from 
vocational rehabilitation services in terms of an employment 
outcome.
  [(B) In making the demonstration required under subparagraph 
(A) with respect to cases in which the issue concerns the 
severity of the disability of an individual, the designated 
State unit shall first conduct an extended evaluation by 
providing the services described in subparagraph (C)(iii)(I), 
and conducting the assessment described in subparagraph 
(C)(iii)(II), of section 7(22).
  [(5)(A) The designated State unit shall determine whether an 
individual is eligible for vocational rehabilitation services 
under this title within a reasonable period of time, not to 
exceed 60 days after the individual has submitted an 
application to receive the services unless--
          [(i) the designated State unit notifies the 
        individual that exceptional and unforeseen 
        circumstances beyond the control of the agency preclude 
        the agency from completing the determination within the 
        prescribed time and the individual agrees that an 
        extension of time is warranted; or
          [(ii) such an extended evaluation is required.
  [(B) The determination of eligibility shall be based on the 
review of existing data described in section 7(22)(A)(i), and, 
to the extent necessary, the preliminary assessment described 
in section 7(22)(A)(ii).
  [(6) The designated State unit shall ensure that a 
determination of ineligibility made with respect to an 
individual prior to the initiation of an individualized written 
rehabilitation program, based on the review, and to the extent 
necessary, the preliminary assessment, shall include 
specification of--
          [(A) the reasons for such a determination;
          [(B) the rights and remedies available to the 
        individual, including, if appropriate, recourse to the 
        processes set forth in subsections (b)(2) and (d); and
          [(C) the availability of services provided by the 
        client assistance program under section 112 to the 
        individual.
  [(b)(1)(A) As soon as a determination has been made that an 
individual is eligible for vocational rehabilitation services, 
the designated State unit shall complete an assessment for 
determining eligibility and vocational rehabilitation needs 
described in subparagraphs (B) and (C) of section 7(22) (if 
such assessment is necessary) and ensure that--
          [(i) an individualized written rehabilitation program 
        is jointly developed, agreed upon, and signed by--
                  [(I) such eligible individual (or, in an 
                appropriate case, a parent, a family member, a 
                guardian, an advocate, or an authorized 
                representative, of such individual); and
                  [(II) the vocational rehabilitation counselor 
                or coordinator; and
          [(ii) such program meets the requirements set forth 
        in subparagraph (B).
  [(B) Each individualized written rehabilitation program 
shall--
          [(i) be designed to achieve the employment objective 
        of the individual, consistent with the unique 
        strengths, resources, priorities, concerns, abilities, 
        and capabilities, of the individual;
          [(ii) include a statement of the long-term 
        rehabilitation goals based on the assessment for 
        determining eligibility and vocational rehabilitation 
        needs described in section 7(22)(B), including an 
        assessment of career interests, for the individual, 
        which goals shall, to the maximum extent appropriate, 
        include placement in integrated settings;
          [(iii) include a statement of the intermediate 
        rehabilitation objectives related to the attainment of 
        such goals, determined through such assessment carried 
        out in the most individualized and integrated setting 
        (consistent with the informed choice of the 
        individual);
          [(iv)(I) include a statement of the specific 
        vocational rehabilitation services to be provided, and 
        the projected dates for the initiation and the 
        anticipated duration of each such service;
          [(II) if appropriate, include a statement of the 
        specific rehabilitation technology services to be 
        provided to assist in the implementation of 
        intermediate rehabilitation objectives and long-term 
        rehabilitation goals for the individual; and
          [(III) if appropriate, include a statement of the 
        specific on-the-job and related personal assistance 
        services to be provided to the individual, and, if 
        appropriate and desired by the individual, the training 
        in managing, supervising, and directing personal 
        assistance services to be provided to the individual;
          [(v) include an assessment of the expected need for 
        postemployment services and, if appropriate, extended 
        services;
          [(vi) provide for--
                  [(I) a reassessment of the need for 
                postemployment services and, if appropriate, 
                extended services prior to the point of 
                successful rehabilitation, in accordance with 
                this subsection; and
                  [(II) if appropriate, the development of a 
                statement detailing how such services shall be 
                provided or arranged through cooperative 
                agreements with other service providers;
          [(vii) include objective criteria and an evaluation 
        procedure and schedule for determining whether such 
        goals and objectives are being achieved;
          [(viii) include the terms and conditions under which 
        goods and services described above will be provided to 
        the individual in the most integrated settings;
          [(ix) identify the entity or entities that will 
        provide the vocational rehabilitation services and the 
        process used to provide or procure such services;
          [(x) include a statement by the individual, in the 
        words of the individual (or, if appropriate, in the 
        words of a parent, a family member, a guardian, an 
        advocate, or an authorized representative, of the 
        individual), describing how the individual was informed 
        about and involved in choosing among alternative goals, 
        objectives, services, entities providing such services, 
        and methods used to provide or procure such services;
          [(xi) include, if necessary, an amendment 
        specifying--
                  [(I) the reasons that an individual for whom 
                a program has been prepared is no longer 
                eligible for vocational rehabilitation 
                services; and
                  [(II) the rights and remedies available to 
                such an individual including, if appropriate, 
                recourse to the processes set forth in 
                subsections (b)(2) and (d);
          [(xii) set forth the rights and remedies available to 
        such an individual including, if appropriate, recourse 
        to the processes set forth in subsections (b)(2) and 
        (d);
          [(xiii) provide a description of the availability of 
        a client assistance program established pursuant to 
        section 112;
          [(xiv) to the maximum extent possible, be provided in 
        the native language, or mode of communication, of the 
        individual, or, in an appropriate case, of a parent, a 
        family member, a guardian, an advocate, or an 
        authorized representative, of such individual; and
          [(xv) include information identifying other related 
        services and benefits provided pursuant to any Federal, 
        State, or local program that will enhance the capacity 
        of the individual to achieve the vocational objectives 
        of the individual.
  [(C) The designated State unit shall furnish a copy of the 
individualized written rehabilitation program and amendments to 
the program to the individual with a disability or, in an 
appropriate case, a parent, a family member, a guardian, an 
advocate, or an authorized representative, of the individual.
  [(2) Each individualized written rehabilitation program shall 
be reviewed annually, at which time such individual (or, in 
appropriate cases, the parents or guardian of the individual) 
will be afforded an opportunity to review such program and 
jointly redevelop and agree to its terms. Any revisions or 
amendments to the program resulting from such review shall be 
incorporated into or affixed to such program. Such revisions or 
amendments shall not take effect until agreed to and signed by 
the individual with a disability, or, if appropriate, by a 
parent, a family member, a guardian, an advocate, or an 
authorized representative, of such individual. Each 
individualized written rehabilitation program shall be revised 
as needed.
  [(c) The Director of the designated State unit shall also 
ensure that (1) in making any determination of ineligibility 
referred to in subsection (a) of this section, or in developing 
and carrying out the individualized written rehabilitation 
program required by section 101 in the case of each individual 
with a disability, emphasis is placed upon the determination 
and achievement of a vocational goal for such individual, (2) a 
decision that such an individual is not capable of achieving 
such a goal and thus is not eligible for vocational 
rehabilitation services provided with assistance under this 
part, is made only in full consultation with such individual 
(or, in appropriate cases, such individual's parents or 
guardians), and only upon the certification, as an amendment to 
such written program, or as a part of the specification of 
reasons for an ineligibility determination, as appropriate, 
that the preliminary diagnosis or assessment for determining 
eligibility and vocational rehabilitation needs described in 
subparagraphs (B) and (C) of section 7(22), as appropriate, has 
demonstrated that such individual is not then capable of 
achieving such a goal, and (3) any such decision, as an 
amendment to such written program, shall be reviewed at least 
annually in accordance with the procedure and criteria 
established in this section.
  [(d)(1) Except as provided in paragraph (4), the Director of 
any designated State unit shall establish procedures for the 
review of determinations made by the rehabilitation counselor 
or coordinator under this section, upon the request of an 
individual with a disability (or, in appropriate cases, such 
individual's parents or guardian).
  [(2)(A) Such review procedures shall provide an opportunity 
to such individuals for the submission of additional evidence 
and information to an impartial hearing officer who shall make 
a decision based on the provisions of the State plan approved 
under section 101(a).
  [(B) The impartial hearing officer shall be selected to hear 
a particular case--
          [(i) on a random basis; or
          [(ii) by agreement between--
                  [(I) the Director of the designated State 
                unit and the individual with a disability; or
                  [(II) in an appropriate case, the Director 
                and a parent, a family member, a guardian, an 
                advocate, or an authorized representative, of 
                such individual.
  [(C) The impartial hearing officer shall be selected from 
among a pool of qualified persons identified jointly by--
          [(i) the designated State unit; and
          [(ii)(I) the members of the State Rehabilitation 
        Advisory Council established under section 105 who were 
        appointed under one of clauses (v) through (viii) of 
        section 105(b)(1)(A), or under one of clauses (v) 
        through (ix) of section 105(b)(1)(B), as appropriate;
          [(II) the commission described in subparagraph (B) or 
        (C)(i) of section 101(a)(36); or
          [(III) the commissions described in section 
        101(a)(36)(C)(ii).
  [(3)(A) Within 20 days of the mailing of the decision to the 
individual with a disability (or, in appropriate cases, such 
individual's parents or guardian), the Director shall notify 
such individuals of the intent to review such decision in whole 
or in part.
  [(B) If the Director decides to review the decision, such 
individuals shall be provided an opportunity for the submission 
of additional evidence and information relevant to a final 
decision.
  [(C)(i) The Director may not overturn or modify a decision of 
an impartial hearing officer, or part of such a decision, that 
supports the position of the individual unless the Director 
concludes, based on clear and convincing evidence, that the 
decision of the independent hearing officer is clearly 
erroneous on the basis of being contrary to Federal or State 
law, including policy.
  [(ii) A final decision shall be made in writing by the 
Director and shall include a full report of the findings and 
the grounds for such decision.
  [(iii) Upon making a final decision, the Director shall 
provide a copy of such decision to such individual.
  [(D) Except as provided in paragraph (4), the Director may 
not delegate responsibility to make any such final decision to 
any other officer or employee of the designated State unit.
  [(4)(A) A fair hearing board, established by a State before 
January 1, 1985, and authorized under State law to review 
determinations under this Act, is authorized to carry out the 
responsibilities of the Director under this subsection.
  [(B) The provisions of paragraphs (1) through (3) of this 
subsection shall not apply to any State to which subparagraph 
(A) of this paragraph applies.
  [(5) Unless the individual with a disability so requests, or, 
in an appropriate case, a parent, a family member, a guardian, 
an advocate, or an authorized representative, of such 
individual so requests, pending a final determination of such 
hearing or other final resolution under this subsection, the 
designated State unit shall not institute a suspension, 
reduction, or termination of services being provided under the 
individualized written rehabilitation program, unless such 
services have been obtained through misrepresentation, fraud, 
collusion, or criminal conduct on the part of the individual 
with a disability.
  [(6)(A) The Director shall collect data described in 
subparagraph (B) and prepare and submit to the Commissioner a 
report containing such data. For the report submitted on or 
before February 1, 1988, the Commissioner shall prepare a 
summary of the information furnished under this paragraph and 
include the summary in the annual report submitted under 
section 13.
  [(B) The data required to be collected under this paragraph 
shall include--
          [(i) a description of State procedures for review;
          [(ii) the number of appeals to the independent 
        hearing officer and the State Director, including the 
        type of complaint and the issues involved;
          [(iii) the number of decisions by the State Director 
        reversing in whole or in part the decision of the 
        impartial hearing officer; and
          [(iv) the number of decisions affirming the position 
        of the individual with a disability assisted through 
        the client assistance program.

              [scope of vocational rehabilitation services

  [Sec. 103. (a) Vocational rehabilitation services provided 
under this Act are any goods or services necessary to render an 
individual with a disability employable, including, but not 
limited to, the following:
          [(1) an assessment for determining eligibility and 
        vocational rehabilitation needs by qualified personnel, 
        including, if appropriate, an assessment by personnel 
        skilled in rehabilitation technology;
          [(2) counseling, guidance, and work-related placement 
        services for individuals with disabilities, including 
        job search assistance, placement assistance, job 
        retention services, personal assistance services, and 
        followup, follow-along, and specific postemployment 
        services necessary to assist such individuals to 
        maintain, regain, or advance in employment;
          [(3) vocational and other training services for 
        individuals with disabilities, which shall include 
        personal and vocational adjustment, books, or other 
        training materials, and such services to the families 
        of such individuals as are necessary to the adjustment 
        or rehabilitation of such individuals, except that no 
        training services in institutions of higher education 
        shall be paid for with funds under this title unless 
        maximum efforts have been made to secure grant 
        assistance, in whole or in part, from other sources to 
        pay for such training;
          [(4) physical and mental restoration services, 
        including, but not limited to, (A) corrective surgery 
        or therapeutic treatment necessary to correct or 
        substantially modify a physical or mental condition 
        which is stable or slowly progressive and constitutes a 
        substantial impediment to employment, but is of such 
        nature that such correction or modification may 
        reasonably be expected to eliminate or reduce such 
        impediment to employment within a reasonable length of 
        time, (B) necessary hospitalization in connection with 
        surgery or treatment, (C) prosthetic and orthotic 
        devices, (D) eyeglasses and visual services as 
        prescribed by qualified personnel, under State 
        licensure laws, that are selected by the individual, 
        (E) special services (including transplantation and 
        dialysis), artificial kidneys, and supplies necessary 
        for the treatment of individuals with end-stage renal 
        disease, and (F) diagnosis and treatment for mental and 
        emotional disorders by qualified personnel under State 
        licensure laws;
          [(5) maintenance for additional costs incurred while 
        participating in rehabilitation;
          [(6) interpreter services for individuals who are 
        deaf, and reader services for those individuals 
        determined to be blind after an examination by 
        qualified personnel under State licensure laws;
          [(7) recruitment and training services for 
        individuals with disabilities to provide them with new 
        employment opportunities in the fields of 
        rehabilitation, health, welfare, public safety, and law 
        enforcement, and other appropriate service employment;
          [(8) rehabilitation teaching services and orientation 
        and mobility services for individuals who are blind;
          [(9) occupational licenses, tools, equipment, and 
        initial stocks and supplies;
          [(10) transportation in connection with the rendering 
        of any vocational rehabilitation service;
          [(11) telecommunications, sensory, and other 
        technological aids and devices;
          [(12) rehabilitation technology services;
          [(13) referral and other services designed to assist 
        individuals with disabilities in securing needed 
        services from other agencies through agreements 
        developed under section 101(a)(11), if such services 
        are not available under this Act;
          [(14) transition services that promote or facilitate 
        the accomplishment of long-term rehabilitation goals 
        and intermediate rehabilitation objectives;
          [(15) on-the-job or other related personal assistance 
        services provided while an individual with a disability 
        is receiving services described in this section; and
          [(16) supported employment services.
  [(b) Vocational rehabilitation services, when provided for 
the benefit of groups of individuals, may also include the 
following:
          [(1) In the case of any type of small business 
        operated by individuals with the most severe 
        disabilities the operation of which can be improved by 
        management services and supervision provided by the 
        State agency, the provision of such services and 
        supervision, along or together with the acquisition by 
        the State agency of vending facilities or other 
        equipment and initial stocks and supplies.
          [(2) The establishment, development, or improvement 
        of community rehabilitation programs, including, under 
        special circumstances, the construction of a facility, 
        and the provision of other services (including services 
        offered at community rehabilitation programs) which 
        promise to contribute substantially to the 
        rehabilitation of a group of individuals but which are 
        not related directly to the individualized 
        rehabilitation written program of any one individual 
        with a disability. Such programs shall be used to 
        provide services that promote integration and 
        competitive employment.
          [(3) The use of existing telecommunications systems 
        (including telephone, television, satellite, radio, and 
        other similar systems) which have the potential for 
        substantially improving service delivery methods, and 
        the development of appropriate programing to meet the 
        particular needs of individuals with disabilities.
          [(4) The use of services providing recorded material 
        for individuals who are blind and captioned films or 
        video cassettes for individuals who are deaf.
          [(5) Technical assistance and support services to 
        businesses that are not subject to title I of the 
        Americans with Disabilities Act of 1990 (42 U.S.C. 
        12111 et seq.) and that are seeking to employ 
        individuals with disabilities.

                  [non-federal share for construction

  [Sec. 104. For the purpose of determining the amount of 
payments to States for carrying out part B of this title (or to 
an Indian tribe under part D of this title), the non-Federal 
share, subject to such limitations and conditions as may be 
prescribed in regulations by the Commissioner, shall include 
contributions of funds made by any private agency, 
organization, or individual to a State or local agency to 
assist in meeting the costs of establishment of a community 
rehabilitation program or construction, under special 
circumstances, of a facility for such a program, which would be 
regarded as State or local funds except for the condition, 
imposed by the contributor, limiting use of such funds to 
establishment of such a program or construction of such a 
facility.
[SEC. 105. STATE REHABILITATION ADVISORY COUNCIL.

  [(a) Establishment.--
          [(1) In general.--Except as provided in subparagraph 
        (B) or (C) of section 101(a)(36), to be eligible to 
        receive financial assistance under this title a State 
        shall establish a State Rehabilitation Advisory Council 
        (referred to in this section as the ``Council'') in 
        accordance with this section.
          [(2) Separate agency for individuals who are blind.--
        A State that designates a State agency to administer 
        the part of the State plan under which vocational 
        rehabilitation services are provided for individuals 
        who are blind under section 101(a)(1)(A)(i) may 
        establish a separate Council in accordance with this 
        section to perform the duties of such a Council with 
        respect to such State agency.
  [(b) Composition and Appointment.--
          [(1) Composition.--
                  [(A) In general.--Except in the case of a 
                separate Council established under subsection 
                (a)(2), the Council shall be composed of--
                          [(i) at least one representative of 
                        the Statewide Independent Living 
                        Council established under section 705, 
                        which representative may be the 
                        chairperson or other designee of the 
                        Council;
                          [(ii) at least one representative of 
                        a parent training and information 
                        center established pursuant to section 
                        631(e)(1) of the Individuals with 
                        Disabilities Education Act (20 U.S.C. 
                        1431(e)(1));
                          [(iii) at least one representative of 
                        the client assistance program 
                        established under section 112;
                          [(iv) at least one vocational 
                        rehabilitation counselor, with 
                        knowledge of and experience with 
                        vocational rehabilitation programs, who 
                        shall serve as an ex officio, nonvoting 
                        member of the Council if the counselor 
                        is an employee of the designated State 
                        agency;
                          [(v) at least one representative of 
                        community rehabilitation program 
                        service providers;
                          [(vi) four representatives of 
                        business, industry, and labor;
                          [(vii) representatives of disability 
                        advocacy groups representing a cross 
                        section of--
                                  [(I) individuals with 
                                physical, cognitive, sensory, 
                                and mental disabilities; and
                                  [(II) parents, family 
                                members, guardians, advocates, 
                                or authorized representatives, 
                                of individuals with 
                                disabilities who have 
                                difficulty in representing 
                                themselves or are unable due to 
                                their disabilities to represent 
                                themselves; and
                          [(viii) current or former applicants 
                        for, or recipients of, vocational 
                        rehabilitation services.
                  [(B) Separate council.--In the case of a 
                separate Council established under subsection 
                (a)(2), the Council shall be composed of--
                          [(i) at least one representative 
                        described in subparagraph (A)(i);
                          [(ii) at least one representative 
                        described in subparagraph (A)(ii);
                          [(iii) at least one representative 
                        described in subparagraph (A)(iii);
                          [(iv) at least one vocational 
                        rehabilitation counselor described in 
                        subparagraph (A)(iv), who shall serve 
                        as described in such subparagraph;
                          [(v) at least one representative 
                        described in subparagraph (A)(v);
                          [(vi) four representatives described 
                        in subparagraph (A)(vi);
                          [(vii) at least one representative of 
                        a disability advocacy group 
                        representing individuals who are blind;
                          [(viii) at least one parent, family 
                        member, guardian, advocate, or 
                        authorized representative, of an 
                        individual who--
                                  [(I) is an individual who is 
                                blind and has multiple 
                                disabilities; and
                                  [(II) has difficulty in 
                                representing himself or herself 
                                or is unable due to 
                                disabilities to represent 
                                himself or herself; and
                          [(ix) applicants or recipients 
                        described in subparagraph (A)(viii).
                  [(C) Exception.--In the case of a separate 
                Council established under subsection (a)(2), 
                any Council that is required by State law, as 
                in effect on the date of enactment of the 
                Rehabilitation Act Amendments of 1992, to have 
                fewer than 13 members shall be deemed to be in 
                compliance with subparagraph (B) if the 
                Council--
                          [(i) meets the requirements of 
                        subparagraph (B), other than the 
                        requirements of clauses (vi) and (ix) 
                        of such subparagraph; and
                          [(ii) includes at least--
                                  [(I) one representative 
                                described in subparagraph 
                                (B)(vi); and
                                  [(II) one applicant or 
                                recipient described in 
                                subparagraph (B)(ix).
          [(2) Ex officio member.--The Director of the 
        designated State unit shall be an ex officio member of 
        the Council.
          [(3) Appointment.--Members of the Council shall be 
        appointed by the Governor. In the case of a State that, 
        under State law, vests appointment authority in an 
        entity in lieu of, or in conjunction with, the 
        Governor, such as one or more houses of the State 
        legislature, or an independent board that has general 
        appointment authority, that entity shall make the 
        appointments. The appointing authority shall select 
        members after soliciting recommendations from 
        representatives of organizations representing a broad 
        range of individuals with disabilities and 
        organizations interested in individuals with 
        disabilities.
          [(4) Qualifications.--A majority of Council members 
        shall be persons who are--
                  [(A) individuals with disabilities described 
                in section 7(8)(B); and
                  [(B) not employed by the designated State 
                unit.
          [(5) Chairperson.--
                  [(A) In general.--Except as provided in 
                subparagraph (B), the Council shall select a 
                chairperson from among the membership of the 
                Council.
                  [(B) Designation by governor.--In States in 
                which the Governor does not have veto power 
                pursuant to State law, the Governor shall 
                designate a member of the Council to serve as 
                the chairperson of the Council or shall require 
                the Council to so designate such a member.
          [(6) Terms of appointment.--
                  [(A) Length of term.--Each member of the 
                Council shall serve for a term of not more than 
                3 years, except that--
                          [(i) a member appointed to fill a 
                        vacancy occurring prior to the 
                        expiration of the term for which a 
                        predecessor was appointed, shall be 
                        appointed for the remainder of such 
                        term; and
                          [(ii) the terms of service of the 
                        members initially appointed shall be 
                        (as specified by the appointing 
                        authority) for such fewer number of 
                        years as will provide for the 
                        expiration of terms on a staggered 
                        basis.
                  [(B) Number of terms.--No member of the 
                Council may serve more than two consecutive 
                full terms.
          [(7) Vacancies.--Any vacancy occurring in the 
        membership of the Council shall be filled in the same 
        manner as the original appointment. The vacancy shall 
        not affect the power of the remaining members to 
        execute the duties of the Council.
  [(c) Functions of Council.--The Council shall--
          [(1) review, analyze, and advise the designated State 
        unit regarding the performance of the responsibilities 
        of the unit under this title, particularly 
        responsibilities relating to--
                  [(A) eligibility (including order of 
                selection);
                  [(B) the extent, scope, and effectiveness of 
                services provided; and
                  [(C) functions performed by State agencies 
                that affect or that potentially affect the 
                ability of individuals with disabilities in 
                achieving rehabilitation goals and objectives 
                under this title;
          [(2) advise the designated State agency and the 
        designated State unit, and, at the discretion of the 
        designated State agency, assist in the preparation of 
        applications, the State plan, the strategic plan and 
        amendments to the plans, reports, needs assessments, 
        and evaluations required by this title;
          [(3) to the extent feasible, conduct a review and 
        analysis of the effectiveness of, and consumer 
        satisfaction with--
                  [(A) the functions performed by State 
                agencies and other public and private entities 
                responsible for performing functions for 
                individuals with disabilities; and
                  [(B) vocational rehabilitation services--
                          [(i) provided, or paid for from funds 
                        made available, under this Act or 
                        through other public or private 
                        sources; and
                          [(ii) provided by State agencies and 
                        other public and private entities 
                        responsible for providing vocational 
                        rehabilitation services to individuals 
                        with disabilities;
          [(4) prepare and submit an annual report to the 
        Governor or appropriate State entity and the 
        Commissioner on the status of vocational rehabilitation 
        programs operated within the State, and make the report 
        available to the public;
          [(5) coordinate with other councils within the State, 
        including the Statewide Independent Living Council 
        established under section 705, the advisory panel 
        established under section 613(a)(12) of the Individuals 
        with Disabilities Education Act (20 U.S.C. 
        1413(a)(12)), the State Planning Council described in 
        section 124 of the Developmental Disabilities 
        Assistance and Bill of Rights Act (42 U.S.C. 6024), and 
        the State mental health planning council established 
        under section 1916(e) of the Public Health Service Act 
        (42 U.S.C. 300x-4(e));
          [(6) advise the State agency designated under section 
        101(a)(1) and provide for coordination and the 
        establishment of working relationships between the 
        State agency and the Statewide Independent Living 
        Council and centers for independent living within the 
        State; and
          [(7) perform such other functions, consistent with 
        the purpose of this title, as the State Rehabilitation 
        Advisory Council determines to be appropriate, that are 
        comparable to the other functions performed by the 
        Council.
  [(d) Resources.--
          [(1) Plan.--The Council shall prepare, in conjunction 
        with the designated State unit, a plan for the 
        provision of such resources, including such staff and 
        other personnel, as may be necessary to carry out the 
        functions of the Council under this section. The 
        resource plan shall, to the maximum extent possible, 
        rely on the use of resources in existence during the 
        period of implementation of the plan.
          [(2) Resolution of disagreements.--To the extent that 
        there is a disagreement between the Council and the 
        designated State unit in regard to the resources 
        necessary to carry out the functions of the Council as 
        set forth in this section, the disagreement shall be 
        resolved by the Governor or appointing agency 
        consistent with paragraph (1).
          [(3) Supervision and evaluation.--Each Council shall, 
        consistent with State law, supervise and evaluate such 
        staff and other personnel as may be necessary to carry 
        out its functions under this section.
          [(4) Personnel conflict of interest.--While assisting 
        the Council in carrying out its duties, staff and other 
        personnel shall not be assigned duties by the 
        designated State unit or any other agency or office of 
        the State, that would create a conflict of interest.
  [(e) Conflict of Interest.--No member of the Council shall 
cast a vote on any matter that would provide direct financial 
benefit to the member or otherwise give the appearance of a 
conflict of interest under State law.
  [(f) Meetings.--The Council shall convene at least 4 meetings 
a year in such places as it determines to be necessary to 
conduct Council business and conduct such forums or hearings as 
the Council considers appropriate. The meetings, hearings, and 
forums shall be publicly announced. The meetings shall be open 
and accessible to the general public unless there is a valid 
reason for an executive session.
  [(g) Compensation and Expenses.--The Council may use funds 
appropriated under this title (except for funds appropriated to 
carry out the client assistance program under section 112 and 
funds reserved pursuant to section 110(d) to carry out part D 
of this title) to reimburse members of the Council for 
reasonable and necessary expenses of attending Council meetings 
and performing Council duties (including child care and 
personal assistance services), and to pay compensation to a 
member of the Council, if such member is not employed or must 
forfeit wages from other employment, for each day the member is 
engaged in performing the duties of the Council.
  [(h) Hearings and Forums.--The Council is authorized to hold 
such hearings and forums as the Council may determine to be 
necessary to carry out the duties of the Council.
  [(i) Use of Existing Councils.--To the extent that a State 
has established a Council before September 30, 1992, that is 
comparable to the Council described in this section, such 
established Council shall be considered to be in compliance 
with this section. Within 1 year after the date of enactment of 
the Rehabilitation Act Amendments of 1992, such State shall 
establish a Council that complies in full with this section.

[SEC. 106. EVALUATION STANDARDS AND PERFORMANCE INDICATORS.

  [(a) Establishment.--
          [(1) In general.--The Commissioner shall, not later 
        than September 30, 1994, establish and publish 
        evaluation standards and performance indicators for the 
        vocational rehabilitation program under this title.
          [(2) Measures.--The standards and indicators shall 
        include outcome and related measures of program 
        performance that facilitate and in no way impede the 
        accomplishment of the purpose and policy of this title.
          [(3) Comment.--The standards and indicators shall be 
        developed with input from State vocational 
        rehabilitation agencies, related professional and 
        consumer organizations, recipients of vocational 
        rehabilitation services, and other interested parties. 
        The Commissioner shall publish in the Federal Register 
        a notice of intent to regulate regarding the 
        development of proposed standards and indicators. 
        Proposed standards and indicators shall be published in 
        the Federal Register for review and comment. Final 
        standards and indicators shall be published in the 
        Federal Register.
  [(b) Compliance.--
          [(1) State reports.--In accordance with regulations 
        established by the Secretary, each State shall report 
        to the Commissioner after the end of each fiscal year 
        the extent to which the State is in compliance with the 
        standards and indicators.
          [(2) Program improvement.--
                  [(A) Plan.--If the Commissioner determines 
                that the performance of any State is below 
                established standards, the Commissioner shall 
                provide technical assistance to the State and 
                the State and the Commissioner shall jointly 
                develop a program improvement plan outlining 
                the specific actions to be taken by the State 
                to improve program performance.
                  [(B) Review.--The Commissioner shall--
                          [(i) review the program improvement 
                        efforts of the State on a biannual 
                        basis and, if necessary, request the 
                        State to make further revisions to the 
                        plan to improve performance; and
                          [(ii) continue to conduct such 
                        reviews and request such revisions 
                        until the State sustains satisfactory 
                        performance over a period of more than 
                        1 year.
  [(c) Withholding.--If the Commissioner determines that a 
State whose performance falls below the established standards 
has failed to enter into a program improvement plan, or is not 
complying substantially with the terms and conditions of such a 
program improvement plan, the Commissioner shall, consistent 
with subsections (c) and (d) of section 107, reduce or make no 
further payments to the State under this program, until the 
State has entered into an approved program improvement plan, or 
satisfies the Commissioner that the State is complying 
substantially with the terms and conditions of such a program 
improvement plan, as appropriate.
  [(d) Report to Congress.--Beginning in fiscal year 1996, the 
Commissioner shall include in each annual report to the 
Congress under section 13 an analysis of program performance, 
including relative State performance, based on the standards 
and indicators.

[SEC. 107. MONITORING AND REVIEW.

  [(a) In General.--
          [(1) Duties.--In carrying out the duties of the 
        Commissioner under this title, the Commissioner shall--
                  [(A) provide for the annual review and 
                periodic on-site monitoring of programs under 
                this title; and
                  [(B) determine whether, in the administration 
                of the State plan, a State is complying 
                substantially with the provisions of such plan 
                and with evaluation standards and performance 
                indicators established under section 106.
          [(2) Procedures for reviews.--In conducting reviews 
        under this section the Commissioner shall consider, at 
        a minimum--
                  [(A) State policies and procedures;
                  [(B) guidance materials;
                  [(C) decisions resulting from hearings 
                conducted in accordance with due process;
                  [(D) strategic plans and updates;
                  [(E) plans and reports prepared under section 
                106(b);
                  [(F) consumer satisfaction surveys described 
                in section 101(a)(32);
                  [(G) information provided by the State 
                Rehabilitation Advisory Council established 
                under section 105;
                  [(H) reports; and
                  [(I) budget and financial management data.
          [(3) Procedures for monitoring.--In conducting 
        monitoring under this section the Commissioner shall 
        conduct--
                  [(A) on-site visits, including on-site 
                reviews of records to verify that the State is 
                following requirements regarding the order of 
                selection set forth in section 101(a)(5)(A);
                  [(B) public hearings and other strategies for 
                collecting information from the public;
                  [(C) meetings with the State Rehabilitation 
                Advisory Council;
                  [(D) reviews of individual case files, 
                including individualized written rehabilitation 
                programs and ineligibility determinations; and
                  [(E) meetings with rehabilitation counselors 
                and other personnel.
          [(4) Areas of inquiry.--In conducting the review and 
        monitoring, the Commissioner shall examine--
                  [(A) the eligibility process;
                  [(B) the provision of services, including, if 
                applicable, the order of selection;
                  [(C) whether the personnel evaluation system 
                described in section 101(a)(35) facilitates and 
                does not impede the accomplishments of the 
                program;
                  [(D) such other areas as may be identified by 
                the public or through meetings with the State 
                Rehabilitation Advisory Council; and
                  [(E) such other areas of inquiry as the 
                Commissioner may consider appropriate.
  [(b) Technical Assistance.--The Commissioner shall--
          [(1) provide technical assistance to programs under 
        this title regarding improving the quality of 
        vocational rehabilitation services provided; and
          [(2) provide technical assistance and establish a 
        corrective action plan for a program under this title 
        if the Commissioner finds that the program fails to 
        comply substantially with the provisions of the State 
        plan, or with evaluation standards or performance 
        indicators established under section 106, in order to 
        ensure that such failure is corrected as soon as 
        practicable.
  [(c) Failure To Comply With Plan.--
          [(1) Withholding payments.--Whenever the 
        Commissioner, after providing reasonable notice and an 
        opportunity for a hearing to the State agency 
        administering or supervising the administration of the 
        State plan approved under section 101, finds that--
                  [(A) the plan has been so changed that it no 
                longer complies with the requirements of 
                section 101(a); or
                  [(B) in the administration of the plan there 
                is a failure to comply substantially with any 
                provision of such plan or with an evaluation 
                standard or performance indicator established 
                under section 106,
        the Commissioner shall notify such State agency that no 
        further payments will be made to the State under this 
        title (or, in the discretion of the Commissioner, that 
        such further payments will be reduced, in accordance 
        with regulations the Commissioner shall prescribe, or 
        that further payments will not be made to the State 
        only for the projects under the parts of the State plan 
        affected by such failure), until the Commissioner is 
        satisfied there is no longer any such failure.
          [(2) Period.--Until the Commissioner is so satisfied, 
        the Commissioner shall make no further payments to such 
        State under this title (or shall reduce payments or 
        limit payments to projects under those parts of the 
        State plan in which there is no such failure).
          [(3) Disbursal of withheld funds.--The Commissioner 
        may, in accordance with regulations the Secretary shall 
        prescribe, disburse any funds withheld from a State 
        under paragraph (1) to any public or nonprofit private 
        organization or agency within such State or to any 
        political subdivision of such State submitting a plan 
        meeting the requirements of section 101(a). The 
        Commissioner may not make any payment under this 
        paragraph unless the entity to which such payment is 
        made has provided assurances to the Commissioner that 
        such entity will contribute, for purposes of carrying 
        out such plan, the same amount as the State would have 
        been obligated to contribute if the State received such 
        payment.
  [(d) Review.--
          [(1) Petition.--Any State that is dissatisfied with a 
        final determination of the Commissioner under section 
        101(b) or subsection (c) may file a petition for 
        judicial review of such determination in the United 
        States Court of Appeals for the circuit in which the 
        State is located. Such a petition may be filed only 
        within the 30-day period beginning on the date that 
        notice of such final determination was received by the 
        State. The clerk of the court shall transmit a copy of 
        the petition to the Commissioner or to any officer 
        designated by the Commissioner for that purpose. In 
        accordance with section 2112 of title 28, United States 
        Code, the Commissioner shall file with the court a 
        record of the proceeding on which the Commissioner 
        based the determination being appealed by the State. 
        Until a record is so filed, the Commissioner may modify 
        or set aside any determination made under such 
        proceedings.
          [(2) Submissions and determinations.--If, in an 
        action under this subsection to review a final 
        determination of the Commissioner under section 101(b) 
        or subsection (c), the petitioner or the Commissioner 
        applies to the court for leave to have additional oral 
        submissions or written presentations made respecting 
        such determination, the court may, for good cause 
        shown, order the Commissioner to provide within 30 days 
        an additional opportunity to make such submissions and 
        presentations. Within such period, the Commissioner may 
        revise any findings of fact, modify or set aside the 
        determination being reviewed, or make a new 
        determination by reason of the additional submissions 
        and presentations, and shall file such modified or new 
        determination, and any revised findings of fact, with 
        the return of such submissions and presentations. The 
        court shall thereafter review such new or modified 
        determination.
          [(3) Standards of review.--
                  [(A) In general.--Upon the filing of a 
                petition under paragraph (1) for judicial 
                review of a determination, the court shall have 
                jurisdiction--
                          [(i) to grant appropriate relief as 
                        provided in chapter 7 of title 5, 
                        United States Code, except for interim 
                        relief with respect to a determination 
                        under subsection (c); and
                          [(ii) except as otherwise provided in 
                        subparagraph (B), to review such 
                        determination in accordance with 
                        chapter 7 of title 5, United States 
                        Code.
                  [(B) Substantial evidence.--Section 706 of 
                title 5, United States Code, shall apply to the 
                review of any determination under this 
                subsection, except that the standard for review 
                prescribed by paragraph (2)(E) of such section 
                706 shall not apply and the court shall hold 
                unlawful and set aside such determination if 
                the court finds that the determination is not 
                supported by substantial evidence in the record 
                of the proceeding submitted pursuant to 
                paragraph (1), as supplemented by any 
                additional submissions and presentations filed 
                under paragraph (2).

[SEC. 108. EXPENDITURE OF CERTAIN AMOUNTS.

  [(a) Expenditure.--Amounts described in subsection (b) may 
not be expended by a State for any purpose other than carrying 
out programs for which the State receives financial assistance 
under this title, under part C of title VI, or under title VII.
  [(b) Amounts.--The amounts referred to in subsection (a) are 
amounts provided to a State under the Social Security Act (42 
U.S.C. 301 et seq.) as reimbursement for the expenditure of 
payments received by the State from allotments under section 
110 of this Act.

[SEC. 109. TRAINING OF EMPLOYERS WITH RESPECT TO AMERICANS WITH 
                    DISABILITIES ACT OF 1990.

  [A State may expend payments received under section 111--
          [(1) to carry out a program to train employers with 
        respect to compliance with the requirements of title I 
        of the Americans with Disabilities Act of 1990 (42 
        U.S.C. 12111 et seq.); and
          [(2) to inform employers of the existence of the 
        program and the availability of the services of the 
        program.

           [Part B--Basic Vocational Rehabilitation Services

                           [state allotments

  [Sec. 110. (a)(1) Subject to the provisions of subsection 
(d), for each fiscal year beginning before October 1, 1978, 
each State shall be entitled to an allotment of an amount 
bearing the same ratio to the amount authorized to be 
appropriated under section 100(b)(1) for allotment under this 
section as the product of (A) the population of the State, and 
(B) the square of its allotment percentage, bears to the sum of 
the corresponding products for all the States.
  [(2)(A) For each fiscal year beginning on or after October 1, 
1978, each State shall be entitled to an allotment in an amount 
equal to the amount such State received under paragraph (1) for 
the fiscal year ending September 30, 1978, and an additional 
amount determined pursuant to subparagraph (B) of this 
paragraph.
  [(B) For each fiscal year beginning on or after October 1, 
1978, each State shall be entitled to an allotment, from any 
amount authorized to be appropriated for such fiscal year under 
section 100(b)(1)(A) for allotment under this section in excess 
of the amount appropriated under section 100(b)(1)(A) for the 
fiscal year ending September 30, 1978, in an amount equal to 
the sum of--
          [(i) an amount bearing the same ratio to 50 percent 
        of such excess amount as the product of the population 
        of the State and the square of its allotment percentage 
        bears to the sum of the corresponding products for all 
        the States; and
          [(ii) an amount bearing the same ratio to 50 percent 
        of such excess amount as the product of the population 
        of the State and its allotment percentage bears to the 
        sum of the corresponding products for all the States.
  [(3) The sum of the payment to any State (other than Guam, 
American Samoa, the Virgin Islands, the Northern Mariana 
Islands, and the Republic of Palau) under this subsection for 
any fiscal year which is less than one-third of 1 percent of 
the amount appropriated under section 100(b)(1)(A), or 
$3,000,000, whichever is greater, shall be increased to that 
amount, the total of the increases thereby required being 
derived by proportionately reducing the allotment to each of 
the remaining such States under this subsection, but with such 
adjustments as may be necessary to prevent the sum of the 
allotments made under this subsection to any such remaining 
State from being thereby reduced to less than that amount.
  [(4) For each fiscal year beginning on or after October 1, 
1984, for which any amount is appropriated pursuant to section 
100(b)(1)(B), each State shall receive an allocation (from such 
appropriated amount) in addition to the allotment to which such 
State is entitled under paragraphs (2) and (3) of this 
subsection. Such additional allocation shall be an amount which 
bears the same ratio to the amount so appropriated as that 
State's allotment under paragraphs (2) and (3) of this 
subsection bears to the sum of such allotments of all the 
States.
  [(5) The Republic of Palau may receive allotments or 
allocations under this section only until the Compact of Free 
Association with Palau takes effect.
  [(b)(1) If the payment to a State under section 111(a) for a 
fiscal year is less than the total payments such State received 
under section 2 of the Vocational Rehabilitation Act for the 
fiscal year ending June 30, 1973, such State shall be entitled 
to an additional payment (subject to the same terms and 
conditions applicable to other payments under this part) equal 
to the difference between such payment under section 111(a) and 
the amount so received by it.
  [(2) If a State receives as its Federal share under section 
111(a) for any fiscal year less than the applicable Federal 
share of the expenditure of such State for fiscal year 1972 for 
vocational rehabilitation services under the plan for such 
State approved under section 101 (including any amount expended 
by such State for the administration of the State plan but 
excluding any amount expended by such State from non-Federal 
sources for construction under such plan), such State shall be 
entitled to an additional payment for such fiscal year, subject 
to the same terms and conditions applicable to other payments 
under this part, equal to the difference between such payment 
under section 111(a) and an amount equal to the applicable 
Federal share of such expenditure for vocational rehabilitation 
services.
  [(3) Any payment attributable to the additional payment to a 
State under this subsection shall be made only from 
appropriations specifically made to carry out this subsection, 
and such additional appropriations are hereby authorized.
  [(c)(1) Not later than forty-five days prior to the end of 
the fiscal year, the Commissioner shall determine, after 
reasonable opportunity for the submission to the Commissioner 
of comments by the State agency administering or supervising 
the program established under this title, that any payment of 
an allotment to a State under section 111(a) for any fiscal 
year will not be utilized by such State in carrying out the 
purposes of this title.
  [(2) As soon as practicable but not later than the end of the 
fiscal year, the Commissioner shall make such amount available 
for carrying out the purposes of this title to one or more 
other States to the extent the Commissioner determines such 
other State will be able to use such additional amount during 
that fiscal year or the subsequent fiscal year for carrying out 
such purposes. The Commissioner shall make such amount 
available only if such other State will be able to make 
sufficient payments from non-Federal sources to pay for the 
non-Federal share of the cost of vocational rehabilitation 
services under the State plan for the fiscal year for which the 
amount was appropriated.
  [(3) For the purposes of this part, any amount made available 
to a State for any fiscal year pursuant to this subsection 
shall be regarded as an increase of such State's allotment (as 
determined under the preceding provisions of this section) for 
such year.
  [(d)(1) For fiscal year 1987 and for each subsequent fiscal 
year, the Commissioner shall reserve from the amount 
appropriated under section 100(b)(1) for allotment under this 
section a sum, determined under paragraph (2), to carry out the 
purposes of part D of this title.
  [(2) The sum referred to in paragraph (1) shall be, as 
determined by the Secretary--
          [(A) not less than one-third of one percent and not 
        more than 1.5 percent of the amount under paragraph 
        (1), for fiscal years 1993 and 1994; and
          [(B) not less than one-half of one percent and not 
        more than 1.5 percent of the amount under paragraph 
        (1), for fiscal years 1995, 1996, and 1997.

                          [payments to states

  [Sec. 111. (a)(1) Except as provided in paragraph (2), from 
each State's allotment under this part for any fiscal year, the 
Commissioner shall pay to a State an amount equal to the 
Federal share of the cost of vocational rehabilitation services 
under the plan for that State approved under section 101, 
including expenditures for the administration of the State plan 
and development and implementation of the strategic plan as 
provided in section 101(a)(34)(A). Any State that receives such 
an amount shall expend, for development and implementation of 
the strategic plan, not less than the percentage of the 
allotment of the State referred to in section 101(a)(34)(B).
  [(2)(A) The total of payments under paragraph (1) to a State 
for a fiscal year may not exceed its allotment under subsection 
(a) of section 110 for such year and such payments shall not be 
made in an amount which would result in a violation of the 
provisions of the State plan required by section 101(a)(17).
  [(B)(i) For fiscal year 1993, the amount otherwise payable to 
a State for a fiscal year under this section shall be reduced 
by the amount by which expenditures from non-Federal sources 
under the State plan under this title for the previous fiscal 
year are less than the average of the total of such 
expenditures for the 3 fiscal years preceding the previous 
fiscal year.
  [(ii) For fiscal year 1994 and each fiscal year thereafter, 
the amount otherwise payable to a State for a fiscal year under 
this section shall be reduced by the amount by which 
expenditures from non-Federal sources under the State plan 
under this title for the previous fiscal year are less than the 
total of such expenditures for the second fiscal year preceding 
the previous fiscal year.
  [(C) The Commissioner may waive or modify any requirement or 
limitation under paragraphs (A) and (B) if the Commissioner 
determines that a waiver or modification is an equitable 
response to exceptional or uncontrollable circumstances 
affecting the State.
  [(3)(A) Except as provided in subparagraph (B), the amount of 
a payment under this section with respect to any construction 
project in any State shall be equal to the same percentage of 
the cost of such project as the Federal share that is 
applicable in the case of rehabilitation facilities (as defined 
in section 645(g) of the Public Health Service Act (42 U.S.C. 
291o(a))), in such State.
  [(B) If the Federal share with respect to rehabilitation 
facilities in such State is determined pursuant to section 
645(b)(2) of such Act (42 U.S.C. 291o(b)(2)), the percentage of 
the cost for purposes of this section shall be determined in 
accordance with regulations prescribed by the Commissioner 
designed to achieve as nearly as practicable results comparable 
to the results obtained under such section.
  [(b) The method of computing and paying amounts pursuant to 
subsection (a) shall be as follows:
          [(1) The Commissioner shall, prior to the beginning 
        of each calendar quarter or other period prescribed by 
        the Commissioner, estimate the amount to be paid to 
        each State under the provisions of such subsection for 
        such period, such estimate to be based on such records 
        of the State and information furnished by it, and such 
        other investigation as the Commissioner may find 
        necessary.
          [(2) The Commissioner shall pay, from the allotment 
        available therefor, the amount so estimated by the 
        Commissioner for such period, reduced or increased, as 
        the case may be, by any sum (not previously adjusted 
        under this paragraph) by which the Commissioner finds 
        that the estimate of the amount to be paid the State 
        for any prior period under such subsection was greater 
        or less than the amount which should have been paid to 
        the State for such prior period under such subsection. 
        Such payment shall be made prior to audit or settlement 
        by the General Accounting Office, shall be made through 
        the disbursing facilities of the Treasury Department, 
        and shall be made in such installments as the 
        Commissioner may determine.
                       [client assistance program

  [Sec. 112. (a) From funds appropriated under subsection (i), 
the Secretary shall, in accordance with this section, make 
grants to States to establish and carry out client assistance 
programs to provide assistance in informing and advising all 
clients and client applicants of all available benefits under 
this Act, and, upon request of such clients or client 
applicants, to assist and advocate for such clients or 
applicants in their relationships with projects, programs, and 
community rehabilitation programs providing services to them 
under this Act, including assistance and advocacy in pursuing 
legal, administrative, or other appropriate remedies to ensure 
the protection of the rights of such individuals under this Act 
and to facilitate access to the services funded under this Act 
through individual and systemic advocacy. The client assistance 
program shall provide information on the available services and 
benefits under this Act and title I of the Americans with 
Disabilities Act of 1990 (42 U.S.C. 12111 et seq.) to 
individuals with disabilities in the State, especially with 
regard to individuals with disabilities who have traditionally 
been unserved or underserved by vocational rehabilitation 
programs. In providing assistance and advocacy under this 
subsection with respect to services under this title, a client 
assistance program may provide the assistance and advocacy with 
respect to services that are directly related to facilitating 
the employment of the individual.
  [(b) No State may receive payments from its allotment under 
this Act in any fiscal year unless the State has in effect not 
later than October 1, 1984, a client assistance program which--
          [(1) has the authority to pursue legal, 
        administrative, and other appropriate remedies to 
        ensure the protection of rights of individuals with 
        disabilities who are receiving treatments, services, or 
        rehabilitation under this Act within the State; and
          [(2) meets the requirements of designation under 
        subsection (c).
  [(c)(1)(A) The Governor shall designate a public or private 
agency to conduct the client assistance program under this 
section. Except as provided in the last sentence of this 
paragraph, the Governor shall designate an agency which is 
independent of any agency which provides treatment, services, 
or rehabilitation to individuals under this Act. If there is an 
agency in the State which has, or had, prior to the date of 
enactment of the Rehabilitation Amendments of 1984, served as a 
client assistance agency under this section and which received 
Federal financial assistance under this Act, the Governor may, 
in the initial designation, designate an agency which provides 
treatment, services, or rehabilitation to individuals with 
disabilities under this Act.
  [(B) The Governor may not redesignate the agency designated 
under subparagraph (A) without good cause and unless--
          [(i) the Governor has given the agency 30 days notice 
        of the intention to make such redesignation, including 
        specification of the good cause for such redesignation 
        and an opportunity to respond to the assertion that 
        good cause has been shown;
          [(ii) individuals with disabilities or their 
        representatives have timely notice of the redesignation 
        and opportunity for public comment; and
          [(iii) the agency has the opportunity to appeal to 
        the Commissioner on the basis that the redesignation 
        was not for good cause.
  [(2) In carrying out the provisions of this section, the 
Governor shall consult with the director of the State 
vocational rehabilitation agency, the head of the developmental 
disability protection and advocacy agency, and with 
representatives of professional and consumer organizations 
serving individuals with disabilities in the State.
  [(3) The agency designated under this subsection shall be 
accountable for the proper use of funds made available to the 
agency.
  [(4) For the purpose of this subsection, the term 
``Governor'' means the chief executive of the State.
  [(d) The agency designated under subsection (c) of this 
section may not bring any class action in carrying out its 
responsibilities under this section.
  [(e)(1)(A) The Secretary shall allot the sums appropriated 
for each fiscal year under this section among the States on the 
basis of relative population of each State, except that no 
State shall receive less than $50,000.
  [(B) The Secretary shall allot $30,000 each to American 
Samoa, Guam, the Virgin Islands, the Northern Mariana Islands, 
and the Republic of Palau, except that the Republic of Palau 
may receive such allotment under this section only until the 
Compact of Free Association with Palau takes effect.
  [(C) For the purpose of this paragraph, the term ``State'' 
does not include American Samoa, Guam, the Virgin Islands, the 
Northern Mariana Islands, and the Republic of Palau.
  [(D)(i) In any fiscal year that the funds appropriated for 
such fiscal year exceed $7,500,000, the minimum allotment shall 
be $100,000 for States and $45,000 for territories.
  [(ii) For any fiscal year in which the total amount 
appropriated under subsection (h) exceeds the total amount 
appropriated under such subsection for the preceding fiscal 
year by a percentage greater than the most recent percentage 
change in the Consumer Price Index For All Urban Consumers 
published by the Secretary of Labor under section 100(c)(1), 
the Secretary shall increase each of the minimum allotments 
under clause (i) by such percentage change in the Consumer 
Price Index For All Urban Consumers.
  [(2) The amount of an allotment to a State for a fiscal year 
which the Secretary determines will not be required by the 
State during the period for which it is available for the 
purpose for which allotted shall be available for reallotment 
by the Secretary at appropriate times to other States with 
respect to which such a determination has not been made, in 
proportion to the original allotments of such States for such 
fiscal year, but with such proportionate amount for any of such 
other States being reduced to the extent it exceeds the sum the 
Secretary estimates such State needs and will be able to use 
during such period; and the total of such reduction shall be 
similarly reallotted among the States whose proportionate 
amounts were not so reduced. Any such amount so reallotted to a 
State for a fiscal year shall be deemed to be a part of its 
allotment for such fiscal year.
  [(3) Except as specifically prohibited by or as otherwise 
provided in State law, the Secretary shall pay to the agency 
designated under subsection (c) the amount specified in the 
application approved under subsection (f).
  [(f) No grant may be made under this section unless the State 
submits an application to the Secretary at such time, in such 
manner, and containing or accompanied by such information as 
the Secretary deems necessary to meet the requirements of this 
section.
  [(g) The Secretary shall prescribe regulations applicable to 
the client assistance program which shall include the following 
requirements:
          [(1) No employees of such programs shall, while so 
        employed, serve as staff or consultants of any 
        rehabilitation project, program, or facility receiving 
        assistance under this Act in the State.
          [(2) Each program shall be afforded reasonable access 
        to policymaking and administrative personnel in the 
        State and local rehabilitation programs, projects, or 
        facilities.
          [(3) Each program shall contain provisions designed 
        to assure that to the maximum extent possible mediation 
        procedures are used prior to resorting to 
        administrative or legal remedies.
          [(4) The agency designated under subsection (c) shall 
        submit an annual report to the Secretary on the 
        operation of the program during the previous year, 
        including a summary of the work done and the uniform 
        statistical tabulation of all cases handled by such 
        program. A copy of each such report shall be submitted 
        to the appropriate committees of the Congress by the 
        Secretary, together with a summary of such reports and 
        the Secretary's evaluation of the program, including 
        appropriate recommendations.
          [(5) Each such report shall contain information on 
        the number of requests the client assistance program 
        under this section receives annually, the number of 
        requests such program is unable to serve, and the 
        reasons that the program is unable to serve all the 
        requests.
          [(6) For purposes of such report or for any other 
        periodic audit, report, or evaluation of the 
        performance of a client assistance program under this 
        section, the Secretary shall not require such a program 
        to disclose the identity of, or any other personally 
        identifiable information related to, any individual 
        requesting assistance under such program.
  [(h) There are authorized to be appropriated such sums as may 
be necessary for fiscal years 1993 through 1997 to carry out 
the provisions of this section.

                [Part C--Innovation and Expansion Grants

[SEC. 120. STATE ELIGIBILITY.

  [Effective October 1, 1993, any State desiring to receive 
assistance under this part and part B of this title shall 
prepare and submit to the Commissioner a statewide strategic 
plan for developing and using innovative approaches for 
achieving long-term success in expanding and improving 
vocational rehabilitation services, including supported 
employment services, provided under the State plan submitted 
under section 101 and the supplement to the State plan 
submitted under part C of title VI.

[SEC. 121. CONTENTS OF STRATEGIC PLANS.

  [(a) Purpose and Policy.--The strategic plan shall be 
designed to achieve the purpose and policy of this title and 
carry out the State plan and the supplement to the State plan 
submitted under part C of title VI.
  [(b) Contents.--The strategic plan shall include--
          [(1) a statement of the mission, philosophy, values, 
        and principles of the vocational rehabilitation program 
        in the State;
          [(2) specific goals and objectives for expanding and 
        improving the system for providing the vocational 
        rehabilitation program;
          [(3) specific multifaceted and systemic approaches 
        for accomplishing the objectives, including interagency 
        coordination and cooperation, that build upon state-of-
        the-art practices and research findings and that 
        implement the State plan and the supplement to the 
        State plan submitted under part C of title VI;
          [(4) a description of the specific programs, 
        projects, and activities funded under this part and how 
        the programs, projects, and activities accomplish the 
        objectives; and
          [(5) specific criteria for determining whether the 
        objectives have been achieved, an assurance that the 
        State will conduct an annual evaluation to determine 
        the extent to which the objectives have been achieved, 
        and, if specific objectives have not been achieved, the 
        reasons that the objectives have not been achieved and 
        a description of alternative approaches that will be 
        taken.

[SEC. 122. PROCESS FOR DEVELOPING STRATEGIC PLANS.

  [(a) Period and Updates.--The strategic plan shall cover a 3-
year period and shall be updated on an annual basis to reflect 
actual experience over the previous year and input from the 
State Rehabilitation Advisory Council established under section 
105, individuals with disabilities, and other interested 
parties.
  [(b) Recommendations.--Prior to developing the strategic 
plan, the State shall hold public forums and meet with and 
receive recommendations from members of the State 
Rehabilitation Advisory Council and the Statewide Independent 
Living Council established under section 705.
  [(c) Consideration of Recommendations.--The State shall 
consider the recommendations and, if the State rejects the 
recommendations, shall include a written explanation of the 
rejection in the strategic plan.
  [(d) Procedure.--The State shall develop a procedure for 
ensuring ongoing comment from the councils described in 
subsection (b) as the plan is being implemented.
  [(e) Dissemination.--The State shall widely disseminate the 
strategic plan to individuals with disabilities, disability 
organizations, rehabilitation professionals, and other 
interested persons.

[SEC. 123. USE OF FUNDS.

  [A State may use funds made available under this part, 
directly or by grant, contract, or other arrangement, to carry 
out--
          [(1) programs to initiate and expand employment 
        opportunities for individuals with severe disabilities 
        in integrated settings that allow for the use of on-
        the-job training to promote the objectives of title I 
        of the Americans with Disabilities Act of 1990 (42 
        U.S.C. 12111 et seq.);
          [(2) programs or activities to improve the provision 
        of, and expand, employment services in integrated 
        settings to individuals with sensory, cognitive, 
        physical, and mental impairments who have traditionally 
        not been served by the State vocational rehabilitation 
        agency;
          [(3) programs and activities to maximize the ability 
        of individuals with disabilities to use rehabilitation 
        technology in employment settings;
          [(4) programs and activities that--
                  [(A) assist employers in accommodating, 
                evaluating, training, or placing individuals 
                with disabilities in the workplace of the 
                employer consistent with provisions of this Act 
                and title I of the Americans with Disabilities 
                Act of 1990; and
                  [(B) may include short-term technical 
                assistance or other effective strategies;
          [(5) programs and activities that expand and improve 
        the extent and type of client involvement in the review 
        and selection of the training and employment goals of 
        the client;
          [(6) programs and activities that expand and improve 
        opportunities for career advancement for individuals 
        with severe disabilities;
          [(7) programs, projects, and activities designed to 
        initiate, expand, or improve working relationships 
        between vocational rehabilitation services provided 
        under this title and independent living services 
        provided under title VII;
          [(8) programs, projects, and activities designed to 
        improve functioning of the system for delivering 
        vocational rehabilitation services and to improve 
        coordination and working relationships with other State 
        and local agencies, business, industry, labor, 
        community rehabilitation programs, and centers for 
        independent living, including projects designed to--
                  [(A) increase the ease of access to, 
                timeliness of, and quality of vocational 
                rehabilitation services through the development 
                and implementation of policies, procedures, and 
                systems and interagency mechanisms for 
                providing vocational rehabilitation services;
                  [(B) improve the working relationships 
                between State vocational rehabilitation 
                agencies, and other State agencies, centers for 
                independent living, community rehabilitation 
                programs, educational agencies involved in 
                higher education, adult basic education, and 
                continuing education, and businesses, industry, 
                and labor organizations, in order to create and 
                facilitate cooperation in--
                          [(i) planning and implementing 
                        services; and
                          [(ii) the development of an 
                        integrated system of community-based 
                        vocational rehabilitation service that 
                        includes appropriate transitions 
                        between service systems; and
                  [(C) improve the ability of professionals, 
                clients, advocates, business, industry, and 
                labor to work in cooperative partnerships to 
                improve the quality of vocational 
                rehabilitation services and job and career 
                opportunities for individuals with 
                disabilities;
          [(9) support efforts to ensure that the annual 
        evaluation of the effectiveness of the program in 
        meeting the goals and objectives set forth in the State 
        plan, including the system for evaluating the 
        performance of rehabilitation counselors, coordinators, 
        and other personnel used in the State, facilitates and 
        does not impede the accomplishment of the purpose and 
        policy of this title, including serving, among others, 
        individuals with the most severe disabilities;
          [(10) support the initiation, expansion, and 
        improvement of a comprehensive system of personnel 
        development;
          [(11) support the provision of training and technical 
        assistance to clients, business, industry, labor, 
        community rehabilitation programs, and others regarding 
        the implementation of the amendments made by the 
        Rehabilitation Act Amendments of 1992, of title V of 
        this Act, and of the Americans with Disabilities Act of 
        1990; and
          [(12) support the funding of the State Rehabilitation 
        Advisory Council and the Statewide Independent Living 
        Council established under section 705.

[SEC. 124. ALLOTMENTS AMONG STATES.

  [(a) In General.--
          [(1) States.--
                  [(A) Population basis.--Except as provided in 
                subparagraph (B), from sums appropriated for 
                each fiscal year to carry out this part (not 
                including sums used in accordance with section 
                101(a)(34)(B)), the Commissioner shall make an 
                allotment to each State whose State plan has 
                been approved under section 101 of an amount 
                bearing the same ratio to such sums as the 
                population of the State bears to the population 
                of all States.
                  [(B) Minimums.--Subject to the availability 
                of appropriations to carry out this part, the 
                allotment to any State under subparagraph (A) 
                shall be not less than $200,000 or one-third of 
                one percent of the sums made available for the 
                fiscal year for which the allotment is made, 
                whichever is greater, and the allotment of any 
                State under this section for any fiscal year 
                that is less than $200,000 or one-third of one 
                percent of such sums shall be increased to the 
                greater of the two amounts.
          [(2) Certain territories.--
                  [(A) In general.--For the purposes of 
                paragraph (1)(B), Guam, American Samoa, the 
                United States Virgin Islands, the Commonwealth 
                of the Northern Mariana Islands, and the 
                Republic of Palau shall not be considered to be 
                States.
                  [(B) Allotment.--Each jurisdiction described 
                in subparagraph (A) shall be allotted under 
                paragraph (1)(A) not less than one-eighth of 
                one percent of the amounts made available for 
                purposes of this part for the fiscal year for 
                which the allotment is made, except that the 
                Republic of Palau may receive such allotment 
                under this section only until the Compact of 
                Free Association with Palau takes effect.
          [(3) Adjustment for inflation.--For any fiscal year, 
        beginning in fiscal year 1994, in which the total 
        amount appropriated to carry out this part exceeds the 
        total amount appropriated to carry out this part for 
        the preceding fiscal year by a percentage greater than 
        the most recent percentage change in the Consumer Price 
        Index For All Urban Consumers published by the 
        Secretary of Labor under section 100(c)(1), the 
        Commissioner shall increase the minimum allotment under 
        paragraph (1)(B) by such percentage change in the 
        Consumer Price Index For All Urban Consumers.
  [(b) Proportional Reduction.--To provide minimum allotments 
to States (as increased under subsection (a)(3)) under 
subsection (a)(1)(B), or to provide minimum allotments to 
States under subsection (a)(2)(B), the Commissioner shall 
proportionately reduce the allotments of the remaining States 
under subsection (a)(1)(A), with such adjustments as may be 
necessary to prevent the allotment of any such remaining State 
from being reduced to less than the minimum allotment for a 
State (as increased under subsection (a)(3)) under subsection 
(a)(1)(B), or the minimum allotment for a State under 
subsection (a)(2)(B), as appropriate.
  [(c) Reallotment.--Whenever the Commissioner determines that 
any amount of an allotment to a State for any fiscal year will 
not be expended by such State for carrying out the provisions 
of this part, the Commissioner shall make such amount available 
for carrying out the purposes of this part to one or more of 
the States that the Commissioner determines will be able to use 
additional amounts during such year for carrying out such 
provisions. Any amount made available to a State for any fiscal 
year pursuant to the preceding sentence shall, for the purposes 
of this section, be regarded as an increase in the allotment of 
the State (as determined under the preceding provisions of this 
section) for such year.
      [Part D--American Indian Vocational Rehabilitation Services

               [vocational rehabilitation services grants

  [Sec. 130. (a) The Commissioner, in accordance with the 
provisions of this part, may make grants to the governing 
bodies of Indian tribes located on Federal and State 
reservations (and consortia of such governing bodies) to pay 90 
percent of the costs of vocational rehabilitation services for 
American Indians who are individuals with disabilities residing 
on such reservations. The non-Federal share of such costs may 
be in cash or in kind, fairly valued, and the Commissioner may 
waive such non-Federal share requirement in order to carry out 
the purposes of this Act.
  [(b)(1) No grant may be made under this part for any fiscal 
year unless an application therefor has been submitted to and 
approved by the Commissioner. The Commissioner may not approve 
an application unless the application--
          [(A) is made at such time, in such manner, and 
        contains such information as the Commissioner may 
        require;
          [(B) contains assurances that the rehabilitation 
        services provided under this part to American Indians 
        who are individuals with disabilities residing on a 
        reservation in a State shall be, to the maximum extent 
        feasible, comparable to rehabilitation services 
        provided under this title to other individuals with 
        disabilities residing in the State and that, where 
        appropriate, may include services traditionally used by 
        Indian tribes; and
          [(C) contains assurances that the application was 
        developed in consultation with the designated State 
        unit of the State.
  [(2) The provisions of sections 5, 6, 7, and 102(a) of the 
Indian Self-Determination and Education Assistance Act shall be 
applicable to any application submitted under this part. For 
purposes of this paragraph, any reference in any such provision 
to the Secretary of Education or to the Secretary of the 
Interior shall be considered to be a reference to the 
Commissioner.
  [(3) Any application approved under this part shall be 
effective for not less than twelve months or more than 36 
months, except as determined otherwise by the Commissioner 
pursuant to prescribed regulations. The State shall continue to 
provide vocational rehabilitation services under its State plan 
to American Indians residing on a reservation whenever such 
State includes any such American Indians in its State 
population under section 110(a)(1).
  [(4) In making grants under this part, the Secretary shall 
give priority consideration to applications for the 
continuation of programs which have been funded under this 
part.
  [(5) Nothing in this section may be construed to authorize a 
separate service delivery system for Indian residents of a 
State who reside in non-reservation areas.
  [(c) The term ``reservation'' includes Indian reservations, 
public domain Indian allotments, former Indian reservations in 
Oklahoma, and land held by incorporated Native groups, regional 
corporations, and village corporations under the provisions of 
the Alaska Native Claims Settlement Act.

     [Part E--Vocational Rehabilitation Services Client Information

[SEC. 140. REVIEW OF DATA COLLECTION AND REPORTING SYSTEM.

  [(a) Review.--The Commissioner shall conduct a comprehensive 
review of the current system for collecting and reporting data 
on clients of programs carried out under this Act, particularly 
data on clients of the programs carried out under this title.
  [(b) Considerations.--
          [(1) Current data.--In conducting the review, the 
        Commissioner shall examine the kind, quantity, and 
        quality of the data that are currently collected and 
        reported, taking into consideration the range of 
        purposes that the data serve at the Federal, State, and 
        local levels.
          [(2) Additional information.--In conducting the 
        review, the Commissioner shall examine the feasibility 
        of collecting and reporting under the system 
        information, if such information can be determined, 
        with respect to each client participating in a program 
        under this Act, regarding--
                  [(A) other programs in which the client 
                participated during the 3 years before the date 
                on which the client applied to participate in a 
                program under this Act;
                  [(B) the number of jobs held, hours worked, 
                and earnings received by the client during such 
                3 years;
                  [(C) the types of major and secondary 
                disabilities of the client;
                  [(D) the dates of the onset of the 
                disabilities;
                  [(E) the severity of the disabilities;
                  [(F) the source from which the client was 
                referred to a program under this Act;
                  [(G) the hours worked by the client;
                  [(H) the size and industry code of the place 
                of employment of the client at the time of 
                entry into such a program and at the 
                termination of services under the program;
                  [(I) the number of services provided to the 
                client under the programs and the cost of each 
                service;
                  [(J) the types of public support received by 
                the client;
                  [(K) the primary sources of economic support 
                and amounts of public assistance received by 
                the client before and after receiving the 
                services;
                  [(L) whether the client is covered by health 
                insurance from any source and whether health 
                insurance is available through the employer of 
                the client;
                  [(M) the supported employment status of the 
                client; and
                  [(N) the reasons for terminating the services 
                received by the client.
  [(c) Recommendations.--Based on the review, the Commissioner 
shall recommend improvements in the data collection and 
reporting system.
  [(d) Views.--In developing the recommendations, the 
Commissioner shall seek views of persons and entities providing 
or using such data, including State agencies, State 
Rehabilitation Advisory Councils, providers of vocational 
rehabilitation services, professionals in the field of 
vocational rehabilitation, clients and organizations 
representing clients, the National Council on Disability, other 
Federal agencies, non-Federal researchers, other analysts using 
the data, and other members of the public.
  [(e) Publication and Submission of Report.--Not later than 18 
months after the date of the enactment of the Rehabilitation 
Act Amendments of 1992 (Public Law 102-569), the Commissioner 
shall publish the recommendations in the Federal Register and 
shall prepare and submit a report containing the 
recommendations to the appropriate committees of Congress. The 
Commissioner shall not implement the recommendations earlier 
than 90 days after the date on which the Commissioner submits 
the report.

[SEC. 141. EXCHANGE OF DATA.

  [(a) Exchange.--The Secretary of Education and the Secretary 
of Health and Human Services shall enter into a memorandum of 
understanding for the purposes of exchanging data of mutual 
importance--
          [(1) that concern clients of State vocational 
        rehabilitation agencies; and
          [(2) that are data maintained either by--
                  [(A) the Rehabilitation Services 
                Administration, as required by section 13; or
                  [(B) the Social Security Administration, from 
                its Summary Earnings and Records and Master 
                Beneficiary Records.
  [(b) Treatment of Information.--For purposes of the exchange, 
the data described in subsection (a)(2)(B) shall not be 
considered return information (as defined in section 6103(b)(2) 
of the Internal Revenue Code of 1986) and, as appropriate, the 
confidentiality of all client information shall be maintained 
by both agencies.]
              TITLE I--VOCATIONAL REHABILITATION SERVICES

SEC. 100. PURPOSE.

  The purpose of this title is to assist States in making 
available to individuals with disabilities a program of 
employment, training, and rehabilitation services that is 
consistent with their strengths, resources, priorities, 
concerns, abilities, and capabilities; that maximizes 
individuals' control over their vocational and career choices; 
and that is in accordance with the goal of assuring equality of 
opportunity, full participation, independent living, and 
economic self-sufficiency for such individuals.

SEC. 101. FORMULA GRANTS.

  (a) In General.--
          (1) Formula grants.--In the case of each State that 
        submits to the Secretary a workforce development and 
        literacy plan for fiscal year 1999 or any subsequent 
        fiscal year that meets the requirement of section 104 
        of the Consolidated and Reformed Education, Employment, 
        and Rehabilitation Systems Act, the Secretary shall 
        make a grant for the year to the State as the Federal 
        share of carrying out the purposes specified in this 
        title. The grant shall consist of the allotment 
        determined for the State under section 107.
          (2) Conditions for grant.--A State may receive a 
        grant under paragraph (1) for a fiscal year only if the 
        State meets the conditions described in this title for 
        the State for the fiscal year.
  (b) Administrator of Federal Program.--The Secretary shall 
carry out this title acting through the Commissioner of the 
Rehabilitation Services Administration, except as indicated 
otherwise.
  (c) Rule of Construction.--The purpose specified in section 
100 shall be carried out only in accordance with the other 
provisions of this title.
  (d) Funding.--
          (1) Authorization of appropriations.--For the purpose 
        of carrying out this title, there are authorized to be 
        appropriated such sums as may be necessary for each of 
        the fiscal years 1999 through 2002, except that the 
        amount to be appropriated for a fiscal year shall not 
        be less than the amount of the appropriation under this 
        subsection for the immediately preceding fiscal year, 
        plus the amount of the Consumer Price Index addition 
        determined under paragraph (2) for the immediately 
        preceding fiscal year.
          (2) Adjustments pursuant to consumer price index.--
                  (A) Not later than November 15 of each fiscal 
                year, the Secretary of Labor shall publish in 
                the Federal Register the percentage change in 
                the Consumer Price Index published for October 
                of the preceding fiscal year and October of the 
                fiscal year in which such publication is made.
                  (B) If in any fiscal year the percentage 
                change published under subparagraph (A) 
                indicates an increase in the Consumer Price 
                Index, then the amount to be appropriated under 
                paragraph (1) for the subsequent fiscal year 
                shall be at least the amount appropriated for 
                the fiscal year in which the publication is 
                made under subparagraph (A) increased by such 
                percentage change.
                  (C) If in any fiscal year the percentage 
                change published under subparagraph (A) does 
                not indicate an increase in the Consumer Price 
                Index, then the amount to be appropriated under 
                paragraph (1) for the subsequent fiscal year 
                shall be at least the amount appropriated for 
                the fiscal year in which the publication is 
                made under subparagraph (A).
                  (D) For purposes of this paragraph, the term 
                ``Consumer Price Index'' means the Consumer 
                Price Index for All Urban Consumers, published 
                monthly by the Bureau of Labor Statistics.
          (3) Automatic extension of authorization.--
                  (A) Unless, in the regular session that ends 
                prior to the beginning of the last fiscal year 
                for which an authorization of appropriations is 
                provided in paragraph (1), legislation has been 
                enacted that has the effect of extending such 
                authorization, such authorization is 
                automatically extended for one additional year.
                  (B) The amount authorized to be appropriated 
                for the additional fiscal year described in 
                subparagraph (A) shall be an amount equal to 
                the amount appropriated for such program for 
                fiscal year 2002, plus the amount of the 
                Consumer Price Index addition determined under 
                paragraph (2) for the immediately preceding 
                fiscal year.
                  (C) In any case where the Commissioner is 
                required under an applicable statute to carry 
                out certain acts or make certain determinations 
                that are necessary for the continuation of the 
                program authorized by this title, and such acts 
                or determinations are required during the last 
                fiscal year for which an authorization of 
                appropriations is provided in paragraph (1), 
                such acts and determinations shall be required 
                during any fiscal year for which subparagraph 
                (A) is in operation.

SEC. 102. ALLOCATION WITHIN STATE OF ADMINISTRATIVE RESPONSIBILITIES.

  (a) In General.--For purposes of section 101(a), a State 
will--
          (1) subject to subsection (b), reserve not more than 
        20 percent of the grant under such section for the 
        fiscal year involved for carrying out the 
        responsibilities of a State administrative agent under 
        section 103; and
          (2) reserve not less than 80 percent of the grant for 
        carrying out the responsibilities under section 104 of 
        local workforce development boards and one-stop career 
        centers with respect to workforce development areas.
  (b) Additional State Responsibilities.--Amounts reserved by a 
State under subsection (a)(1) may be expended by the State 
administrative agent to carry out responsibilities that 
otherwise would be carried out under section 104 by local 
workforce development boards or one-stop career centers, if the 
State determines that such expenditures are justified to make 
available goods and services that could not otherwise be 
obtained within a local workforce development area, to provide 
services to individuals unable to utilize the one-stop career 
centers, or to otherwise ensure the efficient and equitable 
provision in the State of services under this title, including 
the provision of services for individuals in rural areas.
  (c) Certain Definitions.--For purposes of this Act, the terms 
``State admini