[Congressional Record Volume 144, Number 104 (Wednesday, July 29, 1998)]
[House]
[Pages H6604-H6695]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    CONFERENCE REPORT ON H.R. 1385, WORKFORCE INVESTMENT ACT OF 1998

  Mr. BOB SCHAFFER of Colorado submitted the following conference 
report and statement on the bill (H.R. 1385) to consolidate, 
coordinate, and improve employment, training, literacy, and vocational 
rehabilitation programs in the United States, and for other purposes:

                  Conference Report (H. Rept. 105-659)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendment of the Senate to the bill (H.R. 
     1385), to consolidate, coordinate, and improve employment, 
     training, literacy, and vocational rehabilitation programs in 
     the United States, and for other purposes, having met, after 
     full and free conference, have agreed to recommend and do 
     recommend to their respective Houses as follows:
       That the House recede from its disagreement to the 
     amendment of the Senate and agree to the same with an 
     amendment as follows:
       In lieu of the matter proposed to be inserted by the Senate 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Workforce 
     Investment Act of 1998''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                 TITLE I--WORKFORCE INVESTMENT SYSTEMS

              Subtitle A--Workforce Investment Definitions

Sec. 101. Definitions.

      Subtitle B--Statewide and Local Workforce Investment Systems

Sec. 106. Purpose.

                      Chapter 1--State Provisions

Sec. 111. State workforce investment boards.
Sec. 112. State plan.

[[Page H6605]]

                      Chapter 2--Local Provisions

Sec. 116. Local workforce investment areas.
Sec. 117. Local workforce investment boards.
Sec. 118. Local plan.

          Chapter 3--Workforce Investment Activities Providers

Sec. 121. Establishment of one-stop delivery systems.
Sec. 122. Identification of eligible providers of training services.
Sec. 123. Identification of eligible providers of youth activities.

                      Chapter 4--Youth Activities

Sec. 126. General authorization.
Sec. 127. State allotments.
Sec. 128. Within State allocations.
Sec. 129. Use of funds for youth activities.

    Chapter 5--Adult And Dislocated Worker Employment and Training 
                               Activities

Sec. 131. General authorization.
Sec. 132. State allotments.
Sec. 133. Within State allocations.
Sec. 134. Use of funds for employment and training activities.

                     Chapter 6--General Provisions

Sec. 136. Performance accountability system.
Sec. 137. Authorization of appropriations.

                         Subtitle C--Job Corps

Sec. 141. Purposes.
Sec. 142. Definitions.
Sec. 143. Establishment.
Sec. 144. Individuals eligible for the job corps.
Sec. 145. Recruitment, screening, selection, and assignment of 
              enrollees.
Sec. 146. Enrollment.
Sec. 147. Job corps centers.
Sec. 148. Program activities.
Sec. 149. Counseling and job placement.
Sec. 150. Support.
Sec. 151. Operating plan.
Sec. 152. Standards of conduct.
Sec. 153. Community participation.
Sec. 154. Industry councils.
Sec. 155. Advisory committees.
Sec. 156. Experimental, research, and demonstration projects.
Sec. 157. Application of provisions of Federal law.
Sec. 158. Special provisions.
Sec. 159. Management information.
Sec. 160. General provisions.
Sec. 161. Authorization of appropriations.

                     Subtitle D--National Programs

Sec. 166. Native american programs.
Sec. 167. Migrant and seasonal farmworker programs.
Sec. 168. Veterans' workforce investment programs.
Sec. 169. Youth opportunity grants.
Sec. 170. Technical assistance.
Sec. 171. Demonstration, pilot, multiservice, research, and multistate 
              projects.
Sec. 172. Evaluations.
Sec. 173. National emergency grants.
Sec. 174. Authorization of appropriations.

                       Subtitle E--Administration

Sec. 181. Requirements and restrictions.
Sec. 182. Prompt allocation of funds.
Sec. 183. Monitoring.
Sec. 184. Fiscal controls; sanctions.
Sec. 185. Reports; recordkeeping; investigations.
Sec. 186. Administrative adjudication.
Sec. 187. Judicial review.
Sec. 188. Nondiscrimination.
Sec. 189. Administrative provisions.
Sec. 190. Reference.
Sec. 191. State legislative authority.
Sec. 192. Workforce flexibility plans.
Sec. 193. Use of certain real property.
Sec. 194. Continuation of State activities and policies.
Sec. 195. General program requirements.

             Subtitle F--Repeals and Conforming Amendments

Sec. 199. Repeals.
Sec. 199A. Conforming amendments.

                 TITLE II--ADULT EDUCATION AND LITERACY

Sec. 201. Short title.
Sec. 202. Purpose.
Sec. 203. Definitions.
Sec. 204. Home schools.
Sec. 205. Authorization of appropriations.

           Subtitle A--Adult Education and Literacy Programs

                     Chapter 1--Federal Provisions

Sec. 211. Reservation; grants to eligible agencies; allotments.
Sec. 212. Performance accountability system.

                      Chapter 2--State Provisions

Sec. 221. State administration.
Sec. 222. State distribution of funds; matching requirement.
Sec. 223. State leadership activities.
Sec. 224. State plan.
Sec. 225. Programs for corrections education and other 
              institutionalized individuals.

                      Chapter 3--Local Provisions

Sec. 231. Grants and contracts for eligible providers.
Sec. 232. Local application.
Sec. 233. Local administrative cost limits.

                     Chapter 4--General Provisions

Sec. 241. Administrative provisions.
Sec. 242. National institute for literacy.
Sec. 243. National leadership activities.

                          Subtitle B--Repeals

Sec. 251. Repeals.

           TITLE III--WORKFORCE INVESTMENT-RELATED ACTIVITIES

                     Subtitle A--Wagner-Peyser Act

Sec. 301. Definitions.
Sec. 302. Functions.
Sec. 303. Designation of State agencies.
Sec. 304. Appropriations.
Sec. 305. Disposition of allotted funds.
Sec. 306. State plans.
Sec. 307. Repeal of Federal advisory council.
Sec. 308. Regulations.
Sec. 309. Employment statistics.
Sec. 310. Technical amendments.
Sec. 311. Effective date.

                Subtitle B--Linkages With Other Programs

Sec. 321. Trade act of 1974.
Sec. 322. Veterans' employment programs.
Sec. 323. Older americans act of 1965.

         Subtitle C--Twenty-First Century Workforce Commission

Sec. 331. Short title.
Sec. 332. Findings.
Sec. 333. Definitions.
Sec. 334. Establishment of twenty-first century workforce commission.
Sec. 335. Duties of the commission.
Sec. 336. Powers of the commission.
Sec. 337. Commission personnel matters.
Sec. 338. Termination of the commission.
Sec. 339. Authorization of appropriations.

 Subtitle D--Application of Civil Rights and Labor-Management Laws to 
                      the Smithsonian Institution

Sec. 341. Application of civil rights and labor-management laws to the 
              Smithsonian Institution.

            TITLE IV--REHABILITATION ACT AMENDMENTS OF 1998

Sec. 401. Short title.
Sec. 402. Title.
Sec. 403. General provisions.
Sec. 404. Vocational rehabilitation services.
Sec. 405. Research and training.
Sec. 406. Professional development and special projects and 
              demonstrations.
Sec. 407. National Council on Disability.
Sec. 408. Rights and advocacy.
Sec. 409. Employment opportunities for individuals with disabilities.
Sec. 410. Independent living services and centers for independent 
              living.
Sec. 411. Repeal.
Sec. 412. Helen Keller National Center Act.
Sec. 413. President's Committee on Employment of People With 
              Disabilities.
Sec. 414. Conforming amendments.

                      TITLE V--GENERAL PROVISIONS

Sec. 501. State unified plan.
Sec. 502. Definitions for indicators of performance.
Sec. 503. Incentive grants.
Sec. 504. Privacy.
Sec. 505. Buy-american requirements.
Sec. 506. Transition provisions.
Sec. 507. Effective date.
                 TITLE I--WORKFORCE INVESTMENT SYSTEMS
              Subtitle A--Workforce Investment Definitions

     SEC. 101. DEFINITIONS.

       In this title:
       (1) Adult.--Except in sections 127 and 132, the term 
     ``adult'' means an individual who is age 18 or older.
       (2) Adult education; adult education and literacy 
     activities.--The terms ``adult education'' and ``adult 
     education and literacy activities'' have the meanings given 
     the terms in section 203.
       (3) Area vocational education school.--The term ``area 
     vocational education school'' has the meaning given the term 
     in section 521 of the Carl D. Perkins Vocational and Applied 
     Technology Education Act (20 U.S.C. 2471).
       (4) Basic skills deficient.--The term ``basic skills 
     deficient'' means, with respect to an individual, that the 
     individual has English reading, writing, or computing skills 
     at or below the 8th grade level on a generally accepted 
     standardized test or a comparable score on a criterion-
     referenced test.
       (5) Case management.--The term ``case management'' means 
     the provision of a client-centered approach in the delivery 
     of services, designed--
       (A) to prepare and coordinate comprehensive employment 
     plans, such as service strategies, for participants to ensure 
     access to necessary workforce investment activities and 
     supportive services, using, where feasible, computer-based 
     technologies; and
       (B) to provide job and career counseling during program 
     participation and after job placement.
       (6) Chief elected official.--The term ``chief elected 
     official'' means--
       (A) the chief elected executive officer of a unit of 
     general local government in a local area; and
       (B) in a case in which a local area includes more than 1 
     unit of general local government, the individuals designated 
     under the agreement described in section 117(c)(1)(B).
       (7) Community-based organization.--The term ``community-
     based organization'' means a private nonprofit organization 
     that is representative of a community or a significant 
     segment of a community and that has demonstrated expertise 
     and effectiveness in the field of workforce investment.
       (8) Customized training.--The term ``customized training'' 
     means training--
       (A) that is designed to meet the special requirements of an 
     employer (including a group of employers);
       (B) that is conducted with a commitment by the employer to 
     employ an individual on successful completion of the 
     training; and
       (C) for which the employer pays for not less than 50 
     percent of the cost of the training.
       (9) Dislocated worker.--The term ``dislocated worker'' 
     means an individual who--
       (A)(i) has been terminated or laid off, or who has received 
     a notice of termination or layoff, from employment;
       (ii)(I) is eligible for or has exhausted entitlement to 
     unemployment compensation; or

[[Page H6606]]

       (II) has been employed for a duration sufficient to 
     demonstrate, to the appropriate entity at a one-stop center 
     referred to in section 134(c), attachment to the workforce, 
     but is not eligible for unemployment compensation due to 
     insufficient earnings or having performed services for an 
     employer that were not covered under a State unemployment 
     compensation law; and
       (iii) is unlikely to return to a previous industry or 
     occupation;
       (B)(i) has been terminated or laid off, or has received a 
     notice of termination or layoff, from employment as a result 
     of any permanent closure of, or any substantial layoff at, a 
     plant, facility, or enterprise;
       (ii) is employed at a facility at which the employer has 
     made a general announcement that such facility will close 
     within 180 days; or
       (iii) for purposes of eligibility to receive services other 
     than training services described in section 134(d)(4), 
     intensive services described in section 134(d)(3), or 
     supportive services, is employed at a facility at which the 
     employer has made a general announcement that such facility 
     will close;
       (C) was self-employed (including employment as a farmer, a 
     rancher, or a fisherman) but is unemployed as a result of 
     general economic conditions in the community in which the 
     individual resides or because of natural disasters; or
       (D) is a displaced homemaker.
       (10) Displaced homemaker.--The term ``displaced homemaker'' 
     means an individual who has been providing unpaid services to 
     family members in the home and who--
       (A) has been dependent on the income of another family 
     member but is no longer supported by that income; and
       (B) is unemployed or underemployed and is experiencing 
     difficulty in obtaining or upgrading employment.
       (11) Economic development agencies.--The term ``economic 
     development agencies'' includes local planning and zoning 
     commissions or boards, community development agencies, and 
     other local agencies and institutions responsible for 
     regulating, promoting, or assisting in local economic 
     development.
       (12) Eligible provider.--The term ``eligible provider'', 
     used with respect to--
       (A) training services, means a provider who is identified 
     in accordance with section 122(e)(3);
       (B) intensive services, means a provider who is identified 
     or awarded a contract as described in section 134(d)(3)(B);
       (C) youth activities, means a provider who is awarded a 
     grant or contract in accordance with section 123; or
       (D) other workforce investment activities, means a public 
     or private entity selected to be responsible for such 
     activities, such as a one-stop operator designated or 
     certified under section 121(d).
       (13)  Eligible youth.--Except as provided in subtitles C 
     and D, the term ``eligible youth'' means an individual who--
       (A) is not less than age 14 and not more than age 21;
       (B) is a low-income individual; and
       (C) is an individual who is 1 or more of the following:
       (i) Deficient in basic literacy skills.
       (ii) A school dropout.
       (iii) Homeless, a runaway, or a foster child.
       (iv) Pregnant or a parent.
       (v) An offender.
       (vi) An individual who requires additional assistance to 
     complete an educational program, or to secure and hold 
     employment.
       (14) Employment and training activity.--The term 
     ``employment and training activity'' means an activity 
     described in section 134 that is carried out for an adult or 
     dislocated worker.
       (15) Family.--The term ``family'' means two or more persons 
     related by blood, marriage, or decree of court, who are 
     living in a single residence, and are included in one or more 
     of the following categories:
       (A) A husband, wife, and dependent children.
       (B) A parent or guardian and dependent children.
       (C) A husband and wife.
       (16) Governor.--The term ``Governor'' means the chief 
     executive of a State.
       (17) Individual with a disability.--
       (A) In general.--The term ``individual with a disability'' 
     means an individual with any disability (as defined in 
     section 3 of the Americans with Disabilities Act of 1990 (42 
     U.S.C. 12102)).
       (B) Individuals with disabilities.--The term ``individuals 
     with disabilities'' means more than 1 individual with a 
     disability.
       (18) 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 an area 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.
       (19) Literacy.--The term ``literacy'' has the meaning given 
     the term in section 203.
       (20) Local area.--The term ``local area'' means a local 
     workforce investment area designated under section 116.
       (21) Local board.--The term ``local board'' means a local 
     workforce investment board established under section 117.
       (22) Local performance measure.--The term ``local 
     performance measure'' means a performance measure established 
     under section 136(c).
       (23) Local educational agency.--The term ``local 
     educational agency'' has the meaning given the term in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 8801).
       (24) Lower living standard income level.--The term ``lower 
     living standard income level'' means that income level 
     (adjusted for regional, metropolitan, urban, and rural 
     differences and family size) determined annually by the 
     Secretary based on the most recent lower living family budget 
     issued by the Secretary.
       (25) Low-income individual.--The term ``low-income 
     individual'' means an individual who--
       (A) receives, or is a member of a family that receives, 
     cash payments under a Federal, State, or local income-based 
     public assistance program;
       (B) received an income, or is a member of a family that 
     received a total family income, for the 6-month period prior 
     to application for the program involved (exclusive of 
     unemployment compensation, child support payments, payments 
     described in subparagraph (A), and old-age and survivors 
     insurance benefits received under section 202 of the Social 
     Security Act (42 U.S.C. 402)) that, in relation to family 
     size, does not exceed the higher of--
       (i) the poverty line, for an equivalent period; or
       (ii) 70 percent of the lower living standard income level, 
     for an equivalent period;
       (C) is a member of a household that receives (or has been 
     determined within the 6-month period prior to application for 
     the program involved to be eligible to receive) food stamps 
     pursuant to the Food Stamp Act of 1977 (7 U.S.C. 2011 et 
     seq.);
       (D) qualifies as a homeless individual, as defined in 
     subsections (a) and (c) of section 103 of the Stewart B. 
     McKinney Homeless Assistance Act (42 U.S.C. 11302);
       (E) is a foster child on behalf of whom State or local 
     government payments are made; or
       (F) in cases permitted by regulations promulgated by the 
     Secretary of Labor, is an individual with a disability whose 
     own income meets the requirements of a program described in 
     subparagraph (A) or of subparagraph (B), but who is a member 
     of a family whose income does not meet such requirements.
       (26) Nontraditional employment.--The term ``nontraditional 
     employment'' refers to occupations or fields of work for 
     which individuals from one gender comprise less than 25 
     percent of the individuals employed in each such occupation 
     or field of work.
       (27) Offender.--The term ``offender'' means any adult or 
     juvenile--
       (A) who is or has been subject to any stage of the criminal 
     justice process, for whom services under this Act may be 
     beneficial; or
       (B) who requires assistance in overcoming artificial 
     barriers to employment resulting from a record of arrest or 
     conviction.
       (28) Older individual.--The term ``older individual'' means 
     an individual age 55 or older.
       (29) One-stop operator.--The term ``one-stop operator'' 
     means 1 or more entities designated or certified under 
     section 121(d).
       (30) One-stop partner.--The term ``one-stop partner'' 
     means--
       (A) an entity described in section 121(b)(1); and
       (B) an entity described in section 121(b)(2) that is 
     participating, with the approval of the local board and chief 
     elected official, in the operation of a one-stop delivery 
     system.
       (31) On-the-job training.--The term ``on-the-job training'' 
     means training by an employer that is provided to a paid 
     participant while engaged in productive work in a job that--
       (A) provides knowledge or skills essential to the full and 
     adequate performance of the job;
       (B) provides reimbursement to the employer of up to 50 
     percent of the wage rate of the participant, for the 
     extraordinary costs of providing the training and additional 
     supervision related to the training; and
       (C) is limited in duration as appropriate to the occupation 
     for which the participant is being trained, taking into 
     account the content of the training, the prior work 
     experience of the participant, and the service strategy of 
     the participant, as appropriate.
       (32) Outlying area.--The term ``outlying area'' means the 
     United States Virgin Islands, Guam, American Samoa, the 
     Commonwealth of the Northern Mariana Islands, the Republic of 
     the Marshall Islands, the Federated States of Micronesia, and 
     the Republic of Palau.
       (33) Out-of-school youth.--The term ``out-of-school youth'' 
     means--
       (A) an eligible youth who is a school dropout; or
       (B) an eligible youth who has received a secondary school 
     diploma or its equivalent but is basic skills deficient, 
     unemployed, or underemployed.
       (34) Participant.--The term ``participant'' means an 
     individual who has been determined to be eligible to 
     participate in and who is receiving services (except followup 
     services authorized under this title) under a program 
     authorized by this title. Participation shall be deemed to 
     commence on the first day, following determination of 
     eligibility, on which the individual began receiving 
     subsidized employment, training, or other services provided 
     under this title.
       (35) Postsecondary educational institution.--The term 
     ``postsecondary educational institution'' means an 
     institution of higher education, as defined in section 481 of 
     the Higher Education Act of 1965 (20 U.S.C. 1088).
       (36) Poverty line.--The term ``poverty line'' means the 
     poverty line (as defined by the Office of Management and 
     Budget, and revised annually in accordance with section 
     673(2) of the Community Services Block Grant Act (42 U.S.C. 
     9902(2))) applicable to a family of the size involved.
       (37) 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.
       (38) Rapid response activity.--The term ``rapid response 
     activity'' means an activity provided by a State, or by an 
     entity designated by a State, with funds provided by the 
     State under section 134(a)(1)(A), in the case of a permanent 
     closure or mass layoff at a plant, facility, or enterprise, 
     or a natural or other disaster, that results in mass job 
     dislocation, in order to assist

[[Page H6607]]

     dislocated workers in obtaining reemployment as soon as 
     possible, with services including--
       (A) the establishment of onsite contact with employers and 
     employee representatives--
       (i) immediately after the State is notified of a current or 
     projected permanent closure or mass layoff; or
       (ii) in the case of a disaster, immediately after the State 
     is made aware of mass job dislocation as a result of such 
     disaster;
       (B) the provision of information and access to available 
     employment and training activities;
       (C) assistance in establishing a labor-management 
     committee, voluntarily agreed to by labor and management, 
     with the ability to devise and implement a strategy for 
     assessing the employment and training needs of dislocated 
     workers and obtaining services to meet such needs;
       (D) the provision of emergency assistance adapted to the 
     particular closure, layoff, or disaster; and
       (E) the provision of assistance to the local community in 
     developing a coordinated response and in obtaining access to 
     State economic development assistance.
       (39) School dropout.--The term ``school dropout'' means an 
     individual who is no longer attending any school and who has 
     not received a secondary school diploma or its recognized 
     equivalent.
       (40) Secondary school.--The term ``secondary school'' has 
     the meaning given the term in section 14101 of the Elementary 
     and Secondary Education Act of 1965 (20 U.S.C. 8801).
       (41) Secretary.--The term ``Secretary'' means the Secretary 
     of Labor, and the term means such Secretary for purposes of 
     section 503.
       (42) State.--The term ``State'' means each of the several 
     States of the United States, the District of Columbia, and 
     the Commonwealth of Puerto Rico.
       (43) State adjusted level of performance.--The term ``State 
     adjusted level of performance'' means a level described in 
     clause (iii) or (v) of section 136(b)(3)(A).
       (44) State board.--The term ``State board'' means a State 
     workforce investment board established under section 111.
       (45) State performance measure.--The term ``State 
     performance measure'' means a performance measure established 
     under section 136(b).
       (46) Supportive services.--The term ``supportive services'' 
     means services such as transportation, child care, dependent 
     care, housing, and needs-related payments, that are necessary 
     to enable an individual to participate in activities 
     authorized under this title, consistent with the provisions 
     of this title.
       (47) Unemployed individual.--The term ``unemployed 
     individual'' means an individual who is without a job and who 
     wants and is available for work. The determination of whether 
     an individual is without a job shall be made in accordance 
     with the criteria used by the Bureau of Labor Statistics of 
     the Department of Labor in defining individuals as 
     unemployed.
       (48) Unit of general local government.--The term ``unit of 
     general local government'' means any general purpose 
     political subdivision of a State that has the power to levy 
     taxes and spend funds, as well as general corporate and 
     police powers.
       (49) Veteran; related definition.--
       (A) Veteran.--The term ``veteran'' means an individual who 
     served in the active military, naval, or air service, and who 
     was discharged or released from such service under conditions 
     other than dishonorable.
       (B) Recently separated veteran.--The term ``recently 
     separated veteran'' means any veteran who applies for 
     participation under this title within 48 months after the 
     discharge or release from active military, naval, or air 
     service.
       (50) Vocational education.--The term ``vocational 
     education'' has the meaning given the term in section 521 of 
     the Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2471).
       (51) Workforce investment activity.--The term ``workforce 
     investment activity'' means an employment and training 
     activity, and a youth activity.
       (52) Youth activity.--The term ``youth activity'' means an 
     activity described in section 129 that is carried out for 
     eligible youth (or as described in section 129(c)(5)).
       (53) Youth council.--The term ``youth council'' means a 
     council established under section 117(h).
      Subtitle B--Statewide and Local Workforce Investment Systems

     SEC. 106. PURPOSE.

       The purpose of this subtitle is to provide workforce 
     investment activities, through statewide and local workforce 
     investment systems, that increase the employment, retention, 
     and earnings of participants, and increase occupational skill 
     attainment by participants, and, as a result, improve the 
     quality of the workforce, reduce welfare dependency, and 
     enhance the productivity and competitiveness of the Nation.

                      CHAPTER 1--STATE PROVISIONS

     SEC. 111. STATE WORKFORCE INVESTMENT BOARDS.

       (a) In General.--The Governor of a State shall establish a 
     State workforce investment board to assist in the development 
     of the State plan described in section 112 and to carry out 
     the other functions described in subsection (d).
       (b) Membership.--
       (1) In general.--The State Board shall include--
       (A) the Governor;
       (B) 2 members of each chamber of the State legislature, 
     appointed by the appropriate presiding officers of each such 
     chamber; and
       (C) representatives appointed by the Governor, who are--
       (i) representatives of business in the State, who--

       (I) are owners of businesses, chief executives or operating 
     officers of businesses, and other business executives or 
     employers with optimum policymaking or hiring authority, 
     including members of local boards described in section 
     117(b)(2)(A)(i);
       (II) represent businesses with employment opportunities 
     that reflect the employment opportunities of the State; and
       (III) are appointed from among individuals nominated by 
     State business organizations and business trade associations;

       (ii) chief elected officials (representing both cities and 
     counties, where appropriate);
       (iii) representatives of labor organizations, who have been 
     nominated by State labor federations;
       (iv) representatives of individuals and organizations that 
     have experience with respect to youth activities;
       (v) representatives of individuals and organizations that 
     have experience and expertise in the delivery of workforce 
     investment activities, including chief executive officers of 
     community colleges and community-based organizations within 
     the State;
       (vi)(I) the lead State agency officials with responsibility 
     for the programs and activities that are described in section 
     121(b) and carried out by one-stop partners; and
       (II) in any case in which no lead State agency official has 
     responsibility for such a program, service, or activity, a 
     representative in the State with expertise relating to such 
     program, service, or activity; and
       (vii) such other representatives and State agency officials 
     as the Governor may designate, such as the State agency 
     officials responsible for economic development and juvenile 
     justice programs in the State.
       (2) Authority and regional representation of board 
     members.--Members of the board that represent organizations, 
     agencies, or other entities shall be individuals with optimum 
     policymaking authority within the organizations, agencies, or 
     entities. The members of the board shall represent diverse 
     regions of the State, including urban, rural, and suburban 
     areas.
       (3) Majority.--A majority of the members of the State Board 
     shall be representatives described in paragraph (1)(C)(i).
       (c) Chairman.--The Governor shall select a chairperson for 
     the State Board from among the representatives described in 
     subsection (b)(1)(C)(i).
       (d) Functions.--The State Board shall assist the Governor 
     in--
       (1) development of the State plan;
       (2) development and continuous improvement of a statewide 
     system of activities that are funded under this subtitle or 
     carried out through a one-stop delivery system described in 
     section 134(c) that receives funds under this subtitle 
     (referred to in this title as a ``statewide workforce 
     investment system''), including--
       (A) development of linkages in order to assure coordination 
     and nonduplication among the programs and activities 
     described in section 121(b); and
       (B) review of local plans;
       (3) commenting at least once annually on the measures taken 
     pursuant to section 113(b)(14) of the Carl D. Perkins 
     Vocational and Applied Technology Education Act (20 U.S.C 
     2323(b)(14));
       (4) designation of local areas as required in section 116;
       (5) development of allocation formulas for the distribution 
     of funds for adult employment and training activities and 
     youth activities to local areas as permitted under sections 
     128(b)(3)(B) and 133(b)(3)(B);
       (6) development and continuous improvement of comprehensive 
     State performance measures, including State adjusted levels 
     of performance, to assess the effectiveness of the workforce 
     investment activities in the State as required under section 
     136(b);
       (7) preparation of the annual report to the Secretary 
     described in section 136(d);
       (8) development of the statewide employment statistics 
     system described in section 15(e) of the Wagner-Peyser Act; 
     and
       (9) development of an application for an incentive grant 
     under section 503.
       (e) Alternative Entity.--
       (1) In general.--For purposes of complying with subsections 
     (a), (b), and (c), a State may use any State entity 
     (including a State council, State workforce development 
     board, combination of regional workforce development boards, 
     or similar entity) that--
       (A) was in existence on December 31, 1997;
       (B)(i) was established pursuant to section 122 or title VII 
     of the Job Training Partnership Act, as in effect on December 
     31, 1997; or
       (ii) is substantially similar to the State board described 
     in subsections (a), (b), and (c); and
       (C) includes representatives of business in the State and 
     representatives of labor organizations in the State.
       (2) References.--References in this Act to a State board 
     shall be considered to include such an entity.
       (f) Conflict of Interest.--A member of a State board may 
     not--
       (1) vote on a matter under consideration by the State 
     board--
       (A) regarding the provision of services by such member (or 
     by an entity that such member represents); or
       (B) that would provide direct financial benefit to such 
     member or the immediate family of such member; or
       (2) engage in any other activity determined by the Governor 
     to constitute a conflict of interest as specified in the 
     State plan.
       (g) Sunshine Provision.--The State board shall make 
     available to the public, on a regular basis through open 
     meetings, information regarding the activities of the State 
     board, including information regarding the State plan prior 
     to submission of the plan, information regarding

[[Page H6608]]

     membership, and, on request, minutes of formal meetings of 
     the State board.

     SEC. 112. STATE PLAN.

       (a) In General.--For a State to be eligible to receive an 
     allotment under section 127 or 132, or to receive financial 
     assistance under the Wagner-Peyser Act (29 U.S.C. 49 et 
     seq.), the Governor of the State shall submit to the 
     Secretary for consideration by the Secretary, a single State 
     plan (referred to in this title as the ``State plan'') that 
     outlines a 5-year strategy for the statewide workforce 
     investment system of the State and that meets the 
     requirements of section 111 and this section.
       (b) Contents.--The State plan shall include--
       (1) a description of the State board, including a 
     description of the manner in which such board collaborated in 
     the development of the State plan and a description of how 
     the board will continue to collaborate in carrying out the 
     functions described in section 111(d);
       (2) a description of State-imposed requirements for the 
     statewide workforce investment system;
       (3) a description of the State performance accountability 
     system developed for the workforce investment activities to 
     be carried out through the statewide workforce investment 
     system, that includes information identifying State 
     performance measures as described in section 
     136(b)(3)(A)(ii);
       (4) information describing--
       (A) the needs of the State with regard to current and 
     projected employment opportunities, by occupation;
       (B) the job skills necessary to obtain such employment 
     opportunities;
       (C) the skills and economic development needs of the State; 
     and
       (D) the type and availability of workforce investment 
     activities in the State;
       (5) an identification of local areas designated in the 
     State, including a description of the process used for the 
     designation of such areas;
       (6) an identification of criteria to be used by chief 
     elected officials for the appointment of members of local 
     boards based on the requirements of section 117;
       (7) the detailed plans required under section 8 of the 
     Wagner-Peyser Act (29 U.S.C. 49g);
       (8)(A) a description of the procedures that will be taken 
     by the State to assure coordination of and avoid duplication 
     among--
       (i) workforce investment activities authorized under this 
     title;
       (ii) other activities authorized under this title;
       (iii) programs authorized under the Wagner-Peyser Act (29 
     U.S.C. 49 et seq.), title II of this Act, title I of the 
     Rehabilitation Act of 1973 (29 U.S.C. 720 et seq.), part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.), 
     and section 6(d)(4) of the Food Stamp Act of 1977 (7 U.S.C. 
     2015(d)(4)), activities authorized under title V of the Older 
     Americans Act of 1965 (42 U.S.C. 3056 et seq.), and 
     postsecondary vocational education activities authorized 
     under the Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2301 et seq.);
       (iv) work programs authorized under section 6(o) of the 
     Food Stamp Act of 1977 (7 U.S.C. 2015(o));
       (v) activities authorized under chapter 2 of title II of 
     the Trade Act of 1974 (19 U.S.C. 2271 et seq.);
       (vi) activities authorized under chapter 41 of title 38, 
     United States Code;
       (vii) employment and training activities carried out under 
     the Community Services Block Grant Act (42 U.S.C. 9901 et 
     seq.);
       (viii) activities authorized under the National and 
     Community Service Act of 1990 (42 U.S.C. 12501 et seq.);
       (ix) employment and training activities carried out by the 
     Department of Housing and Urban Development; and
       (x) programs authorized under State unemployment 
     compensation laws (in accordance with applicable Federal 
     law); and
       (B) a description of the common data collection and 
     reporting processes used for the programs and activities 
     described in subparagraph (A);
       (9) a description of the process used by the State, 
     consistent with section 111(g), to provide an opportunity for 
     public comment, including comment by representatives of 
     businesses and representatives of labor organizations, and 
     input into development of the plan, prior to submission of 
     the plan;
       (10) information identifying how the State will use funds 
     the State receives under this subtitle to leverage other 
     Federal, State, local, and private resources, in order to 
     maximize the effectiveness of such resources, and to expand 
     the participation of business, employees, and individuals in 
     the statewide workforce investment system;
       (11) assurances that the State will provide, in accordance 
     with section 184 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 
     through the allotments made under sections 127 and 132;
       (12)(A) a description of the methods and factors the State 
     will use in distributing funds to local areas for youth 
     activities and adult employment and training activities under 
     sections 128(b)(3)(B) and 133(b)(3)(B), including--
       (i) a description of how the individuals and entities 
     represented on the State board were involved in determining 
     such methods and factors of distribution; and
       (ii) a description of how the State consulted with chief 
     elected officials in local areas throughout the State in 
     determining such distribution;
       (B) assurances that the funds will be distributed equitably 
     throughout the State, and that no local areas will suffer 
     significant shifts in funding from year to year; and
       (C) a description of the formula prescribed by the Governor 
     pursuant to section 133(b)(2)(B) for the allocation of funds 
     to local areas for dislocated worker employment and training 
     activities;
       (13) information specifying the actions that constitute a 
     conflict of interest prohibited in the State for purposes of 
     sections 111(f) and 117(g);
       (14) with respect to the one-stop delivery systems 
     described in section 134(c) (referred to individually in this 
     title as a ``one-stop delivery system''), a description of 
     the strategy of the State for assisting local areas in 
     development and implementation of fully operational one-stop 
     delivery systems in the State;
       (15) a description of the appeals process referred to in 
     section 116(a)(5);
       (16) a description of the competitive process to be used by 
     the State to award grants and contracts in the State for 
     activities carried out under this title;
       (17) with respect to the employment and training activities 
     authorized in section 134--
       (A) a description of--
       (i) the employment and training activities that will be 
     carried out with the funds received by the State through the 
     allotment made under section 132;
       (ii) how the State will provide rapid response activities 
     to dislocated workers from funds reserved under section 
     133(a)(2) for such purposes, including the designation of an 
     identifiable State rapid response dislocated worker unit to 
     carry out statewide rapid response activities;
       (iii) the procedures the local boards in the State will use 
     to identify eligible providers of training services described 
     in section 134(d)(4) (other than on-the-job training or 
     customized training), as required under section 122; and
       (iv) how the State will serve the employment and training 
     needs of dislocated workers (including displaced homemakers), 
     low-income individuals (including recipients of public 
     assistance), individuals training for nontraditional 
     employment, and other individuals with multiple barriers to 
     employment (including older individuals and individuals with 
     disabilities); and
       (B) an assurance that veterans will be afforded the 
     employment and training activities by the State, to the 
     extent practicable; and
       (18) with respect to youth activities authorized in section 
     129, information--
       (A) describing the State strategy for providing 
     comprehensive services to eligible youth, particularly those 
     eligible youth who are recognized as having significant 
     barriers to employment;
       (B) identifying the criteria to be used by local boards in 
     awarding grants for youth activities, including criteria that 
     the Governor and local boards will use to identify effective 
     and ineffective youth activities and providers of such 
     activities;
       (C) describing how the State will coordinate the youth 
     activities carried out in the State under section 129 with 
     the services provided by Job Corps centers in the State 
     (where such centers exist); and
       (D) describing how the State will coordinate youth 
     activities described in subparagraph (C) with activities 
     carried out through the youth opportunity grants under 
     section 169.
       (c) Plan Submission and Approval.--A State plan submitted 
     to the Secretary under this section by a Governor shall be 
     considered to be approved by the Secretary at the end of the 
     90-day period beginning on the day the Secretary receives the 
     plan, unless the Secretary makes a written determination, 
     during the 90-day period, that--
       (1) the plan is inconsistent with the provisions of this 
     title; and
       (2) in the case of the portion of the plan described in 
     section 8(a) of the Wagner-Peyser Act (29 U.S.C. 49g(a)), the 
     portion does not satisfy the criteria for approval provided 
     in section 8(d) of such Act.
       (d) Modifications to Plan.--A State may submit 
     modifications to a State plan in accordance with the 
     requirements of this section and section 111 as necessary 
     during the 5-year period covered by the plan.

                      CHAPTER 2--LOCAL PROVISIONS

     SEC. 116. LOCAL WORKFORCE INVESTMENT AREAS.

       (a) Designation of Areas.--
       (1) In general.--
       (A) Process.--Except as provided in subsection (b), and 
     consistent with paragraphs (2), (3), and (4), in order for a 
     State to receive an allotment under section 127 or 132, the 
     Governor of the State shall designate local workforce 
     investment areas within the State--
       (i) through consultation with the State board; and
       (ii) after consultation with chief elected officials and 
     after consideration of comments received through the public 
     comment process as described in section 112(b)(9).
       (B) Considerations.--In making the designation of local 
     areas, the Governor shall take into consideration the 
     following:
       (i) Geographic areas served by local educational agencies 
     and intermediate educational agencies.
       (ii) Geographic areas served by postsecondary educational 
     institutions and area vocational education schools.
       (iii) The extent to which such local areas are consistent 
     with labor market areas.
       (iv) The distance that individuals will need to travel to 
     receive services provided in such local areas.
       (v) The resources of such local areas that are available to 
     effectively administer the activities carried out under this 
     subtitle.
       (2) Automatic designation.--The Governor shall approve any 
     request for designation as a local area--
       (A) from any unit of general local government with a 
     population of 500,000 or more;
       (B) of the area served by a rural concentrated employment 
     program grant recipient of demonstrated effectiveness that 
     served as a service

[[Page H6609]]

     delivery area or substate area under the Job Training 
     Partnership Act, if the grant recipient has submitted the 
     request; and
       (C) of an area that served as a service delivery area under 
     section 101(a)(4)(A)(ii) of the Job Training Partnership Act 
     (as in effect on the day before the date of enactment of this 
     Act) in a State that has a population of not more than 
     1,100,000 and a population density greater than 900 persons 
     per square mile.
       (3) Temporary and subsequent designation.--
       (A) Criteria.--Notwithstanding paragraph (2)(A), the 
     Governor shall approve any request, made not later than the 
     date of submission of the initial State plan under this 
     subtitle, for temporary designation as a local area from any 
     unit of general local government (including a combination of 
     such units) with a population of 200,000 or more that was a 
     service delivery area under the Job Training Partnership Act 
     on the day before the date of enactment of this Act if the 
     Governor determines that the area--
       (i) performed successfully, in each of the last 2 years 
     prior to the request for which data are available, in the 
     delivery of services to participants under part A of title II 
     and title III of the Job Training Partnership Act (as in 
     effect on such day); and
       (ii) has sustained the fiscal integrity of the funds used 
     by the area to carry out activities under such part and 
     title.
       (B) Duration and subsequent designation.--A temporary 
     designation under this paragraph shall be for a period of not 
     more than 2 years, after which the designation shall be 
     extended until the end of the period covered by the State 
     plan if the Governor determines that, during the temporary 
     designation period, the area substantially met (as defined by 
     the State board) the local performance measures for the local 
     area and sustained the fiscal integrity of the funds used by 
     the area to carry out activities under this subtitle.
       (C) Technical assistance.--The Secretary shall provide the 
     States with technical assistance in making the determinations 
     required by this paragraph. The Secretary shall not issue 
     regulations governing determinations to be made under this 
     paragraph.
       (D) Performed successfully.--In this paragraph, the term 
     ``performed successfully'' means that the area involved met 
     or exceeded the performance standards for activities 
     administered in the area that--
       (i) are established by the Secretary for each year and 
     modified by the adjustment methodology of the State (used to 
     account for differences in economic conditions, participant 
     characteristics, and combination of services provided from 
     the combination assumed for purposes of the established 
     standards of the Secretary); and
       (ii)(I) if the area was designated as both a service 
     delivery area and a substate area under the Job Training 
     Partnership Act (as in effect on the day before the date of 
     enactment of this Act)--

       (aa) relate to job retention and earnings, with respect to 
     activities carried out under part A of title II of such Act 
     (as in effect on such day); or
       (bb) relate to entry into employment, with respect to 
     activities carried out under title III of such Act (as in 
     effect on such day);

       (II) if the area was designated only as a service delivery 
     area under such Act (as in effect on such day), relate to the 
     standards described in subclause (I)(aa); or
       (III) if the area was only designated as a substate area 
     under such Act (as in effect on such day), relate to the 
     standards described in subclause (I)(bb) .
       (E) Sustained the fiscal integrity.--In this paragraph, the 
     term ``sustained the fiscal integrity'', used with respect to 
     funds used by a service delivery area or local area, means 
     that the Secretary has not made a final determination during 
     any of the last 3 years for which data are available, prior 
     to the date of the designation request involved, that either 
     the grant recipient or the administrative entity of the area 
     misexpended the funds due to willful disregard of the 
     requirements of the Act involved, gross negligence, or 
     failure to observe accepted standards of administration.
       (4) Designation on recommendation of state board.--The 
     Governor may approve a request from any unit of general local 
     government (including a combination of such units) for 
     designation (including temporary designation) as a local area 
     if the State board determines, taking into account the 
     factors described in clauses (i) through (v) of paragraph 
     (1)(B), and recommends to the Governor, that such area should 
     be so designated.
       (5) Appeals.--A unit of general local government (including 
     a combination of such units) or grant recipient that requests 
     but is not granted designation of an area as a local area 
     under paragraph (2) or (3) may submit an appeal to the State 
     board under an appeal process established in the State plan. 
     If the appeal does not result in such a designation, the 
     Secretary, after receiving a request for review from the unit 
     or grant recipient and on determining that the unit or grant 
     recipient was not accorded procedural rights under the appeal 
     process established in the State plan or that the area meets 
     the requirements of paragraph (2) or (3), as appropriate, may 
     require that the area be designated as a local area under 
     such paragraph.
       (b) Small States.--The Governor of any State that was a 
     single State service delivery area under the Job Training 
     Partnership Act as of July 1, 1998, may designate the State 
     as a single State local area for the purposes of this title. 
     In the case of such a designation, the Governor shall 
     identify the State as a local area under section 112(b)(5).
       (c) Regional Planning and Cooperation.--
       (1) Planning.--As part of the process for developing the 
     State plan, a State may require regional planning by local 
     boards for a designated region in the State. The State may 
     require the local boards for a designated region to 
     participate in a regional planning process that results in 
     the establishment of regional performance measures for 
     workforce investment activities authorized under this 
     subtitle. The State may award regional incentive grants to 
     the designated regions that meet or exceed the regional 
     performance measures.
       (2) Information sharing.--The State may require the local 
     boards for a designated region to share, in feasible cases, 
     employment statistics, information about employment 
     opportunities and trends, and other types of information that 
     would assist in improving the performance of all local areas 
     in the designated region on local performance measures.
       (3) Coordination of services.--The State may require the 
     local boards for a designated region to coordinate the 
     provision of workforce investment activities authorized under 
     this subtitle, including the provision of transportation and 
     other supportive services, so that services provided through 
     the activities may be provided across the boundaries of local 
     areas within the designated region.
       (4) Interstate regions.--Two or more States that contain an 
     interstate region that is a labor market area, economic 
     development region, or other appropriate contiguous subarea 
     of the States may designate the area as a designated region 
     for purposes of this subsection, and jointly exercise the 
     State functions described in paragraphs (1) through (3).
       (5) Definitions.--In this subsection:
       (A) Designated region.--The term ``designated region'' 
     means a combination of local areas that are partly or 
     completely in a single labor market area, economic 
     development region, or other appropriate contiguous subarea 
     of a State, that is designated by the State, except as 
     provided in paragraph (4).
       (B) Local board for a designated region.--The term ``local 
     board for a designated region'' means a local board for a 
     local area in a designated region.

     SEC. 117. LOCAL WORKFORCE INVESTMENT BOARDS.

       (a) Establishment.--There shall be established in each 
     local area of a State, and certified by the Governor of the 
     State, a local workforce investment board, to set policy for 
     the portion of the statewide workforce investment system 
     within the local area (referred to in this title as a ``local 
     workforce investment system'').
       (b) Membership.--
       (1) State criteria.--The Governor of the State, in 
     partnership with the State board, shall establish criteria 
     for use by chief elected officials in the local areas for 
     appointment of members of the local boards in such local 
     areas in accordance with the requirements of paragraph (2).
       (2) Composition.--Such criteria shall require, at a 
     minimum, that the membership of each local board--
       (A) shall include--
       (i) representatives of business in the local area, who--

       (I) are owners of businesses, chief executives or operating 
     officers of businesses, and other business executives or 
     employers with optimum policymaking or hiring authority;
       (II) represent businesses with employment opportunities 
     that reflect the employment opportunities of the local area; 
     and
       (III) are appointed from among individuals nominated by 
     local business organizations and business trade associations;

       (ii) representatives of local educational entities, 
     including representatives of local educational agencies, 
     local school boards, entities providing adult education and 
     literacy activities, and postsecondary educational 
     institutions (including representatives of community 
     colleges, where such entities exist), selected from among 
     individuals nominated by regional or local educational 
     agencies, institutions, or organizations representing such 
     local educational entities;
       (iii) representatives of labor organizations (for a local 
     area in which employees are represented by labor 
     organizations), nominated by local labor federations, or (for 
     a local area in which no employees are represented by such 
     organizations), other representatives of employees;
       (iv) representatives of community-based organizations 
     (including organizations representing individuals with 
     disabilities and veterans, for a local area in which such 
     organizations are present);
       (v) representatives of economic development agencies, 
     including private sector economic development entities; and
       (vi) representatives of each of the one-stop partners; and
       (B) may include such other individuals or representatives 
     of entities as the chief elected official in the local area 
     may determine to be appropriate.
       (3) Authority of board members.--Members of the board that 
     represent organizations, agencies, or other entities shall be 
     individuals with optimum policymaking authority within the 
     organizations, agencies, or entities.
       (4) Majority.--A majority of the members of the local board 
     shall be representatives described in paragraph (2)(A)(i).
       (5) Chairperson.--The local board shall elect a chairperson 
     for the local board from among the representatives described 
     in paragraph (2)(A)(i).
       (c) Appointment and Certification of Board.--
       (1) Appointment of board members and assignment of 
     responsibilities.--
       (A) In general.--The chief elected official in a local area 
     is authorized to appoint the members of the local board for 
     such area, in accordance with the State criteria established 
     under subsection (b).
       (B) Multiple units of local government in area.--

[[Page H6610]]

       (i) In general.--In a case in which a local area includes 
     more than 1 unit of general local government, the chief 
     elected officials of such units may execute an agreement that 
     specifies the respective roles of the individual chief 
     elected officials--

       (I) in the appointment of the members of the local board 
     from the individuals nominated or recommended to be such 
     members in accordance with the criteria established under 
     subsection (b); and
       (II) in carrying out any other responsibilities assigned to 
     such officials under this subtitle.

       (ii) Lack of agreement.--If, after a reasonable effort, the 
     chief elected officials are unable to reach agreement as 
     provided under clause (i), the Governor may appoint the 
     members of the local board from individuals so nominated or 
     recommended.
       (C) Concentrated employment programs.--In the case of a 
     local area designated in accordance with section 
     116(a)(2)(B), the governing body of the concentrated 
     employment program involved shall act in consultation with 
     the chief elected official in the local area to appoint 
     members of the local board, in accordance with the State 
     criteria established under subsection (b), and to carry out 
     any other responsibility relating to workforce investment 
     activities assigned to such official under this Act.
       (2) Certification.--
       (A) In general.--The Governor shall, once every 2 years, 
     certify 1 local board for each local area in the State.
       (B) Criteria.--Such certification shall be based on 
     criteria established under subsection (b) and, for a second 
     or subsequent certification, the extent to which the local 
     board has ensured that workforce investment activities 
     carried out in the local area have enabled the local area to 
     meet the local performance measures.
       (C) Failure to achieve certification.--Failure of a local 
     board to achieve certification shall result in reappointment 
     and certification of another local board for the local area 
     pursuant to the process described in paragraph (1) and this 
     paragraph.
       (3) Decertification.--
       (A) Fraud, abuse, failure to carry out functions.--
     Notwithstanding paragraph (2), the Governor may decertify a 
     local board, at any time after providing notice and an 
     opportunity for comment, for--
       (i) fraud or abuse; or
       (ii) failure to carry out the functions specified for the 
     local board in any of paragraphs (1) through (7) of 
     subsection (d).
       (B) Nonperformance.--Notwithstanding paragraph (2), the 
     Governor may decertify a local board if a local area fails to 
     meet the local performance measures for such local area for 2 
     consecutive program years (in accordance with section 
     136(h)).
       (C) Plan.--If the Governor decertifies a local board for a 
     local area under subparagraph (A) or (B), the Governor may 
     require that a new local board be appointed and certified for 
     the local area pursuant to a reorganization plan developed by 
     the Governor, in consultation with the chief elected official 
     in the local area, and in accordance with the criteria 
     established under subsection (b).
       (4) Single state area.--Notwithstanding subsection (b) and 
     paragraphs (1) and (2), if a State described in section 
     116(b) indicates in the State plan that the State will be 
     treated as a local area for purposes of the application of 
     this title, the Governor may designate the State board to 
     carry out any of the functions described in subsection (d).
       (d) Functions of Local Board.--The functions of the local 
     board shall include the following:
       (1) Local plan.--Consistent with section 118, each local 
     board, in partnership with the chief elected official for the 
     local area involved, shall develop and submit a local plan to 
     the Governor.
       (2) Selection of operators and providers.--
       (A) Selection of one-stop operators.--Consistent with 
     section 121(d), the local board, with the agreement of the 
     chief elected official--
       (i) shall designate or certify one-stop operators as 
     described in section 121(d)(2)(A); and
       (ii) may terminate for cause the eligibility of such 
     operators.
       (B) Selection of youth providers.--Consistent with section 
     123, the local board shall identify eligible providers of 
     youth activities in the local area by awarding grants or 
     contracts on a competitive basis, based on the 
     recommendations of the youth council.
       (C) Identification of eligible providers of training 
     services.--Consistent with section 122, the local board shall 
     identify eligible providers of training services described in 
     section 134(d)(4) in the local area.
       (D) Identification of eligible providers of intensive 
     services.--If the one-stop operator does not provide 
     intensive services in a local area, the local board shall 
     identify eligible providers of intensive services described 
     in section 134(d)(3) in the local area by awarding contracts.
       (3) Budget and administration.--
       (A) Budget.--The local board shall develop a budget for the 
     purpose of carrying out the duties of the local board under 
     this section, subject to the approval of the chief elected 
     official.
       (B) Administration.--
       (i) Grant recipient.--

       (I) In general.--The chief elected official in a local area 
     shall serve as the local grant recipient for, and shall be 
     liable for any misuse of, the grant funds allocated to the 
     local area under sections 128 and 133, unless the chief 
     elected official reaches an agreement with the Governor for 
     the Governor to act as the local grant recipient and bear 
     such liability.
       (II) Designation.--In order to assist in the administration 
     of the grant funds, the chief elected official or the 
     Governor, where the Governor serves as the local grant 
     recipient for a local area, may designate an entity to serve 
     as a local grant subrecipient for such funds or as a local 
     fiscal agent. Such designation shall not relieve the chief 
     elected official or the Governor of the liability for any 
     misuse of grant funds as described in subclause (I).
       (III) Disbursal.--The local grant recipient or an entity 
     designated under subclause (II) shall disburse such funds for 
     workforce investment activities at the direction of the local 
     board, pursuant to the requirements of this title, if the 
     direction does not violate a provision of this Act. The local 
     grant recipient or entity designated under subclause (II) 
     shall disburse the funds immediately on receiving such 
     direction from the local board.

       (ii) Staff.--The local board may employ staff.
       (iii) Grants and donations.--The local board may solicit 
     and accept grants and donations from sources other than 
     Federal funds made available under this Act.
       (4) Program oversight.--The local board, in partnership 
     with the chief elected official, shall conduct oversight with 
     respect to local programs of youth activities authorized 
     under section 129, local employment and training activities 
     authorized under section 134, and the one-stop delivery 
     system in the local area.
       (5) Negotiation of local performance measures.--The local 
     board, the chief elected official, and the Governor shall 
     negotiate and reach agreement on local performance measures 
     as described in section 136(c).
       (6) Employment statistics system.--The local board shall 
     assist the Governor in developing the statewide employment 
     statistics system described in section 15(e) of the Wagner-
     Peyser Act.
       (7) Employer linkages.--The local board shall coordinate 
     the workforce investment activities authorized under this 
     subtitle and carried out in the local area with economic 
     development strategies and develop other employer linkages 
     with such activities.
       (8) Connecting, brokering, and coaching.--The local board 
     shall promote the participation of private sector employers 
     in the statewide workforce investment system and ensure the 
     effective provision, through the system, of connecting, 
     brokering, and coaching activities, through intermediaries 
     such as the one-stop operator in the local area or through 
     other organizations, to assist such employers in meeting 
     hiring needs.
       (e) Sunshine Provision.--The local board shall make 
     available to the public, on a regular basis through open 
     meetings, information regarding the activities of the local 
     board, including information regarding the local plan prior 
     to submission of the plan, and regarding membership, the 
     designation and certification of one-stop operators, and the 
     award of grants or contracts to eligible providers of youth 
     activities, and on request, minutes of formal meetings of the 
     local board.
       (f) Limitations.--
       (1) Training services.--
       (A) In general.--Except as provided in subparagraph (B), no 
     local board may provide training services described in 
     section 134(d)(4).
       (B) Waivers of training prohibition.--The Governor of the 
     State in which a local board is located may, pursuant to a 
     request from the local board, grant a written waiver of the 
     prohibition set forth in subparagraph (A) (relating to the 
     provision of training services) for a program of training 
     services, if the local board--
       (i) submits to the Governor a proposed request for the 
     waiver that includes--

       (I) satisfactory evidence that there is an insufficient 
     number of eligible providers of such a program of training 
     services to meet local demand in the local area;
       (II) information demonstrating that the board meets the 
     requirements for an eligible provider of training services 
     under section 122; and
       (III) information demonstrating that the program of 
     training services prepares participants for an occupation 
     that is in demand in the local area;

       (ii) makes the proposed request available to eligible 
     providers of training services and other interested members 
     of the public for a public comment period of not less than 30 
     days; and
       (iii) includes, in the final request for the waiver, the 
     evidence and information described in clause (i) and the 
     comments received pursuant to clause (ii).
       (C) Duration.--A waiver granted to a local board under 
     subparagraph (B) shall apply for a period of not to exceed 1 
     year. The waiver may be renewed for additional periods of not 
     to exceed 1 year, pursuant to requests from the local board, 
     if the board meets the requirements of subparagraph (B) in 
     making the requests.
       (D) Revocation.--The Governor may revoke a waiver granted 
     under this paragraph during the appropriate period described 
     in subparagraph (C) if the State determines that the local 
     board involved has engaged in a pattern of inappropriate 
     referrals to training services operated by the local board.
       (2) Core services; intensive services; designation or 
     certification as one-stop operators.--A local board may 
     provide core services described in section 134(d)(2) or 
     intensive services described in section 134(d)(3) through a 
     one-stop delivery system described in section 134(c) or be 
     designated or certified as a one-stop operator only with the 
     agreement of the chief elected official and the Governor.
       (3) Limitation on authority.--Nothing in this Act shall be 
     construed to provide a local board with the authority to 
     mandate curricula for schools.
       (g) Conflict of Interest.--A member of a local board may 
     not--
       (1) vote on a matter under consideration by the local 
     board--
       (A) regarding the provision of services by such member (or 
     by an entity that such member represents); or

[[Page H6611]]

       (B) that would provide direct financial benefit to such 
     member or the immediate family of such member; or
       (2) engage in any other activity determined by the Governor 
     to constitute a conflict of interest as specified in the 
     State plan.
       (h) Youth Council.--
       (1) Establishment.--There shall be established, as a 
     subgroup within each local board, a youth council appointed 
     by the local board, in cooperation with the chief elected 
     official for the local area.
       (2) Membership.--The membership of each youth council--
       (A) shall include--
       (i) members of the local board described in subparagraph 
     (A) or (B) of subsection (b)(2) with special interest or 
     expertise in youth policy;
       (ii) representatives of youth service agencies, including 
     juvenile justice and local law enforcement agencies;
       (iii) representatives of local public housing authorities;
       (iv) parents of eligible youth seeking assistance under 
     this subtitle;
       (v) individuals, including former participants, and 
     representatives of organizations, that have experience 
     relating to youth activities; and
       (vi) representatives of the Job Corps, as appropriate; and
       (B) may include such other individuals as the chairperson 
     of the local board, in cooperation with the chief elected 
     official, determines to be appropriate.
       (3) Relationship to local board.--Members of the youth 
     council who are not members of the local board described in 
     subparagraphs (A) and (B) of subsection (b)(2) shall be 
     voting members of the youth council and nonvoting members of 
     the board.
       (4) Duties.--The duties of the youth council include--
       (A) developing the portions of the local plan relating to 
     eligible youth, as determined by the chairperson of the local 
     board;
       (B) subject to the approval of the local board and 
     consistent with section 123--
       (i) recommending eligible providers of youth activities, to 
     be awarded grants or contracts on a competitive basis by the 
     local board to carry out the youth activities; and
       (ii) conducting oversight with respect to the eligible 
     providers of youth activities, in the local area;
       (C) coordinating youth activities authorized under section 
     129 in the local area; and
       (D) other duties determined to be appropriate by the 
     chairperson of the local board.
       (i) Alternative Entity.--
       (1) In general.--For purposes of complying with subsections 
     (a), (b), and (c), and paragraphs (1) and (2) of subsection 
     (h), a State may use any local entity (including a local 
     council, regional workforce development board, or similar 
     entity) that--
       (A) is established to serve the local area (or the service 
     delivery area that most closely corresponds to the local 
     area);
       (B) is in existence on December 31, 1997;
       (C)(i) is established pursuant to section 102 of the Job 
     Training Partnership Act, as in effect on December 31, 1997; 
     or
       (ii) is substantially similar to the local board described 
     in subsections (a), (b), and (c), and paragraphs (1) and (2) 
     of subsection (h);
       (D) includes--
       (i) representatives of business in the local area; and
       (ii)(I) representatives of labor organizations (for a local 
     area in which employees are represented by labor 
     organizations), nominated by local labor federations; or
       (II) (for a local area in which no employees are 
     represented by such organizations), other representatives of 
     employees in the local area.
       (2) References.--References in this Act to a local board or 
     a youth council shall be considered to include such an entity 
     or a subgroup of such an entity, respectively.

     SEC. 118. LOCAL PLAN.

       (a) In General.--Each local board shall develop and submit 
     to the Governor a comprehensive 5-year local plan (referred 
     to in this title as the ``local plan''), in partnership with 
     the appropriate chief elected official. The plan shall be 
     consistent with the State plan.
       (b) Contents.--The local plan shall include--
       (1) an identification of--
       (A) the workforce investment needs of businesses, 
     jobseekers, and workers in the local area;
       (B) the current and projected employment opportunities in 
     the local area; and
       (C) the job skills necessary to obtain such employment 
     opportunities;
       (2) a description of the one-stop delivery system to be 
     established or designated in the local area, including--
       (A) a description of how the local board will ensure the 
     continuous improvement of eligible providers of services 
     through the system and ensure that such providers meet the 
     employment needs of local employers and participants; and
       (B) a copy of each memorandum of understanding described in 
     section 121(c) (between the local board and each of the one-
     stop partners) concerning the operation of the one-stop 
     delivery system in the local area;
       (3) a description of the local levels of performance 
     negotiated with the Governor and chief elected official 
     pursuant to section 136(c), to be used to measure the 
     performance of the local area and to be used by the local 
     board for measuring the performance of the local fiscal agent 
     (where appropriate), eligible providers, and the one-stop 
     delivery system, in the local area;
       (4) a description and assessment of the type and 
     availability of adult and dislocated worker employment and 
     training activities in the local area;
       (5) a description of how the local board will coordinate 
     workforce investment activities carried out in the local area 
     with statewide rapid response activities, as appropriate;
       (6) a description and assessment of the type and 
     availability of youth activities in the local area, including 
     an identification of successful providers of such activities;
       (7) a description of the process used by the local board, 
     consistent with subsection (c), to provide an opportunity for 
     public comment, including comment by representatives of 
     businesses and comment by representatives of labor 
     organizations, and input into the development of the local 
     plan, prior to submission of the plan;
       (8) an identification of the entity responsible for the 
     disbursal of grant funds described in section 
     117(d)(3)(B)(i)(III), as determined by the chief elected 
     official or the Governor under section 117(d)(3)(B)(i);
       (9) a description of the competitive process to be used to 
     award the grants and contracts in the local area for 
     activities carried out under this subtitle; and
       (10) such other information as the Governor may require.
       (c) Process.--Prior to the date on which the local board 
     submits a local plan under this section, the local board 
     shall--
       (1) make available copies of a proposed local plan to the 
     public through such means as public hearings and local news 
     media;
       (2) allow members of the local board and members of the 
     public, including representatives of business and 
     representatives of labor organizations, to submit comments on 
     the proposed local plan to the local board, not later than 
     the end of the 30-day period beginning on the date on which 
     the proposed local plan is made available; and
       (3) include with the local plan submitted to the Governor 
     under this section any such comments that represent 
     disagreement with the plan.
       (d) Plan Submission and Approval.--A local plan submitted 
     to the Governor under this section shall be considered to be 
     approved by the Governor at the end of the 90-day period 
     beginning on the day the Governor receives the plan, unless 
     the Governor makes a written determination during the 90-day 
     period that--
       (1) deficiencies in activities carried out under this 
     subtitle have been identified, through audits conducted under 
     section 184 or otherwise, and the local area has not made 
     acceptable progress in implementing corrective measures to 
     address the deficiencies; or
       (2) the plan does not comply with this title.

          CHAPTER 3--WORKFORCE INVESTMENT ACTIVITIES PROVIDERS

     SEC. 121. ESTABLISHMENT OF ONE-STOP DELIVERY SYSTEMS.

       (a) In General.--Consistent with the State plan, the local 
     board for a local area, with the agreement of the chief 
     elected official for the local area, shall--
       (1) develop and enter into the memorandum of understanding 
     described in subsection (c) with one-stop partners;
       (2) designate or certify one-stop operators under 
     subsection (d); and
       (3) conduct oversight with respect to the one-stop delivery 
     system in the local area.
       (b) One-Stop Partners.--
       (1) Required partners.--
       (A) In general.--Each entity that carries out a program or 
     activities described in subparagraph (B) shall--
       (i) make available to participants, through a one-stop 
     delivery system, the services described in section 134(d)(2) 
     that are applicable to such program or activities; and
       (ii) participate in the operation of such system consistent 
     with the terms of the memorandum described in subsection (c), 
     and with the requirements of the Federal law in which the 
     program or activities are authorized.
       (B) Programs and activities.--The programs and activities 
     referred to in subparagraph (A) consist of--
       (i) programs authorized under this title;
       (ii) programs authorized under the Wagner-Peyser Act (29 
     U.S.C. 49 et seq.);
       (iii) adult education and literacy activities authorized 
     under title II;
       (iv) programs authorized under title I of the 
     Rehabilitation Act of 1973 (29 U.S.C. 720 et seq.);
       (v) programs authorized under section 403(a)(5) of the 
     Social Security Act (42 U.S.C. 603(a)(5)) (as added by 
     section 5001 of the Balanced Budget Act of 1997);
       (vi) activities authorized under title V of the Older 
     Americans Act of 1965 (42 U.S.C. 3056 et seq.);
       (vii) postsecondary vocational education activities 
     authorized under the Carl D. Perkins Vocational and Applied 
     Technology Education Act (20 U.S.C. 2301 et seq.);
       (viii) activities authorized under chapter 2 of title II of 
     the Trade Act of 1974 (19 U.S.C. 2271 et seq.);
       (ix) activities authorized under chapter 41 of title 38, 
     United States Code;
       (x) employment and training activities carried out under 
     the Community Services Block Grant Act (42 U.S.C. 9901 et 
     seq.);
       (xi) employment and training activities carried out by the 
     Department of Housing and Urban Development; and
       (xii) programs authorized under State unemployment 
     compensation laws (in accordance with applicable Federal 
     law).
       (2) Additional partners.--
       (A) In general.--In addition to the entities described in 
     paragraph (1), other entities that carry out a human resource 
     program described in subparagraph (B) may--
       (i) make available to participants, through the one-stop 
     delivery system, the services described in section 134(d)(2) 
     that are applicable to such program; and

[[Page H6612]]

       (ii) participate in the operation of such system consistent 
     with the terms of the memorandum described in subsection (c), 
     and with the requirements of the Federal law in which the 
     program is authorized;

     if the local board and chief elected official involved 
     approve such participation.
       (B) Programs.--The programs referred to in subparagraph (A) 
     may include--
       (i) programs authorized under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.);
       (ii) programs authorized under section 6(d)(4) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2015(d)(4));
       (iii) work programs authorized under section 6(o) of the 
     Food Stamp Act of 1977 (7 U.S.C. 2015(o));
       (iv) programs authorized under the National and Community 
     Service Act of 1990 (42 U.S.C. 12501 et seq.); and
       (v) other appropriate Federal, State, or local programs, 
     including programs in the private sector.
       (c) Memorandum of Understanding.--
       (1) Development.--The local board, with the agreement of 
     the chief elected official, shall develop and enter into a 
     memorandum of understanding (between the local board and the 
     one-stop partners), consistent with paragraph (2), concerning 
     the operation of the one-stop delivery system in the local 
     area.
       (2) Contents.--Each memorandum of understanding shall 
     contain--
       (A) provisions describing--
       (i) the services to be provided through the one-stop 
     delivery system;
       (ii) how the costs of such services and the operating costs 
     of the system will be funded;
       (iii) methods for referral of individuals between the one-
     stop operator and the one-stop partners, for the appropriate 
     services and activities; and
       (iv) the duration of the memorandum and the procedures for 
     amending the memorandum during the term of the memorandum; 
     and
       (B) such other provisions, consistent with the requirements 
     of this title, as the parties to the agreement determine to 
     be appropriate.
       (d) One-Stop Operators.--
       (1) Designation and certification.--Consistent with 
     paragraphs (2) and (3), the local board, with the agreement 
     of the chief elected official, is authorized to designate or 
     certify one-stop operators and to terminate for cause the 
     eligibility of such operators.
       (2) Eligibility.--To be eligible to receive funds made 
     available under this subtitle to operate a one-stop center 
     referred to in section 134(c), an entity (which may be a 
     consortium of entities)--
       (A) shall be designated or certified as a one-stop 
     operator--
       (i) through a competitive process; or
       (ii) in accordance with an agreement reached between the 
     local board and a consortium of entities that, at a minimum, 
     includes 3 or more of the one-stop partners described in 
     subsection (b)(1); and
       (B) may be a public or private entity, or consortium of 
     entities, of demonstrated effectiveness, located in the local 
     area, which may include--
       (i) a postsecondary educational institution;
       (ii) an employment service agency established under the 
     Wagner-Peyser Act (29 U.S.C. 49 et seq.), on behalf of the 
     local office of the agency;
       (iii) a private, nonprofit organization (including a 
     community-based organization);
       (iv) a private for-profit entity;
       (v) a government agency; and
       (vi) another interested organization or entity, which may 
     include a local chamber of commerce or other business 
     organization.
       (3) Exception.--Elementary schools and secondary schools 
     shall not be eligible for designation or certification as 
     one-stop operators, except that nontraditional public 
     secondary schools and area vocational education schools shall 
     be eligible for such designation or certification.
       (e) Established One-Stop Delivery System.--If a one-stop 
     delivery system has been established in a local area prior to 
     the date of enactment of this Act, the local board, the chief 
     elected official, and the Governor involved may agree to 
     certify an entity carrying out activities through the system 
     as a one-stop operator for purposes of subsection (d), 
     consistent with the requirements of subsection (b), of the 
     memorandum of understanding, and of section 134(c).

     SEC. 122. IDENTIFICATION OF ELIGIBLE PROVIDERS OF TRAINING 
                   SERVICES.

       (a) Eligibility Requirements.--
       (1) In general.--Except as provided in subsection (h), to 
     be identified as an eligible provider of training services 
     described in section 134(d)(4) (referred to in this section 
     as ``training services'') in a local area and to be eligible 
     to receive funds made available under section 133(b) for the 
     provision of training services, a provider of such services 
     shall meet the requirements of this section.
       (2) Providers.--Subject to the provisions of this section, 
     to be eligible to receive the funds, the provider shall be--
       (A) a postsecondary educational institution that--
       (i) is eligible to receive Federal funds under title IV of 
     the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.); 
     and
       (ii) provides a program that leads to an associate degree, 
     baccalaureate degree, or certificate;
       (B) an entity that carries out programs under the Act of 
     August 16, 1937 (commonly known as the ``National 
     Apprenticeship Act''; 50 Stat. 664, chapter 663; 29 U.S.C. 50 
     et seq.); or
       (C) another public or private provider of a program of 
     training services.
       (b) Initial Eligibility Determination.--
       (1) Postsecondary educational institutions and entities 
     carrying out apprenticeship programs.--To be initially 
     eligible to receive funds as described in subsection (a) to 
     carry out a program described in subparagraph (A) or (B) of 
     subsection (a)(2), a provider described in subparagraph (A) 
     or (B), respectively, of subsection (a)(2) shall submit an 
     application, to the local board for the local area in which 
     the provider desires to provide training services, at such 
     time, in such manner, and containing such information as the 
     local board may require.
       (2) Other eligible providers.--
       (A) Procedure.--Each Governor of a State shall establish a 
     procedure for use by local boards in the State in determining 
     the initial eligibility of a provider described in subsection 
     (a)(2)(C) to receive funds as described in subsection (a) for 
     a program of training services, including the initial 
     eligibility of--
       (i) a postsecondary educational institution to receive such 
     funds for a program not described in subsection (a)(2)(A); 
     and
       (ii) a provider described in subsection (a)(2)(B) to 
     receive such funds for a program not described in subsection 
     (a)(2)(B).
       (B) Recommendations.--In developing such procedure, the 
     Governor shall solicit and take into consideration the 
     recommendations of local boards and providers of training 
     services within the State.
       (C) Opportunity to submit comments.--The Governor shall 
     provide an opportunity, during the development of the 
     procedure, for interested members of the public, including 
     representatives of business and labor organizations, to 
     submit comments on such procedure.
       (D) Requirements.--In establishing the procedure, the 
     Governor shall require that, to be initially eligible to 
     receive funds as described in subsection (a) for a program, a 
     provider described in subsection (a)(2)(C)--
       (i) shall submit an application, to the local board for the 
     local area in which the provider desires to provide training 
     services, at such time and in such manner as may be required, 
     and containing a description of the program;
       (ii) if the provider provides training services through a 
     program on the date of application, shall include in the 
     application an appropriate portion of the performance 
     information and program cost information described in 
     subsection (d) for the program, as specified in the 
     procedure, and shall meet appropriate levels of performance 
     for the program, as specified in the procedure; and
       (iii) if the provider does not provide training services on 
     such date, shall meet appropriate requirements, as specified 
     in the procedure.
       (c) Subsequent Eligibility Determination.--
       (1) Procedure.--Each Governor of a State shall establish a 
     procedure for use by local boards in the State in determining 
     the eligibility of a provider described in subsection (a)(2) 
     to continue to receive funds as described in subsection (a) 
     for a program after an initial period of eligibility under 
     subsection (b) (referred to in this section as ``subsequent 
     eligibility'').
       (2) Recommendations.--In developing such procedure, the 
     Governor shall solicit and take into consideration the 
     recommendations of local boards and providers of training 
     services within the State.
       (3) Opportunity to submit comments.--The Governor shall 
     provide an opportunity, during the development of the 
     procedure, for interested members of the public, including 
     representatives of business and labor organizations, to 
     submit comments on such procedure.
       (4) Considerations.--In developing such procedure, the 
     Governor shall ensure that the procedure requires the local 
     boards to take into consideration, in making the 
     determinations of subsequent eligibility--
       (A) the specific economic, geographic, and demographic 
     factors in the local areas in which providers seeking 
     eligibility are located; and
       (B) the characteristics of the populations served by 
     providers seeking eligibility, including the demonstrated 
     difficulties in serving such populations, where applicable.
       (5) Requirements.--In establishing the procedure, the 
     Governor shall require that, to be eligible to continue to 
     receive funds as described in subsection (a) for a program 
     after the initial period of eligibility, a provider described 
     in subsection (a)(2) shall--
       (A) submit the performance information and program cost 
     information described in subsection (d)(1) for the program 
     and any additional information required to be submitted in 
     accordance with subsection (d)(2) for the program annually to 
     the appropriate local board at such time and in such manner 
     as may be required; and
       (B) annually meet the performance levels described in 
     paragraph (6) for the program, as demonstrated utilizing 
     quarterly records described in section 136, in a manner 
     consistent with section 136.
       (6) Levels of performance.--
       (A) In general.--At a minimum, the procedure described in 
     paragraph (1) shall require the provider to meet minimum 
     acceptable levels of performance based on the performance 
     information referred to in paragraph (5)(A).
       (B) Higher levels of performance eligibility.--The local 
     board may require higher levels of performance than the 
     levels referred to in subparagraph (A) for subsequent 
     eligibility to receive funds as described in subsection (a).
       (d) Performance and Cost Information.--
       (1) Required information.--For a provider of training 
     services to be determined to be subsequently eligible under 
     subsection (c) to receive funds as described in subsection 
     (a), such provider shall, under subsection (c), submit--
       (A) verifiable program-specific performance information 
     consisting of--
       (i) program information, including--

       (I) the program completion rates for all individuals 
     participating in the applicable program conducted by the 
     provider;

[[Page H6613]]

       (II) the percentage of all individuals participating in the 
     applicable program who obtain unsubsidized employment, which 
     may also include information specifying the percentage of the 
     individuals who obtain unsubsidized employment in an 
     occupation related to the program conducted; and
       (III) the wages at placement in employment of all 
     individuals participating in the applicable program; and

       (ii) training services information for all participants who 
     received assistance under section 134 to participate in the 
     applicable program, including--

       (I) the percentage of participants who have completed the 
     applicable program and who are placed in unsubsidized 
     employment;
       (II) the retention rates in unsubsidized employment of 
     participants who have completed the applicable program, 6 
     months after the first day of the employment;
       (III) the wages received by participants who have completed 
     the applicable program, 6 months after the first day of the 
     employment involved; and
       (IV) where appropriate, the rates of licensure or 
     certification, attainment of academic degrees or equivalents, 
     or attainment of other measures of skills, of the graduates 
     of the applicable program; and

       (B) information on program costs (such as tuition and fees) 
     for participants in the applicable program.
       (2) Additional information.--Subject to paragraph (3), in 
     addition to the performance information described in 
     paragraph (1)--
       (A) the Governor may require that a provider submit, under 
     subsection (c), such other verifiable program-specific 
     performance information as the Governor determines to be 
     appropriate to obtain such subsequent eligibility, which may 
     include information relating to--
       (i) retention rates in employment and the subsequent wages 
     of all individuals who complete the applicable program;
       (ii) where appropriate, the rates of licensure or 
     certification of all individuals who complete the program; 
     and
       (iii) the percentage of individuals who complete the 
     program who attain industry-recognized occupational skills in 
     the subject, occupation, or industry for which training is 
     provided through the program, where applicable; and
       (B) the Governor, or the local board, may require a 
     provider to submit, under subsection (c), other verifiable 
     program-specific performance information to obtain such 
     subsequent eligibility.
       (3) Conditions.--
       (A) In general.--If the Governor or a local board requests 
     additional information under paragraph (2) that imposes 
     extraordinary costs on providers, or if providers experience 
     extraordinary costs in the collection of information required 
     under paragraph (1)(A)(ii)), the Governor or the local board 
     shall provide access to cost-effective methods for the 
     collection of the information involved, or the Governor shall 
     provide additional resources to assist providers in the 
     collection of such information from funds made available as 
     described in sections 128(a) and 133(a)(1), as appropriate.
       (B) Higher education eligibility requirements.--The local 
     board and the designated State agency described in subsection 
     (i) may accept program-specific performance information 
     consistent with the requirements for eligibility under title 
     IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et 
     seq.) from a provider for purposes of enabling the provider 
     to fulfill the applicable requirements of this subsection, if 
     such information is substantially similar to the information 
     otherwise required under this subsection.
       (e) Local Identification.--
       (1) In general.--The local board shall place on a list 
     providers submitting an application under subsection (b)(1) 
     and providers determined to be initially eligible under 
     subsection (b)(2), and retain on the list providers 
     determined to be subsequently eligible under subsection (c), 
     to receive funds as described in subsection (a) for the 
     provision of training services in the local area served by 
     the local board. The list of providers shall be accompanied 
     by any performance information and program cost information 
     submitted under subsection (b) or (c) by the provider.
       (2) Submission to state agency.--On placing or retaining a 
     provider on the list, the local board shall submit, to the 
     designated State agency described in subsection (i), the list 
     and the performance information and program cost information 
     referred to in paragraph (1). If the agency determines, 
     within 30 days after the date of the submission, that the 
     provider does not meet the performance levels described in 
     subsection (c)(6) for the program (where applicable), the 
     agency may remove the provider from the list for the program. 
     The agency may not remove from the list an agency submitting 
     an application under subsection (b)(1).
       (3) Identification of eligible providers.--A provider who 
     is placed or retained on the list under paragraph (1), and is 
     not removed by the designated State agency under paragraph 
     (2), for a program, shall be considered to be identified as 
     an eligible provider of training services for the program.
       (4) Availability.--
       (A) State list.--The designated State agency shall compile 
     a single list of the providers identified under paragraph (3) 
     from all local areas in the State and disseminate such list, 
     and the performance information and program cost information 
     described in paragraph (1), to the one-stop delivery systems 
     within the State. Such list and information shall be made 
     widely available to participants in employment and training 
     activities authorized under section 134 and others through 
     the one-stop delivery system.
       (B) Selection from state list.--Individuals eligible to 
     receive training services under section 134(d)(4) shall have 
     the opportunity to select any of the eligible providers, from 
     any of the local areas in the State, that are included on the 
     list described in subparagraph (A) to provide the services, 
     consistent with the requirements of section 134.
       (5) Acceptance of individual training accounts by other 
     states.--States may enter into agreements, on a reciprocal 
     basis, to permit eligible providers of training services in a 
     State to accept individual training accounts provided in 
     another State.
       (f) Enforcement.--
       (1) Accuracy of information.--If the designated State 
     agency, after consultation with the local board involved, 
     determines that an eligible provider or individual supplying 
     information on behalf of the provider intentionally supplies 
     inaccurate information under this section, the agency shall 
     terminate the eligibility of the provider to receive funds 
     described in subsection (a) for any program for a period of 
     time, but not less than 2 years.
       (2) Noncompliance.--If the designated State agency, or the 
     local board working with the State agency, determines that an 
     eligible provider described in subsection (a) substantially 
     violates any requirement under this Act, the agency, or the 
     local board working with the State agency, may terminate the 
     eligibility of such provider to receive funds described in 
     subsection (a) for the program involved or take such other 
     action as the agency or local board determines to be 
     appropriate.
       (3) Repayment.--A provider whose eligibility is terminated 
     under paragraph (1) or (2) for a program shall be liable for 
     repayment of all funds described in subsection (a) received 
     for the program during any period of noncompliance described 
     in such paragraph.
       (4) Construction.--This subsection and subsection (g) shall 
     be construed to provide remedies and penalties that 
     supplement, but do not supplant, other civil and criminal 
     remedies and penalties.
       (g) Appeal.--The Governor shall establish procedures for 
     providers of training services to appeal a denial of 
     eligibility by the local board or the designated State agency 
     under subsection (b), (c), or (e), a termination of 
     eligibility or other action by the board or agency under 
     subsection (f), or a denial of eligibility by a one-stop 
     operator under subsection (h). Such procedures shall provide 
     an opportunity for a hearing and prescribe appropriate time 
     limits to ensure prompt resolution of the appeal.
       (h) On-the-Job Training or Customized Training Exception.--
       (1) In general.--Providers of on-the-job training or 
     customized training shall not be subject to the requirements 
     of subsections (a) through (e).
       (2) Collection and dissemination of information.--A one-
     stop operator in a local area shall collect such performance 
     information from on-the-job training and customized training 
     providers as the Governor may require, determine whether the 
     providers meet such performance criteria as the Governor may 
     require, and disseminate information identifying providers 
     that meet the criteria as eligible providers, and the 
     performance information, through the one-stop delivery 
     system. Providers determined to meet the criteria shall be 
     considered to be identified as eligible providers of training 
     services.
       (i) Administration.--The Governor shall designate a State 
     agency to make the determinations described in subsection 
     (e)(2), take the enforcement actions described in subsection 
     (f), and carry out other duties described in this section.

     SEC. 123. IDENTIFICATION OF ELIGIBLE PROVIDERS OF YOUTH 
                   ACTIVITIES.

       From funds allocated under paragraph (2)(A) or (3) of 
     section 128(b) to a local area, the local board for such area 
     shall identify eligible providers of youth activities by 
     awarding grants or contracts on a competitive basis, based on 
     the recommendations of the youth council and on the criteria 
     contained in the State plan, to the providers to carry out 
     the activities, and shall conduct oversight with respect to 
     the providers, in the local area.

                      CHAPTER 4--YOUTH ACTIVITIES

     SEC. 126. GENERAL AUTHORIZATION.

       The Secretary shall make an allotment under section 
     127(b)(1)(C) to each State that meets the requirements of 
     section 112 and a grant to each outlying area that complies 
     with the requirements of this title, to assist the State or 
     outlying area, and to enable the State or outlying area to 
     assist local areas, for the purpose of providing workforce 
     investment activities for eligible youth in the State or 
     outlying area and in the local areas.

     SEC. 127. STATE ALLOTMENTS.

       (a) In General.--The Secretary shall--
       (1) for each fiscal year in which the amount appropriated 
     under section 137(a) exceeds $1,000,000,000, reserve a 
     portion determined under subsection (b)(1)(A) of the amount 
     appropriated under section 137(a) for use under sections 167 
     (relating to migrant and seasonal farmworker programs) and 
     169 (relating to youth opportunity grants); and
       (2) use the remainder of the amount appropriated under 
     section 137(a) for a fiscal year to make allotments and 
     grants in accordance with subparagraphs (B) and (C) of 
     subsection (b)(1) and make funds available for use under 
     section 166 (relating to Native American programs).
       (b) Allotment Among States.--
       (1) Youth activities.--
       (A) Youth opportunity grants.--
       (i) In general.--For each fiscal year in which the amount 
     appropriated under section 137(a) exceeds $1,000,000,000, the 
     Secretary shall reserve a portion of the amount to provide 
     youth opportunity grants and other activities under section 
     169 (relating to youth opportunity

[[Page H6614]]

     grants) and provide youth activities under section 167 
     (relating to migrant and seasonal farmworker programs).
       (ii) Portion.--The portion referred to in clause (i) shall 
     equal, for a fiscal year--

       (I) except as provided in subclause (II), the difference 
     obtained by subtracting $1,000,000,000 from the amount 
     appropriated under section 137(a) for the fiscal year; or
       (II) for any fiscal year in which the amount is 
     $1,250,000,000 or greater, $250,000,000.

       (iii) Youth activities for farmworkers.--From the portion 
     described in clause (i) for a fiscal year, the Secretary 
     shall make available 4 percent of such portion to provide 
     youth activities under section 167.
       (iv) Role model academy project.--From the portion 
     described in clause (i) for fiscal year 1999, the Secretary 
     shall make available such sums as the Secretary determines to 
     be appropriate to carry out section 169(g).
       (B) Outlying areas.--
       (i) In general.--From the amount made available under 
     subsection (a)(2) for a fiscal year, the Secretary shall 
     reserve not more than \1/4\ of 1 percent of the amount 
     appropriated under section 137(a) for the fiscal year--

       (I) to provide assistance to the outlying areas to carry 
     out youth activities and statewide workforce investment 
     activities; and
       (II) for each of fiscal years 1999, 2000, and 2001, to 
     carry out the competition described in clause (ii), except 
     that the funds reserved to carry out such clause for any such 
     fiscal year shall not exceed the amount reserved for the 
     Freely Associated States for fiscal year 1997, from amounts 
     reserved under sections 252(a) and 262(a)(1) of the Job 
     Training Partnership Act (as in effect on the day before the 
     date of enactment of this Act).

       (ii) Limitation for freely associated states.--

       (I) Competitive grants.--The Secretary shall use funds 
     described in clause (i)(II) to award grants to Guam, American 
     Samoa, the Commonwealth of the Northern Mariana Islands, and 
     the Freely Associated States to carry out youth activities 
     and statewide workforce investment activities.
       (II) Award basis.--The Secretary shall award grants 
     pursuant to subclause (I) on a competitive basis and pursuant 
     to the recommendations of experts in the field of employment 
     and training, working through the Pacific Region Educational 
     Laboratory in Honolulu, Hawaii.
       (III) Assistance requirements.--Any Freely Associated State 
     that desires to receive assistance under this subparagraph 
     shall submit an application to the Secretary and shall 
     include in the application for assistance--

       (aa) information demonstrating that the Freely Associated 
     State will meet all conditions that apply to States under 
     this title;
       (bb) an assurance that, notwithstanding any other provision 
     of this title, the Freely Associated State will use such 
     assistance only for the direct provision of services; and
       (cc) such other information and assurances as the Secretary 
     may require.

       (IV) Termination of eligibility.--Notwithstanding any other 
     provision of law, the Freely Associated States shall not 
     receive any assistance under this subparagraph for any 
     program year that begins after September 30, 2001.
       (V) Administrative costs.--The Secretary may provide not 
     more than 5 percent of the funds made available for grants 
     under subclause (I) to pay the administrative costs of the 
     Pacific Region Educational Laboratory in Honolulu, Hawaii, 
     regarding activities assisted under this clause.

       (iii) Additional requirement.--The provisions of Public Law 
     95-134, permitting the consolidation of grants by the 
     outlying areas, shall not apply to assistance provided to 
     those areas, including the Freely Associated States, under 
     this subparagraph.
       (C) States.--
       (i) In general.--After determining the amounts to be 
     reserved under subparagraph (A) (if any) and subparagraph 
     (B), the Secretary shall--

       (I) from the amount referred to in subsection (a)(2) for a 
     fiscal year, make available not more than 1.5 percent to 
     provide youth activities under section 166 (relating to 
     Native Americans); and
       (II) allot the remainder of the amount referred to in 
     subsection (a)(2) for a fiscal year to the States pursuant to 
     clause (ii) for youth activities and statewide workforce 
     investment activities.

       (ii) Formula.--Subject to clauses (iii) and (iv), of the 
     remainder--

       (I) 33\1/3\ percent shall be allotted on the basis of the 
     relative number of unemployed individuals in areas of 
     substantial unemployment in each State, compared to the total 
     number of unemployed individuals in areas of substantial 
     unemployment in all States;
       (II) 33\1/3\ percent shall be allotted on the basis of the 
     relative excess number of unemployed individuals in each 
     State, compared to the total excess number of unemployed 
     individuals in all States; and
       (III) 33\1/3\ percent shall be allotted on the basis of the 
     relative number of disadvantaged youth in each State, 
     compared to the total number of disadvantaged youth in all 
     States, except as described in clause (iii).

       (iii) Calculation.--In determining an allotment under 
     clause (ii)(III) for any State in which there is a local area 
     designated under section 116(a)(2)(B) (relating to the area 
     served by a rural concentrated employment program grant 
     recipient), the allotment shall be based on the higher of--

       (I) the number of individuals who are age 16 through 21 in 
     families with an income below the low-income level in such 
     area; or
       (II) the number of disadvantaged youth in such area.

       (iv) Minimum and maximum percentages and minimum 
     allotments.--In making allotments under this subparagraph, 
     the Secretary shall ensure the following:

       (I) Minimum percentage and allotment.--Subject to subclause 
     (IV), the Secretary shall ensure that no State shall receive 
     an allotment for a fiscal year that is less than the greater 
     of--

       (aa) an amount based on 90 percent of the allotment 
     percentage of the State for the preceding fiscal year; or
       (bb) 100 percent of the total of the allotments of the 
     State under sections 252 and 262 of the Job Training 
     Partnership Act (as in effect on the day before the date of 
     enactment of this Act) for fiscal year 1998.

       (II) Small state minimum allotment.--Subject to subclauses 
     (I), (III), and (IV), the Secretary shall ensure that no 
     State shall receive an allotment under this subparagraph that 
     is less than the total of--

       (aa) \3/10\ of 1 percent of $1,000,000,000 of the remainder 
     described in clause (i)(II) for the fiscal year; and
       (bb) if the remainder described in clause (i)(II) for the 
     fiscal year exceeds $1,000,000,000, \2/5\ of 1 percent of the 
     excess.

       (III) Maximum percentage.--Subject to subclause (I), the 
     Secretary shall ensure that no State shall receive an 
     allotment percentage for a fiscal year that is more than 130 
     percent of the allotment percentage of the State for the 
     preceding fiscal year.
       (IV) Minimum funding.--In any fiscal year in which the 
     remainder described in clause (i)(II) does not exceed 
     $1,000,000,000, the minimum allotments under subclauses (I) 
     and (II) shall be calculated by the methodology for 
     calculating the corresponding allotments under parts B and C 
     of title II of the Job Training Partnership Act, as in effect 
     on July 1, 1998.

       (2) Definitions.--For the purpose of the formula specified 
     in paragraph (1)(C):
       (A) Allotment percentage.--The term ``allotment 
     percentage'', used with respect to fiscal year 2000 or a 
     subsequent fiscal year, means a percentage of the remainder 
     described in paragraph (1)(C)(i)(II) that is received through 
     an allotment made under paragraph (1)(C) for the fiscal year. 
     The term, used with respect to fiscal year 1998 or 1999, 
     means the percentage of the amounts allotted to States under 
     sections 252(b) and 262(a) of the Job Training Partnership 
     Act (as in effect on the day before the date of enactment of 
     this Act) that is received under such sections by the State 
     involved for fiscal year 1998 or 1999.
       (B) Area of substantial unemployment.--The term ``area of 
     substantial unemployment'' means any area that is of 
     sufficient size and scope to sustain a program of workforce 
     investment activities carried out under this subtitle and 
     that has an average rate of unemployment of at least 6.5 
     percent for the most recent 12 months, as determined by the 
     Secretary. For purposes of this subparagraph, determinations 
     of areas of substantial unemployment shall be made once each 
     fiscal year.
       (C) Disadvantaged youth.--Subject to paragraph (3), the 
     term ``disadvantaged youth'' means an individual who is age 
     16 through 21 who received an income, or is a member of a 
     family that received a total family income, that, in relation 
     to family size, does not exceed the higher of--
       (i) the poverty line; or
       (ii) 70 percent of the lower living standard income level.
       (D) Excess number.--The term ``excess number'' means, used 
     with respect to the excess number of unemployed individuals 
     within a State, the higher of--
       (i) the number that represents the number of unemployed 
     individuals in excess of 4.5 percent of the civilian labor 
     force in the State; or
       (ii) 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.
       (E) Low-income level.--The term ``low-income level'' means 
     $7,000 with respect to income in 1969, and for any later year 
     means that amount that bears the same relationship to $7,000 
     as the Consumer Price Index for that year bears to the 
     Consumer Price Index for 1969, rounded to the nearest $1,000.
       (3) Special rule.--For the purpose of the formula specified 
     in paragraph (1)(C), the Secretary shall, as appropriate and 
     to the extent practicable, exclude college students and 
     members of the Armed Forces from the determination of the 
     number of disadvantaged youth.
       (4) Definition.--In this subsection, the term ``Freely 
     Associated State'' means the Republic of the Marshall 
     Islands, the Federated States of Micronesia, and the Republic 
     of Palau.
       (c) Reallotment.--
       (1) In general.--The Secretary shall, in accordance with 
     this subsection, reallot to eligible States amounts that are 
     allotted under this section for youth activities and 
     statewide workforce investment activities and that are 
     available for reallotment.
       (2) Amount.--The amount available for reallotment for a 
     program year is equal to the amount by which the unobligated 
     balance of the State allotment under this section for such 
     activities, at the end of the program year prior to the 
     program year for which the determination under this paragraph 
     is made, exceeds 20 percent of such allotment for the prior 
     program year.
       (3) Reallotment.--In making reallotments to eligible States 
     of amounts available pursuant to paragraph (2) for a program 
     year, the Secretary shall allot to each eligible State an 
     amount based on the relative amount allotted to such State 
     under this section for such activities for the prior program 
     year, as compared to the total amount allotted to all 
     eligible States under this section for such activities for 
     such prior program year.
       (4) Eligibility.--For purposes of this subsection, an 
     eligible State means a State that has

[[Page H6615]]

     obligated at least 80 percent of the State allotment under 
     this section for such activities for the program year prior 
     to the program year for which the determination under 
     paragraph (2) is made.
       (5) Procedures.--The Governor of each State shall prescribe 
     uniform procedures for the obligation of funds by local areas 
     within the State in order to avoid the requirement that funds 
     be made available for reallotment under this subsection. The 
     Governor shall further prescribe equitable procedures for 
     making funds available from the State and local areas in the 
     event that a State is required to make funds available for 
     reallotment under this subsection.

     SEC. 128. WITHIN STATE ALLOCATIONS.

       (a) Reservations for State Activities.--
       (1) In general.--The Governor of a State shall reserve not 
     more than 15 percent of each of the amounts allotted to the 
     State under section 127(b)(1)(C) and paragraphs (1)(B) and 
     (2)(B) of section 132(b) for a fiscal year for statewide 
     workforce investment activities.
       (2) Use of funds.--Regardless of whether the reserved 
     amounts were allotted under section 127(b)(1)(C), or under 
     paragraph (1)(B) or (2)(B) of section 132(b), the Governor 
     may use the reserved amounts to carry out statewide youth 
     activities described in section 129(b) or statewide 
     employment and training activities, for adults or for 
     dislocated workers, described in paragraph (2)(B) or (3) of 
     section 134(a).
       (b) Within State Allocation.--
       (1) Methods.--The Governor, acting in accordance with the 
     State plan, and after consulting with chief elected officials 
     in the local areas, shall allocate the funds that are 
     allotted to the State for youth activities and statewide 
     workforce investment activities under section 127(b)(1)(C) 
     and are not reserved under subsection (a), in accordance with 
     paragraph (2) or (3).
       (2) Formula allocation.--
       (A) Youth activities.--
       (i) Allocation.--In allocating the funds described in 
     paragraph (1) to local areas, a State may allocate--

       (I) 33\1/3\ percent of the funds on the basis described in 
     section 127(b)(1)(C)(ii)(I);
       (II) 33\1/3\ percent of the funds on the basis described in 
     section 127(b)(1)(C)(ii)(II); and
       (III) 33\1/3\ percent of the funds on the basis described 
     in clauses (ii)(III) and (iii) of section 127(b)(1)(C).

       (ii) Minimum percentage.--Effective at the end of the 
     second full fiscal year after the date on which a local area 
     is designated under section 116, the local area shall not 
     receive an allocation percentage for a fiscal year that is 
     less than 90 percent of the average allocation percentage of 
     the local area for the 2 preceding fiscal years. Amounts 
     necessary for increasing such allocations to local areas to 
     comply with the preceding sentence shall be obtained by 
     ratably reducing the allocations to be made to other local 
     areas under this subparagraph.
       (iii) Definition.--The term ``allocation percentage'', used 
     with respect to fiscal year 2000 or a subsequent fiscal year, 
     means a percentage of the funds referred to in clause (i), 
     received through an allocation made under this subparagraph, 
     for the fiscal year.
       (B) Application.--For purposes of carrying out subparagraph 
     (A)--
       (i) references in section 127(b) to a State shall be deemed 
     to be references to a local area;
       (ii) references in section 127(b) to all States shall be 
     deemed to be references to all local areas in the State 
     involved; and
       (iii) except as described in clause (i), references in 
     section 127(b)(1) to the term ``excess number'' shall be 
     considered to be references to the term as defined in section 
     127(b)(2).
       (3) Youth discretionary allocation.--In lieu of making the 
     allocation described in paragraph (2)(A), in allocating the 
     funds described in paragraph (1) to local areas, a State may 
     distribute--
       (A) a portion equal to not less than 70 percent of the 
     funds in accordance with paragraph (2)(A); and
       (B) the remaining portion of the funds on the basis of a 
     formula that--
       (i) incorporates additional factors (other than the factors 
     described in paragraph (2)(A)) relating to--

       (I) excess youth poverty in urban, rural, and suburban 
     local areas; and
       (II) excess unemployment above the State average in urban, 
     rural, and suburban local areas; and

       (ii) was developed by the State board and approved by the 
     Secretary as part of the State plan.
       (4) Limitation.--
       (A) In general.--Of the amount allocated to a local area 
     under this subsection and section 133(b) for a fiscal year, 
     not more than 10 percent of the amount may be used by the 
     local board for the administrative cost of carrying out local 
     workforce investment activities described in subsection (d) 
     or (e) of section 134 or in section 129(c).
       (B) Use of funds.--Funds made available for administrative 
     costs under subparagraph (A) may be used for the 
     administrative cost of any of the local workforce investment 
     activities described in subsection (d) or (e) of section 134 
     or in section 129(c), regardless of whether the funds were 
     allocated under this subsection or section 133(b).
       (C) Regulations.--The Secretary, after consulting with the 
     Governors, shall develop and issue regulations that define 
     the term ``administrative cost'' for purposes of this title. 
     Such definition shall be consistent with generally accepted 
     accounting principles.
       (c) Reallocation Among Local Areas.--
       (1) In general.--The Governor may, in accordance with this 
     subsection, reallocate to eligible local areas within the 
     State amounts that are allocated under paragraph (2)(A) or 
     (3) of subsection (b) for youth activities and that are 
     available for reallocation.
       (2) Amount.--The amount available for reallocation for a 
     program year is equal to the amount by which the unobligated 
     balance of the local area allocation under paragraph (2)(A) 
     or (3) of subsection (b) for such activities, at the end of 
     the program year prior to the program year for which the 
     determination under this paragraph is made exceeds 20 percent 
     of such allocation for the prior program year.
       (3) Reallocation.--In making reallocations to eligible 
     local areas of amounts available pursuant to paragraph (2) 
     for a program year, the Governor shall allocate to each 
     eligible local area within the State an amount based on the 
     relative amount allocated to such local area under subsection 
     (b)(3) for such activities for the prior program year, as 
     compared to the total amount allocated to all eligible local 
     areas in the State under subsection (b)(3) for such 
     activities for such prior program year. For purposes of this 
     paragraph, local areas that received allocations under 
     subsection (b)(2)(A) for the prior program year shall be 
     treated as if the local areas received allocations under 
     subsection (b)(3) for such year.
       (4) Eligibility.--For purposes of this subsection, an 
     eligible local area means a local area that has obligated at 
     least 80 percent of the local area allocation under paragraph 
     (2)(A) or (3) of subsection (b) for such activities, for the 
     program year prior to the program year for which the 
     determination under paragraph (2) is made.

     SEC. 129. USE OF FUNDS FOR YOUTH ACTIVITIES.

       (a) Purposes.--The purposes of this section are--
       (1) to provide, to eligible youth seeking assistance in 
     achieving academic and employment success, effective and 
     comprehensive activities, which shall include a variety of 
     options for improving educational and skill competencies and 
     provide effective connections to employers;
       (2) to ensure on-going mentoring opportunities for eligible 
     youth with adults committed to providing such opportunities;
       (3) to provide opportunities for training to eligible 
     youth;
       (4) to provide continued supportive services for eligible 
     youth;
       (5) to provide incentives for recognition and achievement 
     to eligible youth; and
       (6) to provide opportunities for eligible youth in 
     activities related to leadership, development, 
     decisionmaking, citizenship, and community service.
       (b) Statewide Youth Activities.--
       (1) In general.--Funds reserved by a Governor for a State 
     as described in sections 128(a) and 133(a)(1)--
       (A) shall be used to carry out the statewide youth 
     activities described in paragraph (2); and
       (B) may be used to carry out any of the statewide youth 
     activities described in paragraph (3),

     regardless of whether the funds were allotted to the State 
     under section 127(b)(1) or under paragraph (1) or (2) of 
     section 132(b).
       (2) Required statewide youth activities.--A State shall use 
     funds reserved as described in sections 128(a) and 133(a)(1) 
     (regardless of whether the funds were allotted to the State 
     under section 127(b)(1) or paragraph (1) or (2) of section 
     132(b)) to carry out statewide youth activities, which shall 
     include--
       (A) disseminating a list of eligible providers of youth 
     activities described in section 123;
       (B) carrying out activities described in clauses (ii) 
     through (vi) of section 134(a)(2)(B), except that references 
     in such clauses to activities authorized under section 134 
     shall be considered to be references to activities authorized 
     under this section; and
       (C) providing additional assistance to local areas that 
     have high concentrations of eligible youth to carry out the 
     activities described in subsection (c).
       (3) Allowable statewide youth activities.--A State may use 
     funds reserved as described in sections 128(a) and 133(a)(1) 
     (regardless of whether the funds were allotted to the State 
     under section 127(b)(1) or paragraph (1) or (2) of section 
     132(b)) to carry out additional statewide youth activities, 
     which may include--
       (A) carrying out activities described in clauses (i), (ii), 
     (iii), (iv)(II), and (vi)(II) of section 134(a)(3)(A), except 
     that references in such clauses to activities authorized 
     under section 134 shall be considered to be references to 
     activities authorized under this section; and
       (B) carrying out, on a statewide basis, activities 
     described in subsection (c).
       (4) Prohibition.--No funds described in this subsection or 
     section 134(a) shall be used to develop or implement 
     education curricula for school systems in the State.
       (c) Local Elements and Requirements.--
       (1) Program design.--Funds allocated to a local area for 
     eligible youth under paragraph (2)(A) or (3), as appropriate, 
     of section 128(b) shall be used to carry out, for eligible 
     youth, programs that--
       (A) provide an objective assessment of the academic levels, 
     skill levels, and service needs of each participant, which 
     assessment shall include a review of basic skills, 
     occupational skills, prior work experience, employability, 
     interests, aptitudes (including interests and aptitudes for 
     nontraditional jobs), supportive service needs, and 
     developmental needs of such participant, except that a new 
     assessment of a participant is not required if the provider 
     carrying out such a program determines it is appropriate to 
     use a recent assessment of the participant conducted pursuant 
     to another education or training program;
       (B) develop service strategies for each participant that 
     shall identify an employment goal (including, in appropriate 
     circumstances, nontraditional employment), appropriate 
     achievement objectives, and appropriate services for the 
     participant taking into account the assessment conducted 
     pursuant to subparagraph (A), except

[[Page H6616]]

     that a new service strategy for a participant is not required 
     if the provider carrying out such a program determines it is 
     appropriate to use a recent service strategy developed for 
     the participant under another education or training program; 
     and
       (C) provide--
       (i) preparation for postsecondary educational 
     opportunities, in appropriate cases;
       (ii) strong linkages between academic and occupational 
     learning;
       (iii) preparation for unsubsidized employment 
     opportunities, in appropriate cases; and
       (iv) effective connections to intermediaries with strong 
     links to--

       (I) the job market; and
       (II) local and regional employers.

       (2) Program elements.--The programs described in paragraph 
     (1) shall provide elements consisting of--
       (A) tutoring, study skills training, and instruction, 
     leading to completion of secondary school, including dropout 
     prevention strategies;
       (B) alternative secondary school services, as appropriate;
       (C) summer employment opportunities that are directly 
     linked to academic and occupational learning;
       (D) as appropriate, paid and unpaid work experiences, 
     including internships and job shadowing;
       (E) occupational skill training, as appropriate;
       (F) leadership development opportunities, which may include 
     community service and peer-centered activities encouraging 
     responsibility and other positive social behaviors during 
     non-school hours, as appropriate;
       (G) supportive services;
       (H) adult mentoring for the period of participation and a 
     subsequent period, for a total of not less than 12 months;
       (I) followup services for not less than 12 months after the 
     completion of participation, as appropriate; and
       (J) comprehensive guidance and counseling, which may 
     include drug and alcohol abuse counseling and referral, as 
     appropriate.
       (3) Additional requirements.--
       (A) Information and referrals.--Each local board shall 
     ensure that each participant or applicant who meets the 
     minimum income criteria to be considered an eligible youth 
     shall be provided--
       (i) information on the full array of applicable or 
     appropriate services that are available through the local 
     board or other eligible providers or one-stop partners, 
     including those receiving funds under this subtitle; and
       (ii) referral to appropriate training and educational 
     programs that have the capacity to serve the participant or 
     applicant either on a sequential or concurrent basis.
       (B) Applicants not meeting enrollment requirements.--Each 
     eligible provider of a program of youth activities shall 
     ensure that an eligible applicant who does not meet the 
     enrollment requirements of the particular program or who 
     cannot be served shall be referred for further assessment, as 
     necessary, and referred to appropriate programs in accordance 
     with subparagraph (A) to meet the basic skills and training 
     needs of the applicant.
       (C) Involvement in design and implementation.--The local 
     board shall ensure that parents, participants, and other 
     members of the community with experience relating to programs 
     for youth are involved in the design and implementation of 
     the programs described in paragraph (1).
       (4) Priority.--
       (A) In general.--At a minimum, 30 percent of the funds 
     described in paragraph (1) shall be used to provide youth 
     activities to out-of-school youth.
       (B) Exception.--A State that receives a minimum allotment 
     under section 127(b)(1) in accordance with section 
     127(b)(1)(C)(iv)(II) or under section 132(b)(1) in accordance 
     with section 132(b)(1)(B)(iv)(II) may reduce the percentage 
     described in subparagraph (A) for a local area in the State, 
     if--
       (i) after an analysis of the eligible youth population in 
     the local area, the State determines that the local area will 
     be unable to meet the percentage described in subparagraph 
     (A) due to a low number of out-of-school youth; and
       (ii)(I) the State submits to the Secretary, for the local 
     area, a request including a proposed reduced percentage for 
     purposes of subparagraph (A), and the summary of the eligible 
     youth population analysis; and
       (II) the request is approved by the Secretary.
       (5) Exceptions.--Not more than 5 percent of participants 
     assisted under this section in each local area may be 
     individuals who do not meet the minimum income criteria to be 
     considered eligible youth, if such individuals are within 1 
     or more of the following categories:
       (A) Individuals who are school dropouts.
       (B) Individuals who are basic skills deficient.
       (C) Individuals with educational attainment that is 1 or 
     more grade levels below the grade level appropriate to the 
     age of the individuals.
       (D) Individuals who are pregnant or parenting.
       (E) Individuals with disabilities, including learning 
     disabilities.
       (F) Individuals who are homeless or runaway youth.
       (G) Individuals who are offenders.
       (H) Other eligible youth who face serious barriers to 
     employment as identified by the local board.
       (6) Prohibitions.--
       (A) Prohibition against federal control of education.--No 
     provision of this Act shall be construed to authorize any 
     department, agency, officer, or employee of the United States 
     to exercise any direction, supervision, or control over the 
     curriculum, program of instruction, administration, or 
     personnel of any educational institution, school, or school 
     system, or over the selection of library resources, 
     textbooks, or other printed or published instructional 
     materials by any educational institution, school, or school 
     system.
       (B) Nonduplication.--All of the funds made available under 
     this Act shall be used in accordance with the requirements of 
     this Act. None of the funds made available under this Act may 
     be used to provide funding under the School-to-Work 
     Opportunities Act of 1994 (20 U.S.C. 6101 et seq.) or to 
     carry out, through programs funded under this Act, activities 
     that were funded under the School-to-Work Opportunities Act 
     of 1994, unless the programs funded under this Act serve only 
     those participants eligible to participate in the programs 
     under this Act.
       (C) Noninterference and nonreplacement of regular academic 
     requirements.--No funds described in paragraph (1) shall be 
     used to provide an activity for eligible youth who are not 
     school dropouts if participation in the activity would 
     interfere with or replace the regular academic requirements 
     of the youth.
       (7) Linkages.--In coordinating the programs authorized 
     under this section, youth councils shall establish linkages 
     with educational agencies responsible for services to 
     participants as appropriate.
       (8) Volunteers.--The local board shall make opportunities 
     available for individuals who have successfully participated 
     in programs carried out under this section to volunteer 
     assistance to participants in the form of mentoring, 
     tutoring, and other activities.

    CHAPTER 5--ADULT AND DISLOCATED WORKER EMPLOYMENT AND TRAINING 
                               ACTIVITIES

     SEC. 131. GENERAL AUTHORIZATION.

       The Secretary shall make allotments under paragraphs (1)(B) 
     and (2)(B) of section 132(b) to each State that meets the 
     requirements of section 112 and a grant to each outlying area 
     that complies with the requirements of this title, to assist 
     the State or outlying area, and to enable the State or 
     outlying area to assist local areas, for the purpose of 
     providing workforce investment activities for adults, and 
     dislocated workers, in the State or outlying area and in the 
     local areas.

     SEC. 132. STATE ALLOTMENTS.

       (a) In General.--The Secretary shall--
       (1) make allotments and grants from the total amount 
     appropriated under section 137(b) for a fiscal year in 
     accordance with subsection (b)(1); and
       (2)(A) reserve 20 percent of the amount appropriated under 
     section 137(c) for a fiscal year for use under subsection 
     (b)(2)(A), and under sections 170(b) (relating to dislocated 
     worker technical assistance), 171(d) (relating to dislocated 
     worker projects), and 173 (relating to national emergency 
     grants); and
       (B) make allotments from 80 percent of the amount 
     appropriated under section 137(c) for a fiscal year in 
     accordance with subsection (b)(2)(B).
       (b) Allotment Among States.--
       (1) Adult employment and training activities.--
       (A) Reservation for outlying areas.--
       (i) In general.--From the amount made available under 
     subsection (a)(1) for a fiscal year, the Secretary shall 
     reserve not more than \1/4\ of 1 percent to provide 
     assistance to the outlying areas.
       (ii) Applicability of additional requirements.--From the 
     amount reserved under clause (i), the Secretary shall provide 
     assistance to the outlying areas for adult employment and 
     training activities and statewide workforce investment 
     activities in accordance with the requirements of section 
     127(b)(1)(B), except that the reference in section 
     127(b)(1)(B)(i)(II) to sections 252(d) and 262(a)(1) of the 
     Job Training Partnership Act shall be deemed to be a 
     reference to section 202(a)(1) of the Job Training 
     Partnership Act (as in effect on the day before the date of 
     enactment of this Act).
       (B) States.--
       (i) In general.--After determining the amount to be 
     reserved under subparagraph (A), the Secretary shall allot 
     the remainder of the amount referred to in subsection (a)(1) 
     for a fiscal year to the States pursuant to clause (ii) for 
     adult employment and training activities and statewide 
     workforce investment activities.
       (ii) Formula.--Subject to clauses (iii) and (iv), of the 
     remainder--

       (I) 33\1/3\ percent shall be allotted on the basis of the 
     relative number of unemployed individuals in areas of 
     substantial unemployment in each State, compared to the total 
     number of unemployed individuals in areas of substantial 
     unemployment in all States;
       (II) 33\1/3\ percent shall be allotted on the basis of the 
     relative excess number of unemployed individuals in each 
     State, compared to the total excess number of unemployed 
     individuals in all States; and
       (III) 33\1/3\ percent shall be allotted on the basis of the 
     relative number of disadvantaged adults in each State, 
     compared to the total number of disadvantaged adults in all 
     States, except as described in clause (iii).

       (iii) Calculation.--In determining an allotment under 
     clause (ii)(III) for any State in which there is a local area 
     designated under section 116(a)(2)(B), the allotment shall be 
     based on the higher of--

       (I) the number of adults in families with an income below 
     the low-income level in such area; or
       (II) the number of disadvantaged adults in such area.

       (iv) Minimum and maximum percentages and minimum 
     allotments.--In making allotments under this subparagraph, 
     the Secretary shall ensure the following:

       (I) Minimum percentage and allotment.--Subject to subclause 
     (IV), the Secretary shall

[[Page H6617]]

     ensure that no State shall receive an allotment for a fiscal 
     year that is less than the greater of--

       (aa) an amount based on 90 percent of the allotment 
     percentage of the State for the preceding fiscal year; or
       (bb) 100 percent of the allotment of the State under 
     section 202 of the Job Training Partnership Act (as in effect 
     on the day before the date of enactment of this Act) for 
     fiscal year 1998.

       (II) Small state minimum allotment.--Subject to subclauses 
     (I), (III), and (IV), the Secretary shall ensure that no 
     State shall receive an allotment under this subparagraph that 
     is less than the total of--

       (aa) \3/10\ of 1 percent of $960,000,000 of the remainder 
     described in clause (i) for the fiscal year; and
       (bb) if the remainder described in clause (i) for the 
     fiscal year exceeds $960,000,000, \2/5\ of 1 percent of the 
     excess.

       (III) Maximum percentage.--Subject to subclause (I), the 
     Secretary shall ensure that no State shall receive an 
     allotment percentage for a fiscal year that is more than 130 
     percent of the allotment percentage of the State for the 
     preceding fiscal year.
       (IV) Minimum funding.--In any fiscal year in which the 
     remainder described in clause (i) does not exceed 
     $960,000,000, the minimum allotments under subclauses (I) and 
     (II) shall be calculated by the methodology for calculating 
     the corresponding allotments under part A of title II of the 
     Job Training Partnership Act, as in effect on July 1, 1998.

       (v) Definitions.--For the purpose of the formula specified 
     in this subparagraph:

       (I) Adult.--The term ``adult'' means an individual who is 
     not less than age 22 and not more than age 72.
       (II) Allotment percentage.--The term ``allotment 
     percentage'', used with respect to fiscal year 2000 or a 
     subsequent fiscal year, means a percentage of the remainder 
     described in clause (i) that is received through an allotment 
     made under this subparagraph for the fiscal year. The term, 
     used with respect to fiscal year 1998 or 1999, means the 
     percentage of the amounts allotted to States under section 
     202(a) of the Job Training Partnership Act (as in effect on 
     the day before the date of enactment of this Act) that is 
     received under such section by the State involved for fiscal 
     year 1998 or 1999.
       (III) Area of substantial unemployment.--The term ``area of 
     substantial unemployment'' means any area that is of 
     sufficient size and scope to sustain a program of workforce 
     investment activities carried out under this subtitle and 
     that has an average rate of unemployment of at least 6.5 
     percent for the most recent 12 months, as determined by the 
     Secretary. For purposes of this subclause, determinations of 
     areas of substantial unemployment shall be made once each 
     fiscal year.
       (IV) Disadvantaged adult.--Subject to subclause (V), the 
     term ``disadvantaged adult'' means an adult who received an 
     income, or is a member of a family that received a total 
     family income, that, in relation to family size, does not 
     exceed the higher of--

       (aa) the poverty line; or
       (bb) 70 percent of the lower living standard income level.

       (V) Disadvantaged adult special rule.--The Secretary shall, 
     as appropriate and to the extent practicable, exclude college 
     students and members of the Armed Forces from the 
     determination of the number of disadvantaged adults.
       (VI) Excess number.--The term ``excess number'' means, used 
     with respect to the excess number of unemployed individuals 
     within a State, the higher of--

       (aa) the number that represents the number of unemployed 
     individuals in excess of 4.5 percent of the civilian labor 
     force in the State; or
       (bb) 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.
       (2) Dislocated worker employment and training.--
       (A) Reservation for outlying areas.--
       (i) In general.--From the amount made available under 
     subsection (a)(2)(A) for a fiscal year, the Secretary shall 
     reserve not more than \1/4\ of 1 percent of the amount 
     appropriated under section 137(c) for the fiscal year to 
     provide assistance to the outlying areas.
       (ii) Applicability of additional requirements.--From the 
     amount reserved under clause (i), the Secretary shall provide 
     assistance to the outlying areas for dislocated worker 
     employment and training activities and statewide workforce 
     investment activities in accordance with the requirements of 
     section 127(b)(1)(B), except that the reference in section 
     127(b)(1)(B)(i)(II) to sections 252(a) and 262(a)(1) of the 
     Job Training Partnership Act shall be deemed to be a 
     reference to section 302(e) of the Job Training Partnership 
     Act (as in effect on the day before the date of enactment of 
     this Act).
       (B) States.--
       (i) In general.--The Secretary shall allot the amount 
     referred to in subsection (a)(2)(B) for a fiscal year to the 
     States pursuant to clause (ii) for dislocated worker 
     employment and training activities and statewide workforce 
     investment activities.
       (ii) Formula.--Of the amount--

       (I) 33\1/3\ percent shall be allotted on the basis of the 
     relative number of unemployed individuals in each State, 
     compared to the total number of unemployed individuals in all 
     States;
       (II) 33\1/3\ percent shall be allotted on the basis of the 
     relative excess number of unemployed individuals in each 
     State, compared to the total excess number of unemployed 
     individuals in all States; and
       (III) 33\1/3\ percent shall be allotted on the basis of the 
     relative number of individuals in each State who have been 
     unemployed for 15 weeks or more, compared to the total number 
     of individuals in all States who have been unemployed for 15 
     weeks or more.

       (iii) Definition.--In this subparagraph, the term ``excess 
     number'' means, used with respect to the excess number of 
     unemployed individuals within a State, the number that 
     represents the number of unemployed individuals in excess of 
     4.5 percent of the civilian labor force in the State.
       (3) Definitions.--For the purpose of the formulas specified 
     in this subsection:
       (A) Freely associated states.--The term ``Freely Associated 
     States'' means the Republic of the Marshall Islands, the 
     Federated States of Micronesia, and the Republic of Palau.
       (B) Low-income level.--The term ``low-income level'' means 
     $7,000 with respect to income in 1969, and for any later year 
     means that amount that bears the same relationship to $7,000 
     as the Consumer Price Index for that year bears to the 
     Consumer Price Index for 1969, rounded to the nearest $1,000.
       (c) Reallotment.--
       (1) In general.--The Secretary shall, in accordance with 
     this subsection, reallot to eligible States amounts that are 
     allotted under this section for employment and training 
     activities and statewide workforce investment activities and 
     that are available for reallotment.
       (2) Amount.--The amount available for reallotment for a 
     program year is equal to the amount by which the unobligated 
     balance of the State allotments under this section for such 
     activities, at the end of the program year prior to the 
     program year for which the determination under this paragraph 
     is made, exceeds 20 percent of such allotments for the prior 
     program year.
       (3) Reallotment.--In making reallotments to eligible States 
     of amounts available pursuant to paragraph (2) for a program 
     year, the Secretary shall allot to each eligible State an 
     amount based on the relative amount allotted to such State 
     under this section for such activities for the prior program 
     year, as compared to the total amount allotted to all 
     eligible States under this section for such activities for 
     such prior program year.
       (4) Eligibility.--For purposes of this subsection, an 
     eligible State means a State that has obligated at least 80 
     percent of the State allotment under this section for such 
     activities for the program year prior to the program year for 
     which the determination under paragraph (2) is made.
       (5) Procedures.--The Governor of each State shall prescribe 
     uniform procedures for the obligation of funds by local areas 
     within the State in order to avoid the requirement that funds 
     be made available for reallotment under this subsection. The 
     Governor shall further prescribe equitable procedures for 
     making funds available from the State and local areas in the 
     event that a State is required to make funds available for 
     reallotment under this subsection.

     SEC. 133. WITHIN STATE ALLOCATIONS.

       (a) Reservations for State Activities.--
       (1) Statewide workforce investment activities.--The 
     Governor of a State shall make the reservation required under 
     section 128(a).
       (2) Statewide rapid response activities.--The Governor of 
     the State shall reserve not more than 25 percent of the total 
     amount allotted to the State under section 132(b)(2)(B) for a 
     fiscal year for statewide rapid response activities described 
     in section 134(a)(2)(A).
       (b) Within State Allocation.--
       (1) Methods.--The Governor, acting in accordance with the 
     State plan, and after consulting with chief elected officials 
     in the local areas, shall allocate--
       (A) the funds that are allotted to the State for adult 
     employment and training activities and statewide workforce 
     investment activities under section 132(b)(1)(B) and are not 
     reserved under subsection (a)(1), in accordance with 
     paragraph (2) or (3); and
       (B) the funds that are allotted to the State for dislocated 
     worker employment and training activities under section 
     132(b)(2)(B) and are not reserved under paragraph (1) or (2) 
     of subsection (a), in accordance with paragraph (2).
       (2) Formula allocations.--
       (A) Adult employment and training activities.--
       (i) Allocation.--In allocating the funds described in 
     paragraph (1)(A) to local areas, a State may allocate--

       (I) 33\1/3\ percent of the funds on the basis described in 
     section 132(b)(1)(B)(ii)(I);
       (II) 33\1/3\ percent of the funds on the basis described in 
     section 132(b)(1)(B)(ii)(II); and
       (III) 33\1/3\ percent of the funds on the basis described 
     in clauses (ii)(III) and (iii) of section 132(b)(1)(B).

       (ii) Minimum percentage.--Effective at the end of the 
     second full fiscal year after the date on which a local area 
     is designated under section 116, the local area shall not 
     receive an allocation percentage for a fiscal year that is 
     less than 90 percent of the average allocation percentage of 
     the local area for the 2 preceding fiscal years. Amounts 
     necessary for increasing such allocations to local areas to 
     comply with the preceding sentence shall be obtained by 
     ratably reducing the allocations to be made to other local 
     areas under this subparagraph.
       (iii) Definition.--The term ``allocation percentage'', used 
     with respect to fiscal year 2000 or a subsequent fiscal year, 
     means a percentage of the funds referred to in clause (i), 
     received through an allocation made under this subparagraph, 
     for the fiscal year.
       (B) Dislocated worker employment and training activities.--
       (i) Formula.--In allocating the funds described in 
     paragraph (1)(B) to local areas, a State shall allocate the 
     funds based on an allocation formula prescribed by the 
     Governor of the State. Such formula may be amended by the

[[Page H6618]]

     Governor not more than once for each program year. Such 
     formula shall utilize the most appropriate information 
     available to the Governor to distribute amounts to address 
     the State's worker readjustment assistance needs.
       (ii) Information.--The information described in clause (i) 
     shall include insured unemployment data, unemployment 
     concentrations, plant closing and mass layoff data, declining 
     industries data, farmer-rancher economic hardship data, and 
     long-term unemployment data.
       (C) Application.--For purposes of carrying out subparagraph 
     (A)--
       (i) references in section 132(b) to a State shall be deemed 
     to be references to a local area;
       (ii) references in section 132(b) to all States shall be 
     deemed to be references to all local areas in the State 
     involved; and
       (iii) except as described in clause (i), references in 
     section 132(b)(1) to the term ``excess number'' shall be 
     considered to be references to the term as defined in section 
     132(b)(1).
       (3) Adult employment and training discretionary 
     allocations.--In lieu of making the allocation described in 
     paragraph (2)(A), in allocating the funds described in 
     paragraph (1)(A) to local areas, a State may distribute--
       (A) a portion equal to not less than 70 percent of the 
     funds in accordance with paragraph (2)(A); and
       (B) the remaining portion of the funds on the basis of a 
     formula that--
       (i) incorporates additional factors (other than the factors 
     described in paragraph (2)(A)) relating to--

       (I) excess poverty in urban, rural, and suburban local 
     areas; and
       (II) excess unemployment above the State average in urban, 
     rural, and suburban local areas; and

       (ii) was developed by the State board and approved by the 
     Secretary as part of the State plan.
       (4) Transfer authority.--A local board may transfer, if 
     such a transfer is approved by the Governor, not more than 20 
     percent of the funds allocated to the local area under 
     paragraph (2)(A) or (3), and 20 percent of the funds 
     allocated to the local area under paragraph (2)(B), for a 
     fiscal year between--
       (A) adult employment and training activities; and
       (B) dislocated worker employment and training activities.
       (5) Allocation.--
       (A) In general.--The Governor of the State shall allocate 
     the funds described in paragraph (1) to local areas under 
     paragraphs (2) and (3) for the purpose of providing a single 
     system of employment and training activities for adults and 
     dislocated workers in accordance with subsections (d) and (e) 
     of section 134.
       (B) Additional requirements.--
       (i) Adults.--Funds allocated under paragraph (2)(A) or (3) 
     shall be used by a local area to contribute proportionately 
     to the costs of the one-stop delivery system described in 
     section 134(c) in the local area, and to pay for employment 
     and training activities provided to adults in the local area, 
     consistent with section 134.
       (ii) Dislocated workers.--Funds allocated under paragraph 
     (2)(B) shall be used by a local area to contribute 
     proportionately to the costs of the one-stop delivery system 
     described in section 134(c) in the local area, and to pay for 
     employment and training activities provided to dislocated 
     workers in the local area, consistent with section 134.
       (c) Reallocation Among Local Areas.--
       (1) In general.--The Governor may, in accordance with this 
     subsection, reallocate to eligible local areas within the 
     State amounts that are allocated under paragraph (2)(A) or 
     (3) of subsection (b) for adult employment and training 
     activities and that are available for reallocation.
       (2) Amount.--The amount available for reallocation for a 
     program year is equal to the amount by which the unobligated 
     balance of the local area allocation under paragraph (2)(A) 
     or (3) of subsection (b) for such activities, at the end of 
     the program year prior to the program year for which the 
     determination under this paragraph is made exceeds 20 percent 
     of such allocation for the prior program year.
       (3) Reallocation.--In making reallocations to eligible 
     local areas of amounts available pursuant to paragraph (2) 
     for a program year, the Governor shall allocate to each 
     eligible local area within the State an amount based on the 
     relative amount allocated to such local area under subsection 
     (b)(3) for such activities for the prior program year, as 
     compared to the total amount allocated to all eligible local 
     areas in the State under subsection (b)(3) for such 
     activities for such prior program year. For purposes of this 
     paragraph, local areas that received allocations under 
     subsection (b)(2)(A) for the prior program year shall be 
     treated as if the local areas received allocations under 
     subsection (b)(3) for such year.
       (4) Eligibility.--For purposes of this subsection, an 
     eligible local area means a local area that has obligated at 
     least 80 percent of the local area allocation under paragraph 
     (2)(A) or (3) of subsection (b) for such activities, for the 
     program year prior to the program year for which the 
     determination under paragraph (2) is made.

     SEC. 134. USE OF FUNDS FOR EMPLOYMENT AND TRAINING 
                   ACTIVITIES.

       (a) Statewide Employment and Training Activities.--
       (1) In general.--Funds reserved by a Governor for a State--
       (A) as described in section 133(a)(2) shall be used to 
     carry out the statewide rapid response activities described 
     in paragraph (2)(A); and
       (B) as described in sections 128(a) and 133(a)(1)--
       (i) shall be used to carry out the statewide employment and 
     training activities described in paragraph (2)(B); and
       (ii) may be used to carry out any of the statewide 
     employment and training activities described in paragraph 
     (3),

     regardless of whether the funds were allotted to the State 
     under section 127(b)(1) or under paragraph (1) or (2) of 
     section 132(b).
       (2) Required statewide employment and training 
     activities.--
       (A) Statewide rapid response activities.--A State shall use 
     funds reserved as described in section 133(a)(2) to carry out 
     statewide rapid response activities, which shall include--
       (i) provision of rapid response activities, carried out in 
     local areas by the State or by an entity designated by the 
     State, working in conjunction with the local boards and the 
     chief elected officials in the local areas; and
       (ii) provision of additional assistance to local areas that 
     experience disasters, mass layoffs or plant closings, or 
     other events that precipitate substantial increases in the 
     number of unemployed individuals, carried out in local areas 
     by the State or by an entity designated by the State, working 
     in conjunction with the local boards and the chief elected 
     officials in the local areas.
       (B) Other required statewide employment and training 
     activities.--A State shall use funds reserved as described in 
     sections 128(a) and 133(a)(1) (regardless of whether the 
     funds were allotted to the State under section 127(b)(1) or 
     paragraph (1) or (2) of section 132(b)) to carry out other 
     statewide employment and training activities, which shall 
     include--
       (i) disseminating the State list of eligible providers of 
     training services, including eligible providers of 
     nontraditional training services, information identifying 
     eligible providers of on-the-job training and customized 
     training, and performance information and program cost 
     information, as described in subsections (e) and (h) of 
     section 122;
       (ii) conducting evaluations, under section 136(e), of 
     activities authorized in this section, in coordination with 
     the activities carried out under section 172;
       (iii) providing incentive grants to local areas for 
     regional cooperation among local boards (including local 
     boards for a designated region as described in section 
     116(c)), for local coordination of activities carried out 
     under this Act, and for exemplary performance by local areas 
     on the local performance measures;
       (iv) providing technical assistance to local areas that 
     fail to meet local performance measures;
       (v) assisting in the establishment and operation of one-
     stop delivery systems described in subsection (c); and
       (vi) operating a fiscal and management accountability 
     information system under section 136(f).
       (3) Allowable statewide employment and training 
     activities.--
       (A) In general.--A State may use funds reserved as 
     described in sections 128(a) and 133(a)(1) (regardless of 
     whether the funds were allotted to the State under section 
     127(b)(1) or paragraph (1) or (2) of section 132(b)) to carry 
     out additional statewide employment and training activities, 
     which may include--
       (i) subject to subparagraph (B), administration by the 
     State of the activities authorized under this section;
       (ii) provision of capacity building and technical 
     assistance to local areas, one-stop operators, one-stop 
     partners, and eligible providers, including the development 
     and training of staff and the development of exemplary 
     program activities;
       (iii) conduct of research and demonstrations;
       (iv)(I) implementation of innovative incumbent worker 
     training programs, which may include the establishment and 
     implementation of an employer loan program to assist in 
     skills upgrading; and
       (II) the establishment and implementation of programs 
     targeted to empowerment zones and enterprise communities;
       (v) support for the identification of eligible providers of 
     training services as required under section 122;
       (vi)(I) implementation of innovative programs for displaced 
     homemakers, which for purposes of this subclause may include 
     an individual who is receiving public assistance and is 
     within 2 years of exhausting lifetime eligibility under part 
     A of title IV of the Social Security Act (42 U.S.C. 601 et 
     seq.); and
       (II) implementation of programs to increase the number of 
     individuals training for and placed in nontraditional 
     employment; and
       (vii) carrying out other activities authorized in this 
     section that the State determines to be necessary to assist 
     local areas in carrying out activities described in 
     subsection (d) or (e) through the statewide workforce 
     investment system.
       (B) Limitation.--
       (i) In general.--Of the funds allotted to a State under 
     sections 127(b) and 132(b) and reserved as described in 
     sections 128(a) and 133(a)(1) for a fiscal year--

       (I) not more than 5 percent of the amount allotted under 
     section 127(b)(1);
       (II) not more than 5 percent of the amount allotted under 
     section 132(b)(1); and
       (III) not more than 5 percent of the amount allotted under 
     section 132(b)(2),

     may be used by the State for the administration of youth 
     activities carried out under section 129 and employment and 
     training activities carried out under this section.
       (ii) Use of funds.--Funds made available for administrative 
     costs under clause (i) may be used for the administrative 
     cost of any of the statewide youth activities or statewide 
     employment and training activities, regardless of whether the 
     funds were allotted to the State

[[Page H6619]]

     under section 127(b)(1) or paragraph (1) or (2) of section 
     132(b).
       (b) Local Employment and Training Activities.--Funds 
     allocated to a local area for adults under paragraph (2)(A) 
     or (3), as appropriate, of section 133(b), and funds 
     allocated to a local area for dislocated workers under 
     section 133(b)(2)(B)--
       (1) shall be used to carry out employment and training 
     activities described in subsection (d) for adults or 
     dislocated workers, respectively; and
       (2) may be used to carry out employment and training 
     activities described in subsection (e) for adults or 
     dislocated workers, respectively.
       (c) Establishment of One-Stop Delivery System.--
       (1) In general.--There shall be established in a State that 
     receives an allotment under section 132(b) a one-stop 
     delivery system, which--
       (A) shall provide the core services described in subsection 
     (d)(2);
       (B) shall provide access to intensive services and training 
     services as described in paragraphs (3) and (4) of subsection 
     (d), including serving as the point of access to individual 
     training accounts for training services to participants in 
     accordance with subsection (d)(4)(G);
       (C) shall provide access to the activities carried out 
     under subsection (e), if any;
       (D) shall provide access to programs and activities carried 
     out by one-stop partners and described in section 121(b); and
       (E) shall provide access to the information described in 
     section 15 of the Wagner-Peyser Act and all job search, 
     placement, recruitment, and other labor exchange services 
     authorized under the Wagner-Peyser Act (29 U.S.C. 49 et 
     seq.).
       (2) One-stop delivery.--At a minimum, the one-stop delivery 
     system--
       (A) shall make each of the programs, services, and 
     activities described in paragraph (1) accessible at not less 
     than 1 physical center in each local area of the State; and
       (B) may also make programs, services, and activities 
     described in paragraph (1) available--
       (i) through a network of affiliated sites that can provide 
     1 or more of the programs, services, and activities to 
     individuals; and
       (ii) through a network of eligible one-stop partners--

       (I) in which each partner provides 1 or more of the 
     programs, services, and activities to such individuals and is 
     accessible at an affiliated site that consists of a physical 
     location or an electronically or technologically linked 
     access point; and
       (II) that assures individuals that information on the 
     availability of the core services will be available 
     regardless of where the individuals initially enter the 
     statewide workforce investment system, including information 
     made available through an access point described in subclause 
     (I).

       (3) Specialized centers.--The centers and sites described 
     in paragraph (2) may have a specialization in addressing 
     special needs, such as the needs of dislocated workers.
       (d) Required Local Employment and Training Activities.--
       (1) In general.--
       (A) Allocated funds.--Funds allocated to a local area for 
     adults under paragraph (2)(A) or (3), as appropriate, of 
     section 133(b), and funds allocated to the local area for 
     dislocated workers under section 133(b)(2)(B), shall be 
     used--
       (i) to establish a one-stop delivery system described in 
     subsection (c);
       (ii) to provide the core services described in paragraph 
     (2) to adults and dislocated workers, respectively, through 
     the one-stop delivery system in accordance with such 
     paragraph;
       (iii) to provide the intensive services described in 
     paragraph (3) to adults and dislocated workers, respectively, 
     described in such paragraph; and
       (iv) to provide training services described in paragraph 
     (4) to adults and dislocated workers, respectively, described 
     in such paragraph.
       (B) Other funds.--A portion of the funds made available 
     under Federal law authorizing the programs and activities 
     described in section 121(b)(1)(B), including the Wagner-
     Peyser Act (29 U.S.C. 49 et seq.), shall be used as described 
     in clauses (i) and (ii) of subparagraph (A), to the extent 
     not inconsistent with the Federal law involved.
       (2) Core services.--Funds described in paragraph (1)(A) 
     shall be used to provide core services, which shall be 
     available to individuals who are adults or dislocated workers 
     through the one-stop delivery system and shall, at a minimum, 
     include--
       (A) determinations of whether the individuals are eligible 
     to receive assistance under this subtitle;
       (B) outreach, intake (which may include worker profiling), 
     and orientation to the information and other services 
     available through the one-stop delivery system;
       (C) initial assessment of skill levels, aptitudes, 
     abilities, and supportive service needs;
       (D) job search and placement assistance, and where 
     appropriate, career counseling;
       (E) provision of employment statistics information, 
     including the provision of accurate information relating to 
     local, regional, and national labor market areas, including--
       (i) job vacancy listings in such labor market areas;
       (ii) information on job skills necessary to obtain the jobs 
     described in clause (i); and
       (iii) information relating to local occupations in demand 
     and the earnings and skill requirements for such occupations; 
     and
       (F) provision of performance information and program cost 
     information on eligible providers of training services as 
     described in section 122, provided by program, and eligible 
     providers of youth activities described in section 123, 
     providers of adult education described in title II, providers 
     of postsecondary vocational education activities and 
     vocational education activities available to school dropouts 
     under the Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2301 et seq.), and providers of 
     vocational rehabilitation program activities described in 
     title I of the Rehabilitation Act of 1973 (29 U.S.C. 720 et 
     seq.);
       (G) provision of information regarding how the local area 
     is performing on the local performance measures and any 
     additional performance information with respect to the one-
     stop delivery system in the local area;
       (H) provision of accurate information relating to the 
     availability of supportive services, including child care and 
     transportation, available in the local area, and referral to 
     such services, as appropriate;
       (I) provision of information regarding filing claims for 
     unemployment compensation;
       (J) assistance in establishing eligibility for--
       (i) welfare-to-work activities authorized under section 
     403(a)(5) of the Social Security Act (as added by section 
     5001 of the Balanced Budget Act of 1997) available in the 
     local area; and
       (ii) programs of financial aid assistance for training and 
     education programs that are not funded under this Act and are 
     available in the local area; and
       (K) followup services, including counseling regarding the 
     workplace, for participants in workforce investment 
     activities authorized under this subtitle who are placed in 
     unsubsidized employment, for not less than 12 months after 
     the first day of the employment, as appropriate.
       (3) Intensive services.--
       (A) In general.--Funds allocated to a local area for adults 
     under paragraph (2)(A) or (3), as appropriate, of section 
     133(b), and funds allocated to the local area for dislocated 
     workers under section 133(b)(2)(B), shall be used to provide 
     intensive services to adults and dislocated workers, 
     respectively--
       (i)(I) who are unemployed and are unable to obtain 
     employment through core services provided under paragraph 
     (2); and
       (II) who have been determined by a one-stop operator to be 
     in need of more intensive services in order to obtain 
     employment; or
       (ii) who are employed, but who are determined by a one-stop 
     operator to be in need of such intensive services in order to 
     obtain or retain employment that allows for self-sufficiency.
       (B) Delivery of services.--Such intensive services shall be 
     provided through the one-stop delivery system--
       (i) directly through one-stop operators identified pursuant 
     to section 121(d); or
       (ii) through contracts with service providers, which may 
     include contracts with public, private for-profit, and 
     private nonprofit service providers, approved by the local 
     board.
       (C) Types of services.--Such intensive services may include 
     the following:
       (i) Comprehensive and specialized assessments of the skill 
     levels and service needs of adults and dislocated workers, 
     which may include--

       (I) diagnostic testing and use of other assessment tools; 
     and
       (II) in-depth interviewing and evaluation to identify 
     employment barriers and appropriate employment goals.

       (ii) Development of an individual employment plan, to 
     identify the employment goals, appropriate achievement 
     objectives, and appropriate combination of services for the 
     participant to achieve the employment goals.
       (iii) Group counseling.
       (iv) Individual counseling and career planning.
       (v) Case management for participants seeking training 
     services under paragraph (4).
       (vi) Short-term prevocational services, including 
     development of learning skills, communication skills, 
     interviewing skills, punctuality, personal maintenance 
     skills, and professional conduct, to prepare individuals for 
     unsubsidized employment or training.
       (4) Training services.--
       (A) In general.--Funds allocated to a local area for adults 
     under paragraph (2)(A) or (3), as appropriate, of section 
     133(b), and funds allocated to a local area for dislocated 
     workers under section 133(b)(2)(B) shall be used to provide 
     training services to adults and dislocated workers, 
     respectively--
       (i) who have met the eligibility requirements for intensive 
     services under paragraph (3)(A) and who are unable to obtain 
     or retain employment through such services;
       (ii) who after an interview, evaluation, or assessment, and 
     case management, have been determined by a one-stop operator 
     or one-stop partner, as appropriate, to be in need of 
     training services and to have the skills and qualifications 
     to successfully participate in the selected program of 
     training services;
       (iii) who select programs of training services that are 
     directly linked to the employment opportunities in the local 
     area involved or in another area in which the adults or 
     dislocated workers receiving such services are willing to 
     relocate;
       (iv) who meet the requirements of subparagraph (B); and
       (v) who are determined to be eligible in accordance with 
     the priority system, if any, in effect under subparagraph 
     (E).
       (B) Qualification.--
       (i) Requirement.--Except as provided in clause (ii), 
     provision of such training services shall be limited to 
     individuals who--

       (I) are unable to obtain other grant assistance for such 
     services, including Federal Pell Grants established under 
     title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 
     et seq.); or
       (II) require assistance beyond the assistance made 
     available under other grant assistance programs, including 
     Federal Pell Grants.

       (ii) Reimbursements.--Training services may be provided 
     under this paragraph to an individual who otherwise meets the 
     requirements of this paragraph while an application for a 
     Federal Pell Grant is pending, except that if such

[[Page H6620]]

     individual is subsequently awarded a Federal Pell Grant, 
     appropriate reimbursement shall be made to the local area 
     from such Federal Pell Grant.
       (C) Provider qualification.--Training services shall be 
     provided through providers identified in accordance with 
     section 122.
       (D) Training services.--Training services may include--
       (i) occupational skills training, including training for 
     nontraditional employment;
       (ii) on-the-job training;
       (iii) programs that combine workplace training with related 
     instruction, which may include cooperative education 
     programs;
       (iv) training programs operated by the private sector;
       (v) skill upgrading and retraining;
       (vi) entrepreneurial training;
       (vii) job readiness training;
       (viii) adult education and literacy activities provided in 
     combination with services described in any of clauses (i) 
     through (vii); and
       (ix) customized training conducted with a commitment by an 
     employer or group of employers to employ an individual upon 
     successful completion of the training.
       (E) Priority.--In the event that funds allocated to a local 
     area for adult employment and training activities under 
     paragraph (2)(A) or (3) of section 133(b) are limited, 
     priority shall be given to recipients of public assistance 
     and other low-income individuals for intensive services and 
     training services. The appropriate local board and the 
     Governor shall direct the one-stop operators in the local 
     area with regard to making determinations related to such 
     priority.
       (F) Consumer choice requirements.--
       (i) In general.--Training services provided under this 
     paragraph shall be provided in a manner that maximizes 
     consumer choice in the selection of an eligible provider of 
     such services.
       (ii) Eligible providers.--Each local board, through one-
     stop centers referred to in subsection (c), shall make 
     available--

       (I) the State list of eligible providers of training 
     services required under section 122(e), with a description of 
     the programs through which the providers may offer the 
     training services, and the information identifying eligible 
     providers of on-the-job training and customized training 
     required under section 122(h); and
       (II) the performance information and performance cost 
     information relating to eligible providers of training 
     services described in subsections (e) and (h) of section 122.

       (G) Use of individual training accounts.--
       (i) In general.--Except as provided in clause (ii), 
     training services provided under this paragraph shall be 
     provided through the use of individual training accounts in 
     accordance with this paragraph, and shall be provided to 
     eligible individuals through the one-stop delivery system.
       (ii) Exceptions.--Training services authorized under this 
     paragraph may be provided pursuant to a contract for services 
     in lieu of an individual training account if the requirements 
     of subparagraph (F) are met and if--

       (I) such services are on-the-job training provided by an 
     employer or customized training;
       (II) the local board determines there are an insufficient 
     number of eligible providers of training services in the 
     local area involved (such as in a rural area) to accomplish 
     the purposes of a system of individual training accounts; or
       (III) the local board determines that there is a training 
     services program of demonstrated effectiveness offered in the 
     local area by a community-based organization or another 
     private organization to serve special participant populations 
     that face multiple barriers to employment.

       (iii) Linkage to occupations in demand.--Training services 
     provided under this paragraph shall be directly linked to 
     occupations that are in demand in the local area, or in 
     another area to which an adult or dislocated worker receiving 
     such services is willing to relocate, except that a local 
     board may approve training services for occupations 
     determined by the local board to be in sectors of the economy 
     that have a high potential for sustained demand or growth in 
     the local area.
       (iv) Definition.--In this subparagraph, the term ``special 
     participant population that faces multiple barriers to 
     employment'' means a population of low-income individuals 
     that is included in 1 or more of the following categories:

       (I) Individuals with substantial language or cultural 
     barriers.
       (II) Offenders.
       (III) Homeless individuals.
       (IV) Other hard-to-serve populations as defined by the 
     Governor involved.

       (e) Permissible Local Employment and Training Activities.--
       (1) Discretionary one-stop delivery activities.--Funds 
     allocated to a local area for adults under paragraph (2)(A) 
     or (3), as appropriate, of section 133(b), and funds 
     allocated to the local area for dislocated workers under 
     section 133(b)(2)(B), may be used to provide, through one-
     stop delivery described in subsection (c)(2)--
       (A) customized screening and referral of qualified 
     participants in training services described in subsection 
     (d)(4) to employment; and
       (B) customized employment-related services to employers on 
     a fee-for-service basis.
       (2) Supportive services.--Funds allocated to a local area 
     for adults under paragraph (2)(A) or (3), as appropriate, of 
     section 133(b), and funds allocated to the local area for 
     dislocated workers under section 133(b)(2)(B), may be used to 
     provide supportive services to adults and dislocated workers, 
     respectively--
       (A) who are participating in programs with activities 
     authorized in any of paragraphs (2), (3), or (4) of 
     subsection (d); and
       (B) who are unable to obtain such supportive services 
     through other programs providing such services.
       (3) Needs-related payments.--
       (A) In general.--Funds allocated to a local area for adults 
     under paragraph (2)(A) or (3), as appropriate, of section 
     133(b), and funds allocated to the local area for dislocated 
     workers under section 133(b)(2)(B), may be used to provide 
     needs-related payments to adults and dislocated workers, 
     respectively, who are unemployed and do not qualify for (or 
     have ceased to qualify for) unemployment compensation for the 
     purpose of enabling such individuals to participate in 
     programs of training services under subsection (d)(4).
       (B) Additional eligibility requirements.--In addition to 
     the requirements contained in subparagraph (A), a dislocated 
     worker who has ceased to qualify for unemployment 
     compensation may be eligible to receive needs-related 
     payments under this paragraph only if such worker was 
     enrolled in the training services--
       (i) by the end of the 13th week after the most recent 
     layoff that resulted in a determination of the worker's 
     eligibility for employment and training activities for 
     dislocated workers under this subtitle; or
       (ii) if later, by the end of the 8th week after the worker 
     is informed that a short-term layoff will exceed 6 months.
       (C) Level of payments.--The level of a needs-related 
     payment made to a dislocated worker under this paragraph 
     shall not exceed the greater of--
       (i) the applicable level of unemployment compensation; or
       (ii) if such worker did not qualify for unemployment 
     compensation, an amount equal to the poverty line, for an 
     equivalent period, which amount shall be adjusted to reflect 
     changes in total family income.

                     CHAPTER 6--GENERAL PROVISIONS

     SEC. 136. PERFORMANCE ACCOUNTABILITY SYSTEM.

       (a) Purpose.--The purpose of this section is to establish a 
     comprehensive performance accountability system, comprised of 
     the activities described in this section, to assess the 
     effectiveness of States and local areas in achieving 
     continuous improvement of workforce investment activities 
     funded under this subtitle, in order to optimize the return 
     on investment of Federal funds in statewide and local 
     workforce investment activities.
       (b) State Performance Measures.--
       (1) In general.--For each State, the State performance 
     measures shall consist of--
       (A)(i) the core indicators of performance described in 
     paragraph (2)(A) and the customer satisfaction indicator of 
     performance described in paragraph (2)(B); and
       (ii) additional indicators of performance (if any) 
     identified by the State under paragraph (2)(C); and
       (B) a State adjusted level of performance for each 
     indicator described in subparagraph (A).
       (2) Indicators of performance.--
       (A) Core indicators of performance.--
       (i) In general.--The core indicators of performance for 
     employment and training activities authorized under section 
     134 (except for self-service and informational activities) 
     and (for participants who are eligible youth age 19 through 
     21) for youth activities authorized under section 129 shall 
     consist of--

       (I) entry into unsubsidized employment;
       (II) retention in unsubsidized employment 6 months after 
     entry into the employment;
       (III) earnings received in unsubsidized employment 6 months 
     after entry into the employment; and
       (IV) attainment of a recognized credential relating to 
     achievement of educational skills, which may include 
     attainment of a secondary school diploma or its recognized 
     equivalent, or occupational skills, by participants who enter 
     unsubsidized employment, or by participants who are eligible 
     youth age 19 through 21 who enter postsecondary education, 
     advanced training, or unsubsidized employment.

       (ii) Core indicators for eligible youth.--The core 
     indicators of performance (for participants who are eligible 
     youth age 14 through 18) for youth activities authorized 
     under section 129, shall include--

       (I) attainment of basic skills and, as appropriate, work 
     readiness or occupational skills;
       (II) attainment of secondary school diplomas and their 
     recognized equivalents; and
       (III) placement and retention in postsecondary education or 
     advanced training, or placement and retention in military 
     service, employment, or qualified apprenticeships.

       (B) Customer satisfaction indicators.--The customer 
     satisfaction indicator of performance shall consist of 
     customer satisfaction of employers and participants with 
     services received from the workforce investment activities 
     authorized under this subtitle. Customer satisfaction may be 
     measured through surveys conducted after the conclusion of 
     participation in the workforce investment activities.
       (C) Additional indicators.--A State may identify in the 
     State plan additional indicators for workforce investment 
     activities authorized under this subtitle.
       (3) Levels of performance.--
       (A) State adjusted levels of performance for core 
     indicators and customer satisfaction indicator.--
       (i) In general.--For each State submitting a State plan, 
     there shall be established, in accordance with this 
     subparagraph, levels of performance for each of the core 
     indicators of performance described in paragraph (2)(A) and 
     the customer satisfaction indicator described in paragraph 
     (2)(B) for workforce investment activities authorized under 
     this subtitle. The levels of performance established under 
     this subparagraph shall, at a minimum--

       (I) be expressed in an objective, quantifiable, and 
     measurable form; and
       (II) show the progress of the State toward continuously 
     improving in performance.

[[Page H6621]]

       (ii) Identification in state plan.--Each State shall 
     identify, in the State plan submitted under section 112, 
     expected levels of performance for each of the core 
     indicators of performance and the customer satisfaction 
     indicator of performance, for the first 3 program years 
     covered by the State plan.
       (iii) Agreement on state adjusted levels of performance for 
     first 3 years.--In order to ensure an optimal return on the 
     investment of Federal funds in workforce investment 
     activities authorized under this subtitle, the Secretary and 
     each Governor shall reach agreement on levels of performance 
     for each of the core indicators of performance and the 
     customer satisfaction indicator of performance, for the first 
     3 program years covered by the State plan, taking into 
     account the levels identified in the State plan under clause 
     (ii) and the factors described in clause (iv). The levels 
     agreed to under this clause shall be considered to be the 
     State adjusted levels of performance for the State for such 
     years and shall be incorporated into the State plan prior to 
     the approval of such plan.
       (iv) Factors.--The agreement described in clause (iii) or 
     (v) shall take into account--

       (I) the extent to which the levels involved will assist the 
     State in attaining a high level of customer satisfaction;
       (II) how the levels involved compare with the State 
     adjusted levels of performance established for other States, 
     taking into account factors including differences in economic 
     conditions, the characteristics of participants when the 
     participants entered the program, and the services to be 
     provided; and
       (III) the extent to which such levels involved promote 
     continuous improvement in performance on the performance 
     measures by such State and ensure optimal return on the 
     investment of Federal funds.

       (v) Agreement on state adjusted levels of performance for 
     4th and 5th years.--Prior to the fourth program year covered 
     by the State plan, the Secretary and each Governor shall 
     reach agreement on levels of performance for each of the core 
     indicators of performance and the customer satisfaction 
     indicator of performance, for the fourth and fifth program 
     years covered by the State plan, taking into account the 
     factors described in clause (iv). The levels agreed to under 
     this clause shall be considered to be the State adjusted 
     levels of performance for the State for such years and shall 
     be incorporated into the State plan.
       (vi) Revisions.--If unanticipated circumstances arise in a 
     State resulting in a significant change in the factors 
     described in clause (iv)(II), the Governor may request that 
     the State adjusted levels of performance agreed to under 
     clause (iii) or (v) be revised. The Secretary, after 
     collaboration with the representatives described in 
     subsection (i), shall issue objective criteria and methods 
     for making such revisions.
       (B) Levels of performance for additional indicators.--The 
     State may identify, in the State plan, State levels of 
     performance for each of the additional indicators described 
     in paragraph (2)(C). Such levels shall be considered to be 
     State adjusted levels of performance for purposes of this 
     title.
       (c) Local Performance Measures.--
       (1) In general.--For each local area in a State, the local 
     performance measures shall consist of--
       (A)(i) the core indicators of performance described in 
     subsection (b)(2)(A), and the customer satisfaction indicator 
     of performance described in subsection (b)(2)(B), for 
     activities described in such subsections, other than 
     statewide workforce investment activities; and
       (ii) additional indicators of performance (if any) 
     identified by the State under subsection (b)(2)(C) for 
     activities described in such subsection, other than statewide 
     workforce investment activities; and
       (B) a local level of performance for each indicator 
     described in subparagraph (A).
       (2) Local level of performance.--The local board, the chief 
     elected official, and the Governor shall negotiate and reach 
     agreement on the local levels of performance based on the 
     State adjusted levels of performance established under 
     subsection (b).
       (3) Determinations.--In determining such local levels of 
     performance, the local board, the chief elected official, and 
     the Governor shall take into account the specific economic, 
     demographic, and other characteristics of the populations to 
     be served in the local area.
       (d) Report.--
       (1) In general.--Each State that receives an allotment 
     under section 127 or 132 shall annually prepare and submit to 
     the Secretary a report on the progress of the State in 
     achieving State performance measures, including information 
     on the levels of performance achieved by the State with 
     respect to the core indicators of performance and the 
     customer satisfaction indicator. The annual report also shall 
     include information regarding the progress of local areas in 
     the State in achieving local performance measures, including 
     information on the levels of performance achieved by the 
     areas with respect to the core indicators of performance and 
     the customer satisfaction indicator. The report also shall 
     include information on the status of State evaluations of 
     workforce investment activities described in subsection (e).
       (2) Additional information.--In preparing such report, the 
     State shall include, at a minimum, information on 
     participants in workforce investment activities authorized 
     under this subtitle relating to--
       (A) entry by participants who have completed training 
     services provided under section 134(d)(4) into unsubsidized 
     employment related to the training received;
       (B) wages at entry into employment for participants in 
     workforce investment activities who entered unsubsidized 
     employment, including the rate of wage replacement for such 
     participants who are dislocated workers;
       (C) cost of workforce investment activities relative to the 
     effect of the activities on the performance of participants;
       (D) retention and earnings received in unsubsidized 
     employment 12 months after entry into the employment;
       (E) performance with respect to the indicators of 
     performance specified in subsection (b)(2)(A) of participants 
     in workforce investment activities who received the training 
     services compared with the performance of participants in 
     workforce investment activities who received only services 
     other than the training services (excluding participants who 
     received only self-service and informational activities); and
       (F) performance with respect to the indicators of 
     performance specified in subsection (b)(2)(A) of recipients 
     of public assistance, out-of-school youth, veterans, 
     individuals with disabilities, displaced homemakers, and 
     older individuals.
       (3) Information dissemination.--The Secretary--
       (A) shall make the information contained in such reports 
     available to the general public through publication and other 
     appropriate methods;
       (B) shall disseminate State-by-State comparisons of the 
     information; and
       (C) shall provide the appropriate congressional committees 
     with copies of such reports.
       (e) Evaluation of State Programs.--
       (1) In general.--Using funds made available under this 
     subtitle, the State, in coordination with local boards in the 
     State, shall conduct ongoing evaluation studies of workforce 
     investment activities carried out in the State under this 
     subtitle in order to promote, establish, implement, and 
     utilize methods for continuously improving the activities in 
     order to achieve high-level performance within, and high-
     level outcomes from, the statewide workforce investment 
     system. To the maximum extent practicable, the State shall 
     coordinate the evaluations with the evaluations provided for 
     by the Secretary under section 172.
       (2) Design.--The evaluation studies conducted under this 
     subsection shall be designed in conjunction with the State 
     board and local boards and shall include analysis of customer 
     feedback and outcome and process measures in the statewide 
     workforce investment system. The studies may include use of 
     control groups.
       (3) Results.--The State shall periodically prepare and 
     submit to the State board, and local boards in the State, 
     reports containing the results of evaluation studies 
     conducted under this subsection, to promote the efficiency 
     and effectiveness of the statewide workforce investment 
     system in improving employability for jobseekers and 
     competitiveness for employers.
       (f) Fiscal and Management Accountability Information 
     Systems.--
       (1) In general.--Using funds made available under this 
     subtitle, the Governor, in coordination with local boards and 
     chief elected officials in the State, shall establish and 
     operate a fiscal and management accountability information 
     system based on guidelines established by the Secretary after 
     consultation with the Governors, local elected officials, and 
     one-stop partners. Such guidelines shall promote efficient 
     collection and use of fiscal and management information for 
     reporting and monitoring the use of funds made available 
     under this subtitle and for preparing the annual report 
     described in subsection (d).
       (2) Wage records.--In measuring the progress of the State 
     on State and local performance measures, a State shall 
     utilize quarterly wage records, consistent with State law. 
     The Secretary shall make arrangements, consistent with State 
     law, to ensure that the wage records of any State are 
     available to any other State to the extent that such wage 
     records are required by the State in carrying out the State 
     plan of the State or completing the annual report described 
     in subsection (d).
       (3) Confidentiality.--In carrying out the requirements of 
     this Act, the State shall comply with section 444 of the 
     General Education Provisions Act (20 U.S.C. 1232g) (as added 
     by the Family Educational Rights and Privacy Act of 1974).
       (g) Sanctions for State Failure To Meet State Performance 
     Measures.--
       (1) States.--
       (A) Technical assistance.--If a State fails to meet State 
     adjusted levels of performance relating to indicators 
     described in subparagraph (A) or (B) of subsection (b)(2) for 
     a program for any program year, the Secretary shall, upon 
     request, provide technical assistance in accordance with 
     section 170, including assistance in the development of a 
     performance improvement plan.
       (B) Reduction in amount of grant.--If such failure 
     continues for a second consecutive year, or if a State fails 
     to submit a report under subsection (d) for any program year, 
     the 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 State adjusted levels 
     of performance.
       (2) Funds resulting from reduced allotments.--The Secretary 
     shall use an amount retained, as a result of a reduction in 
     an allotment to a State made under paragraph (1)(B), to 
     provide incentive grants under section 503.
       (h) Sanctions for Local Area Failure To Meet Local 
     Performance Measures.--
       (1) Technical assistance.--If a local area fails to meet 
     levels of performance relating to indicators described in 
     subparagraph (A) or (B) of subsection (b)(2) for a program 
     for any program year, the Governor, or upon request by the 
     Governor, the Secretary, shall provide technical assistance, 
     which may include assistance in the development of a 
     performance improvement plan, or the development of a 
     modified local plan.

[[Page H6622]]

       (2) Corrective actions.--
       (A) In general.--If such failure continues for a second 
     consecutive year, the Governor shall take corrective actions, 
     which may include development of a reorganization plan 
     through which the Governor may--
       (i) require the appointment and certification of a new 
     local board (consistent with the criteria established under 
     section 117(b));
       (ii) prohibit the use of eligible providers and one-stop 
     partners identified as achieving a poor level of performance; 
     or
       (iii) take such other actions as the Governor determines 
     are appropriate.
       (B) Appeal by local area.--
       (i) Appeal to governor.--A local area that is subject to a 
     reorganization plan under subparagraph (A) may, not later 
     than 30 days after receiving notice of the reorganization 
     plan, appeal to the Governor to rescind or revise such plan. 
     In such case, the Governor shall make a final decision not 
     later then 30 days after the receipt of the appeal.
       (ii) Subsequent action.--The local area may, not later than 
     30 days after receiving a decision from the Governor pursuant 
     to clause (i), appeal such decision to the Secretary. In such 
     case, the Secretary shall make a final decision not later 
     than 30 days after the receipt of the appeal.
       (C) Effective date.--The decision made by the Governor 
     under clause (i) of subparagraph (B) shall become effective 
     at the time the Governor issues the decision pursuant to such 
     clause. Such decision shall remain effective unless the 
     Secretary rescinds or revises such plan pursuant to clause 
     (ii) of subparagraph (B).
       (i) Other Measures and Terminology.--
       (1) Responsibilities.--In order to ensure nationwide 
     comparability of performance data, the Secretary, after 
     collaboration with representatives of appropriate Federal 
     agencies, and representatives of States and political 
     subdivisions, business and industry, employees, eligible 
     providers of employment and training activities, educators, 
     and participants, with expertise regarding workforce 
     investment policies and workforce investment activities, 
     shall issue--
       (A) definitions for information required to be reported 
     under subsection (d)(2);
       (B) terms for a menu of additional indicators of 
     performance described in subsection (b)(2)(C) to assist 
     States in assessing their progress toward State workforce 
     investment goals; and
       (C) objective criteria and methods described in subsection 
     (b)(3)(A)(vi) for making revisions to levels of performance.
       (2) Definitions for core indicators.--The Secretary and the 
     representatives described in paragraph (1) shall participate 
     in the activities described in section 502 concerning the 
     issuance of definitions for indicators of performance 
     described in subsection (b)(2)(A).
       (3) Assistance.--The Secretary shall make the services of 
     staff available to the representatives to assist the 
     representatives in participating in the collaboration 
     described in paragraph (1) and in the activities described in 
     section 502.

     SEC. 137. AUTHORIZATION OF APPROPRIATIONS.

       (a) Youth Activities.--There are authorized to be 
     appropriated to carry out the activities described in section 
     127(a), such sums as may be necessary for each of fiscal 
     years 1999 through 2003.
       (b) Adult Employment and Training Activities.--There are 
     authorized to be appropriated to carry out the activities 
     described in section 132(a)(1), such sums as may be necessary 
     for each of fiscal years 1999 through 2003.
       (c) Dislocated Worker Employment and Training Activities.--
     There are authorized to be appropriated to carry out the 
     activities described in section 132(a)(2), such sums as may 
     be necessary for each of fiscal years 1999 through 2003.
                         Subtitle C--Job Corps

     SEC. 141. PURPOSES.

       The purposes of this subtitle are--
       (1) to maintain a national Job Corps program, carried out 
     in partnership with States and communities, to assist 
     eligible youth who need and can benefit from an intensive 
     program, operated in a group setting in residential and 
     nonresidential centers, to become more responsible, 
     employable, and productive citizens;
       (2) to set forth standards and procedures for selecting 
     individuals as enrollees in the Job Corps;
       (3) to authorize the establishment of Job Corps centers in 
     which enrollees will participate in intensive programs of 
     activities described in this subtitle; and
       (4) to prescribe various other powers, duties, and 
     responsibilities incident to the operation and continuing 
     development of the Job Corps.

     SEC. 142. DEFINITIONS.

       In this subtitle:
       (1) Applicable local board.--The term ``applicable local 
     board'' means a local board--
       (A) that provides information for a Job Corps center on 
     local employment opportunities and the job skills needed to 
     obtain the opportunities; and
       (B) that serves communities in which the graduates of the 
     Job Corps center seek employment.
       (2) Applicable one-stop center.--The term ``applicable one-
     stop center'' means a one-stop customer service center that 
     provides services, such as referral, intake, recruitment, and 
     placement, to a Job Corps center.
       (3) Enrollee.--The term ``enrollee'' means an individual 
     who has voluntarily applied for, been selected for, and 
     enrolled in the Job Corps program, and remains with the 
     program, but has not yet become a graduate.
       (4) Former enrollee.--The term ``former enrollee'' means an 
     individual who has voluntarily applied for, been selected 
     for, and enrolled in the Job Corps program, but left the 
     program before completing the requirements of a vocational 
     training program, or receiving a secondary school diploma or 
     recognized equivalent, as a result of participation in the 
     Job Corps program.
       (5) Graduate.--The term ``graduate'' means an individual 
     who has voluntarily applied for, been selected for, and 
     enrolled in the Job Corps program and has completed the 
     requirements of a vocational training program, or received a 
     secondary school diploma or recognized equivalent, as a 
     result of participation in the Job Corps program.
       (6) Job corps.--The term ``Job Corps'' means the Job Corps 
     described in section 143.
       (7) Job corps center.--The term ``Job Corps center'' means 
     a center described in section 147.
       (8) Operator.--The term ``operator'' means an entity 
     selected under this subtitle to operate a Job Corps center.
       (9) Region.--The term ``region'' means an area served by a 
     regional office of the Employment and Training 
     Administration.
       (10) Service provider.--The term ``service provider'' means 
     an entity selected under this subtitle to provide services 
     described in this subtitle to a Job Corps center.

     SEC. 143. ESTABLISHMENT.

       There shall be within the Department of Labor a ``Job 
     Corps''.

     SEC. 144. INDIVIDUALS ELIGIBLE FOR THE JOB CORPS.

       To be eligible to become an enrollee, an individual shall 
     be--
       (1) not less than age 16 and not more than age 21 on the 
     date of enrollment, except that--
       (A) not more than 20 percent of the individuals enrolled in 
     the Job Corps may be not less than age 22 and not more than 
     age 24 on the date of enrollment; and
       (B) either such maximum age limitation may be waived by the 
     Secretary, in accordance with regulations of the Secretary, 
     in the case of an individual with a disability;
       (2) a low-income individual; and
       (3) an individual who is 1 or more of the following:
       (A) Basic skills deficient.
       (B) A school dropout.
       (C) Homeless, a runaway, or a foster child.
       (D) A parent.
       (E) An individual who requires additional education, 
     vocational training, or intensive counseling and related 
     assistance, in order to participate successfully in regular 
     schoolwork or to secure and hold employment.

     SEC. 145. RECRUITMENT, SCREENING, SELECTION, AND ASSIGNMENT 
                   OF ENROLLEES.

       (a) Standards and Procedures.--
       (1) In general.--The Secretary shall prescribe specific 
     standards and procedures for the recruitment, screening, and 
     selection of eligible applicants for the Job Corps, after 
     considering recommendations from the Governors, local boards, 
     and other interested parties.
       (2) Methods.--In prescribing standards and procedures under 
     paragraph (1), the Secretary, at a minimum, shall--
       (A) prescribe procedures for informing enrollees that drug 
     tests will be administered to the enrollees and the results 
     received within 45 days after the enrollees enroll in the Job 
     Corps;
       (B) establish standards for recruitment of Job Corps 
     applicants;
       (C) establish standards and procedures for--
       (i) determining, for each applicant, whether the 
     educational and vocational needs of the applicant can best be 
     met through the Job Corps program or an alternative program 
     in the community in which the applicant resides; and
       (ii) obtaining from each applicant pertinent data relating 
     to background, needs, and interests for determining 
     eligibility and potential assignment;
       (D) where appropriate, take measures to improve the 
     professional capability of the individuals conducting 
     screening of the applicants; and
       (E) assure that an appropriate number of enrollees are from 
     rural areas.
       (3) Implementation.--To the extent practicable, the 
     standards and procedures shall be implemented through 
     arrangements with--
       (A) applicable one-stop centers;
       (B) community action agencies, business organizations, and 
     labor organizations; and
       (C) agencies and individuals that have contact with youth 
     over substantial periods of time and are able to offer 
     reliable information about the needs and problems of youth.
       (4) Consultation.--The standards and procedures shall 
     provide for necessary consultation with individuals and 
     organizations, including court, probation, parole, law 
     enforcement, education, welfare, and medical authorities and 
     advisers.
       (5) Reimbursement.--The Secretary is authorized to enter 
     into contracts with and make payments to individuals and 
     organizations for the cost of conducting recruitment, 
     screening, and selection of eligible applicants for the Job 
     Corps, as provided for in this section. The Secretary shall 
     make no payment to any individual or organization solely as 
     compensation for referring the names of applicants for the 
     Job Corps.
       (b) Special Limitations on Selection.--
       (1) In general.--No individual shall be selected as an 
     enrollee unless the individual or organization implementing 
     the standards and procedures described in subsection (a) 
     determines that--
       (A) there is a reasonable expectation that the individual 
     considered for selection can participate successfully in 
     group situations and activities, and is not likely to engage 
     in behavior that would prevent other enrollees from receiving 
     the benefit of the Job Corps program or be incompatible with 
     the maintenance of sound discipline and satisfactory 
     relationships between the Job Corps center to which the 
     individual might be assigned and communities surrounding the 
     Job Corps center;

[[Page H6623]]

       (B) the individual manifests a basic understanding of both 
     the rules to which the individual will be subject and of the 
     consequences of failure to observe the rules; and
       (C) the individual has passed a background check conducted 
     in accordance with procedures established by the Secretary.
       (2) Individuals on probation, parole, or supervised 
     release.--An individual on probation, parole, or supervised 
     release may be selected as an enrollee only if release from 
     the supervision of the probation or parole official involved 
     is satisfactory to the official and the Secretary and does 
     not violate applicable laws (including regulations). No 
     individual shall be denied a position in the Job Corps solely 
     on the basis of individual contact with the criminal justice 
     system.
       (c) Assignment Plan.--
       (1) In general.--Every 2 years, the Secretary shall develop 
     and implement an assignment plan for assigning enrollees to 
     Job Corps centers. In developing the plan, the Secretary 
     shall, based on the analysis described in paragraph (2), 
     establish targets, applicable to each Job Corps center, for--
       (A) the maximum attainable percentage of enrollees at the 
     Job Corps center that reside in the State in which the center 
     is located; and
       (B) the maximum attainable percentage of enrollees at the 
     Job Corps center that reside in the region in which the 
     center is located, and in surrounding regions.
       (2) Analysis.--In order to develop the plan described in 
     paragraph (1), the Secretary shall, every 2 years, analyze, 
     for the Job Corps center--
       (A) the size of the population of individuals eligible to 
     participate in Job Corps in the State and region in which the 
     Job Corps center is located, and in surrounding regions;
       (B) the relative demand for participation in the Job Corps 
     in the State and region, and in surrounding regions; and
       (C) the capacity and utilization of the Job Corps center, 
     including services provided through the center.
       (d) Assignment of Individual Enrollees.--
       (1) In general.--After an individual has been selected for 
     the Job Corps in accordance with the standards and procedures 
     of the Secretary under subsection (a), the enrollee shall be 
     assigned to the Job Corps center that is closest to the home 
     of the enrollee, except that the Secretary may waive this 
     requirement if--
       (A) the enrollee chooses a vocational training program, or 
     requires an English literacy program, that is not available 
     at such center;
       (B) the enrollee would be unduly delayed in participating 
     in the Job Corps program because the closest center is 
     operating at full capacity; or
       (C) the parent or guardian of the enrollee requests 
     assignment of the enrollee to another Job Corps center due to 
     circumstances in the community of the enrollee that would 
     impair prospects for successful participation in the Job 
     Corps program.
       (2) Enrollees who are younger than 18.--An enrollee who is 
     younger than 18 shall not be assigned to a Job Corps center 
     other than the center closest to the home of the enrollee 
     pursuant to paragraph (1) if the parent or guardian of the 
     enrollee objects to the assignment.

     SEC. 146. ENROLLMENT.

       (a) Relationship Between Enrollment and Military 
     Obligations.--Enrollment in the Job Corps shall not relieve 
     any individual of obligations under the Military Selective 
     Service Act (50 U.S.C. App. 451 et seq.).
       (b) Period of Enrollment.--No individual may be enrolled in 
     the Job Corps for more than 2 years, except--
       (1) in a case in which completion of an advanced career 
     training program under section 148(c) would require an 
     individual to participate in the Job Corps for not more than 
     1 additional year; or
       (2) as the Secretary may authorize in a special case.

     SEC. 147. JOB CORPS CENTERS.

       (a) Operators and Service Providers.--
       (1) Eligible entities.--
       (A) Operators.--The Secretary shall enter into an agreement 
     with a Federal, State, or local agency, an area vocational 
     education school or residential vocational school, or a 
     private organization, for the operation of each Job Corps 
     center.
       (B) Providers.--The Secretary may enter into an agreement 
     with a local entity to provide activities described in this 
     subtitle to the Job Corps center.
       (2) Selection process.--
       (A) Competitive basis.--Except as provided in subsections 
     (c) and (d) of section 303 of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 253), the 
     Secretary shall select on a competitive basis an entity to 
     operate a Job Corps center and entities to provide activities 
     described in this subtitle to the Job Corps center. In 
     developing a solicitation for an operator or service 
     provider, the Secretary shall consult with the Governor of 
     the State in which the center is located, the industry 
     council for the Job Corps center (if established), and the 
     applicable local board regarding the contents of such 
     solicitation, including elements that will promote the 
     consistency of the activities carried out through the center 
     with the objectives set forth in the State plan or in a local 
     plan.
       (B) Recommendations and considerations.--
       (i) Operators.--In selecting an entity to operate a Job 
     Corps center, the Secretary shall consider--

       (I) the ability of the entity to coordinate the activities 
     carried out through the Job Corps center with activities 
     carried out under the appropriate State plan and local plans;
       (II) the degree to which the vocational training that the 
     entity proposes for the center reflects local employment 
     opportunities in the local areas in which enrollees at the 
     center intend to seek employment;
       (III) the degree to which the entity is familiar with the 
     surrounding communities, applicable one-stop centers, and the 
     State and region in which the center is located; and
       (IV) the past performance of the entity, if any, relating 
     to operating or providing activities described in this 
     subtitle to a Job Corps center.

       (ii) Providers.--In selecting a service provider for a Job 
     Corps center, the Secretary shall consider the factors 
     described in subclauses (I) through (IV) of clause (i), as 
     appropriate.
       (b) Character and Activities.--Job Corps centers may be 
     residential or nonresidential in character, and shall be 
     designed and operated so as to provide enrollees, in a well-
     supervised setting, with access to activities described in 
     this subtitle. In any year, no more than 20 percent of the 
     individuals enrolled in the Job Corps may be nonresidential 
     participants in the Job Corps.
       (c) Civilian Conservation Centers.--
       (1) In general.--The Job Corps centers may include Civilian 
     Conservation Centers operated under agreements with the 
     Secretary of Agriculture or the Secretary of the Interior, 
     located primarily in rural areas, which shall provide, in 
     addition to other vocational training and assistance, 
     programs of work experience to conserve, develop, or manage 
     public natural resources or public recreational areas or to 
     develop community projects in the public interest.
       (2) Selection process.--The Secretary may select an entity 
     to operate a Civilian Conservation Center on a competitive 
     basis, as provided in subsection (a), if the center fails to 
     meet such national performance standards as the Secretary 
     shall establish.
       (d) Indian Tribes.--
       (1) General authority.--The Secretary may enter into 
     agreements with Indian tribes to operate Job Corps centers 
     for Indians.
       (2) Definitions.--In this subsection, the terms ``Indian'' 
     and ``Indian tribe'', have the meanings given such terms in 
     subsections (d) and (e), respectively, of section 4 of the 
     Indian Self-Determination and Education Assistance Act (25 
     U.S.C. 450b).

     SEC. 148. PROGRAM ACTIVITIES.

       (a) Activities Provided by Job Corps Centers.--
       (1) In general.--Each Job Corps center shall provide 
     enrollees with an intensive, well organized, and fully 
     supervised program of education, vocational training, work 
     experience, recreational activities, physical rehabilitation 
     and development, and counseling. Each Job Corps center shall 
     provide enrollees assigned to the center with access to core 
     services described in section 134(d)(2) and the intensive 
     services described in section 134(d)(3).
       (2) Relationship to opportunities.--
       (A) In general.--The activities provided under this 
     subsection shall provide work-based learning throughout the 
     enrollment of the enrollees and assist the enrollees in 
     obtaining meaningful unsubsidized employment, participating 
     in secondary education or postsecondary education programs, 
     enrolling in other suitable vocational training programs, or 
     satisfying Armed Forces requirements, on completion of their 
     enrollment.
       (B) Link to employment opportunities.--The vocational 
     training provided shall be linked to the employment 
     opportunities in the local area in which the enrollee intends 
     to seek employment after graduation.
       (b) Education and Vocational Training.--The Secretary may 
     arrange for education and vocational training of enrollees 
     through local public or private educational agencies, 
     vocational educational institutions, or technical institutes, 
     whenever such entities provide education and training 
     substantially equivalent in cost and quality to that which 
     the Secretary could provide through other means.
       (c) Advanced Career Training Programs.--
       (1) In general.--The Secretary may arrange for programs of 
     advanced career training for selected enrollees in which the 
     enrollees may continue to participate for a period of not 
     to exceed 1 year in addition to the period of 
     participation to which the enrollees would otherwise be 
     limited. The advanced career training may be provided 
     through the eligible providers of training services 
     identified under section 122.
       (2) Benefits.--
       (A) In general.--During the period of participation in an 
     advanced career training program, an enrollee shall be 
     eligible for full Job Corps benefits, or a monthly stipend 
     equal to the average value of the residential support, food, 
     allowances, and other benefits provided to enrollees assigned 
     to residential Job Corps centers.
       (B) Calculation.--The total amount for which an enrollee 
     shall be eligible under subparagraph (A) shall be reduced by 
     the amount of any scholarship or other educational grant 
     assistance received by such enrollee for advanced career 
     training.
       (3) Demonstration.--Each year, any operator seeking to 
     enroll additional enrollees in an advanced career training 
     program shall demonstrate that participants in such program 
     have achieved a satisfactory rate of completion and placement 
     in training-related jobs before the operator may carry out 
     such additional enrollment.
       (d) Continued Services.--The Secretary shall also provide 
     continued services to graduates, including providing 
     counseling regarding the workplace for 12 months after the 
     date of graduation of the graduates. In selecting a provider 
     for such services, the Secretary shall give priority to one-
     stop partners.
       (e) Child Care.--The Secretary shall, to the extent 
     practicable, provide child care at or near Job Corps centers, 
     for individuals who require child care for their children in 
     order to participate in the Job Corps.

[[Page H6624]]

     SEC. 149. COUNSELING AND JOB PLACEMENT.

       (a) Counseling and Testing.--The Secretary shall arrange 
     for counseling and testing for each enrollee at regular 
     intervals to measure progress in the education and vocational 
     training programs carried out through the Job Corps.
       (b) Placement.--The Secretary shall arrange for counseling 
     and testing for enrollees prior to their scheduled 
     graduations to determine their capabilities and, based on 
     their capabilities, shall make every effort to arrange to 
     place the enrollees in jobs in the vocations for which the 
     enrollees are trained or to assist the enrollees in obtaining 
     further activities described in this subtitle. In arranging 
     for the placement of graduates in jobs, the Secretary shall 
     utilize the one-stop delivery system to the fullest extent 
     possible.
       (c) Status and Progress.--The Secretary shall determine the 
     status and progress of enrollees scheduled for graduation and 
     make every effort to assure that their needs for further 
     activities described in this subtitle are met.
       (d) Services to Former Enrollees.--The Secretary may 
     provide such services as the Secretary determines to be 
     appropriate under this subtitle to former enrollees.

     SEC. 150. SUPPORT.

       (a) Personal Allowances.--The Secretary may provide 
     enrollees assigned to Job Corps centers with such personal 
     allowances as the Secretary may determine to be necessary or 
     appropriate to meet the needs of the enrollees.
       (b) Readjustment Allowances.--
       (1) Graduates.--The Secretary shall arrange for a 
     readjustment allowance to be paid to graduates. The Secretary 
     shall arrange for the allowance to be paid at the one-stop 
     center nearest to the home of the graduate who is returning 
     home, or at the one-stop center nearest to the location where 
     the graduate has indicated an intent to seek employment. If 
     the Secretary uses any organization, in lieu of a one-stop 
     center, to provide placement services under this Act, the 
     Secretary shall arrange for that organization to pay the 
     readjustment allowance.
       (2) Former enrollees.--The Secretary may provide for a 
     readjustment allowance to be paid to former enrollees. The 
     provision of the readjustment allowance shall be subject to 
     the same requirements as are applicable to the provision of 
     the readjustment allowance paid to graduates under paragraph 
     (1).

     SEC. 151. OPERATING PLAN.

       (a) In General.--The provisions of the contract between the 
     Secretary and an entity selected to operate a Job Corps 
     center shall, at a minimum, serve as an operating plan for 
     the Job Corps center.
       (b) Additional Information.--The Secretary may require the 
     operator, in order to remain eligible to operate the Job 
     Corps center, to submit such additional information as the 
     Secretary may require, which shall be considered part of the 
     operating plan.
       (c) Availability.--The Secretary shall make the operating 
     plan described in subsections (a) and (b), excluding any 
     proprietary information, available to the public.

     SEC. 152. STANDARDS OF CONDUCT.

       (a) Provision and Enforcement.--The Secretary shall 
     provide, and directors of Job Corps centers shall stringently 
     enforce, standards of conduct within the centers. Such 
     standards of conduct shall include provisions forbidding the 
     actions described in subsection (b)(2)(A).
       (b) Disciplinary Measures.--
       (1) In general.--To promote the proper moral and 
     disciplinary conditions in the Job Corps, the directors of 
     Job Corps centers shall take appropriate disciplinary 
     measures against enrollees. If such a director determines 
     that an enrollee has committed a violation of the standards 
     of conduct, the director shall dismiss the enrollee from the 
     Job Corps if the director determines that the retention of 
     the enrollee in the Job Corps will jeopardize the enforcement 
     of such standards or diminish the opportunities of other 
     enrollees.
       (2) Zero tolerance policy and drug testing.--
       (A) Guidelines.--The Secretary shall adopt guidelines 
     establishing a zero tolerance policy for an act of violence, 
     for use, sale, or possession of a controlled substance, for 
     abuse of alcohol, or for other illegal or disruptive 
     activity.
       (B) Drug testing.--The Secretary shall require drug testing 
     of all enrollees for controlled substances in accordance with 
     procedures prescribed by the Secretary under section 145(a).
       (C) Definitions.--In this paragraph:
       (i) Controlled substance.--The term ``controlled 
     substance'' has the meaning given the term in section 102 of 
     the Controlled Substances Act (21 U.S.C. 802).
       (ii) Zero tolerance policy.--The term ``zero tolerance 
     policy'' means a policy under which an enrollee shall be 
     automatically dismissed from the Job Corps after a 
     determination by the director that the enrollee has carried 
     out an action described in subparagraph (A).
       (c) Appeal.--A disciplinary measure taken by a director 
     under this section shall be subject to expeditious appeal in 
     accordance with procedures established by the Secretary.

     SEC. 153. COMMUNITY PARTICIPATION.

       (a) Business and Community Liaison.--Each Job Corps center 
     shall have a Business and Community Liaison (referred to in 
     this Act as a ``Liaison''), designated by the director of the 
     center.
       (b) Responsibilities.--The responsibilities of the Liaison 
     shall include--
       (1) establishing and developing relationships and networks 
     with--
       (A) local and distant employers; and
       (B) applicable one-stop centers and applicable local 
     boards,

     for the purpose of providing job opportunities for Job Corps 
     graduates; and
       (2) establishing and developing relationships with members 
     of the community in which the Job Corps center is located, 
     informing members of the community about the projects of the 
     Job Corps center and changes in the rules, procedures, or 
     activities of the center that may affect the community, and 
     planning events of mutual interest to the community and the 
     Job Corps center.
       (c) New Centers.--The Liaison for a Job Corps center that 
     is not yet operating shall establish and develop the 
     relationships and networks described in subsection (b) at 
     least 3 months prior to the date on which the center accepts 
     the first enrollee at the center.

     SEC. 154. INDUSTRY COUNCILS.

       (a) In General.--Each Job Corps center shall have an 
     industry council, appointed by the director of the center 
     after consultation with the Liaison, in accordance with 
     procedures established by the Secretary.
       (b) Industry Council Composition.--
       (1) In general.--An industry council shall be comprised 
     of--
       (A) a majority of members who shall be local and distant 
     owners of business concerns, chief executives or chief 
     operating officers of nongovernmental employers, or other 
     private sector employers, who--
       (i) have substantial management, hiring, or policy 
     responsibility; and
       (ii) represent businesses with employment opportunities 
     that reflect the employment opportunities of the applicable 
     local area;
       (B) representatives of labor organizations (where present) 
     and representatives of employees; and
       (C) enrollees and graduates of the Job Corps.
       (2) Local board.--The industry council may include members 
     of the applicable local boards who meet the requirements 
     described in paragraph (1).
       (c) Responsibilities.--The responsibilities of the industry 
     council shall be--
       (1) to work closely with all applicable local boards in 
     order to determine, and recommend to the Secretary, 
     appropriate vocational training for the center;
       (2) to review all the relevant labor market information 
     to--
       (A) determine the employment opportunities in the local 
     areas in which the enrollees intend to seek employment after 
     graduation;
       (B) determine the skills and education that are necessary 
     to obtain the employment opportunities; and
       (C) recommend to the Secretary the type of vocational 
     training that should be implemented at the center to enable 
     the enrollees to obtain the employment opportunities; and
       (3) to meet at least once every 6 months to reevaluate the 
     labor market information, and other relevant information, to 
     determine, and recommend to the Secretary, any necessary 
     changes in the vocational training provided at the center.
       (d) New Centers.--The industry council for a Job Corps 
     center that is not yet operating shall carry out the 
     responsibilities described in subsection (c) at least 3 
     months prior to the date on which the center accepts the 
     first enrollee at the center.

     SEC. 155. ADVISORY COMMITTEES.

       The Secretary may establish and use advisory committees in 
     connection with the operation of the Job Corps program, and 
     the operation of Job Corps centers, whenever the Secretary 
     determines that the availability of outside advice and 
     counsel on a regular basis would be of substantial benefit in 
     identifying and overcoming problems, in planning program or 
     center development, or in strengthening relationships between 
     the Job Corps and agencies, institutions, or groups engaged 
     in related activities.

     SEC. 156. EXPERIMENTAL, RESEARCH, AND DEMONSTRATION PROJECTS.

       The Secretary may carry out experimental, research, or 
     demonstration projects relating to carrying out the Job Corps 
     program and may waive any provisions of this subtitle that 
     the Secretary finds would prevent the Secretary from carrying 
     out the projects.

     SEC. 157. APPLICATION OF PROVISIONS OF FEDERAL LAW.

       (a) Enrollees Not Considered To Be Federal Employees.--
       (1) In general.--Except as otherwise provided in this 
     subsection and in section 8143(a) of title 5, United States 
     Code, enrollees shall not be considered to be Federal 
     employees and shall not be subject to the provisions of law 
     relating to Federal employment, including such provisions 
     regarding hours of work, rates of compensation, leave, 
     unemployment compensation, and Federal employee benefits.
       (2) Provisions relating to taxes and social security 
     benefits.--For purposes of the Internal Revenue Code of 1986 
     and title II of the Social Security Act (42 U.S.C. 401 et 
     seq.), enrollees shall be deemed to be employees of the 
     United States and any service performed by an individual as 
     an enrollee shall be deemed to be performed in the employ of 
     the United States.
       (3) Provisions relating to compensation to federal 
     employees for work injuries.--For purposes of subchapter I of 
     chapter 81 of title 5, United States Code (relating to 
     compensation to Federal employees for work injuries), 
     enrollees shall be deemed to be civil employees of the 
     Government of the United States within the meaning of the 
     term ``employee'' as defined in section 8101 of title 5, 
     United States Code, and the provisions of such subchapter 
     shall apply as specified in section 8143(a) of title 5, 
     United States Code.
       (4) Federal tort claims provisions.--For purposes of the 
     Federal tort claims provisions in title 28, United States 
     Code, enrollees shall be considered to be employees of the 
     Government.
       (b) Adjustments and Settlements.--Whenever the Secretary 
     finds a claim for damages to

[[Page H6625]]

     a person or property resulting from the operation of the Job 
     Corps to be a proper charge against the United States, and 
     the claim is not cognizable under section 2672 of title 28, 
     United States Code, the Secretary may adjust and settle the 
     claim in an amount not exceeding $1,500.
       (c) Personnel of the Uniformed Services.--Personnel of the 
     uniformed services who are detailed or assigned to duty in 
     the performance of agreements made by the Secretary for the 
     support of the Job Corps shall not be counted in computing 
     strength under any law limiting the strength of such services 
     or in computing the percentage authorized by law for any 
     grade in such services.

     SEC. 158. SPECIAL PROVISIONS.

       (a) Enrollment.--The Secretary shall ensure that women and 
     men have an equal opportunity to participate in the Job Corps 
     program, consistent with section 145.
       (b) Studies, Evaluations, Proposals, and Data.--The 
     Secretary shall assure that all studies, evaluations, 
     proposals, and data produced or developed with Federal funds 
     in the course of carrying out the Job Corps program shall 
     become the property of the United States.
       (c) Transfer of Property.--
       (1) In general.--Notwithstanding title II of the Federal 
     Property and Administrative Services Act of 1949 (40 U.S.C. 
     481 et seq.) and any other provision of law, the Secretary 
     and the Secretary of Education shall receive priority by the 
     Secretary of Defense for the direct transfer, on a 
     nonreimbursable basis, of the property described in paragraph 
     (2) for use in carrying out programs under this Act or under 
     any other Act.
       (2) Property.--The property described in this paragraph is 
     real and personal property under the control of the 
     Department of Defense that is not used by such Department, 
     including property that the Secretary of Defense determines 
     is in excess of current and projected requirements of such 
     Department.
       (d) Gross Receipts.--Transactions conducted by a private 
     for-profit or nonprofit entity that is an operator or service 
     provider for a Job Corps center shall not be considered to be 
     generating gross receipts. Such an operator or service 
     provider shall not be liable, directly or indirectly, to any 
     State or subdivision of a State (nor to any person acting on 
     behalf of such a State or subdivision) for any gross receipts 
     taxes, business privilege taxes measured by gross receipts, 
     or any similar taxes imposed on, or measured by, gross 
     receipts in connection with any payments made to or by such 
     entity for operating or providing services to a Job Corps 
     center. Such an operator or service provider shall not be 
     liable to any State or subdivision of a State to collect or 
     pay any sales, excise, use, or similar tax imposed on the 
     sale to or use by such operator or service provider of any 
     property, service, or other item in connection with the 
     operation of or provision of services to a Job Corps center.
       (e) Management Fee.--The Secretary shall provide each 
     operator and (in an appropriate case, as determined by the 
     Secretary) service provider with an equitable and negotiated 
     management fee of not less than 1 percent of the amount of 
     the funding provided under the appropriate agreement 
     specified in section 147.
       (f) Donations.--The Secretary may accept on behalf of the 
     Job Corps or individual Job Corps centers charitable 
     donations of cash or other assistance, including equipment 
     and materials, if such donations are available for 
     appropriate use for the purposes set forth in this subtitle.
       (g) Sale of Property.--Notwithstanding any other provision 
     of law, if the Administrator of General Services sells a Job 
     Corps center facility, the Administrator shall transfer the 
     proceeds from the sale to the Secretary, who shall use the 
     proceeds to carry out the Job Corps program.

     SEC. 159. MANAGEMENT INFORMATION.

       (a) Financial Management Information System.--
       (1) In general.--The Secretary shall establish procedures 
     to ensure that each operator, and each service provider, 
     maintains a financial management information system that will 
     provide--
       (A) accurate, complete, and current disclosures of the 
     costs of Job Corps operations; and
       (B) sufficient data for the effective evaluation of 
     activities carried out through the Job Corps program.
       (2) Accounts.--Each operator and service provider shall 
     maintain funds received under this subtitle in accounts in a 
     manner that ensures timely and accurate reporting as required 
     by the Secretary.
       (3) Fiscal responsibility.--Operators shall remain fiscally 
     responsible and control costs, regardless of whether the 
     funds made available for Job Corps centers are incrementally 
     increased or decreased between fiscal years.
       (b) Audit.--
       (1) Access.--The Secretary, the Inspector General of the 
     Department of Labor, the Comptroller General of the United 
     States, and any of their duly authorized representatives, 
     shall have access to any books, documents, papers, and 
     records of the operators and service providers described in 
     subsection (a) that are pertinent to the Job Corps program, 
     for purposes of conducting surveys, audits, and evaluations 
     of the operators and service providers.
       (2) Surveys, audits, and evaluations.--The Secretary shall 
     survey, audit, or evaluate, or arrange for the survey, audit, 
     or evaluation of, the operators and service providers, using 
     Federal auditors or independent public accountants. The 
     Secretary shall conduct such surveys, audits, or evaluations 
     not less often than once every 3 years.
       (c) Information on Indicators of Performance.--
       (1) Establishment.--The Secretary shall, with continuity 
     and consistency from year to year, establish indicators of 
     performance, and expected levels of performance for Job Corps 
     centers and the Job Corps program, relating to--
       (A) the number of graduates and the rate of such 
     graduation, analyzed by type of vocational training received 
     through the Job Corps program and by whether the vocational 
     training was provided by a local or national service 
     provider;
       (B) the number of graduates who entered unsubsidized 
     employment related to the vocational training received 
     through the Job Corps program and the number who entered 
     unsubsidized employment not related to the vocational 
     training received, analyzed by whether the vocational 
     training was provided by a local or national service provider 
     and by whether the placement in the employment was conducted 
     by a local or national service provider;
       (C) the average wage received by graduates who entered 
     unsubsidized employment related to the vocational training 
     received through the Job Corps program and the average wage 
     received by graduates who entered unsubsidized employment 
     unrelated to the vocational training received;
       (D) the average wage received by graduates placed in 
     unsubsidized employment after completion of the Job Corps 
     program--
       (i) on the first day of the employment;
       (ii) 6 months after the first day of the employment; and
       (iii) 12 months after the first day of the employment,

     analyzed by type of vocational training received through the 
     Job Corps program;
       (E) the number of graduates who entered unsubsidized 
     employment and were retained in the unsubsidized employment--
       (i) 6 months after the first day of the employment; and
       (ii) 12 months after the first day of the employment;
       (F) the number of graduates who entered unsubsidized 
     employment--
       (i) for 32 hours per week or more;
       (ii) for not less than 20 but less than 32 hours per week; 
     and
       (iii) for less than 20 hours per week;
       (G) the number of graduates who entered postsecondary 
     education or advanced training programs, including 
     apprenticeship programs, as appropriate; and
       (H) the number of graduates who attained job readiness and 
     employment skills.
       (2) Performance of recruiters.--The Secretary shall also 
     establish performance measures, and expected performance 
     levels on the performance measures, for local and national 
     recruitment service providers serving the Job Corps program. 
     The performance measures shall relate to the number of 
     enrollees retained in the Job Corps program for 30 days and 
     for 60 days after initial placement in the program.
       (3) Report.--The Secretary shall collect, and annually 
     submit a report to the appropriate committees of Congress 
     containing, information on the performance of each Job Corps 
     center, and the Job Corps program, on the core performance 
     measures, as compared to the expected performance level for 
     each performance measure. The report shall also contain 
     information on the performance of the service providers 
     described in paragraph (2) on the performance measures 
     established under such paragraph, as compared to the expected 
     performance levels for the performance measures.
       (d) Additional Information.--The Secretary shall also 
     collect, and submit in the report described in subsection 
     (c), information on the performance of each Job Corps center, 
     and the Job Corps program, regarding--
       (1) the number of enrollees served;
       (2) the average level of learning gains for graduates and 
     former enrollees;
       (3) the number of former enrollees and graduates who 
     entered the Armed Forces;
       (4) the number of former enrollees who entered 
     postsecondary education;
       (5) the number of former enrollees who entered unsubsidized 
     employment related to the vocational training received 
     through the Job Corps program and the number who entered 
     unsubsidized employment not related to the vocational 
     training received;
       (6) the number of former enrollees and graduates who 
     obtained a secondary school diploma or its recognized 
     equivalent;
       (7) the number and percentage of dropouts from the Job 
     Corps program including the number dismissed under the zero 
     tolerance policy described in section 152(b); and
       (8) any additional information required by the Secretary.
       (e) Methods.--The Secretary may collect the information 
     described in subsections (c) and (d) using methods described 
     in section 136(f)(2) consistent with State law.
       (f) Performance Assessments and Improvements.--
       (1) Assessments.--The Secretary shall conduct an annual 
     assessment of the performance of each Job Corps center. Based 
     on the assessment, the Secretary shall take measures to 
     continuously improve the performance of the Job Corps 
     program.
       (2) Performance improvement plans.--With respect to a Job 
     Corps center that fails to meet the expected levels of 
     performance relating to the core performance measures 
     specified in subsection (c), the Secretary shall develop and 
     implement a performance improvement plan. Such a plan shall 
     require action including--
       (A) providing technical assistance to the center;
       (B) changing the vocational training offered at the center;
       (C) changing the management staff of the center;
       (D) replacing the operator of the center;
       (E) reducing the capacity of the center;
       (F) relocating the center; or
       (G) closing the center.

[[Page H6626]]

       (3) Additional performance improvement plans.--In addition 
     to the performance improvement plans required under paragraph 
     (2), the Secretary may develop and implement additional 
     performance improvement plans. Such a plan shall require 
     improvements, including the actions described in paragraph 
     (2), for a Job Corps center that fails to meet criteria 
     established by the Secretary other than the expected levels 
     of performance described in paragraph (2).
       (g) Closure of Job Corps Center.--Prior to the closure of 
     any Job Corps center, the Secretary shall ensure--
       (1) that the proposed decision to close the center is 
     announced in advance to the general public through 
     publication in the Federal Register or other appropriate 
     means;
       (2) the establishment of a reasonable comment period, not 
     to exceed 30 days, for interested individuals to submit 
     written comments to the Secretary; and
       (3) that the Member of Congress who represents the district 
     in which such center is located is notified within a 
     reasonable period of time in advance of any final decision to 
     close the center.

     SEC. 160. GENERAL PROVISIONS.

       The Secretary is authorized to--
       (1) disseminate, with regard to the provisions of section 
     3204 of title 39, United States Code, data and information in 
     such forms as the Secretary shall determine to be 
     appropriate, to public agencies, private organizations, and 
     the general public;
       (2) subject to section 157(b), collect or compromise all 
     obligations to or held by the Secretary and exercise all 
     legal or equitable rights accruing to the Secretary in 
     connection with the payment of obligations until such time as 
     such obligations may be referred to the Attorney General for 
     suit or collection; and
       (3) expend funds made available for purposes of this 
     subtitle--
       (A) for printing and binding, in accordance with applicable 
     law (including regulation); and
       (B) without regard to any other law (including regulation), 
     for rent of buildings and space in buildings and for repair, 
     alteration, and improvement of buildings and space in 
     buildings rented by the Secretary, except that the Secretary 
     shall not expend funds under the authority of this 
     subparagraph--
       (i) except when necessary to obtain an item, service, or 
     facility, that is required in the proper administration of 
     this subtitle, and that otherwise could not be obtained, or 
     could not be obtained in the quantity or quality needed, or 
     at the time, in the form, or under the conditions in which 
     the item, service, or facility is needed; and
       (ii) prior to having given written notification to the 
     Administrator of General Services (if the expenditure would 
     affect an activity that otherwise would be under the 
     jurisdiction of the General Services Administration) of the 
     intention of the Secretary to make the expenditure, and the 
     reasons and justifications for the expenditure.

     SEC. 161. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to carry out this 
     subtitle such sums as may be necessary for each of the fiscal 
     years 1999 through 2003.
                     Subtitle D--National Programs

     SEC. 166. NATIVE AMERICAN PROGRAMS.

       (a) Purpose.--
       (1) In general.--The purpose of this section is to support 
     employment and training activities for Indian, Alaska Native, 
     and Native Hawaiian individuals in order--
       (A) to develop more fully the academic, occupational, and 
     literacy skills of such individuals;
       (B) to make such individuals more competitive in the 
     workforce; and
       (C) to promote the economic and social development of 
     Indian, Alaska Native, and Native Hawaiian communities in 
     accordance with the goals and values of such communities.
       (2)  Indian policy.--All programs assisted under this 
     section shall be administered in a manner consistent with the 
     principles of the Indian Self-Determination and Education 
     Assistance Act (25 U.S.C. 450 et seq.) and the government-to-
     government relationship between the Federal Government and 
     Indian tribal governments.
       (b) Definitions.--As used in this section:
       (1) Alaska native.--The term ``Alaska Native'' means a 
     Native as such term is defined in section 3(b) of the Alaska 
     Native Claims Settlement Act (43 U.S.C. 1602(b)).
       (2) Indian, indian tribe, and tribal organization.--The 
     terms ``Indian'', ``Indian tribe'', and ``tribal 
     organization'' have the meanings given such terms in 
     subsections (d), (e), and (l), respectively, of section 4 of 
     the Indian Self-Determination and Education Assistance Act 
     (25 U.S.C. 450b).
       (3) Native hawaiian and native hawaiian organization.--The 
     terms ``Native Hawaiian'' and ``Native Hawaiian 
     organization'' have the meanings given such terms in 
     paragraphs (1) and (3), respectively, of section 9212 of the 
     Native Hawaiian Education Act (20 U.S.C. 7912).
       (c) Program Authorized.--
       (1) In general.--The Secretary shall, on a competitive 
     basis, make grants to, or enter into contracts or cooperative 
     agreements with, Indian tribes, tribal organizations, Alaska 
     Native entities, Indian-controlled organizations serving 
     Indians, or Native Hawaiian organizations to carry out the 
     authorized activities described in subsection (d).
       (2) Exception.--The competition for grants, contracts, or 
     cooperative agreements conducted under paragraph (1) shall be 
     conducted every 2 years, except that if a recipient of such a 
     grant, contract, or agreement has performed satisfactorily, 
     the Secretary may waive the requirements for such competition 
     on receipt from the recipient of a satisfactory 2-year 
     program plan for the succeeding 2-year period of the grant, 
     contract, or agreement.
       (d) Authorized Activities.--
       (1) In general.--Funds made available under subsection (c) 
     shall be used to carry out the activities described in 
     paragraph (2) that--
       (A) are consistent with this section; and
       (B) are necessary to meet the needs of Indians or Native 
     Hawaiians preparing to enter, reenter, or retain unsubsidized 
     employment.
       (2) Workforce investment activities and supplemental 
     services.--
       (A) In general.--Funds made available under subsection (c) 
     shall be used for--
       (i) comprehensive workforce investment activities for 
     Indians or Native Hawaiians; or
       (ii) supplemental services for Indian or Native Hawaiian 
     youth on or near Indian reservations and in Oklahoma, Alaska, 
     or Hawaii.
       (B) Special rule.--Notwithstanding any other provision of 
     this section, individuals who were eligible to participate in 
     programs under section 401 of the Job Training Partnership 
     Act (29 U.S.C. 1671) (as such section was in effect on the 
     day before the date of enactment of this Act) shall be 
     eligible to participate in an activity assisted under this 
     section.
       (e) Program Plan.--In order to receive a grant or enter 
     into a contract or cooperative agreement under this section 
     an entity described in subsection (c) shall submit to the 
     Secretary a program plan that describes a 2-year strategy for 
     meeting the needs of Indian, Alaska Native, or Native 
     Hawaiian individuals, as appropriate, in the area served by 
     such entity. Such plan shall--
       (1) be consistent with the purpose of this section;
       (2) identify the population to be served;
       (3) identify the education and employment needs of the 
     population to be served and the manner in which the 
     activities to be provided will strengthen the ability of the 
     individuals served to obtain or retain unsubsidized 
     employment;
       (4) describe the activities to be provided and the manner 
     in which such activities are to be integrated with other 
     appropriate activities; and
       (5) describe, after the entity submitting the plan consults 
     with the Secretary, the performance measures to be used to 
     assess the performance of entities in carrying out the 
     activities assisted under this section.
       (f) Consolidation of Funds.--Each entity receiving 
     assistance under subsection (c) 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 of 1992 (25 
     U.S.C. 3401 et seq.).
       (g) Nonduplicative and Nonexclusive Services.--Nothing in 
     this section shall be construed--
       (1) to limit the eligibility of any entity described in 
     subsection (c) to participate in any activity offered by a 
     State or local entity under this Act; or
       (2) to preclude or discourage any agreement, between any 
     entity described in subsection (c) and any State or local 
     entity, to facilitate the provision of services by such 
     entity or to the population served by such entity.
       (h) Administrative Provisions.--
       (1) Organizational unit established.--The Secretary shall 
     designate a single organizational unit within the Department 
     of Labor that shall have primary responsibility for the 
     administration of the activities authorized under this 
     section.
       (2) Regulations.--The Secretary shall consult with the 
     entities described in subsection (c) in--
       (A) establishing regulations to carry out this section, 
     including performance measures for entities receiving 
     assistance under such subsection, taking into account the 
     economic circumstances of such entities; and
       (B) developing a funding distribution plan that takes into 
     consideration previous levels of funding (prior to the date 
     of enactment of this Act) to such entities.
       (3) Waivers.--
       (A) In general.--With respect to an entity described in 
     subsection (c), the Secretary, notwithstanding any other 
     provision of law, may, pursuant to a request submitted by 
     such entity that meets the requirements established under 
     paragraph (2), waive any of the statutory or regulatory 
     requirements of this title that are inconsistent with the 
     specific needs of the entities described in such subsection, 
     except that the Secretary may not waive requirements relating 
     to wage and labor standards, worker rights, participation and 
     protection of workers and participants, grievance procedures, 
     and judicial review.
       (B) Request and approval.--An entity described in 
     subsection (c) that requests a waiver under subparagraph (A) 
     shall submit a plan to the Secretary to improve the program 
     of workforce investment activities carried out by the entity, 
     which plan shall meet the requirements established by the 
     Secretary and shall be generally consistent with the 
     requirements of section 189(i)(4)(B).
       (4) Advisory council.--
       (A) In general.--Using funds made available to carry out 
     this section, the Secretary shall establish a Native American 
     Employment and Training Council to facilitate the 
     consultation described in paragraph (2).
       (B) Composition.--The Council shall be composed of 
     individuals, appointed by the Secretary, who are 
     representatives of the entities described in subsection (c).
       (C) Duties.--The Council shall advise the Secretary on all 
     aspects of the operation and administration of the programs 
     assisted under this section, including the selection of the 
     individual appointed as the head of the unit established 
     under paragraph (1).
       (D) Personnel matters.--
       (i) Compensation of members.--Members of the Council shall 
     serve without compensation.

[[Page H6627]]

       (ii) Travel expenses.--The members of the Council shall be 
     allowed travel expenses, including per diem in lieu of 
     subsistence, at rates authorized for employees of agencies 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from their homes or regular places of 
     business in the performance of services for the Council.
       (iii) Administrative support.--The Secretary shall provide 
     the Council with such administrative support as may be 
     necessary to perform the functions of the Council.
       (E) Chairperson.--The Council shall select a chairperson 
     from among its members.
       (F) Meetings.--The Council shall meet not less than twice 
     each year.
       (G) Application.--Section 14 of the Federal Advisory 
     Committee Act (5 U.S.C. App.) shall not apply to the Council.
       (5) Technical assistance.--The Secretary, acting through 
     the unit established under paragraph (1), is authorized to 
     provide technical assistance to entities described in 
     subsection (c) that receive assistance under subsection (c) 
     to enable such entities to improve the activities authorized 
     under this section that are provided by such entities.
       (6) Agreement for certain federally-recognized indian 
     tribes to transfer funds to the program.--A federally-
     recognized Indian tribe that administers funds provided under 
     this section and funds provided by more than 1 State under 
     other sections of this title may enter into an agreement with 
     the Secretary and the Governors of the affected States to 
     transfer the funds provided by the States to the program 
     administered by the tribe under this section.
       (i) Compliance With Single Audit Requirements; Related 
     Requirement.--Grants, contracts, and cooperative agreements 
     entered into under this section shall be subject to the 
     requirements of chapter 75 of subtitle V of title 31, United 
     States Code (enacted by the Single Audit Act of 1984) and 
     charging of costs under this section shall be subject to 
     appropriate circulars issued by the Office of Management and 
     Budget.
       (j) Assistance to American Samoans in Hawaii.--
       (1) In general.--Notwithstanding any other provision of 
     law, the Secretary is authorized to provide assistance to 
     American Samoans who reside in Hawaii for the co-location of 
     federally-funded and State-funded workforce investment 
     activities.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated for fiscal year 1999 such sums as may be 
     necessary to carry out this subsection.

     SEC. 167. MIGRANT AND SEASONAL FARMWORKER PROGRAMS.

       (a) In General.--Every 2 years, the Secretary shall, on a 
     competitive basis, make grants to, or enter into contracts 
     with, eligible entities to carry out the activities described 
     in subsection (d).
       (b) Eligible Entities.--To be eligible to receive a grant 
     or enter into a contract under this section, an entity shall 
     have an understanding of the problems of eligible migrant and 
     seasonal farmworkers (including dependents), a familiarity 
     with the area to be served, and the ability to demonstrate a 
     capacity to administer effectively a diversified program of 
     workforce investment activities (including youth activities) 
     and related assistance for eligible migrant and seasonal 
     farmworkers.
       (c) Program Plan.--
       (1) In general.--To be eligible to receive a grant or enter 
     into a contract under this section, an entity described in 
     subsection (b) shall submit to the Secretary a plan that 
     describes a 2-year strategy for meeting the needs of eligible 
     migrant and seasonal farmworkers in the area to be served by 
     such entity.
       (2) Contents.--Such plan shall--
       (A) identify the education and employment needs of the 
     population to be served and the manner in which the services 
     to be provided will strengthen the ability of the eligible 
     migrant and seasonal farmworkers and dependents to obtain or 
     retain unsubsidized employment or stabilize their 
     unsubsidized employment;
       (B) describe the related assistance and supportive services 
     to be provided and the manner in which such assistance and 
     services are to be integrated and coordinated with other 
     appropriate services; and
       (C) describe the indicators of performance to be used to 
     assess the performance of such entity in carrying out the 
     activities assisted under this section.
       (3) Administration.--Grants and contracts awarded under 
     this section shall be centrally administered by the 
     Department of Labor and competitively awarded by the 
     Secretary using procedures consistent with standard Federal 
     Government competitive procurement policies.
       (4) Competition.--
       (A) In general.--The competition for grants made and 
     contracts entered into under this section shall be conducted 
     every 2 years.
       (B) Exception.--Notwithstanding subparagraph (A), if a 
     recipient of such a grant or contract has performed 
     satisfactorily under the terms of the grant agreement or 
     contract, the Secretary may waive the requirement for such 
     competition for such recipient upon receipt from the 
     recipient of a satisfactory 2-year plan described in 
     paragraph (1) for the succeeding 2-year grant or contract 
     period. The Secretary may exercise the waiver authority of 
     the preceding sentence not more than once during any 4-year 
     period with respect any single recipient.
       (d) Authorized Activities.--Funds made available under this 
     section shall be used to carry out workforce investment 
     activities (including youth activities) and provide related 
     assistance for eligible migrant and seasonal farmworkers, 
     which may include employment, training, educational 
     assistance, literacy assistance, an English language program, 
     worker safety training, housing, supportive services, dropout 
     prevention activities, follow-up services for those 
     individuals placed in employment, self-employment and related 
     business enterprise development education as needed by 
     eligible migrant and seasonal farmworkers and identified 
     pursuant to the plan required by subsection (c), and 
     technical assistance relating to capacity enhancement in such 
     areas as management information technology.
       (e) Consultation With Governors and Local Boards.--In 
     making grants and entering into contracts under this section, 
     the Secretary shall consult with the Governors and local 
     boards of the States in which the eligible entities will 
     carry out the activities described in subsection (d).
       (f) Regulations.--The Secretary shall consult with eligible 
     migrant and seasonal farmworkers groups and States in 
     establishing regulations to carry out this section, including 
     performance measures for eligible entities that take into 
     account the economic circumstances and demographics of 
     eligible migrant and seasonal farmworkers.
       (g) Compliance With Single Audit Requirements; Related 
     Requirement.--Grants and contracts entered into under this 
     section shall be subject to the requirements of chapter 75 of 
     subtitle V of title 31, United States Code (enacted by the 
     Single Audit Act of 1984) and charging of costs under this 
     section shall be subject to appropriate circulars issued by 
     the Office of Management and Budget.
       (h) Definitions.--In this section:
       (1) Disadvantaged.--The term ``disadvantaged'', used with 
     respect to a farmworker, means a farmworker whose income, for 
     12 consecutive months out of the 24 months prior to 
     application for the program involved, does not exceed the 
     higher of--
       (A) the poverty line (as defined in section 334(a)(2)(B)) 
     for an equivalent period; or
       (B) 70 percent of the lower living standard income level, 
     for an equivalent period.
       (2) Eligible migrant and seasonal farmworkers.--The term 
     ``eligible migrant and seasonal farmworkers'' means 
     individuals who are eligible migrant farmworkers or are 
     eligible seasonal farmworkers.
       (3) Eligible migrant farmworker.--The term ``eligible 
     migrant farmworker'' means--
       (A) an eligible seasonal farmworker described in paragraph 
     (4)(A) whose agricultural labor requires travel to a job site 
     such that the farmworker is unable to return to a permanent 
     place of residence within the same day; and
       (B) a dependent of the farmworker described in subparagraph 
     (A).
       (4) Eligible seasonal farmworker.--The term ``eligible 
     seasonal farmworker'' means--
       (A) a disadvantaged person who, for 12 consecutive months 
     out of the 24 months prior to application for the program 
     involved, has been primarily employed in agricultural labor 
     that is characterized by chronic unemployment or 
     underemployment; and
       (B) a dependent of the person described in subparagraph 
     (A).

     SEC. 168. VETERANS' WORKFORCE INVESTMENT PROGRAMS.

       (a) Authorization.--
       (1) In general.--The Secretary shall conduct, directly or 
     through grants or contracts, programs to meet the needs for 
     workforce investment activities of veterans with service-
     connected disabilities, veterans who have significant 
     barriers to employment, veterans who served on active duty in 
     the armed forces during a war or in a campaign or expedition 
     for which a campaign badge has been authorized, and recently 
     separated veterans.
       (2) Conduct of programs.--Programs supported under this 
     section may be conducted through grants and contracts with 
     public agencies and private nonprofit organizations, 
     including recipients of Federal assistance under other 
     provisions of this title, that the Secretary determines have 
     an understanding of the unemployment problems of veterans 
     described in paragraph (1), familiarity with the area to be 
     served, and the capability to administer effectively a 
     program of workforce investment activities for such veterans.
       (3) Required activities.--Programs supported under this 
     section shall include--
       (A) activities to enhance services provided to veterans by 
     other providers of workforce investment activities funded by 
     Federal, State, or local government;
       (B) activities to provide workforce investment activities 
     to such veterans that are not adequately provided by other 
     public providers of workforce investment activities; and
       (C) outreach and public information activities to develop 
     and promote maximum job and job training opportunities for 
     such veterans and to inform such veterans about employment, 
     job training, on-the-job training and educational 
     opportunities under this title, under title 38, United States 
     Code, and under other provisions of law, which activities 
     shall be coordinated with activities provided through the 
     one-stop centers described in section 134(c).
       (b) Administration of Programs.--
       (1) In general.--The Secretary shall administer programs 
     supported under this section through the Assistant Secretary 
     for Veterans' Employment and Training.
       (2) Additional responsibilities.--In carrying out 
     responsibilities under this section, the Assistant Secretary 
     for Veterans' Employment and Training shall--
       (A) be responsible for the awarding of grants and contracts 
     and the distribution of funds under this section and for the 
     establishment of appropriate fiscal controls, accountability, 
     and program performance measures for recipients of grants and 
     contracts under this section; and
       (B) consult with the Secretary of Veterans Affairs and take 
     steps to ensure that programs supported under this section 
     are coordinated, to the maximum extent feasible, with related 
     programs and activities conducted under title 38,

[[Page H6628]]

     United States Code, including programs and activities 
     conducted under subchapter II of chapter 77 of such title, 
     chapters 30, 31, 32, and 34 of such title, and sections 
     1712A, 1720A, 3687, and 4103A of such title.

     SEC. 169. YOUTH OPPORTUNITY GRANTS.

       (a) Grants.--
       (1) In general.--Using funds made available under section 
     127(b)(1)(A), the Secretary shall make grants to eligible 
     local boards and eligible entities described in subsection 
     (d) to provide activities described in subsection (b) for 
     youth to increase the long-term employment of youth who live 
     in empowerment zones, enterprise communities, and high 
     poverty areas and who seek assistance.
       (2) Definition.--In this section, the term ``youth'' means 
     an individual who is not less than age 14 and not more than 
     age 21.
       (3) Grant period.--The Secretary may make a grant under 
     this section for a 1-year period, and may renew the grant for 
     each of the 4 succeeding years.
       (4) Grant awards.--In making grants under this section, the 
     Secretary shall ensure that grants are distributed equitably 
     among local boards and entities serving urban areas and local 
     boards and entities serving rural areas, taking into 
     consideration the poverty rate in such urban and rural areas, 
     as described in subsection (c)(3)(B).
       (b) Use of Funds.--
       (1) In general.--A local board or entity that receives a 
     grant under this section shall use the funds made available 
     through the grant to provide activities that meet the 
     requirements of section 129, except as provided in paragraph 
     (2), as well as youth development activities such as 
     activities relating to leadership development, citizenship, 
     and community service, and recreation activities.
       (2) Intensive placement and followup services.--In 
     providing activities under this section, a local board or 
     entity shall provide--
       (A) intensive placement services; and
       (B) followup services for not less than 24 months after the 
     completion of participation in the other activities described 
     in this subsection, as appropriate.
       (c) Eligible Local Boards.--To be eligible to receive a 
     grant under this section, a local board shall serve a 
     community that--
       (1) has been designated as an empowerment zone or 
     enterprise community under section 1391 of the Internal 
     Revenue Code of 1986;
       (2)(A) is a State without a zone or community described in 
     paragraph (1); and
       (B) has been designated as a high poverty area by the 
     Governor of the State; or
       (3) is 1 of 2 areas in a State that--
       (A) have been designated by the Governor as areas for which 
     a local board may apply for a grant under this section; and
       (B) meet the poverty rate criteria set forth in subsections 
     (a)(4), (b), and (d) of section 1392 of the Internal Revenue 
     Code of 1986.
       (d) Eligible Entities.--To be eligible to receive a grant 
     under this section, an entity (other than a local board) 
     shall--
       (1) be a recipient of financial assistance under section 
     166; and
       (2) serve a community that--
       (A) meets the poverty rate criteria set forth in 
     subsections (a)(4), (b), and (d) of section 1392 of the 
     Internal Revenue Code of 1986; and
       (B) is located on an Indian reservation or serves Oklahoma 
     Indians or Alaska Native villages or Native groups (as such 
     terms are defined in section 3 of the Alaska Native Claims 
     Settlement Act (43 U.S.C. 1602)).
       (e) Application.--To be eligible to receive a grant under 
     this section, a local board or entity shall submit an 
     application to the Secretary at such time, in such manner, 
     and containing such information as the Secretary may require, 
     including--
       (1) a description of the activities that the local board or 
     entity will provide under this section to youth in the 
     community described in subsection (c);
       (2) a description of the performance measures negotiated 
     under subsection (f), and the manner in which the local 
     boards or entities will carry out the activities to meet the 
     performance measures;
       (3) a description of the manner in which the activities 
     will be linked to activities described in section 129; and
       (4) a description of the community support, including 
     financial support through leveraging additional public and 
     private resources, for the activities.
       (f) Performance Measures.--
       (1) In general.--The Secretary shall negotiate and reach 
     agreement with the local board or entity on performance 
     measures for the indicators of performance referred to in 
     subparagraphs (A) and (B) of section 136(b)(2) that will be 
     used to evaluate the performance of the local board or entity 
     in carrying out the activities described in subsection (b). 
     Each local performance measure shall consist of such a 
     indicator of performance, and a performance level referred to 
     in paragraph (2).
       (2) Performance levels.--The Secretary shall negotiate and 
     reach agreement with the local board or entity regarding the 
     levels of performance expected to be achieved by the local 
     board or entity on the indicators of performance.
       (g) Role Model Academy Project.--
       (1) In general.--Using the funds made available pursuant to 
     section 127(b)(1)(A)(iv) for fiscal year 1999, the Secretary 
     shall provide assistance to an entity to carry out a project 
     establishing a role model academy for out-of-school youth.
       (2) Residential center.--The entity shall use the 
     assistance to establish an academy that consists of a 
     residential center located on the site of a military 
     installation closed or realigned pursuant to a law providing 
     for closures and realignments of such installations.
       (3) Services.--The academy established pursuant to this 
     subsection shall provide services that--
       (A) utilize a military style model that emphasizes 
     leadership skills and discipline, or another model of 
     demonstrated effectiveness; and
       (B) include vocational training, secondary school course 
     work leading to a secondary school diploma or recognized 
     equivalent, and the use of mentors who serve as role models 
     and who provide academic training and career counseling to 
     the youth.

     SEC. 170. TECHNICAL ASSISTANCE.

       (a) General Technical Assistance.--
       (1) In general.--The Secretary shall provide, coordinate, 
     and support the development of, appropriate training, 
     technical assistance, staff development, and other 
     activities, including assistance in replicating programs of 
     demonstrated effectiveness, to States and localities, and, in 
     particular, to assist States in making transitions from 
     carrying out activities under the provisions of law repealed 
     under section 199 to carrying out activities under this 
     title.
       (2) Form of assistance.--In carrying out paragraph (1) on 
     behalf of a State, or recipient of financial assistance under 
     any of sections 166 through 169, the Secretary, after 
     consultation with the State or grant recipient, may award 
     grants and enter into contracts and cooperative agreements.
       (3) Limitation.--Grants or contracts awarded under 
     paragraph (1) to entities other than States or local units of 
     government that are for amounts in excess of $100,000 shall 
     only be awarded on a competitive basis.
       (b) Dislocated Worker Technical Assistance.--
       (1) Authority.--Of the amounts available pursuant to 
     section 132(a)(2), the Secretary shall reserve not more than 
     5 percent of such amounts to provide technical assistance to 
     States that do not meet the State performance measures 
     described in section 136 with respect to employment and 
     training activities for dislocated workers. Using such 
     reserved funds, the Secretary may provide such assistance to 
     other States, local areas, and other entities involved in 
     providing assistance to dislocated workers, to promote the 
     continuous improvement of assistance provided to dislocated 
     workers, under this title.
       (2) Training.--Amounts reserved under this subsection may 
     be used to provide for the training of staff, including 
     specialists, who provide rapid response services. Such 
     training shall include instruction in proven methods of 
     promoting, establishing, and assisting labor-management 
     committees. Such projects shall be administered through the 
     dislocated worker office described in section 174(b).

     SEC. 171. DEMONSTRATION, PILOT, MULTISERVICE, RESEARCH, AND 
                   MULTISTATE PROJECTS.

       (a) Strategic Plan.--
       (1) In general.--After consultation with States, 
     localities, and other interested parties, the Secretary 
     shall, every 2 years, publish in the Federal Register, a plan 
     that describes the demonstration and pilot (including 
     dislocated worker demonstration and pilot), multiservice, 
     research, and multistate project priorities of the Department 
     of Labor concerning employment and training for the 5-year 
     period following the submission of the plan. Copies of the 
     plan shall be transmitted to the appropriate committees of 
     Congress.
       (2) Factors.--The plan published under paragraph (1) shall 
     contain strategies to address national employment and 
     training problems and take into account factors such as--
       (A) the availability of existing research (as of the date 
     of the publication);
       (B) the need to ensure results that have interstate 
     validity;
       (C) the benefits of economies of scale and the efficiency 
     of proposed projects; and
       (D) the likelihood that the results of the projects will be 
     useful to policymakers and stakeholders in addressing 
     employment and training problems.
       (b) Demonstration and Pilot Projects.--
       (1) In general.--Under a plan published under subsection 
     (a), the Secretary shall, through grants or contracts, carry 
     out demonstration and pilot projects for the purpose of 
     developing and implementing techniques and approaches, and 
     demonstrating the effectiveness of specialized methods, in 
     addressing employment and training needs. Such projects shall 
     include the provision of direct services to individuals to 
     enhance employment opportunities and an evaluation component 
     and may include--
       (A) the establishment of advanced manufacturing technology 
     skill centers developed through local partnerships of 
     industry, labor, education, community-based organizations, 
     and economic development organizations to meet unmet, high-
     tech skill needs of local communities;
       (B) projects that provide training to upgrade the skills of 
     employed workers who reside and are employed in enterprise 
     communities or empowerment zones;
       (C) programs conducted jointly with the Department of 
     Defense to develop training programs utilizing computer-based 
     and other innovative learning technologies;
       (D) projects that promote the use of distance learning, 
     enabling students to take courses through the use of media 
     technology such as videos, teleconferencing computers, and 
     the Internet;
       (E) projects that assist in providing comprehensive 
     services to increase the employment rates of out-of-school 
     youth residing in targeted high poverty areas within 
     empowerment zones and enterprise communities;
       (F) the establishment of partnerships with national 
     organizations with special expertise in developing, 
     organizing, and administering employment and training 
     services, for individuals with

[[Page H6629]]

     disabilities, at the national, State, and local levels;
       (G) projects to assist public housing authorities that 
     provide, to public housing residents, job training programs 
     that demonstrate success in upgrading the job skills and 
     promoting employment of the residents; and
       (H) projects that assist local areas to develop and 
     implement local self-sufficiency standards to evaluate the 
     degree to which participants in programs under this title are 
     achieving self-sufficiency.
       (2) Limitations.--
       (A) Competitive awards.--Grants or contracts awarded for 
     carrying out demonstration and pilot projects under this 
     subsection shall be awarded only on a competitive basis, 
     except that a noncompetitive award may be made in the case of 
     a project that is funded jointly with other public or private 
     sector entities that provide a portion of the funding for the 
     project.
       (B) Eligible entities.--Grants or contracts may be awarded 
     under this subsection only to--
       (i) entities with recognized expertise in--

       (I) conducting national demonstration projects;
       (II) utilizing state-of-the-art demonstration methods; or
       (III) conducting evaluations of workforce investment 
     projects; or

       (ii) State and local entities with expertise in operating 
     or overseeing workforce investment programs.
       (C) Time limits.--The Secretary shall establish appropriate 
     time limits for carrying out demonstration and pilot projects 
     under this subsection.
       (c) Multiservice Projects, Research Projects, and 
     Multistate Projects.--
       (1) Multiservice projects.--Under a plan published under 
     subsection (a), the Secretary shall, through grants or 
     contracts, carry out multiservice projects--
       (A) that will test an array of approaches to the provision 
     of employment and training services to a variety of targeted 
     populations;
       (B) in which the entity carrying out the project, in 
     conjunction with employers, organized labor, and other groups 
     such as the disability community, will design, develop, and 
     test various training approaches in order to determine 
     effective practices; and
       (C) that will assist in the development and replication of 
     effective service delivery strategies for targeted 
     populations for the national employment and training system 
     as a whole.
       (2) Research projects.--
       (A) In general.--Under a plan published under subsection 
     (a), the Secretary shall, through grants or contracts, carry 
     out research projects that will contribute to the solution of 
     employment and training problems in the United States.
       (B) Formula improvement study and report.--
       (i) Study.--The Secretary shall conduct a 2-year study 
     concerning improvements in the formulas described in section 
     132(b)(1)(B) and paragraphs (2)(A) and (3) of section 133(b) 
     (regarding distributing funds under subtitle B to States and 
     local areas for adult employment and training activities). In 
     conducting the study, the Secretary shall examine means of 
     improving the formulas by--

       (I) developing formulas based on statistically reliable 
     data;
       (II) developing formulas that are consistent with the goals 
     and objectives of this title; and
       (III) developing formulas based on organizational and 
     financial stability of State boards and local boards.

       (ii) Report.--The Secretary shall prepare and submit to 
     Congress a report containing the results of the study, 
     including recommendations for improved formulas.
       (3) Multistate projects.--
       (A) In general.--
       (i) Authority.--Under a plan published under subsection 
     (a), the Secretary may, through grants or contracts, carry 
     out multistate projects that require demonstrated expertise 
     that is available at the national level to effectively 
     disseminate best practices and models for implementing 
     employment and training services, address the specialized 
     employment and training needs of particular service 
     populations, or address industry-wide skill shortages.
       (ii) Design of grants.--Grants or contracts awarded under 
     this subsection shall be designed to obtain information 
     relating to the provision of services under different 
     economic conditions or to various demographic groups in order 
     to provide guidance at the national and State levels about 
     how best to administer specific employment and training 
     services.
       (4) Limitations.--
       (A) Competitive awards.--Grants or contracts awarded for 
     carrying out projects under this subsection in amounts that 
     exceed $100,000 shall be awarded only on a competitive basis, 
     except that a noncompetitive award may be made in the case of 
     a project that is funded jointly with other public or private 
     sector entities that provide a substantial portion of 
     assistance under the grant or contract for the project.
       (B) Time limits.--A grant or contract shall not be awarded 
     under this subsection to the same organization for more than 
     3 consecutive years unless such grant or contract is 
     competitively reevaluated within such period.
       (C) Peer review.--
       (i) In general.--The Secretary shall utilize a peer review 
     process--

       (I) to review and evaluate all applications for grants in 
     amounts that exceed $500,000 that are submitted under this 
     section; and
       (II) to review and designate exemplary and promising 
     programs under this section.

       (ii) Availability of funds.--The Secretary is authorized to 
     use funds provided under this section to carry out peer 
     review activities under this subparagraph.
       (D) Priority.--In awarding grants or contracts under this 
     subsection, priority shall be provided to entities with 
     nationally recognized expertise in the methods, techniques, 
     and knowledge of workforce investment activities and shall 
     include appropriate time limits, established by the 
     Secretary, for the duration of such projects.
       (d) Dislocated Worker Projects.--Of the amount made 
     available pursuant to section 132(a)(2)(A) for any program 
     year, the Secretary shall use not more than 10 percent of 
     such amount to carry out demonstration and pilot projects, 
     multiservice projects, and multistate projects, relating to 
     the employment and training needs of dislocated workers. Of 
     the requirements of this section, such projects shall be 
     subject only to the provisions relating to review and 
     evaluation of applications under subsection (c)(4)(C). Such 
     projects may include demonstration and pilot projects 
     relating to promoting self-employment, promoting job 
     creation, averting dislocations, assisting dislocated 
     farmers, assisting dislocated fishermen, and promoting public 
     works. Such projects shall be administered through the 
     dislocated worker office described in section 173(b).

     SEC. 172. EVALUATIONS.

       (a) Programs and Activities Carried Out Under This Title.--
     For the purpose of improving the management and effectiveness 
     of programs and activities carried out under this title, the 
     Secretary shall provide for the continuing evaluation of the 
     programs and activities, including those programs and 
     activities carried out under section 171. Such evaluations 
     shall address--
       (1) the general effectiveness of such programs and 
     activities in relation to their cost, including the extent to 
     which the programs and activities--
       (A) improve the employment competencies of participants in 
     comparison to comparably-situated individuals who did not 
     participate in such programs and activities; and
       (B) to the extent feasible, increase the level of total 
     employment over the level that would have existed in the 
     absence of such programs and activities;
       (2) the effectiveness of the performance measures relating 
     to such programs and activities;
       (3) the effectiveness of the structure and mechanisms for 
     delivery of services through such programs and activities;
       (4) the impact of the programs and activities on the 
     community and participants involved;
       (5) the impact of such programs and activities on related 
     programs and activities;
       (6) the extent to which such programs and activities meet 
     the needs of various demographic groups; and
       (7) such other factors as may be appropriate.
       (b) Other Programs and Activities.--The Secretary may 
     conduct evaluations of other federally funded employment-
     related programs and activities under other provisions of 
     law.
       (c) Techniques.--Evaluations conducted under this section 
     shall utilize appropriate methodology and research designs, 
     including the use of control groups chosen by scientific 
     random assignment methodologies. The Secretary shall conduct 
     as least 1 multisite control group evaluation under this 
     section by the end of fiscal year 2005.
       (d) Reports.--The entity carrying out an evaluation 
     described in subsection (a) or (b) shall prepare and submit 
     to the Secretary a draft report and a final report containing 
     the results of the evaluation.
       (e) Reports to Congress.--Not later than 30 days after the 
     completion of such a draft report, the Secretary shall 
     transmit the draft report to the Committee on Education and 
     the Workforce of the House of Representatives and the 
     Committee on Labor and Human Resources of the Senate. Not 
     later than 60 days after the completion of such a final 
     report, the Secretary shall transmit the final report to such 
     committees of the Congress.
       (f) Coordination.--The Secretary shall ensure the 
     coordination of evaluations carried out by States pursuant to 
     section 136(e) with the evaluations carried out under this 
     section.

     SEC. 173. NATIONAL EMERGENCY GRANTS.

       (a) In General.--The Secretary is authorized to award 
     national emergency grants in a timely manner--
       (1) to an entity described in subsection (c) to provide 
     employment and training assistance to workers affected by 
     major economic dislocations, such as plant closures, mass 
     layoffs, or closures and realignments of military 
     installations;
       (2) to provide assistance to the Governor of any State 
     within the boundaries of which is 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 (42 
     U.S.C. 5122 (1) and (2)) (referred to in this section as the 
     ``disaster area'') to provide disaster relief employment in 
     the area; and
       (3) to provide additional assistance to a State or local 
     board for eligible dislocated workers in a case in which the 
     State or local board has expended the funds provided under 
     this section to carry out activities described in paragraphs 
     (1) and (2) and can demonstrate the need for additional funds 
     to provide appropriate services for such workers, in 
     accordance with requirements prescribed by the Secretary.
       (b) Administration.--The Secretary shall designate a 
     dislocated worker office to coordinate the functions of the 
     Secretary under this title relating to employment and 
     training activities for dislocated workers, including 
     activities carried out under the national emergency grants.
       (c) Employment and Training Assistance Requirements.--
       (1) Grant recipient eligibility.--
       (A) Application.--To be eligible to receive a grant under 
     subsection (a)(1), an entity shall

[[Page H6630]]

     submit an application to the Secretary at such time, in such 
     manner, and containing such information as the Secretary may 
     require.
       (B) Eligible entity.--In this paragraph, the term 
     ``entity'' means a State, a local board, an entity described 
     in section 166(c), entities determined to be eligible by the 
     Governor of the State involved, and other entities that 
     demonstrate to the Secretary the capability to effectively 
     respond to the circumstances relating to particular 
     dislocations.
       (2) Participant eligibility.--
       (A) In general.--In order to be eligible to receive 
     employment and training assistance under a national emergency 
     grant awarded pursuant to subsection (a)(1), an individual 
     shall be--
       (i) a dislocated worker;
       (ii) a civilian employee of the Department of Defense or 
     the Department of Energy employed at a military installation 
     that is being closed, or that will undergo realignment, 
     within the next 24 months after the date of the determination 
     of eligibility;
       (iii) an individual who is employed in a nonmanagerial 
     position with a Department of Defense contractor, who is 
     determined by the Secretary of Defense to be at-risk of 
     termination from employment as a result of reductions in 
     defense expenditures, and whose employer is converting 
     operations from defense to nondefense applications in order 
     to prevent worker layoffs; or
       (iv) a member of the Armed Forces who--

       (I) was on active duty or full-time National Guard duty;
       (II)(aa) is involuntarily separated (as defined in section 
     1141 of title 10, United States Code) from active duty or 
     full-time National Guard duty; or
       (bb) is separated from active duty or full-time National 
     Guard duty pursuant to a special separation benefits program 
     under section 1174a of title 10, United States Code, or the 
     voluntary separation incentive program under section 1175 of 
     that title;
       (III) is not entitled to retired or retained pay incident 
     to the separation described in subclause (II); and
       (IV) applies for such employment and training assistance 
     before the end of the 180-day period beginning on the date of 
     that separation.

       (B) Retraining assistance.--The individuals described in 
     subparagraph (A)(iii) shall be eligible for retraining 
     assistance to upgrade skills by obtaining marketable skills 
     needed to support the conversion described in subparagraph 
     (A)(iii).
       (C) Additional requirements.--The Secretary shall establish 
     and publish additional requirements related to eligibility 
     for employment and training assistance under the national 
     emergency grants to ensure effective use of the funds 
     available for this purpose.
       (D) Definitions.--In this paragraph, the terms `military 
     institution' and `realignment' have the meanings given the 
     terms in section 2910 of the Defense Base Closure and 
     Realignment Act of 1990 (Public Law 101-510; 10 U.S.C. 2687 
     note).
       (d) Disaster Relief Employment Assistance Requirements.--
       (1) In general.--Funds made available under subsection 
     (a)(2)--
       (A) shall be used to provide disaster relief employment on 
     projects that provide food, clothing, shelter, and other 
     humanitarian assistance for disaster victims, and projects 
     regarding demolition, cleaning, repair, renovation, and 
     reconstruction of damaged and destroyed structures, 
     facilities, and lands located within the disaster area;
       (B) may be expended through public and private agencies and 
     organizations engaged in such projects; and
       (C) may be expended to provide employment and training 
     activities.
       (2) Eligibility.--An individual shall be eligible to be 
     offered disaster relief employment under subsection (a)(2) if 
     such individual is a dislocated worker, is a long-term 
     unemployed individual, 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 subsection (a)(2) for more 
     than 6 months for work related to recovery from a single 
     natural disaster.

     SEC. 174. AUTHORIZATION OF APPROPRIATIONS.

       (a) Native American Programs; Migrant and Seasonal 
     Farmworker Programs; Veterans' Workforce Investment 
     Programs.--
       (1) In general.--Subject to paragraph (2), there are 
     authorized to be appropriated to carry out sections 166 
     through 168 such sums as may be necessary for each of the 
     fiscal years 1999 through 2003.
       (2) Reservations.--Of the amount appropriated pursuant to 
     the authorization of appropriations under paragraph (1) for a 
     fiscal year, the Secretary shall--
       (A) reserve not less than $55,000,000 for carrying out 
     section 166;
       (B) reserve not less than $70,000,000 for carrying out 
     section 167; and
       (C) reserve not less than $7,300,000 for carrying out 
     section 168.
       (b) Technical Assistance; Demonstration and Pilot Projects; 
     Evaluations; Incentive Grants.--
       (1) In general.--Subject to paragraph (2), there are 
     authorized to be appropriated to carry out sections 170 
     through 172 and section 503 such sums as may be necessary for 
     each of the fiscal years 1999 through 2003.
       (2) Reservations.--Of the amount appropriated pursuant to 
     the authorization of appropriations under paragraph (1) for a 
     fiscal year, the Secretary shall--
       (A)(i) for fiscal year 1999, reserve up to 40 percent for 
     carrying out section 170 (other than subsection (b) of such 
     section);
       (ii) for fiscal year 2000, reserve up to 25 percent for 
     carrying out section 170 (other than subsection (b) of such 
     section); and
       (iii) for each of the fiscal years 2001 through 2003, 
     reserve up to 20 percent for carrying out section 170 (other 
     than subsection (b) of such section);
       (B)(i) for fiscal year 1999, reserve not less than 50 
     percent for carrying out section 171; and
       (ii) for each of the fiscal years 2000 through 2003, 
     reserve not less than 45 percent for carrying out section 
     171;
       (C)(i) for fiscal year 1999, reserve not less than 10 
     percent for carrying out section 172; and
       (ii) for each of the fiscal years 2000 through 2003, 
     reserve not less than 10 percent for carrying out section 
     172; and
       (D)(i) for fiscal year 1999, reserve no funds for carrying 
     out section 503;
       (ii) for fiscal year 2000, reserve up to 20 percent for 
     carrying out section 503; and
       (iii) for each of the fiscal years 2001 through 2003, 
     reserve up to 25 percent for carrying out section 503.
                       Subtitle E--Administration

     SEC. 181. REQUIREMENTS AND RESTRICTIONS.

       (a) Benefits.--
       (1) Wages.--
       (A) In general.--Individuals in on-the-job training or 
     individuals employed in activities under this title shall be 
     compensated at the same rates, including periodic increases, 
     as trainees or employees who are similarly situated in 
     similar occupations by the same employer and who have similar 
     training, experience, and skills, and such rates shall be in 
     accordance with applicable law, but in no event less than the 
     higher of the rate specified in section 6(a)(1) of the Fair 
     Labor Standards Act of 1938 (29 U.S.C. 206(a)(1)) or the 
     applicable State or local minimum wage law.
       (B) Rule of construction.--The reference in subparagraph 
     (A) to section 6(a)(1) of the Fair Labor Standards Act of 
     1938 (29 U.S.C. 206(a)(1))--
       (i) shall be deemed to be a reference to section 6(a)(3) of 
     that Act for individuals in American Samoa; and
       (ii) shall not be applicable for individuals in other 
     territorial jurisdictions in which section 6 of the Fair 
     Labor Standards Act of 1938 does not apply.
       (2) Treatment of allowances, earnings, and payments.--
     Allowances, earnings and payments to individuals 
     participating in programs under this title shall not be 
     considered as income for the purposes of determining 
     eligibility for and the amount of income transfer and in-kind 
     aid furnished under any Federal or federally assisted program 
     based on need, other than as provided under the Social 
     Security Act (42 U.S.C. 301 et seq.).
       (b) Labor Standards.--
       (1) Limitations on activities that impact wages of 
     employees.--No funds provided under this title shall be used 
     to pay the wages of incumbent employees during their 
     participation in economic development activities provided 
     through a statewide workforce investment system.
       (2) Displacement.--
       (A) Prohibition.--A participant in a program or activity 
     authorized under this title (referred to in this section as a 
     ``specified activity'') shall not displace (including a 
     partial displacement, such as a reduction in the hours of 
     nonovertime work, wages, or employment benefits) any 
     currently employed employee (as of the date of the 
     participation).
       (B) Prohibition on impairment of contracts.--A specified 
     activity shall not impair an existing contract for services 
     or collective bargaining agreement, and no such activity 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) Other prohibitions.--A participant in a specified 
     activity shall not be employed in a job if--
       (A) any other individual is on layoff from the same or any 
     substantially equivalent job;
       (B) 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 participant; or
       (C) the job is created in a promotional line that will 
     infringe in any way upon the promotional opportunities of 
     currently employed individuals (as of the date of the 
     participation).
       (4) Health and safety.--Health and safety standards 
     established under Federal and State law otherwise applicable 
     to working conditions of employees shall be equally 
     applicable to working conditions of participants engaged in 
     specified activities. To the extent that a State workers' 
     compensation law applies, workers' compensation shall be 
     provided to participants on the same basis as the 
     compensation is provided to other individuals in the State in 
     similar employment.
       (5) Employment conditions.--Individuals in on-the-job 
     training or individuals employed in programs and activities 
     under this title, shall be provided benefits and working 
     conditions at the same level and to the same extent as other 
     trainees or employees working a similar length of time and 
     doing the same type of work.
       (6) Opportunity to submit comments.--Interested members of 
     the public, including representatives of businesses and of 
     labor organizations, shall be provided an opportunity to 
     submit comments to the Secretary with respect to programs and 
     activities proposed to be funded under subtitle B.
       (7) No impact on union organizing.--Each recipient of funds 
     under this title shall provide to the Secretary assurances 
     that none of such funds will be used to assist, promote, or 
     deter union organizing.
       (c) Grievance Procedure.--

[[Page H6631]]

       (1) In general.--Each State and local area receiving an 
     allotment under this title shall establish and maintain a 
     procedure for grievances or complaints alleging violations of 
     the requirements of this title from participants and other 
     interested or affected parties. Such procedure shall include 
     an opportunity for a hearing and be completed within 60 days 
     after the filing of the grievance or complaint.
       (2) Investigation.--
       (A) In general.--The Secretary shall investigate an 
     allegation of a violation described in paragraph (1) if--
       (i) a decision relating to such violation has not been 
     reached within 60 days after the date of the filing of the 
     grievance or complaint and either party appeals to the 
     Secretary; or
       (ii) a decision relating to such violation has been reached 
     within such 60 days and the party to which such decision is 
     adverse appeals such decision to the Secretary.
       (B) Additional requirement.--The Secretary shall make a 
     final determination relating to an appeal made under 
     subparagraph (A) no later than 120 days after receiving such 
     appeal.
       (3) Remedies.--Remedies that may be imposed under this 
     section for a violation of any requirement of this title 
     shall be limited--
       (A) to suspension or termination of payments under this 
     title;
       (B) to prohibition of placement of a participant with an 
     employer that has violated any requirement under this title;
       (C) where applicable, to reinstatement of an employee, 
     payment of lost wages and benefits, and reestablishment of 
     other relevant terms, conditions, and privileges of 
     employment; and
       (D) where appropriate, to other equitable relief.
       (4) Rule of construction.--Nothing in paragraph (3) shall 
     be construed to prohibit a grievant or complainant from 
     pursuing a remedy authorized under another Federal, State, or 
     local law for a violation of this title.
       (d) Relocation.--
       (1) Prohibition on use of funds to encourage or induce 
     relocation.--No funds provided under this title shall be 
     used, or proposed for use, to encourage or induce the 
     relocation of a business or part of a business if such 
     relocation would result in a loss of employment for any 
     employee of such business at the original location and such 
     original location is within the United States.
       (2) Prohibition on use of funds for customized or skill 
     training and related activities after relocation.--No funds 
     provided under this title for an employment and training 
     activity shall be used for customized or skill training, on-
     the-job training, or company-specific assessments of job 
     applicants or employees, for any business or part of a 
     business that has relocated, until the date that is 120 days 
     after the date on which such business commences operations at 
     the new location, if the relocation of such business or part 
     of a business results in a loss of employment for any 
     employee of such business at the original location and such 
     original location is within the United States.
       (3) Repayment.--If the Secretary determines that a 
     violation of paragraph (1) or (2) has occurred, the Secretary 
     shall require the State that has violated such paragraph to 
     repay to the United States an amount equal to the amount 
     expended in violation of such paragraph.
       (e) Limitation on Use of Funds.--No funds available under 
     this title shall be used for employment generating 
     activities, economic development activities, investment in 
     revolving loan funds, capitalization of businesses, 
     investment in contract bidding resource centers, and similar 
     activities that are not directly related to training for 
     eligible individuals under this title. No funds available 
     under subtitle B shall be used for foreign travel.
       (f) Testing and Sanctioning for Use of Controlled 
     Substances.--
       (1) In general.--Notwithstanding any other provision of 
     law, a State shall not be prohibited by the Federal 
     Government from--
       (A) testing participants in programs under subtitle B for 
     the use of controlled substances; and
       (B) sanctioning such participants who test positive for the 
     use of such controlled substances.
       (2) Additional requirements.--
       (A) Period of sanction.--In sanctioning participants in 
     programs under subtitle B who test positive for the use of 
     controlled substances--
       (i) with respect to the first occurrence for which a 
     participant tests positive, a State may exclude the 
     participant from the program for a period not to exceed 6 
     months; and
       (ii) with respect to the second occurrence and each 
     subsequent occurrence for which a participant tests positive, 
     a State may exclude the participant from the program for a 
     period not to exceed not to exceed 2 years.
       (B) Appeal.--The testing of participants and the imposition 
     of sanctions under this subsection shall be subject to 
     expeditious appeal in accordance with due process procedures 
     established by the State.
       (C) Privacy.-- A State shall establish procedures for 
     testing participants for the use of controlled substances 
     that ensure a maximum degree of privacy for the participants.
       (4) Funding requirement.--In testing and sanctioning of 
     participants for the use of controlled substances in 
     accordance with this subsection, the only Federal funds that 
     a State may use are the amounts made available for the 
     administration of statewide workforce investment activities 
     under section 134(a)(3)(B).

     SEC. 182. PROMPT ALLOCATION OF FUNDS.

       (a) Allotments Based on Latest Available Data.--All 
     allotments to States and grants to outlying areas under this 
     title shall be based on the latest available data and 
     estimates satisfactory to the Secretary. All data relating to 
     disadvantaged adults and disadvantaged youth shall be based 
     on the most recent satisfactory data from the Bureau of the 
     Census.
       (b) Publication in Federal Register Relating to Formula 
     Funds.--Whenever the Secretary allots funds required to be 
     allotted under this title, the Secretary shall publish in a 
     timely fashion in the Federal Register the proposed amount to 
     be distributed to each recipient of the funds.
       (c) Requirement for Funds Distributed by Formula.--All 
     funds required to be allotted under section 127 or 132 shall 
     be allotted within 45 days after the date of enactment of the 
     Act appropriating the funds, except that, if such funds are 
     appropriated in advance as authorized by section 189(g), such 
     funds shall be allotted or allocated not later than the March 
     31 preceding the program year for which such funds are to be 
     available for obligation.
       (d) Publication in Federal Register Relating to 
     Discretionary Funds.--Whenever the Secretary utilizes a 
     formula to allot or allocate funds made available for 
     distribution at the Secretary's discretion under this title, 
     the Secretary shall, not later than 30 days prior to such 
     allotment or allocation, publish such formula in the Federal 
     Register for comments along with the rationale for the 
     formula and the proposed amounts to be distributed to each 
     State and local area. After consideration of any comments 
     received, the Secretary shall publish final allotments and 
     allocations in the Federal Register.
       (e) Availability of Funds.--Funds shall be made available 
     under sections 128 and 133 for a local area not later than 30 
     days after the date the funds are made available to the 
     Governor involved, under section 127 or 132 (as the case may 
     be), or 7 days after the date the local plan for the area is 
     approved, whichever is later.

     SEC. 183. MONITORING.

       (a) In General.--The Secretary is authorized to monitor all 
     recipients of financial assistance under this title to 
     determine whether the recipients are complying with the 
     provisions of this title, including the regulations issued 
     under this title.
       (b) Investigations.--The Secretary may investigate any 
     matter the Secretary determines to be necessary to determine 
     the compliance of the recipients with this title, including 
     the regulations issued under this title. The investigations 
     authorized by this subsection may include examining records 
     (including making certified copies of the records), 
     questioning employees, and entering any premises or onto any 
     site in which any part of a program or activity of such a 
     recipient is conducted or in which any of the records of the 
     recipient are kept.
       (c) Additional Requirement.--For the purpose of any 
     investigation or hearing conducted under this title by the 
     Secretary, the provisions of section 9 of the Federal Trade 
     Commission Act (15 U.S.C. 49) (relating to the attendance of 
     witnesses and the production of documents) apply to the 
     Secretary, in the same manner and to the same extent as the 
     provisions apply to the Federal Trade Commission.

     SEC. 184. FISCAL CONTROLS; SANCTIONS.

       (a) Establishment of Fiscal Controls by States.--
       (1) In general.--Each State shall establish such fiscal 
     control and fund accounting procedures as may be necessary to 
     assure the proper disbursal of, and accounting for, Federal 
     funds allocated to local areas under subtitle B. Such 
     procedures shall ensure that all financial transactions 
     carried out under subtitle B are conducted and records 
     maintained in accordance with generally accepted accounting 
     principles applicable in each State.
       (2) Cost principles.--
       (A) In general.--Each State (including the Governor of the 
     State), local area (including the chief elected official for 
     the area), and provider receiving funds under this title 
     shall comply with the applicable uniform cost principles 
     included in the appropriate circulars of the Office of 
     Management and Budget for the type of entity receiving the 
     funds.
       (B) Exception.--The funds made available to a State for 
     administration of statewide workforce investment activities 
     in accordance with section 134(a)(3)(B) shall be allocable to 
     the overall administration of workforce investment 
     activities, but need not be specifically allocable to--
       (i) the administration of adult employment and training 
     activities;
       (ii) the administration of dislocated worker employment and 
     training activities; or
       (iii) the administration of youth activities.
       (3) Uniform administrative requirements.--
       (A) In general.--Each State (including the Governor of the 
     State), local area (including the chief elected official for 
     the area), and provider receiving funds under this title 
     shall comply with the appropriate uniform administrative 
     requirements for grants and agreements applicable for the 
     type of entity receiving the funds, as promulgated in 
     circulars or rules of the Office of Management and Budget.
       (B) Additional requirement.--Procurement transactions under 
     this title between local boards and units of State or local 
     governments shall be conducted only on a cost-reimbursable 
     basis.
       (4) Monitoring.--Each Governor of a State shall conduct on 
     an annual basis onsite monitoring of each local area within 
     the State to ensure compliance with the uniform 
     administrative requirements referred to in paragraph (3).
       (5) Action by governor.--If the Governor determines that a 
     local area is not in compliance with the uniform 
     administrative requirements referred to in paragraph (3), the 
     Governor shall--
       (A) require corrective action to secure prompt compliance; 
     and

[[Page H6632]]

       (B) impose the sanctions provided under subsection (b) in 
     the event of failure to take the required corrective action.
       (6) Certification.--The Governor shall, every 2 years, 
     certify to the Secretary that--
       (A) the State has implemented the uniform administrative 
     requirements referred to in paragraph (3);
       (B) the State has monitored local areas to ensure 
     compliance with the uniform administrative requirements as 
     required under paragraph (4); and
       (C) the State has taken appropriate action to secure 
     compliance pursuant to paragraph (5).
       (7) Action by the secretary.--If the Secretary determines 
     that the Governor has not fulfilled the requirements of this 
     subsection, the Secretary shall--
       (A) require corrective action to secure prompt compliance; 
     and
       (B) impose the sanctions provided under subsection (e) in 
     the event of failure of the Governor to take the required 
     appropriate action to secure compliance.
       (b) Substantial Violation.--
       (1) Action by governor.--If, as a result of financial and 
     compliance audits or otherwise, the Governor determines that 
     there is a substantial violation of a specific provision of 
     this title, and corrective action has not been taken, the 
     Governor shall--
       (A) issue a notice of intent to revoke approval of all or 
     part of the local plan affected; or
       (B) impose a reorganization plan, which may include--
       (i) decertifying the local board involved;
       (ii) prohibiting the use of eligible providers;
       (iii) selecting an alternative entity to administer the 
     program for the local area involved;
       (iv) merging the local area into 1 or more other local 
     areas; or
       (v) making other such changes as the Secretary or Governor 
     determines necessary to secure compliance.
       (2) Appeal.--
       (A) In general.--The actions taken by the Governor pursuant 
     to subparagraphs (A) and (B) of paragraph (1) may be appealed 
     to the Secretary and shall not become effective until--
       (i) the time for appeal has expired; or
       (ii) the Secretary has issued a decision.
       (B) Additional requirement.--The Secretary shall make a 
     final decision under subparagraph (A) not later than 45 days 
     after the receipt of the appeal.
       (3) Action by the secretary.--If the Governor fails to 
     promptly take the actions required under paragraph (1), the 
     Secretary shall take such actions.
       (c) Repayment of Certain Amounts to the United States.--
       (1) In general.--Every recipient of funds under this title 
     shall repay to the United States amounts found not to have 
     been expended in accordance with this title.
       (2) Offset of repayment.--If the Secretary determines that 
     a State has expended funds made available under this title in 
     a manner contrary to the requirements of this title, the 
     Secretary may offset repayment of such expenditures against 
     any other amount to which the State is or may be entitled, 
     except as provided under subsection (d)(1).
       (3) Repayment from deduction by state.--If the Secretary 
     requires a State to repay funds as a result of a 
     determination that a local area of the State has expended 
     funds contrary to the requirements of this title, the 
     Governor of the State may use an amount deducted under 
     paragraph (4) to repay the funds, except as provided under 
     subsection (e)(1).
       (4) Deduction by state.--The Governor may deduct an amount 
     equal to the misexpenditure described in paragraph (3) from 
     subsequent program year allocations to the local area from 
     funds reserved for the administrative costs of the local 
     programs involved, as appropriate.
       (5) Limitations.--A deduction made by a State as described 
     in paragraph (4) shall not be made until such time as the 
     Governor has taken appropriate corrective action to ensure 
     full compliance within such local area with regard to 
     appropriate expenditures of funds under this title.
       (d) Repayment of Amounts.--
       (1) In general.--Each recipient of funds under this title 
     shall be liable to repay the amounts described in subsection 
     (c)(1), from funds other than funds received under this 
     title, upon a determination by the Secretary that the 
     misexpenditure of funds was due to willful disregard of the 
     requirements of this title, gross negligence, failure to 
     observe accepted standards of administration, or a pattern of 
     misexpenditure as described in paragraphs (2) and (3) of 
     subsection (c). No such determination shall be made under 
     this subsection or subsection (c) until notice and 
     opportunity for a fair hearing has been given to the 
     recipient.
       (2) Factors in imposing sanctions.--In determining whether 
     to impose any sanction authorized by this section against a 
     recipient for violations by a subgrantee or contractor of 
     such recipient under this title (including the regulations 
     issued under this title), the Secretary shall first determine 
     whether such recipient has adequately demonstrated that the 
     recipient has--
       (A) established and adhered to an appropriate system for 
     the award and monitoring of grants and contracts with 
     subgrantees and contractors that contains acceptable 
     standards for ensuring accountability;
       (B) entered into a written grant agreement or contract with 
     such subgrantee or contractor that established clear goals 
     and obligations in unambiguous terms;
       (C) acted with due diligence to monitor the implementation 
     of the grant agreement or contract, including the carrying 
     out of the appropriate monitoring activities (including 
     audits) at reasonable intervals; and
       (D) taken prompt and appropriate corrective action upon 
     becoming aware of any evidence of a violation of this title, 
     including regulations issued under this title, by such 
     subgrantee or contractor.
       (3) Waiver.--If the Secretary determines that the recipient 
     has demonstrated substantial compliance with the requirements 
     of paragraph (2), the Secretary may waive the imposition of 
     sanctions authorized by this section upon such recipient. The 
     Secretary is authorized to impose any sanction consistent 
     with the provisions of this title and any applicable Federal 
     or State law directly against any subgrantee or contractor 
     for violation of this title, including regulations issued 
     under this title.
       (e) Immediate Termination or Suspension of Assistance in 
     Emergency Situations.--In emergency situations, if the 
     Secretary determines it is necessary to protect the integrity 
     of the funds or ensure the proper operation of the program or 
     activity involved, the Secretary may immediately terminate or 
     suspend financial assistance, in whole or in part, to the 
     recipient if the recipient is given prompt notice and the 
     opportunity for a subsequent hearing within 30 days after 
     such termination or suspension. The Secretary shall not 
     delegate any of the functions or authority specified in this 
     subsection, other than to an officer whose appointment is 
     required to be made by and with the advice and consent of the 
     Senate.
       (f) Discrimination Against Participants.--If the Secretary 
     determines that any recipient under this title has discharged 
     or in any other manner discriminated against a participant or 
     against any individual in connection with the administration 
     of the program involved, or against any individual because 
     such individual has filed any complaint or instituted or 
     caused to be instituted any proceeding under or related to 
     this title, or has testified or is about to testify in any 
     such proceeding or investigation under or related to this 
     title, or otherwise unlawfully denied to any individual a 
     benefit to which that individual is entitled under the 
     provisions of this title or the Secretary's regulations, the 
     Secretary shall, within thirty days, take such action or 
     order such corrective measures, as necessary, with respect to 
     the recipient or the aggrieved individual, or both.
       (g) Remedies.--The remedies described in this section shall 
     not be construed to be the exclusive remedies available for 
     violations described in this section.

     SEC. 185. REPORTS; RECORDKEEPING; INVESTIGATIONS.

       (a) Reports.--
       (1) In general.--Recipients of funds under this title shall 
     keep records that are sufficient to permit the preparation of 
     reports required by this title and to permit the tracing of 
     funds to a level of expenditure adequate to ensure that the 
     funds have not been spent unlawfully.
       (2) Submission to the secretary.--Every such recipient 
     shall maintain such records and submit such reports, in such 
     form and containing such information, as the Secretary may 
     require regarding the performance of programs and activities 
     carried out under this title. Such records and reports shall 
     be submitted to the Secretary but shall not be required to be 
     submitted more than once each quarter unless specifically 
     requested by Congress or a committee of Congress, in which 
     case an estimate may be provided.
       (3) Maintenance of standardized records.--In order to allow 
     for the preparation of the reports required under subsection 
     (c), such recipients shall maintain standardized records for 
     all individual participants and provide to the Secretary a 
     sufficient number of such records to provide for an adequate 
     analysis of the records.
       (4) Availability to the public.--
       (A) In general.--Except as provided in subparagraph (B), 
     records maintained by such recipients pursuant to this 
     subsection shall be made available to the public upon 
     request.
       (B) Exception.--Subparagraph (A) shall not apply to--
       (i) information, the disclosure of which would constitute a 
     clearly unwarranted invasion of personal privacy; and
       (ii) trade secrets, or commercial or financial information, 
     that is obtained from a person and privileged or 
     confidential.
       (C) Fees to recover costs.--Such recipients may charge fees 
     sufficient to recover costs applicable to the processing of 
     requests for records under subparagraph (A).
       (b) Investigations of Use of Funds.--
       (1) In general.--
       (A) Secretary.--In order to evaluate compliance with the 
     provisions of this title, the Secretary shall conduct, in 
     several States, in each fiscal year, investigations of the 
     use of funds received by recipients under this title.
       (B) Comptroller general of the united states.--In order to 
     ensure compliance with the provisions of this title, the 
     Comptroller General of the United States may conduct 
     investigations of the use of funds received under this title 
     by any recipient.
       (2) Prohibition.--In conducting any investigation under 
     this title, the Secretary or the Comptroller General of the 
     United States may not request the compilation of any 
     information that the recipient is not otherwise required to 
     compile and that is not readily available to such recipient.
       (3) Audits.--
       (A) In general.--In carrying out any audit under this title 
     (other than any initial audit survey or any audit 
     investigating possible criminal or fraudulent conduct), 
     either directly or through grant or contract, the Secretary, 
     the Inspector General of the Department of Labor, or the 
     Comptroller General of the United States shall furnish to the 
     State, recipient, or other entity to be audited, advance 
     notification of the overall objectives and purposes of the 
     audit, and any extensive recordkeeping or data requirements 
     to be met, not later than 14 days (or as

[[Page H6633]]

     soon as practicable), prior to the commencement of the audit.
       (B) Notification requirement.--If the scope, objectives, or 
     purposes of the audit change substantially during the course 
     of the audit, the entity being audited shall be notified of 
     the change as soon as practicable.
       (C) Additional requirement.--The reports on the results of 
     such audits shall cite the law, regulation, policy, or other 
     criteria applicable to any finding contained in the reports.
       (D) Rule of construction.--Nothing contained in this title 
     shall be construed so as to be inconsistent with the 
     Inspector General Act of 1978 (5 U.S.C. App.) or government 
     auditing standards issued by the Comptroller General of the 
     United States.
       (c) Accessibility of Reports.--Each State, each local 
     board, and each recipient (other than a subrecipient, 
     subgrantee, or contractor of a recipient) receiving funds 
     under this title--
       (1) shall make readily accessible such reports concerning 
     its operations and expenditures as shall be prescribed by the 
     Secretary;
       (2) shall prescribe and maintain comparable management 
     information systems, in accordance with guidelines that shall 
     be prescribed by the Secretary, designed to facilitate the 
     uniform compilation, cross tabulation, and analysis of 
     programmatic, participant, and financial data, on statewide, 
     local area, and other appropriate bases, necessary for 
     reporting, monitoring, and evaluating purposes, including 
     data necessary to comply with section 188; and
       (3) shall monitor the performance of providers in complying 
     with the terms of grants, contracts, or other agreements made 
     pursuant to this title.
       (d) Information To Be Included in Reports.--
       (1) In general.--The reports required in subsection (c) 
     shall include information regarding programs and activities 
     carried out under this title pertaining to--
       (A) the relevant demographic characteristics (including 
     race, ethnicity, sex, and age) and other related information 
     regarding participants;
       (B) the programs and activities in which participants are 
     enrolled, and the length of time that participants are 
     engaged in such programs and activities;
       (C) outcomes of the programs and activities for 
     participants, including the occupations of participants, and 
     placement for participants in nontraditional employment;
       (D) specified costs of the programs and activities; and
       (E) information necessary to prepare reports to comply with 
     section 188.
       (2) Additional requirement.--The Secretary shall ensure 
     that all elements of the information required for the reports 
     described in paragraph (1) are defined and reported 
     uniformly.
       (e) Quarterly Financial Reports.--
       (1) In general.--Each local board in the State shall submit 
     quarterly financial reports to the Governor with respect to 
     programs and activities carried out under this title. Such 
     reports shall include information identifying all program and 
     activity costs by cost category in accordance with generally 
     accepted accounting principles and by year of the 
     appropriation involved.
       (2) Additional requirement.--Each State shall submit to the 
     Secretary, on a quarterly basis, a summary of the reports 
     submitted to the Governor pursuant to paragraph (1).
       (f) Maintenance of Additional Records.--Each State and 
     local board shall maintain records with respect to programs 
     and activities carried out under this title that identify--
       (1) any income or profits earned, including such income or 
     profits earned by subrecipients; and
       (2) any costs incurred (such as stand-in costs) that are 
     otherwise allowable except for funding limitations.
       (g) Cost Categories.--In requiring entities to maintain 
     records of costs by category under this title, the Secretary 
     shall require only that the costs be categorized as 
     administrative or programmatic costs.

     SEC. 186. ADMINISTRATIVE ADJUDICATION.

       (a) In General.--Whenever any applicant for financial 
     assistance under this title is dissatisfied because the 
     Secretary has made a determination not to award financial 
     assistance in whole or in part to such applicant, the 
     applicant may request a hearing before an administrative law 
     judge of the Department of Labor. A similar hearing may also 
     be requested by any recipient for whom a corrective action 
     has been required or a sanction has been imposed by the 
     Secretary under section 184.
       (b) Appeal.--The decision of the administrative law judge 
     shall constitute final action by the Secretary unless, within 
     20 days after receipt of the decision of the administrative 
     law judge, a party dissatisfied with the decision or any part 
     of the decision has filed exceptions with the Secretary 
     specifically identifying the procedure, fact, law, or policy 
     to which exception is taken. Any exception not specifically 
     urged shall be deemed to have been waived. After the 20-day 
     period the decision of the administrative law judge shall 
     become the final decision of the Secretary unless the 
     Secretary, within 30 days after such filing, has notified the 
     parties that the case involved has been accepted for review.
       (c) Time Limit.--Any case accepted for review by the 
     Secretary under subsection (b) shall be decided within 180 
     days after such acceptance. If the case is not decided within 
     the 180-day period, the decision of the administrative law 
     judge shall become the final decision of the Secretary at the 
     end of the 180-day period.
       (d) Additional Requirement.--The provisions of section 187 
     shall apply to any final action of the Secretary under this 
     section.

     SEC. 187. JUDICIAL REVIEW.

       (a) Review.--
       (1) Petition.--With respect to any final order by the 
     Secretary under section 186 by which the Secretary awards, 
     declines to award, or only conditionally awards, financial 
     assistance under his title, or any final order of the 
     Secretary under section 186 with respect to a corrective 
     action or sanction imposed under section 184, any party to a 
     proceeding which resulted in such final order may obtain 
     review of such final order in the United States Court of 
     Appeals having jurisdiction over the applicant or recipient 
     of funds involved, by filing a review petition within 30 days 
     after the date of issuance of such final order.
       (2) Action on petition.--The clerk of the court shall 
     transmit a copy of the review petition to the Secretary who 
     shall file the record on which the final order was entered as 
     provided in section 2112 of title 28, United States Code. The 
     filing of a review petition shall not stay the order of the 
     Secretary, unless the court orders a stay. Petitions filed 
     under this subsection shall be heard expeditiously, if 
     possible within 10 days after the date of filing of a reply 
     to the petition.
       (3) Standard and scope of review.--No objection to the 
     order of the Secretary shall be considered by the court 
     unless the objection was specifically urged, in a timely 
     manner, before the Secretary. The review shall be limited to 
     questions of law and the findings of fact of the Secretary 
     shall be conclusive if supported by substantial evidence.
       (b) Judgment.--The court shall have jurisdiction to make 
     and enter a decree affirming, modifying, or setting aside the 
     order of the Secretary in whole or in part. The judgment of 
     the court regarding the order shall be final, subject to 
     certiorari review by the Supreme Court as provided in section 
     1254(1) of title 28, United States Code.

     SEC. 188. NONDISCRIMINATION.

       (a) In General.--
       (1) Federal financial assistance.--For the purpose of 
     applying the prohibitions against discrimination on the basis 
     of age under the Age Discrimination Act of 1975 (42 U.S.C. 
     6101 et seq.), on the basis of disability under section 504 
     of the Rehabilitation Act of 1973 (29 U.S.C. 794), on the 
     basis of sex under title IX of the Education Amendments of 
     1972 (20 U.S.C. 1681 et seq.), or on the basis of race, 
     color, or national origin under title VI of the Civil Rights 
     Act of 1964 (42 U.S.C. 2000d et seq.), programs and 
     activities funded or otherwise financially assisted in whole 
     or in part under this Act are considered to be programs and 
     activities receiving Federal financial assistance.
       (2) Prohibition of discrimination regarding participation, 
     benefits, and employment.--No individual shall be excluded 
     from participation in, denied the benefits of, subjected to 
     discrimination under, or denied employment in the 
     administration of or in connection with, any such program or 
     activity because of race, color, religion, sex (except as 
     otherwise permitted under title IX of the Education 
     Amendments of 1972), national origin, age, disability, or 
     political affiliation or belief.
       (3) Prohibition on assistance for facilities for sectarian 
     instruction or religious worship.--Participants shall not be 
     employed under this title to carry out the construction, 
     operation, or maintenance of any part of any facility that is 
     used or to be used for sectarian instruction or as a place 
     for religious worship (except with respect to the maintenance 
     of a facility that is not primarily or inherently devoted to 
     sectarian instruction or religious worship, in a case in 
     which the organization operating the facility is part of a 
     program or activity providing services to participants).
       (4) Prohibition on discrimination on basis of participant 
     status.--No person may discriminate against an individual who 
     is a participant in a program or activity that receives funds 
     under this title, with respect to the terms and conditions 
     affecting, or rights provided to, the individual, solely 
     because of the status of the individual as a participant.
       (5) Prohibition on discrimination against certain 
     noncitizens.--Participation in programs and activities or 
     receiving funds under this title shall be available to 
     citizens and nationals of the United States, lawfully 
     admitted permanent resident aliens, refugees, asylees, and 
     parolees, and other immigrants authorized by the Attorney 
     General to work in the United States.
       (b) Action of Secretary.--Whenever the Secretary finds that 
     a State or other recipient of funds under this title has 
     failed to comply with a provision of law referred to in 
     subsection (a)(1), or with paragraph (2), (3), (4), or (5) of 
     subsection (a), including an applicable regulation prescribed 
     to carry out such provision or paragraph, the Secretary shall 
     notify such State or recipient and shall request that the 
     State or recipient comply. If within a reasonable period of 
     time, not to exceed 60 days, the State or recipient fails or 
     refuses to comply, the Secretary may--
       (1) refer the matter to the Attorney General with a 
     recommendation that an appropriate civil action be 
     instituted; or
       (2) take such other action as may be provided by law.
       (c) Action of Attorney General.--When a matter is referred 
     to the Attorney General pursuant to subsection (b)(1), or 
     whenever the Attorney General has reason to believe that a 
     State or other recipient of funds under this title is engaged 
     in a pattern or practice of discrimination in violation of a 
     provision of law referred to in subsection (a)(1) or in 
     violation of paragraph (2), (3), (4), or (5) of subsection 
     (a), the Attorney General may bring a civil action in any 
     appropriate district court of the United States for such 
     relief as may be appropriate, including injunctive relief.
       (d) Job Corps.--For the purposes of this section, Job Corps 
     members shall be considered as the ultimate beneficiaries of 
     Federal financial assistance.

[[Page H6634]]

       (e) Regulations.--The Secretary shall issue regulations 
     necessary to implement this section not later than one year 
     after the date of the enactment of the Workforce Investment 
     Act of 1998. Such regulations shall adopt standards for 
     determining discrimination and procedures for enforcement 
     that are consistent with the Acts referred to in a subsection 
     (a)(1), as well as procedures to ensure that complaints filed 
     under this section and such Acts are processed in a manner 
     that avoids duplication of effort.

     SEC. 189. ADMINISTRATIVE PROVISIONS.

       (a) In General.--The Secretary may, in accordance with 
     chapter 5 of title 5, United States Code, prescribe rules and 
     regulations to carry out this title only to the extent 
     necessary to administer and ensure compliance with the 
     requirements of this title. Such rules and regulations may 
     include provisions making adjustments authorized by section 
     204 of the Intergovernmental Cooperation Act of 1968. All 
     such rules and regulations shall be published in the Federal 
     Register at least 30 days prior to their effective dates. 
     Copies of each such rule or regulation shall be transmitted 
     to the appropriate committees of Congress on the date of such 
     publication and shall contain, with respect to each material 
     provision of such rule or regulation, a citation to the 
     particular substantive section of law that is the basis for 
     the provision.
       (b) Acquisition of Certain Property and Services.--The 
     Secretary is authorized, in carrying out this title, to 
     accept, purchase, or lease in the name of the Department of 
     Labor, and employ or dispose of in furtherance of the 
     purposes of this title, any money or property, real, 
     personal, or mixed, tangible or intangible, received by gift, 
     devise, bequest, or otherwise, and to accept voluntary and 
     uncompensated services notwithstanding the provisions of 
     section 1342 of title 31, United States Code.
       (c) Authority To Enter Into Certain Agreements and To Make 
     Certain Expenditures.--The Secretary may make such grants, 
     enter into such contracts or agreements, establish such 
     procedures, and make such payments, in installments and in 
     advance or by way of reimbursement, or otherwise allocate or 
     expend such funds under this title, as may be necessary to 
     carry out this title, including making expenditures for 
     construction, repairs, and capital improvements, and 
     including making necessary adjustments in payments on account 
     of over-payments or underpayments.
       (d) Annual Report.--The Secretary shall prepare and submit 
     to Congress an annual report regarding the programs and 
     activities carried out under this title. The Secretary shall 
     include in such report--
       (1) a summary of the achievements, failures, and problems 
     of the programs and activities in meeting the objectives of 
     this title;
       (2) a summary of major findings from research, evaluations, 
     pilot projects, and experiments conducted under this title in 
     the fiscal year prior to the submission of the report;
       (3) recommendations for modifications in the programs and 
     activities based on analysis of such findings; and
       (4) such other recommendations for legislative or 
     administrative action as the Secretary determines to be 
     appropriate.
       (e) Utilization of Services and Facilities.--The Secretary 
     is authorized, in carrying out this title, under the same 
     procedures as are applicable under subsection (c) or to the 
     extent permitted by law other than this title, to accept and 
     use the services and facilities of departments, agencies, and 
     establishments of the United States. The Secretary is also 
     authorized, in carrying out this title, to accept and use the 
     services and facilities of the agencies of any State or 
     political subdivision of a State, with the consent of the 
     State or political subdivision.
       (f) Obligational Authority.--Notwithstanding any other 
     provision of this title, the Secretary shall have no 
     authority to enter into contracts, grant agreements, or other 
     financial assistance agreements under this title except to 
     such extent and in such amounts as are provided in advance in 
     appropriations Acts.
       (g) Program Year.--
       (1) In general.--
       (A) Program year.--Except as provided in subparagraph (B), 
     appropriations for any fiscal year for programs and 
     activities carried out under this title shall be available 
     for obligation only on the basis of a program year. The 
     program year shall begin on July 1 in the fiscal year for 
     which the appropriation is made.
       (B) Youth activities.--The Secretary may make available for 
     obligation, beginning April 1 of any fiscal year, funds 
     appropriated for such fiscal year to carry out youth 
     activities under subtitle B.
       (2) Availability.--Funds obligated for any program year for 
     a program or activity carried out under this title may be 
     expended by each State receiving such funds during that 
     program year and the 2 succeeding program years. Funds 
     obligated for any program year for a program or activity 
     carried out under section 171 or 172 shall remain available 
     until expended. Funds received by local areas from States 
     under this title during a program year may be expended during 
     that program year and the succeeding program year. No amount 
     of the funds described in this paragraph shall be deobligated 
     on account of a rate of expenditure that is consistent with a 
     State plan, an operating plan described in section 151, or a 
     plan, grant agreement, contract, application, or other 
     agreement described in subtitle D, as appropriate.
       (h) Enforcement of Military Selective Service Act.--The 
     Secretary shall ensure that each individual participating in 
     any program or activity established under this title, or 
     receiving any assistance or benefit under this title, has not 
     violated section 3 of the Military Selective Service Act (50 
     U.S.C. App. 453) by not presenting and submitting to 
     registration as required pursuant to such section. The 
     Director of the Selective Service System shall cooperate with 
     the Secretary to enable the Secretary to carry out this 
     subsection.
       (i) Waivers and Special Rules.--
       (1) Existing waivers.--With respect to a State that has 
     been granted a waiver under the provisions relating to 
     training and employment services of the Department of Labor 
     in title I of the Departments of Labor, Health and Human 
     Services, and Education, and Related Agencies Appropriations 
     Act, 1997 (Public Law 104-208; 110 Stat. 3009-234), the 
     authority provided under such waiver shall continue in effect 
     and apply, and include a waiver of the related provisions of 
     subtitle B and this subtitle, for the duration of the initial 
     waiver.
       (2) Special rule regarding designated areas.--A State that 
     has enacted, not later than December 31, 1997, a State law 
     providing for the designation of service delivery areas for 
     the delivery of workforce investment activities, may use such 
     areas as local areas under this title, notwithstanding 
     section 116.
       (3) Special rule regarding sanctions.--A State that enacts, 
     not later than December 31, 1997, a State law providing for 
     the sanctioning of such service delivery areas for failure to 
     meet performance measures for workforce investment 
     activities, may use the State law to sanction local areas for 
     failure to meet State performance measures under this title.
       (4) General waivers of statutory or regulatory 
     requirements.--
       (A) General authority.--Notwithstanding any other provision 
     of law, the Secretary may waive for a State, or a local area 
     in a State, pursuant to a request submitted by the Governor 
     of the State (in consultation with appropriate local elected 
     officials) that meets the requirements of subparagraph (B)--
       (i) any of the statutory or regulatory requirements of 
     subtitle B or this subtitle (except for requirements relating 
     to wage and labor standards, including nondisplacement 
     protections, worker rights, participation and protection of 
     workers and participants, grievance procedures and judicial 
     review, nondiscrimination, allocation of funds to local 
     areas, eligibility of providers or participants, the 
     establishment and functions of local areas and local boards, 
     and procedures for review and approval of plans); and
       (ii) any of the statutory or regulatory requirements of 
     sections 8 through 10 of the Wagner-Peyser Act (29 U.S.C. 49g 
     through 49i) (excluding requirements relating to the 
     provision of services to unemployment insurance claimants and 
     veterans, and requirements relating to universal access to 
     basic labor exchange services without cost to jobseekers).
       (B) Requests.--A Governor requesting a waiver under 
     subparagraph (A) shall submit a plan to the Secretary to 
     improve the statewide workforce investment system that--
       (i) identifies the statutory or regulatory requirements 
     that are requested to be waived and the goals that the State 
     or local area in the State, as appropriate, intends to 
     achieve as a result of the waiver;
       (ii) describes the actions that the State or local area, as 
     appropriate, has undertaken to remove State or local 
     statutory or regulatory barriers;
       (iii) describes the goals of the waiver and the expected 
     programmatic outcomes if the request is granted;
       (iv) describes the individuals impacted by the waiver; and
       (v) describes the process used to monitor the progress in 
     implementing such a waiver, and the process by which notice 
     and an opportunity to comment on such request has been 
     provided to the local board.
       (C) Conditions.--Not later than 90 days after the date of 
     the original submission of a request for a waiver under 
     subparagraph (A), the Secretary shall provide a waiver under 
     this paragraph if and only to the extent that--
       (i) the Secretary determines that the requirements 
     requested to be waived impede the ability of the State or 
     local area, as appropriate, to implement the plan described 
     in subparagraph (B); and
       (ii) the State has executed a memorandum of understanding 
     with the Secretary requiring such State to meet, or ensure 
     that the local area meets, agreed-upon outcomes and to 
     implement other appropriate measures to ensure 
     accountability.

     SEC. 190. REFERENCE.

       Effective on the date of the enactment of the Workforce 
     Investment Act of 1998, all references in any other provision 
     of law (other than section 665 of title 18, United States 
     Code) to the Comprehensive Employment and Training Act, or to 
     the Job Training Partnership Act, as the case may be, shall 
     be deemed to refer to Workforce Investment Act of 1998.''.

     SEC. 191. STATE LEGISLATIVE AUTHORITY.

       (a) Authority of State Legislature.--Nothing in this title 
     shall be interpreted to preclude the enactment of State 
     legislation providing for the implementation, consistent with 
     the provisions of this title, of the activities assisted 
     under this title. Any funds received by a State under this 
     title shall be subject to appropriation by the State 
     legislature, consistent with the terms and conditions 
     required under this title.
       (b) Interstate Compacts and Cooperative Agreements.--In the 
     event that compliance with provisions of this title would be 
     enhanced by compacts and cooperative agreements between 
     States, the consent of Congress is given to States to enter 
     into such compacts and agreements to facilitate such 
     compliance, subject to the approval of the Secretary.

     SEC. 192. WORKFORCE FLEXIBILITY PLANS.

       (a) Plans.--A State may submit to the Secretary, and the 
     Secretary may approve, a workforce flexibility plan under 
     which the State is authorized to waive, in accordance with 
     the plan--

[[Page H6635]]

       (1) any of the statutory or regulatory requirements 
     applicable under this title to local areas, pursuant to 
     applications for such waivers from the local areas, except 
     for requirements relating to the basic purposes of this 
     title, wage and labor standards, grievance procedures and 
     judicial review, nondiscrimination, eligibility of 
     participants, allocation of funds to local areas, 
     establishment and functions of local areas and local boards, 
     review and approval of local plans, and worker rights, 
     participation, and protection;
       (2) any of the statutory or regulatory requirements 
     applicable under sections 8 through 10 of the Wagner-Peyser 
     Act (29 U.S.C. 49g through 49i) to the State, except for 
     requirements relating to the provision of services to 
     unemployment insurance claimants and veterans, and to 
     universal access to basic labor exchange services without 
     cost to jobseekers; and
       (3) any of the statutory or regulatory requirements 
     applicable under the Older Americans Act of 1965 (42 U.S.C. 
     3001 et seq.) to State agencies on aging with respect to 
     activities carried out using funds allotted under section 
     506(a)(3) of such Act (42 U.S.C. 3056d(a)(3)), except for 
     requirements relating to the basic purposes of such Act, wage 
     and labor standards, eligibility of participants in the 
     activities, and standards for agreements.
       (b) Content of Plans.--A workforce flexibility plan 
     implemented by a State under subsection (a) shall include 
     descriptions of--
       (1)(A) the process by which local areas in the State may 
     submit and obtain approval by the State of applications for 
     waivers of requirements applicable under this title; and
       (B) the requirements described in subparagraph (A) that are 
     likely to be waived by the State under the plan;
       (2) the requirements applicable under sections 8 through 10 
     of the Wagner-Peyser Act that are proposed to be waived, if 
     any;
       (3) the requirements applicable under the Older Americans 
     Act of 1965 that are proposed to be waived, if any;
       (4) the outcomes to be achieved by the waivers described in 
     paragraphs (1) through (3); and
       (5) other measures to be taken to ensure appropriate 
     accountability for Federal funds in connection with the 
     waivers.
       (c) Periods.--The Secretary may approve a workforce 
     flexibility plan for a period of not more than 5 years.
       (d) Opportunity for Public Comments.--Prior to submitting a 
     workforce flexibility plan to the Secretary for approval, the 
     State shall provide to all interested parties and to the 
     general public adequate notice and a reasonable opportunity 
     for comment on the waiver requests proposed to be implemented 
     pursuant to such plan.

     SEC. 193. USE OF CERTAIN REAL PROPERTY.

       (a) In General.--Notwithstanding any other provision of 
     law, the Governor may authorize a public agency to make 
     available, for the use of a one-stop service delivery system 
     within the State which is carried out by a consortium of 
     entities that includes the public agency, real property in 
     which, as of the date of the enactment of the Workforce 
     Investment Act of 1998, the Federal Government has acquired 
     equity through the use of funds provided under title III of 
     the Social Security Act (42 U.S.C. 501 et seq.), section 
     903(c) of such Act (42 U.S.C. 1103(c)), or the Wagner-Peyser 
     Act (29 U.S.C. 49 et seq.).
       (b) Use of Funds.--Subsequent to the commencement of the 
     use of the property described in subsection (a) for the 
     functions of a one-stop service delivery system, funds 
     provided under the provisions of law described in subsection 
     (a) may only be used to acquire further equity in such 
     property, or to pay operating and maintenance expenses 
     relating to such property in proportion to the extent of the 
     use of such property attributable to the activities 
     authorized under such provisions of law.

     SEC. 194. CONTINUATION OF STATE ACTIVITIES AND POLICIES.

       (a) In General.--Notwithstanding any other provision of 
     this title, the Secretary may not deny approval of a State 
     plan for a covered State, or an application of a covered 
     State for financial assistance, under this title or find a 
     covered State (including a State board or Governor), or a 
     local area (including a local board or chief elected 
     official) in a covered State, in violation of a provision of 
     this title, on the basis that--
       (1)(A) the State proposes to allocate or disburse, 
     allocates, or disburses, within the State, funds made 
     available to the State under section 127 or 132 in accordance 
     with the allocation formula for the type of activities 
     involved, or in accordance with a disbursal procedure or 
     process, used by the State under prior consistent State laws; 
     or
       (B) a local board in the State proposes to disburse, or 
     disburses, within the local area, funds made available to a 
     State under section 127 or 132 in accordance with a disbursal 
     procedure or process used by a private industry council under 
     prior consistent State law;
       (2) the State proposes to carry out or carries out a State 
     procedure through which local areas use, as fiscal agents for 
     funds made available to the State under section 127 or 132 
     and allocated within the State, fiscal agents selected in 
     accordance with a process established under prior consistent 
     State laws;
       (3) the State proposes to carry out or carries out a State 
     procedure through which the local board in the State (or the 
     local boards, the chief elected officials in the State, and 
     the Governor) designate or select the one-stop partners and 
     one-stop operators of the statewide system in the State under 
     prior consistent State laws, in lieu of making the 
     designation, or certification described in section 121 
     (regardless of the date the one-stop delivery systems 
     involved have been established);
       (4) the State proposes to carry out or carries out a State 
     procedure through which the persons responsible for selecting 
     eligible providers for purposes of subtitle B are permitted 
     to determine that a provider shall not be selected to provide 
     both intake services under section 134(d)(2) and training 
     services under section 134(d)(4), under prior consistent 
     State laws;
       (5) the State proposes to designate or designates a State 
     board, or proposes to assign or assigns functions and roles 
     of the State board (including determining the time periods 
     for development and submission of a State plan required under 
     section 112), for purposes of subtitle B in accordance with 
     prior consistent State laws; or
       (6) a local board in the State proposes to use or carry 
     out, uses, or carries out a local plan (including assigning 
     functions and roles of the local board) for purposes of 
     subtitle B in accordance with the authorities and 
     requirements applicable to local plans and private industry 
     councils under prior consistent State laws.
       (b) Definition.--In this section:
       (1) Covered state.--The term ``covered State'' means a 
     State that enacted State laws described in paragraph (2).
       (2) Prior consistent state laws.--The term ``prior 
     consistent State laws'' means State laws, not inconsistent 
     with the Job Training Partnership Act or any other applicable 
     Federal law, that took effect on September 1, 1993, September 
     1, 1995, and September 1, 1997.

     SEC. 195. GENERAL PROGRAM REQUIREMENTS.

       Except as otherwise provided in this title, the following 
     conditions are applicable to all programs under this title:
       (1) Each program under this title shall provide employment 
     and training opportunities to those who can benefit from, and 
     who are most in need of, such opportunities. In addition, 
     efforts shall be made to develop programs which contribute to 
     occupational development, upward mobility, development of new 
     careers, and opportunities for nontraditional employment.
       (2) Funds provided under this title shall only be used for 
     activities that are in addition to those that would otherwise 
     be available in the local area in the absence of such funds.
       (3)(A) Any local area may enter into an agreement with 
     another local area (including a local area that is a city or 
     county within the same labor market) to pay or share the cost 
     of educating, training, or placing individuals participating 
     in programs assisted under this title, including the 
     provision of supportive services.
       (B) Such agreement shall be approved by each local board 
     providing guidance to the local area and shall be described 
     in the local plan under section 118.
       (4) On-the-job training contracts under this title shall 
     not be entered into with employers who have received payments 
     under previous contracts and have exhibited a pattern of 
     failing to provide on-the-job training participants with 
     continued long-term employment as regular employees with 
     wages and employment benefits (including health benefits) and 
     working conditions at the same level and to the same extent 
     as other employees working a similar length of time and doing 
     the same type of work.
       (5) No person or organization may charge an individual a 
     fee for the placement or referral of the individual in or to 
     a workforce investment activity under this title.
       (7) The Secretary shall not provide financial assistance 
     for any program under this title that involves political 
     activities.
       (8)(A) Income under any program administered by a public or 
     private nonprofit entity may be retained by such entity only 
     if such income is used to continue to carry out the program.
       (B) Income subject to the requirements of subparagraph (A) 
     shall include--
       (i) receipts from goods or services (including conferences) 
     provided as a result of activities funded under this title;
       (ii) funds provided to a service provider under this title 
     that are in excess of the costs associated with the services 
     provided; and
       (iii) interest income earned on funds received under this 
     title.
       (C) For purposes of this paragraph, each entity receiving 
     financial assistance under this title shall maintain records 
     sufficient to determine the amount of such income received 
     and the purposes for which such income is expended.
       (9)(A) The Secretary shall notify the Governor and the 
     appropriate local board and chief elected official of, and 
     consult with the Governor and such board and official 
     concerning, any activity to be funded by the Secretary under 
     this title within the corresponding State or local area.
       (B) The Governor shall notify the appropriate local board 
     and chief elected official of, and consult with such board 
     and official concerning, any activity to be funded by the 
     Governor under this title within the corresponding local 
     area.
       (10)(A) All education programs for youth supported with 
     funds provided under chapter 4 of subtitle B shall be 
     consistent with applicable State and local educational 
     standards.
       (B) Standards and procedures with respect to awarding 
     academic credit and certifying educational attainment in 
     programs conducted under such chapter shall be consistent 
     with the requirements of applicable State and local law, 
     including regulation.
       (11) No funds available under this title may be used for 
     public service employment except as specifically authorized 
     under this title.
       (12) The Federal requirements governing the title, use, and 
     disposition of real property, equipment, and supplies 
     purchased with funds provided under this title shall be the 
     Federal requirements generally applicable to Federal grants 
     to States and local governments.
       (13) Nothing in this title shall be construed to provide an 
     individual with an entitlement to a service under this title.
       (14) Services, facilities, or equipment funded under this 
     title may be used, as appropriate, on

[[Page H6636]]

     a fee-for-service basis, by employers in a local area in 
     order to provide employment and training activities to 
     incumbent workers--
       (A) when such services, facilities, or equipment are not in 
     use for the provision of services for eligible participants 
     under this title;
       (B) if such use for incumbent workers would not have an 
     adverse affect on the provision of services to eligible 
     participants under this title; and
       (C) if the income derived from such fees is used to carry 
     out the programs authorized under this title.
             Subtitle F--Repeals and Conforming Amendments

     SEC. 199. REPEALS.

       (a) General Immediate Repeals.--The following provisions 
     are repealed:
       (1) Section 204 of the Immigration Reform and Control Act 
     of 1986 (8 U.S.C. 1255a note).
       (2) Title II of Public Law 95-250 (92 Stat. 172).
       (3) The Displaced Homemakers Self-Sufficiency Assistance 
     Act (29 U.S.C. 2301 et seq.).
       (4) Section 211 of the Appalachian Regional Development Act 
     of 1965 (40 U.S.C. App. 211).
       (5) Subtitle C of title VII of the Stewart B. McKinney 
     Homeless Assistance Act (42 U.S.C. 11441 et seq.), except 
     section 738 of such title (42 U.S.C. 11448).
       (6) Subchapter I of chapter 421 of title 49, United States 
     Code.
       (b) Subsequent Repeals.--The following provisions are 
     repealed:
       (1) Title VII of the Stewart B. McKinney Homeless 
     Assistance Act (42 U.S.C. 11421 et seq.), except subtitle B 
     and section 738 of such title (42 U.S.C. 11431 et seq. and 
     11448).
       (2) The Job Training Partnership Act (29 U.S.C. 1501 et 
     seq.).
       (c) Effective Dates.--
       (1) Immediate repeals.--The repeals made by subsection (a) 
     shall take effect on the date of enactment of this Act.
       (2) Subsequent repeals.--
       (A) Stewart b. mckinney homeless assistance act.--The 
     repeal made by subsection (b)(1) shall take effect on July 1, 
     1999.
       (B) Job training partnership act.--The repeal made by 
     subsection (b)(2) shall take effect on July 1, 2000.

     SEC. 199A. CONFORMING AMENDMENTS.

       (a) Preparation.--After consultation with the appropriate 
     committees of Congress and the Director of the Office of 
     Management and Budget, the Secretary shall prepare 
     recommended legislation containing technical and conforming 
     amendments to reflect the changes made by this subtitle.
       (b) Submission to Congress.--Not later than 6 months after 
     the date of enactment of this Act, the Secretary shall submit 
     to Congress the recommended legislation referred to under 
     subsection (a).
       (c) References.--All references in any other provision of 
     law to a provision of the Comprehensive Employment and 
     Training Act, or of the Job Training Partnership Act, as the 
     case may be, shall be deemed to refer to the corresponding 
     provision of this title.
                 TITLE II--ADULT EDUCATION AND LITERACY

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Adult Education and Family 
     Literacy Act''.

     SEC. 202. PURPOSE.

       It is the purpose of this title to create a partnership 
     among the Federal Government, States, and localities to 
     provide, on a voluntary basis, adult education and literacy 
     services, in order to--
       (1) assist adults to become literate and obtain the 
     knowledge and skills necessary for employment and self-
     sufficiency;
       (2) assist adults who are parents to obtain the educational 
     skills necessary to become full partners in the educational 
     development of their children; and
       (3) assist adults in the completion of a secondary school 
     education.

     SEC. 203. DEFINITIONS.

       In this subtitle:
       (1) Adult education.--The term ``adult education'' means 
     services or instruction below the postsecondary level for 
     individuals--
       (A) who have attained 16 years of age;
       (B) who are not enrolled or required to be enrolled in 
     secondary school under State law; and
       (C) who--
       (i) lack sufficient mastery of basic educational skills to 
     enable the individuals to function effectively in society;
       (ii) do not have a secondary school diploma or its 
     recognized equivalent, and have not achieved an equivalent 
     level of education; or
       (iii) are unable to speak, read, or write the English 
     language.
       (2) Adult education and literacy activities.--The term 
     ``adult education and literacy activities'' means activities 
     described in section 231(b).
       (3) Educational service agency.--The term ``educational 
     service agency'' means a regional public multiservice agency 
     authorized by State statute to develop and manage a service 
     or program, and to provide the service or program to a local 
     educational agency.
       (4) Eligible agency.--The term ``eligible agency'' means 
     the sole entity or agency in a State or an outlying area 
     responsible for administering or supervising policy for adult 
     education and literacy in the State or outlying area, 
     respectively, consistent with the law of the State or 
     outlying area, respectively.
       (5) Eligible provider.--The term ``eligible provider'' 
     means--
       (A) a local educational agency;
       (B) a community-based organization of demonstrated 
     effectiveness;
       (C) a volunteer literacy organization of demonstrated 
     effectiveness;
       (D) an institution of higher education;
       (E) a public or private nonprofit agency;
       (F) a library;
       (G) a public housing authority;
       (H) a nonprofit institution that is not described in any of 
     subparagraphs (A) through (G) and has the ability to provide 
     literacy services to adults and families; and
       (I) a consortium of the agencies, organizations, 
     institutions, libraries, or authorities described in any of 
     subparagraphs (A) through (H).
       (6) English literacy program.--The term ``English literacy 
     program'' means a program of instruction designed to help 
     individuals of limited English proficiency achieve competence 
     in the English language.
       (7) Family literacy services.--The term ``family literacy 
     services'' means services that are of sufficient intensity in 
     terms of hours, and of sufficient duration, to make 
     sustainable changes in a family, and that integrate all of 
     the following activities:
       (A) Interactive literacy activities between parents and 
     their children.
       (B) Training for parents regarding how to be the primary 
     teacher for their children and full partners in the education 
     of their children.
       (C) Parent literacy training that leads to economic self-
     sufficiency.
       (D) An age-appropriate education to prepare children for 
     success in school and life experiences.
       (8) Governor.--The term ``Governor'' means the chief 
     executive officer of a State or outlying area.
       (9) Individual with a disability.--
       (A) In general.--The term ``individual with a disability'' 
     means an individual with any disability (as defined in 
     section 3 of the Americans with Disabilities Act of 1990 (42 
     U.S.C. 12102)).
       (B) Individuals with disabilities.--The term ``individuals 
     with disabilities'' means more than 1 individual with a 
     disability.
       (10) 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.
       (11) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given the 
     term in section 1201 of the Higher Education Act of 1965 (20 
     U.S.C. 1141).
       (12) Literacy.--The term ``literacy'' means an individual's 
     ability to read, write, and speak in English, compute, and 
     solve problems, at levels of proficiency necessary to 
     function on the job, in the family of the individual, and in 
     society.
       (13) Local educational agency.--The term ``local 
     educational agency'' has the meaning given the term in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 8801).
       (14) Outlying area.--The term ``outlying area'' has the 
     meaning given the term in section 101.
       (15) Postsecondary educational institution.--The term 
     ``postsecondary educational institution'' means--
       (A) an institution of higher education that provides not 
     less than a 2-year program of instruction that is acceptable 
     for credit toward a bachelor's degree;
       (B) a tribally controlled community college; or
       (C) a nonprofit educational institution offering 
     certificate or apprenticeship programs at the postsecondary 
     level.
       (16) Secretary.--The term ``Secretary'' means the Secretary 
     of Education.
       (17) State.--The term ``State'' means each of the several 
     States of the United States, the District of Columbia, and 
     the Commonwealth of Puerto Rico.
       (18) Workplace literacy services.--The term ``workplace 
     literacy services'' means literacy services that are offered 
     for the purpose of improving the productivity of the 
     workforce through the improvement of literacy skills.

     SEC. 204. HOME SCHOOLS.

       Nothing in this subtitle shall be construed to affect home 
     schools, or to compel a parent engaged in home schooling to 
     participate in an English literacy program, family literacy 
     services, or adult education.

     SEC. 205. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out this 
     subtitle such sums as may be necessary for each of the fiscal 
     years 1999 through 2003.
           Subtitle A--Adult Education and Literacy Programs

                     CHAPTER 1--FEDERAL PROVISIONS

     SEC. 211. RESERVATION OF FUNDS; GRANTS TO ELIGIBLE AGENCIES; 
                   ALLOTMENTS.

       (a) Reservation of Funds.--From the sum appropriated under 
     section 205 for a fiscal year, the Secretary--
       (1) shall reserve 1.5 percent to carry out section 242, 
     except that the amount so reserved shall not exceed 
     $8,000,000;
       (2) shall reserve 1.5 percent to carry out section 243, 
     except that the amount so reserved shall not exceed 
     $8,000,000; and
       (3) shall make available, to the Secretary of Labor, 1.72 
     percent for incentive grants under section 503.
       (b) Grants to Eligible Agencies.--
       (1) In general.--From the sum appropriated under section 
     205 and not reserved under subsection (a) for a fiscal year, 
     the Secretary shall award a grant to each eligible agency 
     having a State plan approved under section 224 in an amount 
     equal to the sum of the initial allotment under subsection 
     (c)(1) and the additional allotment under subsection (c)(2) 
     for the eligible

[[Page H6637]]

     agency for the fiscal year, subject to subsections (f) and 
     (g), to enable the eligible agency to carry out the 
     activities assisted under this subtitle.
       (2) Purpose of grants.--The Secretary may award a grant 
     under paragraph (1) only if the eligible entity involved 
     agrees to expend the grant for adult education and literacy 
     activities in accordance with the provisions of this 
     subtitle.
       (c) Allotments.--
       (1) Initial allotments.--From the sum appropriated under 
     section 205 and not reserved under subsection (a) for a 
     fiscal year, the Secretary shall allot to each eligible 
     agency having a State plan approved under section 224(f)--
       (A) $100,000, in the case of an eligible agency serving an 
     outlying area.
       (B) $250,000, in the case of any other eligible agency.
       (2) Additional allotments.--From the sum appropriated under 
     section 205, not reserved under subsection (a), and not 
     allotted under paragraph (1), for a fiscal year, the 
     Secretary shall allot to each eligible agency that receives 
     an initial allotment under paragraph (1) an additional amount 
     that bears the same relationship to such sum as the number of 
     qualifying adults in the State or outlying area served by the 
     eligible agency bears to the number of such adults in all 
     States and outlying areas.
       (d) Qualifying Adult.--For the purpose of subsection 
     (c)(2), the term ``qualifying adult'' means an adult who--
       (1) is at least 16 years of age, but less than 61 years of 
     age;
       (2) is beyond the age of compulsory school attendance under 
     the law of the State or outlying area;
       (3) does not have a secondary school diploma or its 
     recognized equivalent; and
       (4) is not enrolled in secondary school.
       (e) Special Rule.--
       (1) In general.--From amounts made available under 
     subsection (c) for the Republic of the Marshall Islands, the 
     Federated States of Micronesia, and the Republic of Palau, 
     the Secretary shall award grants to Guam, American Samoa, the 
     Commonwealth of the Northern Mariana Islands, the Republic of 
     the Marshall Islands, the Federated States of Micronesia, or 
     the Republic of Palau to carry out activities described in 
     this subtitle in accordance with the provisions of this 
     subtitle that the Secretary determines are not inconsistent 
     with this subsection.
       (2) Award basis.--The Secretary shall award grants pursuant 
     to paragraph (1) on a competitive basis and pursuant to 
     recommendations from the Pacific Region Educational 
     Laboratory in Honolulu, Hawaii.
       (3) Termination of eligibility.--Notwithstanding any other 
     provision of law, the Republic of the Marshall Islands, the 
     Federated States of Micronesia, and the Republic of Palau 
     shall not receive any funds under this subtitle for any 
     fiscal year that begins after September 30, 2001.
       (4) Administrative costs.--The Secretary may provide not 
     more than 5 percent of the funds made available for grants 
     under this subsection to pay the administrative costs of the 
     Pacific Region Educational Laboratory regarding activities 
     assisted under this subsection.
       (f) Hold-Harmless.--
       (1) In general.--Notwithstanding subsection (c)--
       (A) for fiscal year 1999, no eligible agency shall receive 
     an allotment under this subtitle that is less than 90 percent 
     of the payments made to the State or outlying area of the 
     eligible agency for fiscal year 1998 for programs for which 
     funds were authorized to be appropriated under section 313 of 
     the Adult Education Act (as such Act was in effect on the day 
     before the date of the enactment of the Workforce Investment 
     Act of 1998); and
       (B) for fiscal year 2000 and each succeeding fiscal year, 
     no eligible agency shall receive an allotment under this 
     subtitle that is less than 90 percent of the allotment the 
     eligible agency received for the preceding fiscal year under 
     this subtitle.
       (2) Ratable reduction.--If for any fiscal year the amount 
     available for allotment under this subtitle is insufficient 
     to satisfy the provisions of paragraph (1), the Secretary 
     shall ratably reduce the payments to all eligible agencies, 
     as necessary.
       (g) Reallotment.--The portion of any eligible agency's 
     allotment under this subtitle for a fiscal year that the 
     Secretary determines will not be required for the period such 
     allotment is available for carrying out activities under this 
     subtitle, shall be available for reallotment from time to 
     time, on such dates during such period as the Secretary shall 
     fix, to other eligible agencies in proportion to the original 
     allotments to such agencies under this subtitle for such 
     year.

     SEC. 212. PERFORMANCE ACCOUNTABILITY SYSTEM.

       (a) Purpose.--The purpose of this section is to establish a 
     comprehensive performance accountability system, comprised of 
     the activities described in this section, to assess the 
     effectiveness of eligible agencies in achieving continuous 
     improvement of adult education and literacy activities funded 
     under this subtitle, in order to optimize the return on 
     investment of Federal funds in adult education and literacy 
     activities.
       (b) Eligible Agency Performance Measures.--
       (1) In general.--For each eligible agency, the eligible 
     agency performance measures shall consist of--
       (A)(i) the core indicators of performance described in 
     paragraph (2)(A); and
       (ii) additional indicators of performance (if any) 
     identified by the eligible agency under paragraph (2)(B); and
       (B) an eligible agency adjusted level of performance for 
     each indicator described in subparagraph (A).
       (2) Indicators of performance.--
       (A) Core indicators of performance.--The core indicators of 
     performance shall include the following:
       (i) Demonstrated improvements in literacy skill levels in 
     reading, writing and speaking the English language, numeracy, 
     problem-solving, English language acquisition, and other 
     literacy skills.
       (ii) Placement in, retention in, or completion of, 
     postsecondary education, training, unsubsidized employment or 
     career advancement.
       (iii) Receipt of a secondary school diploma or its 
     recognized equivalent.
       (B) Additional indicators.--An eligible agency may identify 
     in the State plan additional indicators for adult education 
     and literacy activities authorized under this subtitle.
       (3) Levels of performance.--
       (A) Eligible agency adjusted levels of performance for core 
     indicators.--
       (i) In general.--For each eligible agency submitting a 
     State plan, there shall be established, in accordance with 
     this subparagraph, levels of performance for each of the core 
     indicators of performance described in paragraph (2)(A) for 
     adult education and literacy activities authorized under this 
     subtitle. The levels of performance established under this 
     subparagraph shall, at a minimum--

       (I) be expressed in an objective, quantifiable, and 
     measurable form; and
       (II) show the progress of the eligible agency toward 
     continuously improving in performance.

       (ii) Identification in state plan.--Each eligible agency 
     shall identify, in the State plan submitted under section 
     224, expected levels of performance for each of the core 
     indicators of performance for the first 3 program years 
     covered by the State plan.
       (iii) Agreement on eligible agency adjusted levels of 
     performance for first 3 years.--In order to ensure an optimal 
     return on the investment of Federal funds in adult education 
     and literacy activities authorized under this subtitle, the 
     Secretary and each eligible agency shall reach agreement on 
     levels of performance for each of the core indicators of 
     performance, for the first 3 program years covered by the 
     State plan, taking into account the levels identified in the 
     State plan under clause (ii) and the factors described in 
     clause (iv). The levels agreed to under this clause shall be 
     considered to be the eligible agency adjusted levels of 
     performance for the eligible agency for such years and shall 
     be incorporated into the State plan prior to the approval of 
     such plan.
       (iv) Factors.--The agreement described in clause (iii) or 
     (v) shall take into account--

       (I) how the levels involved compare with the eligible 
     agency adjusted levels of performance established for other 
     eligible agencies, taking into account factors including the 
     characteristics of participants when the participants entered 
     the program, and the services or instruction to be provided; 
     and
       (II) the extent to which such levels involved promote 
     continuous improvement in performance on the performance 
     measures by such eligible agency and ensure optimal return on 
     the investment of Federal funds.

       (v) Agreement on eligible agency adjusted levels of 
     performance for 4th and 5th years.--Prior to the fourth 
     program year covered by the State plan, the Secretary and 
     each eligible agency shall reach agreement on levels of 
     performance for each of the core indicators of performance 
     for the fourth and fifth program years covered by the State 
     plan, taking into account the factors described in clause 
     (iv). The levels agreed to under this clause shall be 
     considered to be the eligible agency adjusted levels of 
     performance for the eligible agency for such years and shall 
     be incorporated into the State plan.
       (vi) Revisions.--If unanticipated circumstances arise in a 
     State resulting in a significant change in the factors 
     described in clause (iv)(II), the eligible agency may request 
     that the eligible agency adjusted levels of performance 
     agreed to under clause (iii) or (v) be revised. The 
     Secretary, after collaboration with the representatives 
     described in section 136(j), shall issue objective criteria 
     and methods for making such revisions.
       (B) Levels of performance for additional indicators.--The 
     eligible agency may identify, in the State plan, eligible 
     agency levels of performance for each of the additional 
     indicators described in paragraph (2)(B). Such levels shall 
     be considered to be eligible agency adjusted levels of 
     performance for purposes of this subtitle.
       (c) Report.--
       (1) In general.--Each eligible agency that receives a grant 
     under section 211(b) shall annually prepare and submit to the 
     Secretary a report on the progress of the eligible agency in 
     achieving eligible agency performance measures, including 
     information on the levels of performance achieved by the 
     eligible agency with respect to the core indicators of 
     performance.
       (2) Information dissemination.--The Secretary--
       (A) shall make the information contained in such reports 
     available to the general public through publication and other 
     appropriate methods;
       (B) shall disseminate State-by-State comparisons of the 
     information; and
       (C) shall provide the appropriate committees of Congress 
     with copies of such reports.

                      CHAPTER 2--STATE PROVISIONS

     SEC. 221. STATE ADMINISTRATION.

       Each eligible agency shall be responsible for the State or 
     outlying area administration of activities under this 
     subtitle, including--
       (1) the development, submission, and implementation of the 
     State plan;
       (2) consultation with other appropriate agencies, groups, 
     and individuals that are involved in, or interested in, the 
     development and implementation of activities assisted under 
     this subtitle; and

[[Page H6638]]

       (3) coordination and nonduplication with other Federal and 
     State education, training, corrections, public housing, and 
     social service programs.

     SEC. 222. STATE DISTRIBUTION OF FUNDS; MATCHING REQUIREMENT.

       (a) State Distribution of Funds.--Each eligible agency 
     receiving a grant under this subtitle for a fiscal year--
       (1) shall use not less than 82.5 percent of the grant funds 
     to award grants and contracts under section 231 and to carry 
     out section 225, of which not more than 10 percent of the 
     82.5 percent shall be available to carry out section 225;
       (2) shall use not more than 12.5 percent of the grant funds 
     to carry out State leadership activities under section 223; 
     and
       (3) shall use not more than 5 percent of the grant funds, 
     or $65,000, whichever is greater, for the administrative 
     expenses of the eligible agency.
       (b) Matching Requirement.--
       (1) In general.--In order to receive a grant from the 
     Secretary under section 211(b) each eligible agency shall 
     provide, for the costs to be incurred by the eligible agency 
     in carrying out the adult education and literacy activities 
     for which the grant is awarded, a non-Federal contribution in 
     an amount equal to--
       (A) in the case of an eligible agency serving an outlying 
     area, 12 percent of the total amount of funds expended for 
     adult education and literacy activities in the outlying area, 
     except that the Secretary may decrease the amount of funds 
     required under this subparagraph for an eligible agency; and
       (B) in the case of an eligible agency serving a State, 25 
     percent of the total amount of funds expended for adult 
     education and literacy activities in the State.
       (2) Non-Federal contribution.--An eligible agency's non-
     Federal contribution required under paragraph (1) may be 
     provided in cash or in kind, fairly evaluated, and shall 
     include only non-Federal funds that are used for adult 
     education and literacy activities in a manner that is 
     consistent with the purpose of this subtitle.

     SEC. 223. STATE LEADERSHIP ACTIVITIES.

       (a) In General.--Each eligible agency shall use funds made 
     available under section 222(a)(2) for 1 or more of the 
     following adult education and literacy activities:
       (1) The establishment or operation of professional 
     development programs to improve the quality of instruction 
     provided pursuant to local activities required under section 
     231(b), including instruction incorporating phonemic 
     awareness, systematic phonics, fluency, and reading 
     comprehension, and instruction provided by volunteers or by 
     personnel of a State or outlying area.
       (2) The provision of technical assistance to eligible 
     providers of adult education and literacy activities.
       (3) The provision of technology assistance, including staff 
     training, to eligible providers of adult education and 
     literacy activities to enable the eligible providers to 
     improve the quality of such activities.
       (4) The support of State or regional networks of literacy 
     resource centers.
       (5) The monitoring and evaluation of the quality of, and 
     the improvement in, adult education and literacy activities.
       (6) Incentives for--
       (A) program coordination and integration; and
       (B) performance awards.
       (7) Developing and disseminating curricula, including 
     curricula incorporating phonemic awareness, systematic 
     phonics, fluency, and reading comprehension.
       (8) Other activities of statewide significance that promote 
     the purpose of this title.
       (9) Coordination with existing support services, such as 
     transportation, child care, and other assistance designed to 
     increase rates of enrollment in, and successful completion 
     of, adult education and literacy activities, to adults 
     enrolled in such activities.
       (10) Integration of literacy instruction and occupational 
     skill training, and promoting linkages with employers.
       (11) Linkages with postsecondary educational institutions.
       (b) Collaboration.--In carrying out this section, eligible 
     agencies shall collaborate where possible, and avoid 
     duplicating efforts, in order to maximize the impact of the 
     activities described in subsection (a).
       (c) State-Imposed Requirements.--Whenever a State or 
     outlying area implements any rule or policy relating to the 
     administration or operation of a program authorized under 
     this subtitle that has the effect of imposing a requirement 
     that is not imposed under Federal law (including any rule or 
     policy based on a State or outlying area interpretation of a 
     Federal statute, regulation, or guideline), the State or 
     outlying area shall identify, to eligible providers, the rule 
     or policy as being State- or outlying area-imposed.

     SEC. 224. STATE PLAN.

       (a) 5-Year Plans.--
       (1) In general.--Each eligible agency desiring a grant 
     under this subtitle for any fiscal year shall submit to, or 
     have on file with, the Secretary a 5-year State plan.
       (2) Comprehensive plan or application.--The eligible agency 
     may submit the State plan as part of a comprehensive plan or 
     application for Federal education assistance.
       (b) Plan Contents.--In developing the State plan, and any 
     revisions to the State plan, the eligible agency shall 
     include in the State plan or revisions--
       (1) an objective assessment of the needs of individuals in 
     the State or outlying area for adult education and literacy 
     activities, including individuals most in need or hardest to 
     serve;
       (2) a description of the adult education and literacy 
     activities that will be carried out with any funds received 
     under this subtitle;
       (3) a description of how the eligible agency will evaluate 
     annually the effectiveness of the adult education and 
     literacy activities based on the performance measures 
     described in section 212;
       (4) a description of the performance measures described in 
     section 212 and how such performance measures will ensure the 
     improvement of adult education and literacy activities in the 
     State or outlying area;
       (5) an assurance that the eligible agency will award not 
     less than 1 grant under this subtitle to an eligible provider 
     who offers flexible schedules and necessary support services 
     (such as child care and transportation) to enable 
     individuals, including individuals with disabilities, or 
     individuals with other special needs, to participate in adult 
     education and literacy activities, which eligible provider 
     shall attempt to coordinate with support services that are 
     not provided under this subtitle prior to using funds for 
     adult education and literacy activities provided under this 
     subtitle for support services;
       (6) an assurance that the funds received under this 
     subtitle will not be expended for any purpose other than for 
     activities under this subtitle;
       (7) a description of how the eligible agency will fund 
     local activities in accordance with the considerations 
     described in section 231(e);
       (8) an assurance that the eligible agency will expend the 
     funds under this subtitle only in a manner consistent with 
     fiscal requirements in section 241;
       (9) a description of the process that will be used for 
     public participation and comment with respect to the State 
     plan;
       (10) a description of how the eligible agency will develop 
     program strategies for populations that include, at a 
     minimum--
       (A) low-income students;
       (B) individuals with disabilities;
       (C) single parents and displaced homemakers; and
       (D) individuals with multiple barriers to educational 
     enhancement, including individuals with limited English 
     proficiency;
       (11) a description of how the adult education and literacy 
     activities that will be carried out with any funds received 
     under this subtitle will be integrated with other adult 
     education, career development, and employment and training 
     activities in the State or outlying area served by the 
     eligible agency; and
       (12) a description of the steps the eligible agency will 
     take to ensure direct and equitable access, as required in 
     section 231(c)(1).
       (c) Plan Revisions.--When changes in conditions or other 
     factors require substantial revisions to an approved State 
     plan, the eligible agency shall submit the revisions to the 
     State plan to the Secretary.
       (d) Consultation.--The eligible agency shall--
       (1) submit the State plan, and any revisions to the State 
     plan, to the Governor of the State or outlying area for 
     review and comment; and
       (2) ensure that any comments by the Governor regarding the 
     State plan, and any revision to the State plan, are submitted 
     to the Secretary.
       (e) Peer Review.--The Secretary shall establish a peer 
     review process to make recommendations regarding the approval 
     of State plans.
       (f) Plan Approval.--A State plan submitted to the Secretary 
     shall be approved by the Secretary unless the Secretary makes 
     a written determination, within 90 days after receiving the 
     plan, that the plan is inconsistent with the specific 
     provisions of this subtitle.

     SEC. 225. PROGRAMS FOR CORRECTIONS EDUCATION AND OTHER 
                   INSTITUTIONALIZED INDIVIDUALS.

       (a) Program Authorized.--From funds made available under 
     section 222(a)(1) for a fiscal year, each eligible agency 
     shall carry out corrections education or education for other 
     institutionalized individuals.
       (b) Uses of Funds.--The funds described in subsection (a) 
     shall be used for the cost of educational programs for 
     criminal offenders in correctional institutions and for other 
     institutionalized individuals, including academic programs 
     for--
       (1) basic education;
       (2) special education programs as determined by the 
     eligible agency;
       (3) English literacy programs; and
       (4) secondary school credit programs.
       (c) Priority.--Each eligible agency that is using 
     assistance provided under this section to carry out a program 
     for criminal offenders in a correctional institution shall 
     give priority to serving individuals who are likely to leave 
     the correctional institution with 5 years of participation in 
     the program.
       (d) Definition of Criminal Offender.--
       (1) Criminal offender.--The term ``criminal offender'' 
     means any individual who is charged with or convicted of any 
     criminal offense.
       (2) Correctional institution.--The term ``correctional 
     institution'' means any--
       (A) prison;
       (B) jail;
       (C) reformatory;
       (D) work farm;
       (E) detention center; or
       (F) halfway house, community-based rehabilitation center, 
     or any other similar institution designed for the confinement 
     or rehabilitation of criminal offenders.

                      CHAPTER 3--LOCAL PROVISIONS

     SEC. 231. GRANTS AND CONTRACTS FOR ELIGIBLE PROVIDERS.

       (a) Grants and Contracts.--From grant funds made available 
     under section 211(b), each eligible agency shall award 
     multiyear grants or contracts, on a competitive basis, to 
     eligible providers within the State or outlying area to 
     enable the eligible providers to develop, implement,

[[Page H6639]]

     and improve adult education and literacy activities within 
     the State.
       (b) Required Local Activities.--The eligible agency shall 
     require that each eligible provider receiving a grant or 
     contract under subsection (a) use the grant or contract to 
     establish or operate 1 or more programs that provide services 
     or instruction in 1 or more of the following categories:
       (1) Adult education and literacy services, including 
     workplace literacy services.
       (2) Family literacy services.
       (3) English literacy programs.
       (c) Direct and Equitable Access; Same Process.--Each 
     eligible agency receiving funds under this subtitle shall 
     ensure that--
       (1) all eligible providers have direct and equitable access 
     to apply for grants or contracts under this section; and
       (2) the same grant or contract announcement process and 
     application process is used for all eligible providers in the 
     State or outlying area.
       (d) Special Rule.--Each eligible agency awarding a grant or 
     contract under this section shall not use any funds made 
     available under this subtitle for adult education and 
     literacy activities for the purpose of supporting or 
     providing programs, services, or activities for individuals 
     who are not individuals described in subparagraphs (A) and 
     (B) of section 203(1), except that such agency may use such 
     funds for such purpose if such programs, services, or 
     activities are related to family literacy services. In 
     providing family literacy services under this subtitle, an 
     eligible provider shall attempt to coordinate with programs 
     and services that are not assisted under this subtitle prior 
     to using funds for adult education and literacy activities 
     under this subtitle for activities other than adult education 
     activities.
       (e) Considerations.--In awarding grants or contracts under 
     this section, the eligible agency shall consider--
       (1) the degree to which the eligible provider will 
     establish measurable goals for participant outcomes;
       (2) the past effectiveness of an eligible provider in 
     improving the literacy skills of adults and families, and, 
     after the 1-year period beginning with the adoption of an 
     eligible agency's performance measures under section 212, the 
     success of an eligible provider receiving funding under this 
     subtitle in meeting or exceeding such performance measures, 
     especially with respect to those adults with the lowest 
     levels of literacy;
       (3) the commitment of the eligible provider to serve 
     individuals in the community who are most in need of literacy 
     services, including individuals who are low-income or have 
     minimal literacy skills;
       (4) whether or not the program--
       (A) is of sufficient intensity and duration for 
     participants to achieve substantial learning gains; and
       (B) uses instructional practices, such as phonemic 
     awareness, systematic phonics, fluency, and reading 
     comprehension that research has proven to be effective in 
     teaching individuals to read;
       (5) whether the activities are built on a strong foundation 
     of research and effective educational practice;
       (6) whether the activities effectively employ advances in 
     technology, as appropriate, including the use of computers;
       (7) whether the activities provide learning in real life 
     contexts to ensure that an individual has the skills needed 
     to compete in the workplace and exercise the rights and 
     responsibilities of citizenship;
       (8) whether the activities are staffed by well-trained 
     instructors, counselors, and administrators;
       (9) whether the activities coordinate with other available 
     resources in the community, such as by establishing strong 
     links with elementary schools and secondary schools, 
     postsecondary educational institutions, one-stop centers, job 
     training programs, and social service agencies;
       (10) whether the activities offer flexible schedules and 
     support services (such as child care and transportation) that 
     are necessary to enable individuals, including individuals 
     with disabilities or other special needs, to attend and 
     complete programs;
       (11) whether the activities maintain a high-quality 
     information management system that has the capacity to report 
     participant outcomes and to monitor program performance 
     against the eligible agency performance measures; and
       (12) whether the local communities have a demonstrated need 
     for additional English literacy programs.

     SEC. 232. LOCAL APPLICATION.

       Each eligible provider desiring a grant or contract under 
     this subtitle shall submit an application to the eligible 
     agency containing such information and assurances as the 
     eligible agency may require, including--
       (1) a description of how funds awarded under this subtitle 
     will be spent; and
       (2) a description of any cooperative arrangements the 
     eligible provider has with other agencies, institutions, or 
     organizations for the delivery of adult education and 
     literacy activities.

     SEC. 233. LOCAL ADMINISTRATIVE COST LIMITS.

       (a) In General.--Subject to subsection (b), of the amount 
     that is made available under this subtitle to an eligible 
     provider--
       (1) not less than 95 percent shall be expended for carrying 
     out adult education and literacy activities; and
       (2) the remaining amount, not to exceed 5 percent, shall be 
     used for planning, administration, personnel development, and 
     interagency coordination.
       (b) Special Rule.--In cases where the cost limits described 
     in subsection (a) are too restrictive to allow for adequate 
     planning, administration, personnel development, and 
     interagency coordination, the eligible provider shall 
     negotiate with the eligible agency in order to determine an 
     adequate level of funds to be used for noninstructional 
     purposes.

                     CHAPTER 4--GENERAL PROVISIONS

     SEC. 241. ADMINISTRATIVE PROVISIONS.

       (a) Supplement Not Supplant.--Funds made available for 
     adult education and literacy activities under this subtitle 
     shall supplement and not supplant other State or local public 
     funds expended for adult education and literacy activities.
       (b) Maintenance of Effort.--
       (1) In general.--
       (A) Determination.--An eligible agency may receive funds 
     under this subtitle for any fiscal year if the Secretary 
     finds that the fiscal effort per student or the aggregate 
     expenditures of such eligible agency for adult education and 
     literacy activities, in the second preceding fiscal year, was 
     not less than 90 percent of the fiscal effort per student or 
     the aggregate expenditures of such eligible agency for adult 
     education and literacy activities, in the third preceding 
     fiscal year.
       (B) Proportionate reduction.--Subject to paragraphs (2), 
     (3), and (4), for any fiscal year with respect to which the 
     Secretary determines under subparagraph (A) that the fiscal 
     effort or the aggregate expenditures of an eligible agency 
     for the preceding program year were less than such effort or 
     expenditures for the second preceding program year, the 
     Secretary--
       (i) shall determine the percentage decreases in such effort 
     or in such expenditures; and
       (ii) shall decrease the payment made under this subtitle 
     for such program year to the agency for adult education and 
     literacy activities by the lesser of such percentages.
       (2) Computation.--In computing the fiscal effort and 
     aggregate expenditures under paragraph (1), the Secretary 
     shall exclude capital expenditures and special one-time 
     project costs.
       (3) Decrease in federal support.--If the amount made 
     available for adult education and literacy activities under 
     this subtitle for a fiscal year is less than the amount made 
     available for adult education and literacy activities under 
     this subtitle for the preceding fiscal year, then the fiscal 
     effort per student and the aggregate expenditures of an 
     eligible agency required in order to avoid a reduction under 
     paragraph (1)(B) shall be decreased by the same percentage as 
     the percentage decrease in the amount so made available.
       (4) Waiver.--The Secretary may waive the requirements of 
     this subsection for 1 fiscal year only, if the Secretary 
     determines that a waiver would be equitable due to 
     exceptional or uncontrollable circumstances, such as a 
     natural disaster or an unforeseen and precipitous decline in 
     the financial resources of the State or outlying area of the 
     eligible agency. If the Secretary grants a waiver under the 
     preceding sentence for a fiscal year, the level of effort 
     required under paragraph (1) shall not be reduced in the 
     subsequent fiscal year because of the waiver.

     SEC. 242. NATIONAL INSTITUTE FOR LITERACY.

       (a) Purpose.--The purpose of this section is to establish a 
     National Institute for Literacy that--
       (1) provides national leadership regarding literacy;
       (2) coordinates literacy services and policy; and
       (3) serves as a national resource for adult education and 
     literacy programs by--
       (A) providing the best and most current information 
     available, including the work of the National Institute of 
     Child Health and Human Development in the area of phonemic 
     awareness, systematic phonics, fluency, and reading 
     comprehension, to all recipients of Federal assistance that 
     focuses on reading, including programs under titles I and VII 
     of the Elementary and Secondary Education Act of 1965 (20 
     U.S.C. 6301 et seq. and 7401 et seq.), the Head Start Act (42 
     U.S.C. 9831 et seq.), the Individuals with Disabilities 
     Education Act (20 U.S.C. 1400 et seq.), and this Act; and
       (B) supporting the creation of new ways to offer services 
     of proven effectiveness.
       (b) Establishment.--
       (1) In general.--There is established the 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 Interagency 
     Group may include in the Institute any research and 
     development center, institute, or clearinghouse established 
     within the Department of Education, the Department of Labor, 
     or the Department of Health and Human Services the purpose of 
     which is determined by the Interagency Group to be related to 
     the purpose of the Institute.
       (2) Offices.--The Institute shall have offices separate 
     from the offices of the Department of Education, the 
     Department of Labor, and the Department of Health and Human 
     Services.
       (3) 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 (e) in planning the goals of the 
     Institute and in the implementation of any programs to 
     achieve the goals. If the Board's recommendations are not 
     followed, the Interagency Group shall provide a written 
     explanation to the Board concerning actions the Interagency 
     Group takes that are inconsistent with the Board's 
     recommendations, including the reasons for not following the 
     Board's recommendations with respect to the actions. The 
     Board may also request a meeting of the Interagency Group to 
     discuss the Board's recommendations.
       (4) Daily operations.--The daily operations of the 
     Institute shall be administered by the Director of the 
     Institute.

[[Page H6640]]

       (c) Duties.--
       (1) In general.--In order to provide leadership for the 
     improvement and expansion of the system for delivery of 
     literacy services, the Institute is authorized--
       (A) to establish a national electronic data base of 
     information that disseminates information to the broadest 
     possible audience within the literacy and basic skills field, 
     and that includes--
       (i) effective practices in the provision of literacy and 
     basic skills instruction, including instruction in phonemic 
     awareness, systematic phonics, fluency, and reading 
     comprehension, and the integration of literacy and basic 
     skills instruction with occupational skills training;
       (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;
       (iii) opportunities for technical assistance, meetings, 
     conferences, and other opportunities that lead to the 
     improvement of literacy and basic skills services; and
       (iv) a communication network for literacy programs, 
     providers, social service agencies, and students;
       (B) to coordinate support for the provision of literacy and 
     basic skills services across Federal agencies and at the 
     State and local levels;
       (C) to coordinate the support of reliable and replicable 
     research and development on literacy and basic skills in 
     families and adults across Federal agencies, especially with 
     the Office of Educational Research and Improvement in the 
     Department of Education, and to carry out basic and applied 
     research and development on topics that are not being 
     investigated by other organizations or agencies, such as the 
     special literacy needs of individuals with learning 
     disabilities;
       (D) to collect and disseminate information on methods of 
     advancing literacy that show great promise, including 
     phonemic awareness, systematic phonics, fluency, and reading 
     comprehension based on the work of the National Institute of 
     Child Health and Human Development;
       (E) to provide policy and technical assistance to Federal, 
     State, and local entities for the improvement of policy and 
     programs relating to literacy;
       (F) to fund a network of State or regional adult literacy 
     resource centers to assist State and local public and private 
     nonprofit efforts to improve literacy by--
       (i) encouraging the coordination of literacy services;
       (ii) enhancing the capacity of State and local 
     organizations to provide literacy services; and
       (iii) serving as a link between the Institute and providers 
     of adult education and literacy activities for the purpose of 
     sharing information, data, research, expertise, and literacy 
     resources;
       (G) to coordinate and share information with national 
     organizations and associations that are interested in 
     literacy and workforce investment activities;
       (H) to advise Congress and Federal departments and agencies 
     regarding the development of policy with respect to literacy 
     and basic skills; and
       (I) to undertake other activities that lead to the 
     improvement of the Nation's literacy delivery system and that 
     complement other such efforts being undertaken by public and 
     private agencies and organizations.
       (2) Grants, contracts, and cooperative agreements.--The 
     Institute may award grants to, or enter into contracts or 
     cooperative agreements with, individuals, public or private 
     institutions, agencies, organizations, or consortia of such 
     institutions, agencies, or organizations to carry out the 
     activities of the Institute.
       (d) Literacy Leadership.--
       (1) In general.--The Institute, in consultation with the 
     Board, may award fellowships, with such stipends and 
     allowances that the Director considers necessary, to 
     outstanding individuals pursuing careers in adult education 
     or literacy in the areas of instruction, management, 
     research, or innovation.
       (2) 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.
       (e) National Institute for Literacy Advisory Board.--
       (1) Establishment.--
       (A) In general.--There shall be a National Institute for 
     Literacy Advisory Board (in this section referred to as the 
     ``Board''), which shall consist of 10 individuals appointed 
     by the President with the advice and consent of the Senate.
       (B) Composition.--The Board shall be comprised of 
     individuals who are not otherwise officers or employees of 
     the Federal Government and who are representative of entities 
     such as--
       (i) literacy organizations and providers of literacy 
     services, including nonprofit providers, providers of English 
     literacy programs and services, social service organizations, 
     and eligible providers receiving assistance under this 
     subtitle;
       (ii) businesses that have demonstrated interest in literacy 
     programs;
       (iii) literacy students, including literacy students with 
     disabilities;
       (iv) experts in the area of literacy research;
       (v) State and local governments;
       (vi) State Directors of adult education; and
       (vii) representatives of employees, including 
     representatives of labor organizations.
       (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) Federal advisory committee act.--Except as otherwise 
     provided, the Board established by this subsection shall be 
     subject to the provisions of the Federal Advisory Committee 
     Act (5 U.S.C. App.).
       (4) Appointments.--
       (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. Any such member may be appointed for not 
     more than 2 consecutive terms.
       (B) Vacancies.--Any member appointed to fill a vacancy 
     occurring before the expiration of the term for which the 
     member's predecessor was appointed shall be appointed only 
     for the remainder of that term. A member may serve after the 
     expiration of that member's term until a successor has taken 
     office.
       (5) Quorum.--A majority of the members of the Board shall 
     constitute a quorum but a lesser number may hold hearings. 
     Any recommendation of the Board may be passed only by a 
     majority of the Board's members present.
       (6) Election of officers.--The Chairperson and Vice 
     Chairperson of the Board shall be elected by the members of 
     the Board. The term of office of the Chairperson and Vice 
     Chairperson shall be 2 years.
       (7) Meetings.--The Board shall meet at the call of the 
     Chairperson or a majority of the members of the Board.
       (f) Gifts, Bequests, and Devises.--
       (1) In general.--The Institute may accept, administer, and 
     use gifts or donations of services, money, or property, 
     whether real or personal, tangible or intangible.
       (2) Rules.--The Board shall establish written rules setting 
     forth the criteria to be used by the Institute in determining 
     whether the acceptance of contributions of services, money, 
     or property whether real or personal, tangible or intangible, 
     would reflect unfavorably upon the ability of the Institute 
     or any employee to carry out the responsibilities of the 
     Institute or employee, or official duties, in a fair and 
     objective manner, or would compromise the integrity or the 
     appearance of the integrity of the Institute's programs or 
     any official involved in those programs.
       (g) 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.
       (h) Staff.--The Interagency Group, after considering 
     recommendations made by the Board, shall appoint and fix the 
     pay of a Director.
       (i) 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 
     annual rate of basic pay payable for level IV of the 
     Executive Schedule.
       (j) Experts and Consultants.--The Institute may procure 
     temporary and intermittent services under section 3109(b) of 
     title 5, United States Code.
       (k) Report.--The Institute shall submit a report biennially 
     to the Committee on Education and the Workforce of the House 
     of Representatives and the Committee on Labor and Human 
     Resources of the Senate. Each report submitted under this 
     subsection shall include--
       (1) a comprehensive and detailed description of the 
     Institute's operations, activities, financial condition, and 
     accomplishments in the field of literacy for the period 
     covered by the report;
       (2) a description of how plans for the operation of the 
     Institute for the succeeding 2 fiscal years will facilitate 
     achievement of the goals of the Institute and the goals of 
     the literacy programs within the Department of Education, the 
     Department of Labor, and the Department of Health and Human 
     Services; and
       (3) any additional minority, or dissenting views submitted 
     by members of the Board.
       (l) Funding.--Any amounts appropriated to the Secretary, 
     the Secretary of Labor, the Secretary of Health and Human 
     Services, or any other department that participates in the 
     Institute for purposes that the Institute is authorized to 
     perform under this section may be provided to the Institute 
     for such purposes.

     SEC. 243. NATIONAL LEADERSHIP ACTIVITIES.

       The Secretary shall establish and carry out a program of 
     national leadership activities to enhance the quality of 
     adult education and literacy programs nationwide. Such 
     activities may include the following:
       (1) Technical assistance, including--
       (A) assistance provided to eligible providers in developing 
     and using performance measures for the improvement of adult 
     education and literacy activities, including family literacy 
     services;
       (B) assistance related to professional development 
     activities, and assistance for the purposes of developing, 
     improving, identifying, and disseminating the most successful 
     methods and techniques for providing adult education and 
     literacy activities, including family literacy services, 
     based on scientific evidence where available; and

[[Page H6641]]

       (C) assistance in distance learning and promoting and 
     improving the use of technology in the classroom.
       (2) Funding national leadership activities that are not 
     described in paragraph (1), either directly or through 
     grants, contracts, or cooperative agreements awarded on a 
     competitive basis to or with postsecondary educational 
     institutions, public or private organizations or agencies, or 
     consortia of such institutions, organizations, or agencies, 
     such as--
       (A) developing, improving, and identifying the most 
     successful methods and techniques for addressing the 
     education needs of adults, including instructional practices 
     using phonemic awareness, systematic phonics, fluency, and 
     reading comprehension, based on the work of the National 
     Institute of Child Health and Human Development;
       (B) increasing the effectiveness of, and improving the 
     qualify of, adult education and literacy activities, 
     including family literacy services;
       (C) carrying out research, such as estimating the number of 
     adults functioning at the lowest levels of literacy 
     proficiency;
       (D)(i) carrying out demonstration programs;
       (ii) developing and replicating model and innovative 
     programs, such as the development of models for basic skill 
     certificates, identification of effective strategies for 
     working with adults with learning disabilities and with 
     individuals with limited English proficiency who are adults, 
     and workplace literacy programs; and
       (iii) disseminating best practices information, including 
     information regarding promising practices resulting from 
     federally funded demonstration programs;
       (E) providing for the conduct of an independent evaluation 
     and assessment of adult education and literacy activities 
     through studies and analyses conducted independently through 
     grants and contracts awarded on a competitive basis, which 
     evaluation and assessment shall include descriptions of--
       (i) the effect of performance measures and other measures 
     of accountability on the delivery of adult education and 
     literacy activities, including family literacy services;
       (ii) the extent to which the adult education and literacy 
     activities, including family literacy services, increase the 
     literacy skills of adults (and of children, in the case of 
     family literacy services), lead the participants in such 
     activities to involvement in further education and training, 
     enhance the employment and earnings of such participants, 
     and, if applicable, lead to other positive outcomes, such as 
     reductions in recidivism in the case of prison-based adult 
     education and literacy activities;
       (iii) the extent to which the provision of support services 
     to adults enrolled in adult education and family literacy 
     programs increase the rate of enrollment in, and successful 
     completion of, such programs; and
       (iv) the extent to which eligible agencies have distributed 
     funds under section 231 to meet the needs of adults through 
     community-based organizations;
       (F) supporting efforts aimed at capacity building at the 
     State and local levels, such as technical assistance in 
     program planning, assessment, evaluation, and monitoring of 
     activities carried out under this subtitle;
       (G) collecting data, such as data regarding the improvement 
     of both local and State data systems, through technical 
     assistance and development of model performance data 
     collection systems; and
       (H) other activities designed to enhance the quality of 
     adult education and literacy activities nationwide.
                          Subtitle B--Repeals

     SEC. 251. REPEALS.

       (a) Repeals.--
       (1) Adult education act.--The Adult Education Act (20 
     U.S.C. 1201 et seq.) is repealed.
       (2) National literacy act of 1991.--The National Literacy 
     Act of 1991 (20 U.S.C. 1201 note) is repealed.
       (b) Conforming Amendments.--
       (1) Refugee education assistance act.--Subsection (b) of 
     section 402 of the Refugee Education Assistance Act of 1980 
     (8 U.S.C. 1522 note) is repealed.
       (2) Elementary and secondary education act of 1965.--
       (A) Section 1202 of esea.--Section 1202(c)(1) of the 
     Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     6362(c)(1)) is amended by striking ``Adult Education Act'' 
     and inserting ``Adult Education and Family Literacy Act''.
       (B) Section 1205 of esea.--Section 1205(8)(B) of such Act 
     (20 U.S.C. 6365(8)(B)) is amended by striking ``Adult 
     Education Act'' and inserting ``Adult Education and Family 
     Literacy Act''.
       (C) Section 1206 of esea.--Section 1206(a)(1)(A) of such 
     Act (20 U.S.C. 6366(a)(1)(A)) is amended by striking ``an 
     adult basic education program under the Adult Education Act'' 
     and inserting ``adult education and literacy activities under 
     the Adult Education and Family Literacy Act''.
       (D) Section 3113 of esea.--Section 3113(1) of such Act (20 
     U.S.C. 6813(1)) is amended by striking ``section 312 of the 
     Adult Education Act'' and inserting ``section 203 of the 
     Adult Education and Family Literacy Act''.
       (E) Section 9161 of esea.--Section 9161(2) of such Act (20 
     U.S.C. 7881(2)) is amended by striking ``section 312(2) of 
     the Adult Education Act'' and inserting ``section 203 of the 
     Adult Education and Family Literacy Act''.
       (3) Older americans act of 1965.--Section 203(b)(8) of the 
     Older Americans Act of 1965 (42 U.S.C. 3013(b)(8)) is amended 
     by striking ``Adult Education Act'' and inserting ``Adult 
     Education and Family Literacy Act''.
           TITLE III--WORKFORCE INVESTMENT-RELATED ACTIVITIES
                     Subtitle A--Wagner-Peyser Act

     SEC. 301. DEFINITIONS.

       Section 2 of the Wagner-Peyser Act (29 U.S.C. 49a) is 
     amended--
       (1) in paragraph (1)--
       (A) by striking ``or officials''; and
       (B) by striking ``Job Training Partnership Act'' and 
     inserting ``Workforce Investment Act of 1998'';
       (2) by striking paragraphs (2) and (4);
       (3) by redesignating paragraph (3) as paragraph (4);
       (4) by inserting after paragraph (1) the following:
       ``(2) the term `local workforce investment board' means a 
     local workforce investment board established under section 
     117 of the Workforce Investment Act of 1998;
       ``(3) the term `one-stop delivery system' means a one-stop 
     delivery system described in section 134(c) of the Workforce 
     Investment Act of 1998;''; and
       (5) in paragraph (4) (as redesignated in paragraph (3)), by 
     striking the semicolon and inserting ``; and''.

     SEC. 302. FUNCTIONS.

       (a) In General.--Section 3 of the Wagner-Peyser Act (29 
     U.S.C. 49b) is amended--
       (1) in subsection (a), by striking ``United States 
     Employment Service'' and inserting ``Secretary''; and
       (2) by adding at the end the following:
       ``(c) The Secretary shall--
       ``(1) assist in the coordination and development of a 
     nationwide system of public labor exchange services, provided 
     as part of the one-stop customer service systems of the 
     States;
       ``(2) assist in the development of continuous improvement 
     models for such nationwide system that ensure private sector 
     satisfaction with the system and meet the demands of 
     jobseekers relating to the system; and
       ``(3) ensure, for individuals otherwise eligible to receive 
     unemployment compensation, the provision of reemployment 
     services and other activities in which the individuals are 
     required to participate to receive the compensation.''.
       (b) Conforming Amendments.--Section 508(b)(1) of the 
     Unemployment Compensation Amendments of 1976 (42 U.S.C. 
     603a(b)(1)) is amended--
       (1) by striking ``the third sentence of section 3(a)'' and 
     inserting ``section 3(b)''; and
       (2) by striking ``49b(a)'' and inserting ``49b(b))''.

     SEC. 303. DESIGNATION OF STATE AGENCIES.

       Section 4 of the Wagner-Peyser Act (29 U.S.C. 49c) is 
     amended--
       (1) by striking ``, through its legislature,'' and 
     inserting ``, pursuant to State statute,'';
       (2) by inserting after ``the provisions of this Act and'' 
     the following: ``, in accordance with such State statute, the 
     Governor shall''; and
       (3) by striking ``United States Employment Service'' and 
     inserting ``Secretary''.

     SEC. 304. APPROPRIATIONS.

       Section 5(c) of the Wagner-Peyser Act (29 U.S.C. 49d(c)) is 
     amended by striking paragraph (3).

     SEC. 305. DISPOSITION OF ALLOTTED FUNDS.

       Section 7 of the Wagner-Peyser Act (29 U.S.C. 49f) is 
     amended--
       (1) in subsection (b)(2), by striking ``private industry 
     council'' and inserting ``local workforce investment board'';
       (2) in subsection (c)(2), by striking ``any program under'' 
     and all that follows and inserting ``any workforce investment 
     activity carried out under the Workforce Investment Act of 
     1998.'';
       (3) in subsection (d)--
       (A) by striking ``United States Employment Service'' and 
     inserting ``Secretary''; and
       (B) by striking ``Job Training Partnership Act'' and 
     inserting ``Workforce Investment Act of 1998''; and
       (4) by adding at the end the following:
       ``(e) All job search, placement, recruitment, labor 
     employment statistics, and other labor exchange services 
     authorized under subsection (a) shall be provided, consistent 
     with the other requirements of this Act, as part of the one-
     stop delivery system established by the State.''.

     SEC. 306. STATE PLANS.

       Section 8 of the Wagner-Peyser 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 plan 
     submitted under section 112 of the Workforce Investment Act 
     of 1998, detailed plans for carrying out the provisions of 
     this Act within such State.'';
       (2) by striking subsections (b) and (c);
       (3) by redesignating subsection (d) as subsection (b);
       (4) by inserting after subsection (b) (as redesignated by 
     paragraph (3)) the following:
       ``(c) The part of the State plan described in subsection 
     (a) shall include the information described in paragraphs (8) 
     and (14) of section 112(b) of the Workforce Investment Act of 
     1998.'';
       (5) by redesignating subsection (e) as subsection (d); and
       (6) in subsection (d) (as redesignated in paragraph (5)), 
     by striking ``such plans'' and inserting ``such detailed 
     plans''.

     SEC. 307. REPEAL OF FEDERAL ADVISORY COUNCIL.

       Section 11 of the Wagner-Peyser Act (29 U.S.C. 49j) is 
     amended--
       (1) by striking ``11.'' and all that follows through ``(b) 
     In'' and inserting ``11. In''; and
       (2) by striking ``Director'' and inserting ``Secretary''.

     SEC. 308. REGULATIONS.

       Section 12 of the Wagner-Peyser Act (29 U.S.C. 49k) is 
     amended by striking ``The Director, with the approval of the 
     Secretary of Labor,'' and inserting ``The Secretary''.

[[Page H6642]]

     SEC. 309. EMPLOYMENT STATISTICS.

       The Wagner-Peyser Act is amended--
       (1) by redesignating section 15 (29 U.S.C. 49 note) as 
     section 16; and
       (2) by inserting after section 14 (29 U.S.C. 49l-1) the 
     following:

     ``SEC. 15. EMPLOYMENT STATISTICS.

       ``(a) System Content.--
       ``(1) In general.--The Secretary, in accordance with the 
     provisions of this section, shall oversee the development, 
     maintenance, and continuous improvement of a nationwide 
     employment statistics system of employment statistics that 
     includes--
       ``(A) statistical data from cooperative statistical survey 
     and projection programs and data from administrative 
     reporting systems that, taken together, enumerate, estimate, 
     and project employment opportunities and conditions at 
     national, State, and local levels in a timely manner, 
     including statistics on--
       ``(i) employment and unemployment status of national, 
     State, and local populations, including self-employed, part-
     time, and seasonal workers;
       ``(ii) industrial distribution of occupations, as well as 
     current and projected employment opportunities, wages, 
     benefits (where data is available), and skill trends by 
     occupation and industry, with particular attention paid to 
     State and local conditions;
       ``(iii) the incidence of, industrial and geographical 
     location of, and number of workers displaced by, permanent 
     layoffs and plant closings; and
       ``(iv) employment and earnings information maintained in a 
     longitudinal manner to be used for research and program 
     evaluation;
       ``(B) information on State and local employment 
     opportunities, and other appropriate statistical data related 
     to labor market dynamics, which--
       ``(i) shall be current and comprehensive;
       ``(ii) shall meet the needs identified through the 
     consultations described in subparagraphs (A) and (B) of 
     subsection (e)(2); and
       ``(iii) shall meet the needs for the information identified 
     in section 134(d);
       ``(C) technical standards (which the Secretary shall 
     publish annually) for data and information described in 
     subparagraphs (A) and (B) that, at a minimum, meet the 
     criteria of chapter 35 of title 44, United States Code;
       ``(D) procedures to ensure compatibility and additivity of 
     the data and information described in subparagraphs (A) and 
     (B) from national, State, and local levels;
       ``(E) procedures to support standardization and aggregation 
     of data from administrative reporting systems described in 
     subparagraph (A) of employment-related programs;
       ``(F) analysis of data and information described in 
     subparagraphs (A) and (B) for uses such as--
       ``(i) national, State, and local policymaking;
       ``(ii) implementation of Federal policies (including 
     allocation formulas);
       ``(iii) program planning and evaluation; and
       ``(iv) researching labor market dynamics;
       ``(G) wide dissemination of such data, information, and 
     analysis in a user-friendly manner and voluntary technical 
     standards for dissemination mechanisms; and
       ``(H) programs of--
       ``(i) training for effective data dissemination;
       ``(ii) research and demonstration; and
       ``(iii) programs and technical assistance.
       ``(2) Information to be confidential.--
       ``(A) In general.--No officer or employee of the Federal 
     Government or agent of the Federal Government may--
       ``(i) use any submission that is furnished for exclusively 
     statistical purposes under the provisions of this section for 
     any purpose other than the statistical purposes of this 
     section for which the submission is furnished;
       ``(ii) make any publication or media transmittal of the 
     data contained in the submission described in clause (i) that 
     permits information concerning individual subjects to be 
     reasonably inferred by either direct or indirect means; or
       ``(iii) permit anyone other than a sworn officer, employee, 
     or agent of any Federal department or agency, or a contractor 
     (including an employee of a contractor) of such department or 
     agency, to examine an individual submission described in 
     clause (i);

     without the consent of the individual, agency, or other 
     person who is the subject of the submission or provides that 
     submission.
       ``(B) Immunity from legal process.--Any submission 
     (including any data derived from the submission) that is 
     collected and retained by a Federal department or agency, or 
     an officer, employee, agent, or contractor of such a 
     department or agency, for exclusively statistical purposes 
     under this section shall be immune from the legal process and 
     shall not, without the consent of the individual, agency, or 
     other person who is the subject of the submission or provides 
     that submission, be admitted as evidence or used for any 
     purpose in any action, suit, or other judicial or 
     administrative proceeding.
       ``(C) Rule of construction.--Nothing in this section shall 
     be construed to provide immunity from the legal process for 
     such submission (including any data derived from the 
     submission) if the submission is in the possession of any 
     person, agency, or entity other than the Federal Government 
     or an officer, employee, agent, or contractor of the Federal 
     Government, or if the submission is independently collected, 
     retained, or produced for purposes other than the purposes of 
     this Act.
       ``(b) System Responsibilities.--
       ``(1) In general.--The employment statistics system 
     described in subsection (a) shall be planned, administered, 
     overseen, and evaluated through a cooperative governance 
     structure involving the Federal Government and States.
       ``(2) Duties.--The Secretary, with respect to data 
     collection, analysis, and dissemination of labor employment 
     statistics for the system, shall carry out the following 
     duties:
       ``(A) Assign responsibilities within the Department of 
     Labor for elements of the employment statistics system 
     described in subsection (a) to ensure that all statistical 
     and administrative data collected is consistent with 
     appropriate Bureau of Labor Statistics standards and 
     definitions.
       ``(B) Actively seek the cooperation of other Federal 
     agencies to establish and maintain mechanisms for ensuring 
     complementarity and nonduplication in the development and 
     operation of statistical and administrative data collection 
     activities.
       ``(C) Eliminate gaps and duplication in statistical 
     undertakings, with the systemization of wage surveys as an 
     early priority.
       ``(D) In collaboration with the Bureau of Labor Statistics 
     and States, develop and maintain the elements of the 
     employment statistics system described in subsection (a), 
     including the development of consistent procedures and 
     definitions for use by the States in collecting the data and 
     information described in subparagraphs (A) and (B) of 
     subsection (a)(1).
       ``(E) Establish procedures for the system to ensure that--
       ``(i) such data and information are timely;
       ``(ii) paperwork and reporting for the system are reduced 
     to a minimum; and
       ``(iii) States and localities are fully involved in the 
     development and continuous improvement of the system at all 
     levels, including ensuring the provision, to such States and 
     localities, of budget information necessary for carrying out 
     their responsibilities under subsection (e).
       ``(c) Annual Plan.--The Secretary, working through the 
     Bureau of Labor Statistics, and in cooperation with the 
     States, and with the assistance of other appropriate Federal 
     agencies, shall prepare an annual plan which shall be the 
     mechanism for achieving cooperative management of the 
     nationwide employment statistics system described in 
     subsection (a) and the statewide employment statistics 
     systems that comprise the nationwide system. The plan shall--
       ``(1) describe the steps the Secretary has taken in the 
     preceding year and will take in the following 5 years to 
     carry out the duties described in subsection (b)(2);
       ``(2) include a report on the results of an annual consumer 
     satisfaction review concerning the performance of the system, 
     including the performance of the system in addressing the 
     needs of Congress, States, localities, employers, jobseekers, 
     and other consumers;
       ``(3) evaluate the performance of the system and recommend 
     needed improvements, taking into consideration the results of 
     the consumer satisfaction review, with particular attention 
     to the improvements needed at the State and local levels;
       ``(4) justify the budget request for annual appropriations 
     by describing priorities for the fiscal year succeeding the 
     fiscal year in which the plan is developed and priorities for 
     the 5 subsequent fiscal years for the system;
       ``(5) describe current (as of the date of the submission of 
     the plan) spending and spending needs to carry out activities 
     under this section, including the costs to States and 
     localities of meeting the requirements of subsection (e)(2); 
     and
       ``(6) describe the involvement of States in the development 
     of the plan, through formal consultations conducted by the 
     Secretary in cooperation with representatives of the 
     Governors of every State, and with representatives of local 
     workforce investment boards, pursuant to a process 
     established by the Secretary in cooperation with the States.
       ``(d) Coordination With the States.--The Secretary, working 
     through the Bureau of Labor Statistics, and in cooperation 
     with the States, shall--
       ``(1) develop the annual plan described in subsection (c) 
     and address other employment statistics issues by holding 
     formal consultations, at least once each quarter (beginning 
     with the calendar quarter in which the Workforce Investment 
     Act of 1998 is enacted) on the products and administration of 
     the nationwide employment statistics system; and
       ``(2) hold the consultations with representatives from each 
     of the 10 Federal regions of the Department of Labor, elected 
     (pursuant to a process established by the Secretary) by and 
     from the State employment statistics directors affiliated 
     with the State agencies that perform the duties described in 
     subsection (e)(2).
       ``(e) State Responsibilities.--
       ``(1) Designation of state agency.--In order to receive 
     Federal financial assistance under this section, the Governor 
     of a State shall--
       ``(A) designate a single State agency to be responsible for 
     the management of the portions of the employment statistics 
     system described in subsection (a) that comprise a statewide 
     employment statistics system and for the State's 
     participation in the development of the annual plan; and
       ``(B) establish a process for the oversight of such system.
       ``(2) Duties.--In order to receive Federal financial 
     assistance under this section, the State agency shall--
       ``(A) consult with State and local employers, participants, 
     and local workforce investment boards about the labor market 
     relevance of the data to be collected and disseminated 
     through the statewide employment statistics system;
       ``(B) consult with State educational agencies and local 
     educational agencies concerning the provision of employment 
     statistics in order to meet the needs of secondary school and 
     postsecondary school students who seek such information;
       ``(C) collect and disseminate for the system, on behalf of 
     the State and localities in the State, the information and 
     data described in subparagraphs (A) and (B) of subsection 
     (a)(1);

[[Page H6643]]

       ``(D) maintain and continuously improve the statewide 
     employment statistics system in accordance with this section;
       ``(E) perform contract and grant responsibilities for data 
     collection, analysis, and dissemination for such system;
       ``(F) conduct such other data collection, analysis, and 
     dissemination activities as will ensure an effective 
     statewide employment statistics system;
       ``(G) actively seek the participation of other State and 
     local agencies in data collection, analysis, and 
     dissemination activities in order to ensure complementarity, 
     compatibility, and usefulness of data;
       ``(H) participate in the development of the annual plan 
     described in subsection (c); and
       ``(I) utilize the quarterly records described in section 
     136(f)(2) of the Workforce Investment Act of 1998 to assist 
     the State and other States in measuring State progress on 
     State performance measures.
       ``(3) Rule of construction.--Nothing in this section shall 
     be construed as limiting the ability of a State agency to 
     conduct additional data collection, analysis, and 
     dissemination activities with State funds or with Federal 
     funds from sources other than this section.
       ``(f) Nonduplication Requirement.--None of the functions 
     and activities carried out pursuant to this section shall 
     duplicate the functions and activities carried out under the 
     Carl D. Perkins Vocational and Applied Technology Education 
     Act (20 U.S.C. 2301 et seq.).
       ``(g) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for each of the fiscal years 1999 
     through 2004.
       ``(h) Definition.--In this section, the term `local area' 
     means the smallest geographical area for which data can be 
     produced with statistical reliability.''.

     SEC. 310. TECHNICAL AMENDMENTS.

       Sections 3(b), 6(b)(1), and 7(d) of the Wagner-Peyser Act 
     (29 U.S.C. 49b(b), 49e(b)(1), and 49f(d)) are amended by 
     striking ``Secretary of Labor'' and inserting ``Secretary''.

     SEC. 311. EFFECTIVE DATE.

       The amendments made by this subtitle shall take effect on 
     July 1, 1999.
                Subtitle B--Linkages With Other Programs

     SEC. 321. TRADE ACT OF 1974.

       Section 239 of the Trade Act of 1974 (19 U.S.C. 2311) is 
     amended by adding at the end the following:
       ``(g) In order to promote the coordination of workforce 
     investment activities in each State with activities carried 
     out under this chapter, any agreement entered into under this 
     section shall provide that the State shall submit to the 
     Secretary, in such form as the Secretary may require, the 
     description and information described in paragraphs (8) and 
     (14) of section 112(b) of the Workforce Investment Act of 
     1998.''.

     SEC. 322. VETERANS' EMPLOYMENT PROGRAMS.

       Chapter 41 of title 38, United States Code, is amended by 
     adding at the end the following:

     ``Sec. 4110B. Coordination and nonduplication

       ``In carrying out this chapter, the Secretary shall require 
     that an appropriate administrative entity in each State enter 
     into an agreement with the Secretary regarding the 
     implementation of this Act that includes the description and 
     information described in paragraphs (8) and (14) of section 
     112(b) of the Workforce Investment Act of 1998.''.

     SEC. 323. OLDER AMERICANS ACT OF 1965.

       Section 502(b)(1) of the Older Americans Act of 1965 (42 
     U.S.C. 3056(b)(1)) is amended--
       (1) in subparagraph (O), by striking ``; and'' and 
     inserting a semicolon;
       (2) in subparagraph (P), by striking the period and 
     inserting ``; and''; and
       (3) by adding at the end the following subparagraph:
       ``(Q) will provide to the Secretary the description and 
     information described in paragraphs (8) and (14) of section 
     112(b) of the Workforce Investment Act of 1998.''.
         Subtitle C--Twenty-First Century Workforce Commission

     SEC. 331. SHORT TITLE.

       This subtitle may be cited as the ``Twenty-First Century 
     Workforce Commission Act''.

     SEC. 332. FINDINGS.

       Congress finds that--
       (1) information technology is one of the fastest growing 
     areas in the United States economy;
       (2) the United States is a world leader in the information 
     technology industry;
       (3) the continued growth and prosperity of the information 
     technology industry is important to the continued prosperity 
     of the United States economy;
       (4) highly skilled employees are essential for the success 
     of business entities in the information technology industry 
     and other business entities that use information technology;
       (5) employees in information technology jobs are highly 
     paid;
       (6) as of the date of enactment of this Act, these 
     employees are in high demand in all industries and all 
     regions of the United States; and
       (7) through a concerted effort by business entities, the 
     Federal Government, the governments of States and political 
     subdivisions of States, and educational institutions, more 
     individuals will gain the skills necessary to enter into a 
     technology-based job market, ensuring that the United States 
     remains the world leader in the information technology 
     industry.

     SEC. 333. DEFINITIONS.

       In this subtitle:
       (1) Business entity.--The term ``business entity'' means a 
     firm, corporation, association, partnership, consortium, 
     joint venture, or other form of enterprise.
       (2) Commission.--The term ``Commission'' means the Twenty-
     First Century Workforce Commission established under section 
     334.
       (3) Information technology.--The term ``information 
     technology'' has the meaning given that term in section 5002 
     of the Information Technology Management Reform Act of 1996 
     (110 Stat. 679).
       (4) State.--The term ``State'' means each of the several 
     States of the United States and the District of Columbia.

     SEC. 334. ESTABLISHMENT OF TWENTY-FIRST CENTURY WORKFORCE 
                   COMMISSION.

       (a) Establishment.--There is established a commission to be 
     known as the Twenty-First Century Workforce Commission.
       (b) Membership.--
       (1) Composition.--
       (A) In general.--The Commission shall be composed of 15 
     voting members, of which--
       (i) 5 members shall be appointed by the President;
       (ii) 5 members shall be appointed by the Majority Leader of 
     the Senate; and
       (iii) 5 members shall be appointed by the Speaker of the 
     House of Representatives.
       (B) Governmental representatives.--Of the members appointed 
     under this subsection, 3 members shall be representatives of 
     the governments of States and political subdivisions of 
     States, 1 of whom shall be appointed by the President, 1 of 
     whom shall be appointed by the Majority Leader of the Senate, 
     and 1 of whom shall be appointed by the Speaker of the House 
     of Representatives.
       (C) Educators.--Of the members appointed under this 
     subsection, 3 shall be educators who are selected from among 
     elementary, secondary, vocational, and postsecondary 
     educators--
       (i) 1 of whom shall be appointed by the President;
       (ii) 1 of whom shall be appointed by the Majority Leader of 
     the Senate; and
       (iii) 1 of whom shall be appointed by the Speaker of the 
     House of Representatives.
       (D) Business representatives.--
       (i) In general.--Of the members appointed under this 
     subsection, 8 shall be representatives of business entities 
     (at least 3 of which shall be individuals who are employed by 
     non-information technology business entities), 2 of whom 
     shall be appointed by the President, 3 of whom shall be 
     appointed by the Majority Leader of the Senate, and 3 of whom 
     shall be appointed by the Speaker of the House of 
     Representatives.
       (ii) Size.--Members appointed under this subsection in 
     accordance with clause (i) shall, to the extent practicable, 
     include individuals from business entities of a size that is 
     small or average.
       (E) Labor representative.--Of the members appointed under 
     this subsection, 1 shall be a representative of a labor 
     organization who has been nominated by a national labor 
     federation and who shall be appointed by the President.
       (F) Ex-officio members.--The Commission shall include 2 
     non-voting members, of which--
       (i) 1 member shall be an officer or employee of the 
     Department of Labor, who shall be appointed by the President; 
     and
       (ii) 1 member shall be an officer or employee of the 
     Department of Education, who shall be appointed by the 
     President.
       (2) Date.--The appointments of the members of the 
     Commission shall be made by the later of--
       (A) October 31, 1998; or
       (B) the date that is 45 days after the date of enactment of 
     this Act.
       (c) Period of Appointment; Vacancies.--Members shall be 
     appointed for the life of the Commission. Any vacancy in the 
     Commission shall not affect its powers, but shall be filled 
     in the same manner as the original appointment.
       (d) Initial Meeting.--No later than 30 days after the date 
     on which all members of the Commission have been appointed, 
     the Commission shall hold its first meeting.
       (e) Meetings.--The Commission shall meet at the call of the 
     Chairperson.
       (f) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum, but a lesser number of members may 
     hold hearings.
       (g) Chairperson and Vice Chairperson.--The Commission shall 
     select by vote a chairperson and vice chairperson from among 
     its voting members.

     SEC. 335. DUTIES OF THE COMMISSION.

       (a) Study.--
       (1) In general.--The Commission shall conduct a thorough 
     study of all matters relating to the information technology 
     workforce in the United States.
       (2) Matters studied.--The matters studied by the Commission 
     shall include an examination of--
       (A) the skills necessary to enter the information 
     technology workforce;
       (B) ways to expand the number of skilled information 
     technology workers; and
       (C) the relative efficacy of programs in the United States 
     and foreign countries to train information technology 
     workers, with special emphasis on programs that provide for 
     secondary education or postsecondary education in a program 
     other than a 4-year baccalaureate program (including 
     associate degree programs and graduate degree programs).
       (3) Public hearings.--As part of the study conducted under 
     this subsection, the Commission shall hold public hearings in 
     each region of the United States concerning the issues 
     referred to in subparagraphs (A) and (B) of paragraph (2).
       (4) Existing information.--To the extent practicable, in 
     carrying out the study under this subsection, the Commission 
     shall identify and use existing information related to the 
     issues referred to in subparagraphs (A) and (B) of paragraph 
     (2).
       (5) Consultation with chief information officers council.--
     In carrying out the study

[[Page H6644]]

     under this subsection, the Commission shall consult with the 
     Chief Information Officers Council established under 
     Executive Order No. 13011.
       (b) Report.--Not later than 6 months after the first 
     meeting of the Commission, the Commission shall submit a 
     report to the President and the Congress that shall contain a 
     detailed statement of the findings and conclusions of the 
     Commission resulting from the study, together with its 
     recommendations for such legislation and administrative 
     actions as the Commission considers to be appropriate.
       (c) Facilitation of Exchange of Information.--In carrying 
     out the study under subsection (a), the Commission shall, to 
     the extent practicable, facilitate the exchange of 
     information concerning the issues that are the subject of the 
     study among--
       (1) officials of the Federal Government and the governments 
     of States and political subdivisions of States; and
       (2) educators from Federal, State, and local institutions 
     of higher education and secondary schools.

     SEC. 336. POWERS OF THE COMMISSION.

       (a) Hearings.--The Commission may hold such hearings, sit 
     and act at such times and places, take such testimony, and 
     receive such evidence as the Commission considers advisable 
     to carry out the purposes of this subtitle.
       (b) Information From Federal Agencies.--The Commission may 
     secure directly from any Federal department or agency such 
     information as the Commission considers necessary to carry 
     out the provisions of this subtitle. Upon request of the 
     Chairperson of the Commission, the head of such department or 
     agency shall furnish such information to the Commission.
       (c) Postal Services.--The Commission may use the United 
     States mails in the same manner and under the same conditions 
     as other departments and agencies of the Federal Government.
       (d) Gifts.--The Commission may accept, use, and dispose of 
     gifts or donations of services or property.

     SEC. 337. COMMISSION PERSONNEL MATTERS.

       (a) Compensation of Members.--Except as provided in 
     subsection (b), each member of the Commission who is not an 
     officer or employee of the Federal Government shall serve 
     without compensation. All members of the Commission who are 
     officers or employees of the United States shall serve 
     without compensation in addition to that received for their 
     services as officers or employees of the United States.
       (b) Travel Expenses.--The members of the Commission shall 
     be allowed travel expenses, including per diem in lieu of 
     subsistence, at rates authorized for employees of agencies 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from their homes or regular places of 
     business in the performance of services for the Commission.
       (c) Staff.--
       (1) In general.--The Chairperson of the Commission may, 
     without regard to the civil service laws and regulations, 
     appoint and terminate an executive director and such other 
     additional personnel as may be necessary to enable the 
     Commission to perform its duties. The employment of an 
     executive director shall be subject to confirmation by the 
     Commission.
       (2) Compensation.--The Chairperson of the Commission may 
     fix the compensation of the executive director and other 
     personnel without regard to the provisions of chapter 51 and 
     subchapter III of chapter 53 of title 5, United States Code, 
     relating to classification of positions and General Schedule 
     pay rates, except that the rate of pay for the executive 
     director and other personnel may not exceed the rate payable 
     for level V of the Executive Schedule under section 5316 of 
     such title.
       (d) Detail of Government Employees.--Any Federal Government 
     employee may be detailed to the Commission without 
     reimbursement, and such detail shall be without interruption 
     or loss of civil service status or privilege.
       (e) Procurement of Temporary and Intermittent Services.--
     The Chairperson of the Commission may procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code, at rates for individuals that do not 
     exceed the daily equivalent of the annual rate of basic pay 
     prescribed for level V of the Executive Schedule under 
     section 5316 of such title.

     SEC. 338. TERMINATION OF THE COMMISSION.

       The Commission shall terminate on the date that is 90 days 
     after the date on which the Commission submits its report 
     under section 335(b).

     SEC. 339. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated 
     such sums as may be necessary for fiscal year 1999 to the 
     Commission to carry out the purposes of this subtitle.
       (b) Availability.--Any sums appropriated under the 
     authorization contained in this section shall remain 
     available, without fiscal year limitation, until expended.
 Subtitle D--Application of Civil Rights and Labor-Management Laws to 
                      the Smithsonian Institution

     SEC. 341. APPLICATION OF CIVIL RIGHTS AND LABOR-MANAGEMENT 
                   LAWS TO THE SMITHSONIAN INSTITUTION.

       (a) Prohibition on Employment Discrimination on Basis of 
     Race, Color, Religion, Sex, and National Origin.--Section 
     717(a) of the Civil Rights Act of 1964 (42 U.S.C. 2000e-
     16(a)) is amended by inserting ``in the Smithsonian 
     Institution,'' before ``and in the Government Printing 
     Office,''.
       (b) Prohibition on Employment Discrimination on Basis of 
     Age.--Section 15(a) of the Age Discrimination in Employment 
     Act of 1967 (29 U.S.C. 633a(a)) is amended by inserting ``in 
     the Smithsonian Institution,'' before ``and in the Government 
     Printing Office,''.
       (c) Prohibition on Employment Discrimination on Basis of 
     Disability.--Section 501 of the Rehabilitation Act of 1973 
     (29 U.S.C. 791) is amended--
       (1) in the fourth sentence of subsection (a), in paragraph 
     (1), by inserting ``and the Smithsonian Institution'' after 
     ``Government'';
       (2) in the first sentence of subsection (b)--
       (A) by inserting ``and the Smithsonian Institution'' after 
     ``in the executive branch''; and
       (B) by striking ``such department, agency, or 
     instrumentality'' and inserting ``such department, agency, 
     instrumentality, or Institution''; and
       (3) in subsection (d), by inserting ``and the Smithsonian 
     Institution'' after ``instrumentality''.
       (d) Application.--The amendments made by subsections (a), 
     (b), and (c) shall take effect on the date of enactment of 
     this Act and shall apply to and may be raised in any 
     administrative or judicial claim or action brought before 
     such date of enactment but pending on such date, and any 
     administrative or judicial claim or action brought after such 
     date regardless of whether the claim or action arose prior to 
     such date, if the claim or action was brought within the 
     applicable statute of limitations.
       (e) Labor-Management Laws.--Section 7103(a)(3) of title 5, 
     United States Code, is amended--
       (1) by striking ``and'' after ``Library of Congress,''; and
       (2) by inserting ``and the Smithsonian Institution'' after 
     ``Government Printing Office,''.
            TITLE IV--REHABILITATION ACT AMENDMENTS OF 1998

     SEC. 401. SHORT TITLE.

       This title may be cited as the ``Rehabilitation Act 
     Amendments of 1998''.

     SEC. 402. TITLE.

       The title of the Rehabilitation Act of 1973 is amended by 
     striking ``to establish special responsibilities'' and all 
     that follows and inserting the following: ``to create linkage 
     between State vocational rehabilitation programs and 
     workforce investment activities carried out under title I of 
     the Workforce Investment Act of 1998, to establish special 
     responsibilities for the Secretary of Education for 
     coordination of all activities with respect to individuals 
     with disabilities within and across programs administered by 
     the Federal Government, and for other purposes.''.

     SEC. 403. GENERAL PROVISIONS.

       The Rehabilitation Act of 1973 is amended by striking the 
     matter preceding title I and inserting the following:

     ``SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       ``(a) Short Title.--This Act may be cited as the 
     `Rehabilitation Act of 1973'.
       ``(b) Table of Contents.--The table of contents for this 
     Act is as follows:

``Sec. 1. Short title; table of contents.
``Sec. 2. Findings; purpose; policy.
``Sec. 3. Rehabilitation Services Administration.
``Sec. 4. Advance funding.
``Sec. 5. Joint funding.
``Sec. 7. Definitions.
``Sec. 8. Allotment percentage.
``Sec. 10. Nonduplication.
``Sec. 11. Application of other laws.
``Sec. 12. Administration of the Act.
``Sec. 13. Reports.
``Sec. 14. Evaluation.
``Sec. 15. Information clearinghouse.
``Sec. 16. Transfer of funds.
``Sec. 17. State administration.
``Sec. 18. Review of applications.
``Sec. 19. Carryover.
``Sec. 20. Client assistance information.
``Sec. 21. Traditionally underserved populations.

             ``TITLE I--VOCATIONAL REHABILITATION SERVICES

                      ``Part A--General Provisions

``Sec. 100. Declaration of policy; authorization of appropriations.
``Sec. 101. State plans.
``Sec. 102. Eligibility and individualized plan for employment.
``Sec. 103. Vocational rehabilitation services.
``Sec. 104. Non-Federal share for establishment of program.
``Sec. 105. State Rehabilitation 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--American Indian Vocational Rehabilitation Services

``Sec. 121. Vocational rehabilitation services grants.

    ``Part D--Vocational Rehabilitation Services Client Information

``Sec. 131. Data sharing.

                   ``TITLE II--RESEARCH AND TRAINING

``Sec. 200. Declaration of purpose.
``Sec. 201. Authorization of appropriations.
``Sec. 202. National Institute on Disability and Rehabilitation 
              Research.
``Sec. 203. Interagency Committee.
``Sec. 204. Research and other covered activities.
``Sec. 205. Rehabilitation Research Advisory Council.

    ``TITLE III--PROFESSIONAL DEVELOPMENT AND SPECIAL PROJECTS AND 
                             DEMONSTRATIONS

``Sec. 301. Declaration of purpose and competitive basis of grants and 
              contracts.

[[Page H6645]]

``Sec. 302. Training.
``Sec. 303. Demonstration and training programs.
``Sec. 304. Migrant and seasonal farmworkers.
``Sec. 305. Recreational programs.
``Sec. 306. Measuring of project outcomes and performance.

               ``TITLE IV--NATIONAL COUNCIL ON DISABILITY

``Sec. 400. Establishment of National Council on Disability.
``Sec. 401. Duties of National Council.
``Sec. 402. Compensation of National Council members.
``Sec. 403. Staff of National Council.
``Sec. 404. Administrative powers of National Council.
``Sec. 405. Authorization of Appropriations.

                     ``TITLE V--RIGHTS AND ADVOCACY

``Sec. 501. Employment of individuals with disabilities.
``Sec. 502. Architectural and Transportation Barriers Compliance Board.
``Sec. 503. Employment under Federal contracts.
``Sec. 504. Nondiscrimination under Federal grants and programs.
``Sec. 505. Remedies and attorneys' fees.
``Sec. 506. Secretarial responsibilities.
``Sec. 507. Interagency Disability Coordinating Council.
``Sec. 508. Electronic and information technology regulations.
``Sec. 509. Protection and advocacy of individual rights.

 ``TITLE VI--EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH DISABILITIES

``Sec. 601. Short title.

                    ``Part A--Projects With Industry

``Sec. 611. Projects with industry.
``Sec. 612. Authorization of appropriations.

 ``Part B--Supported Employment Services for Individuals With the Most 
                        Significant Disabilities

``Sec. 621. Purpose.
``Sec. 622. Allotments.
``Sec. 623. Availability of services.
``Sec. 624. Eligibility.
``Sec. 625. State plan.
``Sec. 626. Restriction.
``Sec. 627. Savings provision.
``Sec. 628. Authorization of appropriations.

 ``TITLE VII--INDEPENDENT LIVING SERVICES AND CENTERS FOR INDEPENDENT 
                                 LIVING

         ``Chapter 1--Individuals With Significant Disabilities

                      ``Part A--General Provisions

``Sec. 701. Purpose.
``Sec. 702. Definitions.
``Sec. 703. Eligibility for receipt of services.
``Sec. 704. State plan.
``Sec. 705. Statewide Independent Living Council.
``Sec. 706. Responsibilities of the Commissioner.

                 ``Part B--Independent Living Services

``Sec. 711. Allotments.
``Sec. 712. Payments to States from allotments.
``Sec. 713. Authorized uses of funds.
``Sec. 714. Authorization of appropriations.

                ``Part C--Centers for Independent Living

``Sec. 721. Program authorization.
``Sec. 722. Grants to centers for independent living in States in which 
              Federal funding exceeds State funding.
``Sec. 723. Grants to centers for independent living in States in which 
              State funding equals or exceeds Federal funding.
``Sec. 724. Centers operated by State agencies.
``Sec. 725. Standards and assurances for centers for independent 
              living.
``Sec. 726. Definitions.
``Sec. 727. Authorization of appropriations.

``Chapter 2--Independent Living Services for Older Individuals Who Are 
                                 Blind

``Sec. 751. Definition.
``Sec. 752. Program of grants.
``Sec. 753. Authorization of appropriations.


                      ``findings; purpose; policy

       ``Sec. 2. (a) Findings.--Congress finds that--
       ``(1) millions of Americans have one or more physical or 
     mental disabilities and the number of Americans with such 
     disabilities is increasing;
       ``(2) individuals with disabilities constitute one of the 
     most disadvantaged groups in society;
       ``(3) disability is a natural part of the human experience 
     and in no way diminishes the right of individuals to--
       ``(A) live independently;
       ``(B) enjoy self-determination;
       ``(C) make choices;
       ``(D) contribute to society;
       ``(E) pursue meaningful careers; and
       ``(F) enjoy full inclusion and integration in the economic, 
     political, social, cultural, and educational mainstream of 
     American society;
       ``(4) increased employment of individuals with disabilities 
     can be achieved through implementation of statewide workforce 
     investment systems under title I of the Workforce Investment 
     Act of 1998 that provide meaningful and effective 
     participation for individuals with disabilities in workforce 
     investment activities and activities carried out under the 
     vocational rehabilitation program established under title I, 
     and through the provision of independent living services, 
     support services, and meaningful opportunities for employment 
     in integrated work settings through the provision of 
     reasonable accommodations;
       ``(5) individuals with disabilities continually encounter 
     various forms of discrimination in such critical areas as 
     employment, housing, public accommodations, education, 
     transportation, communication, recreation, 
     institutionalization, health services, voting, and public 
     services; and
       ``(6) the goals of the Nation properly include the goal of 
     providing individuals with disabilities with the tools 
     necessary to--
       ``(A) make informed choices and decisions; and
       ``(B) achieve equality of opportunity, full inclusion and 
     integration in society, employment, independent living, and 
     economic and social self-sufficiency, for such individuals.
       ``(b) Purpose.--The purposes of this Act are--
       ``(1) to empower individuals with disabilities to maximize 
     employment, economic self-sufficiency, independence, and 
     inclusion and integration into society, through--
       ``(A) statewide workforce investment systems implemented in 
     accordance with title I of the Workforce Investment Act of 
     1998 that include, as integral components, comprehensive and 
     coordinated state-of-the-art programs of vocational 
     rehabilitation;
       ``(B) independent living centers and services;
       ``(C) research;
       ``(D) training;
       ``(E) demonstration projects; and
       ``(F) the guarantee of equal opportunity; and
       ``(2) to ensure that the Federal Government plays a 
     leadership role in promoting the employment of individuals 
     with disabilities, especially individuals with significant 
     disabilities, and in assisting States and providers of 
     services in fulfilling the aspirations of such individuals 
     with disabilities for meaningful and gainful employment and 
     independent living.
       ``(c) Policy.--It is the policy of the United States that 
     all programs, projects, and activities receiving assistance 
     under this Act shall be carried out in a manner consistent 
     with the principles of--
       ``(1) respect for individual dignity, personal 
     responsibility, self-determination, and pursuit of meaningful 
     careers, based on informed choice, of individuals with 
     disabilities;
       ``(2) respect for the privacy, rights, and equal access 
     (including the use of accessible formats), of the 
     individuals;
       ``(3) inclusion, integration, and full participation of the 
     individuals;
       ``(4) support for the involvement of an individual's 
     representative if an individual with a disability requests, 
     desires, or needs such support; and
       ``(5) support for individual and systemic advocacy and 
     community involvement.


                ``rehabilitation services administration

       ``Sec. 3. (a) There is established in the Office of the 
     Secretary a Rehabilitation Services Administration which 
     shall be headed by a Commissioner (hereinafter in this Act 
     referred to as the `Commissioner') appointed by the President 
     by and with the advice and consent of the Senate. Except for 
     titles IV and V and as otherwise specifically provided in 
     this Act, such Administration shall be the principal agency, 
     and the Commissioner shall be the principal officer, of such 
     Department for carrying out this Act. The Commissioner shall 
     be an individual with substantial experience in 
     rehabilitation and in rehabilitation program management. In 
     the performance of the functions of the office, the 
     Commissioner shall be directly responsible to the Secretary 
     or to the Under Secretary or an appropriate Assistant 
     Secretary of such Department, as designated by the Secretary. 
     The functions of the Commissioner shall not be delegated to 
     any officer not directly responsible, both with respect to 
     program operation and administration, to the Commissioner. 
     Any reference in this Act to duties to be carried out by the 
     Commissioner shall be considered to be a reference to duties 
     to be carried out by the Secretary acting through the 
     Commissioner. In carrying out any of the functions of the 
     office under this Act, the Commissioner shall be guided by 
     general policies of the National Council on Disability 
     established under title IV of this Act.
       ``(b) The Secretary shall take whatever action is necessary 
     to ensure that funds appropriated pursuant to this Act are 
     expended only for the programs, personnel, and administration 
     of programs carried out under this Act.


                           ``advance funding

       ``Sec. 4. (a) For the purpose of affording adequate notice 
     of funding available under this Act, appropriations under 
     this Act are authorized to be included in the appropriation 
     Act for the fiscal year preceding the fiscal year for which 
     they are available for obligation.
       ``(b) In order to effect a transition to the advance 
     funding method of timing appropriation action, the authority 
     provided by subsection (a) of this section shall apply 
     notwithstanding that its initial application will result in 
     the enactment in the same year (whether in the same 
     appropriation Act or otherwise) of two separate 
     appropriations, one for the then current fiscal year and one 
     for the succeeding fiscal year.


                            ``joint funding

       ``Sec. 5. Pursuant to regulations prescribed by the 
     President, and to the extent consistent with the other 
     provisions of this Act, where funds are provided for a single 
     project by more than one Federal agency to an agency or 
     organization assisted under this Act, the Federal agency 
     principally involved may be designated to act for all in 
     administering the funds provided, and, in such cases, a 
     single non-Federal share requirement may be established 
     according to the proportion of funds advanced by each agency. 
     When the principal agency involved is the Rehabilitation 
     Services Administration, it may waive any grant or contract 
     requirement (as defined by such regulations) under or 
     pursuant to any law other than this Act, which requirement is 
     inconsistent with the similar requirements of the 
     administering agency under or pursuant to this Act.

     ``SEC. 7. DEFINITIONS.

       ``For the purposes of this Act:

[[Page H6646]]

       ``(1) The term `administrative costs' means expenditures 
     incurred in the performance of administrative functions under 
     the vocational rehabilitation program carried out under title 
     I, including expenses related to program planning, 
     development, monitoring, and evaluation, including expenses 
     for--
       ``(A) quality assurance;
       ``(B) budgeting, accounting, financial management, 
     information systems, and related data processing;
       ``(C) providing information about the program to the 
     public;
       ``(D) technical assistance and support services to other 
     State agencies, private nonprofit organizations, and 
     businesses and industries, except for technical assistance 
     and support services described in section 103(b)(5);
       ``(E) the State Rehabilitation Council and other advisory 
     committees;
       ``(F) professional organization membership dues for 
     designated State unit employees;
       ``(G) the removal of architectural barriers in State 
     vocational rehabilitation agency offices and State operated 
     rehabilitation facilities;
       ``(H) operating and maintaining designated State unit 
     facilities, equipment, and grounds;
       ``(I) supplies;
       ``(J) administration of the comprehensive system of 
     personnel development described in section 101(a)(7), 
     including personnel administration, administration of 
     affirmative action plans, and training and staff development;
       ``(K) administrative salaries, including clerical and other 
     support staff salaries, in support of these administrative 
     functions;
       ``(L) travel costs related to carrying out the program, 
     other than travel costs related to the provision of services;
       ``(M) costs incurred in conducting reviews of 
     rehabilitation counselor or coordinator determinations under 
     section 102(c); and
       ``(N) legal expenses required in the administration of the 
     program.
       ``(2) Assessment for determining eligibility and vocational 
     rehabilitation needs.--The term `assessment for determining 
     eligibility and vocational rehabilitation needs' means, as 
     appropriate in each case--
       ``(A)(i) a review of existing data--
       ``(I) to determine whether an individual is eligible for 
     vocational rehabilitation services; and
       ``(II) to assign priority for an order of selection 
     described in section 101(a)(5)(A) in the States that use an 
     order of selection pursuant to section 101(a)(5)(A); and
       ``(ii) to the extent necessary, the provision of 
     appropriate assessment activities to obtain necessary 
     additional data to make such determination and assignment;
       ``(B) to the extent additional data is necessary to make a 
     determination of the employment outcomes, and the objectives, 
     nature, and scope of vocational rehabilitation services, to 
     be included in the individualized plan for employment of an 
     eligible individual, a comprehensive assessment to determine 
     the unique strengths, resources, priorities, concerns, 
     abilities, capabilities, interests, and informed choice, 
     including the need for supported employment, of the eligible 
     individual, which comprehensive assessment--
       ``(i) is limited to information that is necessary to 
     identify the rehabilitation needs of the individual and to 
     develop the individualized plan for employment of the 
     eligible individual;
       ``(ii) uses, as a primary source of such information, to 
     the maximum extent possible and appropriate and in accordance 
     with confidentiality requirements--

       ``(I) existing information obtained for the purposes of 
     determining the eligibility of the individual and assigning 
     priority for an order of selection described in section 
     101(a)(5)(A) for the individual; and
       ``(II) such information as can be provided by the 
     individual and, where appropriate, by the family of the 
     individual;

       ``(iii) may include, to the degree needed to make such a 
     determination, an assessment of the personality, interests, 
     interpersonal skills, intelligence and related functional 
     capacities, educational achievements, work experience, 
     vocational aptitudes, personal and social adjustments, and 
     employment opportunities of the individual, and the medical, 
     psychiatric, psychological, and other pertinent vocational, 
     educational, cultural, social, recreational, and 
     environmental factors, that affect the employment and 
     rehabilitation needs of the individual; and
       ``(iv) may include, to the degree needed, an appraisal of 
     the patterns of work behavior of the individual and services 
     needed for the individual to acquire occupational skills, and 
     to develop work attitudes, work habits, work tolerance, and 
     social and behavior patterns necessary for successful job 
     performance, including the utilization of work in real job 
     situations to assess and develop the capacities of the 
     individual to perform adequately in a work environment;
       ``(C) referral, for the provision of rehabilitation 
     technology services to the individual, to assess and develop 
     the capacities of the individual to perform in a work 
     environment; and
       ``(D) an exploration of the individual's abilities, 
     capabilities, and capacity to perform in work situations, 
     which shall be assessed periodically during trial work 
     experiences, including experiences in which the individual is 
     provided appropriate supports and training.
       ``(3) Assistive technology device.--The term `assistive 
     technology device' has the meaning given such term in section 
     3(2) of the Technology-Related Assistance for Individuals 
     With Disabilities Act of 1988 (29 U.S.C. 2202(2)), except 
     that the reference in such section to the term `individuals 
     with disabilities' shall be deemed to mean more than one 
     individual with a disability as defined in paragraph (20)(A).
       ``(4) Assistive technology service.--The term `assistive 
     technology service' has the meaning given such term in 
     section 3(3) of the Technology-Related Assistance for 
     Individuals With Disabilities Act of 1988 (29 U.S.C. 
     2202(3)), except that the reference in such section--
       ``(A) to the term `individual with a disability' shall be 
     deemed to mean an individual with a disability, as defined in 
     paragraph (20)(A); and
       ``(B) to the term `individuals with disabilities' shall be 
     deemed to mean more than one such individual.
       ``(5) Community rehabilitation program.--The term 
     `community rehabilitation program' means a program that 
     provides directly or facilitates the provision of vocational 
     rehabilitation services to individuals with disabilities, and 
     that provides, singly or in combination, for an individual 
     with a disability to enable the individual to maximize 
     opportunities for employment, including career advancement--
       ``(A) medical, psychiatric, psychological, social, and 
     vocational services that are provided under one management;
       ``(B) testing, fitting, or training in the use of 
     prosthetic and orthotic devices;
       ``(C) recreational therapy;
       ``(D) physical and occupational therapy;
       ``(E) speech, language, and hearing therapy;
       ``(F) psychiatric, psychological, and social services, 
     including positive behavior management;
       ``(G) assessment for determining eligibility and vocational 
     rehabilitation needs;
       ``(H) rehabilitation technology;
       ``(I) job development, placement, and retention services;
       ``(J) evaluation or control of specific disabilities;
       ``(K) orientation and mobility services for individuals who 
     are blind;
       ``(L) extended employment;
       ``(M) psychosocial rehabilitation services;
       ``(N) supported employment services and extended services;
       ``(O) services to family members when necessary to the 
     vocational rehabilitation of the individual;
       ``(P) personal assistance services; or
       ``(Q) services similar to the services described in one of 
     subparagraphs (A) through (P).
       ``(6) Construction; cost of construction.--
       ``(A) Construction.--The term `construction' means--
       ``(i) the construction of new buildings;
       ``(ii) the acquisition, expansion, remodeling, alteration, 
     and renovation of existing buildings; and
       ``(iii) initial equipment of buildings described in clauses 
     (i) and (ii).
       ``(B) Cost of construction.--The term ``cost of 
     construction'' includes architects' fees and the cost of 
     acquisition of land in connection with construction but does 
     not include the cost of offsite improvements.
       ``(7) Criminal act.--The term `criminal act' means any 
     crime, including an act, omission, or possession under the 
     laws of the United States or a State or unit of general local 
     government, which poses a substantial threat of personal 
     injury, notwithstanding that by reason of age, insanity, or 
     intoxication or otherwise the person engaging in the act, 
     omission, or possession was legally incapable of committing a 
     crime.
       ``(8) Designated state agency; designated state unit.--
       ``(A) Designated state agency.--The term `designated State 
     agency' means an agency designated under section 
     101(a)(2)(A).
       ``(B) Designated state unit.--The term `designated State 
     unit' means--
       ``(i) any State agency unit required under section 
     101(a)(2)(B)(ii); or
       ``(ii) in cases in which no such unit is so required, the 
     State agency described in section 101(a)(2)(B)(i).
       ``(9) Disability.--The term `disability' means--
       ``(A) except as otherwise provided in subparagraph (B), a 
     physical or mental impairment that constitutes or results in 
     a substantial impediment to employment; or
       ``(B) for purposes of sections 2, 14, and 15, and titles 
     II, IV, V, and VII, a physical or mental impairment that 
     substantially limits one or more major life activities.
       ``(10) Drug and illegal use of drugs.--
       ``(A) Drug.--The term `drug' means a controlled substance, 
     as defined in schedules I through V of section 202 of the 
     Controlled Substances Act (21 U.S.C. 812).
       ``(B) Illegal use of drugs.--The term `illegal use of 
     drugs' means the use of drugs, the possession or distribution 
     of which is unlawful under the Controlled Substances Act. 
     Such term does not include the use of a drug taken under 
     supervision by a licensed health care professional, or other 
     uses authorized by the Controlled Substances Act or other 
     provisions of Federal law.
       ``(11) Employment outcome.--The term `employment outcome' 
     means, with respect to an individual--
       ``(A) entering or retaining full-time or, if appropriate, 
     part-time competitive employment in the integrated labor 
     market;
       ``(B) satisfying the vocational outcome of supported 
     employment; or
       ``(C) satisfying any other vocational outcome the Secretary 
     may determine to be appropriate (including satisfying the 
     vocational outcome of self-employment, telecommuting, or 
     business ownership),
     in a manner consistent with this Act.
       ``(12) Establishment of a community rehabilitation 
     program.--The term `establishment of a community 
     rehabilitation program' includes the acquisition, expansion, 
     remodeling, or alteration of existing buildings necessary to 
     adapt them to community rehabilitation program purposes or to 
     increase their effectiveness for such purposes (subject, 
     however, to such limitations as the Secretary may determine, 
     in accordance with regulations the Secretary shall prescribe, 
     in order to prevent impairment of the objectives of, or 
     duplication of, other Federal laws providing Federal 
     assistance in the construction of facilities for community 
     rehabilitation programs),

[[Page H6647]]

     and may include such additional equipment and staffing as the 
     Commissioner considers appropriate.
       ``(13) Extended services.--The term `extended services' 
     means ongoing support services and other appropriate 
     services, needed to support and maintain an individual with a 
     most significant disability in supported employment, that--
       ``(A) are provided singly or in combination and are 
     organized and made available in such a way as to assist an 
     eligible individual in maintaining supported employment;
       ``(B) are based on a determination of the needs of an 
     eligible individual, as specified in an individualized plan 
     for employment; and
       ``(C) are provided by a State agency, a nonprofit private 
     organization, employer, or any other appropriate resource, 
     after an individual has made the transition from support 
     provided by the designated State unit.
       ``(14) Federal share.--
       ``(A) In general.--Subject to subparagraph (B), the term 
     `Federal share' means 78.7 percent.
       ``(B) Exception.--The term ``Federal share'' means the 
     share specifically set forth in section 111(a)(3), except 
     that with respect to payments pursuant to part B of title I 
     to any State that are used to meet the costs of construction 
     of those rehabilitation facilities identified in section 
     103(b)(2) in such State, the Federal share shall be the 
     percentages determined in accordance with the provisions of 
     section 111(a)(3) applicable with respect to the State.
       ``(C) Relationship to expenditures by a political 
     subdivision.--For the purpose of determining the non-Federal 
     share with respect to a State, expenditures by a political 
     subdivision thereof or by a local agency shall be regarded as 
     expenditures by such State, subject to such limitations and 
     conditions as the Secretary shall by regulation prescribe.
       ``(15) Governor.--The term `Governor' means a chief 
     executive officer of a State.
       ``(16) Impartial hearing officer.--
       ``(A) In general.--The term `impartial hearing officer' 
     means an individual--
       ``(i) who is not an employee of a public agency (other than 
     an administrative law judge, hearing examiner, or employee of 
     an institution of higher education);
       ``(ii) who is not a member of the State Rehabilitation 
     Council described in section 105;
       ``(iii) who has not been involved previously in the 
     vocational rehabilitation of the applicant or client;
       ``(iv) who has knowledge of the delivery of vocational 
     rehabilitation services, the State plan under section 101, 
     and the Federal and State rules governing the provision of 
     such services and training with respect to the performance of 
     official duties; and
       ``(v) who has no personal or financial interest that would 
     be in conflict with the objectivity of the individual.
       ``(B) Construction.--An individual shall not be considered 
     to be an employee of a public agency for purposes of 
     subparagraph (A)(i) solely because the individual is paid by 
     the agency to serve as a hearing officer.
       ``(17) Independent living core services.--The term 
     `independent living core services' means--
       ``(A) information and referral services;
       ``(B) independent living skills training;
       ``(C) peer counseling (including cross-disability peer 
     counseling); and
       ``(D) individual and systems advocacy.
       ``(18) Independent living services.--The term `independent 
     living services' includes--
       ``(A) independent living core services; and
       ``(B)(i) counseling services, including psychological, 
     psychotherapeutic, and related services;
       ``(ii) services related to securing housing or shelter, 
     including services related to community group living, and 
     supportive of the purposes of this Act and of the titles of 
     this Act, and adaptive housing services (including 
     appropriate accommodations to and modifications of any space 
     used to serve, or occupied by, individuals with 
     disabilities);
       ``(iii) rehabilitation technology;
       ``(iv) mobility training;
       ``(v) services and training for individuals with cognitive 
     and sensory disabilities, including life skills training, and 
     interpreter and reader services;
       ``(vi) personal assistance services, including attendant 
     care and the training of personnel providing such services;
       ``(vii) surveys, directories, and other activities to 
     identify appropriate housing, recreation opportunities, and 
     accessible transportation, and other support services;
       ``(viii) consumer information programs on rehabilitation 
     and independent living services available under this Act, 
     especially for minorities and other individuals with 
     disabilities who have traditionally been unserved or 
     underserved by programs under this Act;
       ``(ix) education and training necessary for living in a 
     community and participating in community activities;
       ``(x) supported living;
       ``(xi) transportation, including referral and assistance 
     for such transportation and training in the use of public 
     transportation vehicles and systems;
       ``(xii) physical rehabilitation;
       ``(xiii) therapeutic treatment;
       ``(xiv) provision of needed prostheses and other appliances 
     and devices;
       ``(xv) individual and group social and recreational 
     services;
       ``(xvi) training to develop skills specifically designed 
     for youths who are individuals with disabilities to promote 
     self-awareness and esteem, develop advocacy and self-
     empowerment skills, and explore career options;
       ``(xvii) services for children;
       ``(xviii) services under other Federal, State, or local 
     programs designed to provide resources, training, counseling, 
     or other assistance, of substantial benefit in enhancing the 
     independence, productivity, and quality of life of 
     individuals with disabilities;
       ``(xix) appropriate preventive services to decrease the 
     need of individuals assisted under this Act for similar 
     services in the future;
       ``(xx) community awareness programs to enhance the 
     understanding and integration into society of individuals 
     with disabilities; and
       ``(xxi) such other services as may be necessary and not 
     inconsistent with the provisions of this Act.
       ``(19) Indian; american indian; indian american; indian 
     tribe.--
       ``(A) In general.--The terms `Indian', `American Indian', 
     and `Indian American' mean an individual who is a member of 
     an Indian tribe.
       ``(B) Indian tribe.--The term `Indian tribe' means any 
     Federal or State Indian tribe, band, rancheria, pueblo, 
     colony, or community, including any Alaskan native village or 
     regional village corporation (as defined in or established 
     pursuant to the Alaska Native Claims Settlement Act).
       ``(20) Individual with a disability.--
       ``(A) In general.--Except as otherwise provided in 
     subparagraph (B), the term `individual with a disability' 
     means any individual who--
       ``(i) has a physical or mental impairment which for such 
     individual constitutes or results in a substantial impediment 
     to employment; and
       ``(ii) can benefit in terms of an employment outcome from 
     vocational rehabilitation services provided pursuant to title 
     I, III, or VI.
       ``(B) Certain programs; limitations on major life 
     activities.--Subject to subparagraphs (C), (D), (E), and (F), 
     the term `individual with a disability' means, for purposes 
     of sections 2, 14, and 15, and titles II, IV, V, and VII of 
     this Act, any person who--
       ``(i) has a physical or mental impairment which 
     substantially limits one or more of such person's major life 
     activities;
       ``(ii) has a record of such an impairment; or
       ``(iii) is regarded as having such an impairment.
       ``(C) Rights and advocacy provisions.--
       ``(i) In general; exclusion of individuals engaging in drug 
     use.--For purposes of title V, the term `individual with a 
     disability' does not include an individual who is currently 
     engaging in the illegal use of drugs, when a covered entity 
     acts on the basis of such use.
       ``(ii) Exception for individuals no longer engaging in drug 
     use.--Nothing in clause (i) shall be construed to exclude as 
     an individual with a disability an individual who--

       ``(I) has successfully completed a supervised drug 
     rehabilitation program and is no longer engaging in the 
     illegal use of drugs, or has otherwise been rehabilitated 
     successfully and is no longer engaging in such use;
       ``(II) is participating in a supervised rehabilitation 
     program and is no longer engaging in such use; or
       ``(III) is erroneously regarded as engaging in such use, 
     but is not engaging in such use;

     except that it shall not be a violation of this Act for a 
     covered entity to adopt or administer reasonable policies or 
     procedures, including but not limited to drug testing, 
     designed to ensure that an individual described in subclause 
     (I) or (II) is no longer engaging in the illegal use of 
     drugs.
       ``(iii) Exclusion for certain services.--Notwithstanding 
     clause (i), for purposes of programs and activities providing 
     health services and services provided under titles I, II, and 
     III, an individual shall not be excluded from the benefits of 
     such programs or activities on the basis of his or her 
     current illegal use of drugs if he or she is otherwise 
     entitled to such services.
       ``(iv) Disciplinary action.--For purposes of programs and 
     activities providing educational services, local educational 
     agencies may take disciplinary action pertaining to the use 
     or possession of illegal drugs or alcohol against any student 
     who is an individual with a disability and who currently is 
     engaging in the illegal use of drugs or in the use of alcohol 
     to the same extent that such disciplinary action is taken 
     against students who are not individuals with disabilities. 
     Furthermore, the due process procedures at section 104.36 of 
     title 34, Code of Federal Regulations (or any corresponding 
     similar regulation or ruling) shall not apply to such 
     disciplinary actions.
       ``(v) Employment; exclusion of alcoholics.--For purposes of 
     sections 503 and 504 as such sections relate to employment, 
     the term `individual with a disability' does not include any 
     individual who is an alcoholic whose current use of alcohol 
     prevents such individual from performing the duties of the 
     job in question or whose employment, by reason of such 
     current alcohol abuse, would constitute a direct threat to 
     property or the safety of others.
       ``(D) Employment; exclusion of individuals with certain 
     diseases or infections.--For the purposes of sections 503 and 
     504, as such sections relate to employment, such term does 
     not include an individual who has a currently contagious 
     disease or infection and who, by reason of such disease or 
     infection, would constitute a direct threat to the health or 
     safety of other individuals or who, by reason of the 
     currently contagious disease or infection, is unable to 
     perform the duties of the job.
       ``(E) Rights provisions; exclusion of individuals on basis 
     of homosexuality or bisexuality.--For the purposes of 
     sections 501, 503, and 504--
       ``(i) for purposes of the application of subparagraph (B) 
     to such sections, the term `impairment' does not include 
     homosexuality or bisexuality; and
       ``(ii) therefore the term `individual with a disability' 
     does not include an individual on the basis of homosexuality 
     or bisexuality.
       ``(F) Rights provisions; exclusion of individuals on basis 
     of certain disorders.--For the purposes of sections 501, 503, 
     and 504, the

[[Page H6648]]

     term `individual with a disability' does not include an 
     individual on the basis of--
       ``(i) transvestism, transsexualism, pedophilia, 
     exhibitionism, voyeurism, gender identity disorders not 
     resulting from physical impairments, or other sexual behavior 
     disorders;
       ``(ii) compulsive gambling, kleptomania, or pyromania; or
       ``(iii) psychoactive substance use disorders resulting from 
     current illegal use of drugs.
       ``(G) Individuals with disabilities.--The term `individuals 
     with disabilities' means more than one individual with a 
     disability.
       ``(21) Individual with a significant disability.--
       ``(A) In general.--Except as provided in subparagraph (B) 
     or (C), the term `individual with a significant disability' 
     means an individual with a disability--
       ``(i) who has a severe physical or mental impairment which 
     seriously limits one or more functional capacities (such as 
     mobility, communication, self-care, self-direction, 
     interpersonal skills, work tolerance, or work skills) in 
     terms of an employment outcome;
       ``(ii) whose vocational rehabilitation can be expected to 
     require multiple vocational rehabilitation services over an 
     extended period of time; and
       ``(iii) who has one or more physical or mental disabilities 
     resulting from amputation, arthritis, autism, blindness, burn 
     injury, cancer, cerebral palsy, cystic fibrosis, deafness, 
     head injury, heart disease, hemiplegia, hemophilia, 
     respiratory or pulmonary dysfunction, mental retardation, 
     mental illness, multiple sclerosis, muscular dystrophy, 
     musculo-skeletal disorders, neurological disorders (including 
     stroke and epilepsy), paraplegia, quadriplegia, and other 
     spinal cord conditions, sickle cell anemia, specific learning 
     disability, end-stage renal disease, or another disability or 
     combination of disabilities determined on the basis of an 
     assessment for determining eligibility and vocational 
     rehabilitation needs described in subparagraphs (A) and (B) 
     of paragraph (2) to cause comparable substantial functional 
     limitation.
       ``(B) Independent living services and centers for 
     independent living.--For purposes of title VII, the term 
     `individual with a significant disability' means an 
     individual with a severe physical or mental impairment whose 
     ability to function independently in the family or community 
     or whose ability to obtain, maintain, or advance in 
     employment is substantially limited and for whom the delivery 
     of independent living services will improve the ability to 
     function, continue functioning, or move towards functioning 
     independently in the family or community or to continue in 
     employment, respectively.
       ``(C) Research and training.--For purposes of title II, the 
     term `individual with a significant disability' includes an 
     individual described in subparagraph (A) or (B).
       ``(D) Individuals with significant disabilities.--The term 
     `individuals with significant disabilities' means more than 
     one individual with a significant disability.
       ``(E) Individual with a most significant disability.--
       ``(i) In general.--The term `individual with a most 
     significant disability', used with respect to an individual 
     in a State, means an individual with a significant disability 
     who meets criteria established by the State under section 
     101(a)(5)(C).
       ``(ii) Individuals with the most significant 
     disabilities.--The term `individuals with the most 
     significant disabilities' means more than one individual with 
     a most significant disability.
       ``(22) Individual's representative; applicant's 
     representative.--The terms `individual's representative' and 
     `applicant's representative' mean a parent, a family member, 
     a guardian, an advocate, or an authorized representative of 
     an individual or applicant, respectively.
       ``(23) Institution of higher education.--The term 
     `institution of higher education' has the meaning given the 
     term in section 1201(a) of the Higher Education Act of 1965 
     (20 U.S.C. 1141(a)).
       ``(24) Local agency.--The term `local agency' means an 
     agency of a unit of general local government or of an Indian 
     tribe (or combination of such units or tribes) which has an 
     agreement with the designated State agency to conduct a 
     vocational rehabilitation program under the supervision of 
     such State agency in accordance with the State plan approved 
     under section 101. Nothing in the preceding sentence of this 
     paragraph or in section 101 shall be construed to prevent the 
     local agency from arranging to utilize another local public 
     or nonprofit agency to provide vocational rehabilitation 
     services if such an arrangement is made part of the agreement 
     specified in this paragraph.
       ``(25) Local workforce investment board.--The term `local 
     workforce investment board' means a local workforce 
     investment board established under section 117 of the 
     Workforce Investment Act of 1998.
       ``(26) Nonprofit.--The term `nonprofit', when used with 
     respect to a community rehabilitation program, means a 
     community rehabilitation program carried out by a corporation 
     or association, no part of the net earnings of which inures, 
     or may lawfully inure, to the benefit of any private 
     shareholder or individual and the income of which is exempt 
     from taxation under section 501(c)(3) of the Internal Revenue 
     Code of 1986.
       ``(27) Ongoing support services.--The term `ongoing support 
     services' means services--
       ``(A) provided to individuals with the most significant 
     disabilities;
       ``(B) provided, at a minimum, twice monthly--
       ``(i) to make an assessment, regarding the employment 
     situation, at the worksite of each such individual in 
     supported employment, or, under special circumstances, 
     especially at the request of the client, off site; and
       ``(ii) based on the assessment, to provide for the 
     coordination or provision of specific intensive services, at 
     or away from the worksite, that are needed to maintain 
     employment stability; and
       ``(C) consisting of--
       ``(i) a particularized assessment supplementary to the 
     comprehensive assessment described in paragraph (2)(B);
       ``(ii) the provision of skilled job trainers who accompany 
     the individual for intensive job skill training at the 
     worksite;
       ``(iii) job development, job retention, and placement 
     services;
       ``(iv) social skills training;
       ``(v) regular observation or supervision of the individual;
       ``(vi) followup services such as regular contact with the 
     employers, the individuals, the individuals' representatives, 
     and other appropriate individuals, in order to reinforce and 
     stabilize the job placement;
       ``(vii) facilitation of natural supports at the worksite;
       ``(viii) any other service identified in section 103; or
       ``(ix) a service similar to another service described in 
     this subparagraph.
       ``(28) Personal assistance services.--The term `personal 
     assistance services' means a range of services, provided by 
     one or more persons, designed to assist an individual with a 
     disability to perform daily living activities on or off the 
     job that the individual would typically perform if the 
     individual did not have a disability. Such services shall be 
     designed to increase the individual's control in life and 
     ability to perform everyday activities on or off the job.
       ``(29) Public or nonprofit.--The term `public or 
     nonprofit', used with respect to an agency or organization, 
     includes an Indian tribe.
       ``(30) Rehabilitation technology.--The term `rehabilitation 
     technology' means the systematic application of technologies, 
     engineering methodologies, or scientific principles to meet 
     the needs of and address the barriers confronted by 
     individuals with disabilities in areas which include 
     education, rehabilitation, employment, transportation, 
     independent living, and recreation. The term includes 
     rehabilitation engineering, assistive technology devices, and 
     assistive technology services.
       ``(31) Secretary.--The term `Secretary', except when the 
     context otherwise requires, means the Secretary of Education.
       ``(32) State.--The term `State' includes, in addition to 
     each of the several States of the United States, the District 
     of Columbia, the Commonwealth of Puerto Rico, the United 
     States Virgin Islands, Guam, American Samoa, and the 
     Commonwealth of the Northern Mariana Islands.
       ``(33) State workforce investment board.--The term `State 
     workforce investment board' means a State workforce 
     investment board established under section 111 of the 
     Workforce Investment Act of 1998.
       ``(34) Statewide workforce investment system.--The term 
     `statewide workforce investment system' means a system 
     described in section 111(d)(2) of the Workforce Investment 
     Act of 1998.
       ``(35) Supported employment.--
       ``(A) In general.--The term `supported employment' means 
     competitive work in integrated work settings, or employment 
     in integrated work settings in which individuals are working 
     toward competitive work, consistent with the strengths, 
     resources, priorities, concerns, abilities, capabilities, 
     interests, and informed choice of the individuals, for 
     individuals with the most significant disabilities--
       ``(i)(I) for whom competitive employment has not 
     traditionally occurred; or
       ``(II) for whom competitive employment has been interrupted 
     or intermittent as a result of a significant disability; and
       ``(ii) who, because of the nature and severity of their 
     disability, need intensive supported employment services for 
     the period, and any extension, described in paragraph (36)(C) 
     and extended services after the transition described in 
     paragraph (13)(C) in order to perform such work.
       ``(B) Certain transitional employment.--Such term includes 
     transitional employment for persons who are individuals with 
     the most significant disabilities due to mental illness.
       ``(36) Supported employment services.--The term `supported 
     employment services' means ongoing support services and other 
     appropriate services needed to support and maintain an 
     individual with a most significant disability in supported 
     employment, that--
       ``(A) are provided singly or in combination and are 
     organized and made available in such a way as to assist an 
     eligible individual to achieve competitive employment;
       ``(B) are based on a determination of the needs of an 
     eligible individual, as specified in an individualized plan 
     for employment; and
       ``(C) are provided by the designated State unit for a 
     period of time not to extend beyond 18 months, unless under 
     special circumstances the eligible individual and the 
     rehabilitation counselor or coordinator involved jointly 
     agree to extend the time in order to achieve the 
     rehabilitation objectives identified in the individualized 
     plan for employment.
       ``(37) Transition services.--The term `transition services' 
     means a coordinated set of activities for a student, designed 
     within an outcome-oriented process, that promotes movement 
     from school to post school activities, including 
     postsecondary education, vocational training, integrated 
     employment (including supported employment), continuing and 
     adult education, adult services, independent living, or 
     community participation. The coordinated set of activities 
     shall be based upon the individual student's needs, taking 
     into account the student's preferences and interests, and 
     shall include instruction, community experiences, the 
     development of

[[Page H6649]]

     employment and other post school adult living objectives, 
     and, when appropriate, acquisition of daily living skills and 
     functional vocational evaluation.
       ``(38) Vocational rehabilitation services.--The term 
     `vocational rehabilitation services' means those services 
     identified in section 103 which are provided to individuals 
     with disabilities under this Act.
       ``(39) Workforce investment activities.--The term 
     `workforce investment activities' means workforce investment 
     activities, as defined in section 101 of the Workforce 
     Investment Act of 1998, that are carried out under that Act.


                         ``allotment percentage

       ``Sec. 8. (a)(1) For purposes of section 110, the allotment 
     percentage for any State shall be 100 per centum less that 
     percentage which bears the same ratio to 50 per centum as the 
     per capita income of such State bears to the per capita 
     income of the United States, except that--
       ``(A) the allotment percentage shall in no case be more 
     than 75 per centum or less than 33\1/3\ per centum; and
       ``(B) the allotment percentage for the District of 
     Columbia, Puerto Rico, Guam, the Virgin Islands, American 
     Samoa, and the Commonwealth of the Northern Mariana Islands 
     shall be 75 per centum.
       ``(2) The allotment percentages shall be promulgated by the 
     Secretary between October 1 and December 31 of each even-
     numbered year, on the basis of the average of the per capita 
     incomes of the States and of the United States for the three 
     most recent consecutive years for which satisfactory data are 
     available from the Department of Commerce. Such promulgation 
     shall be conclusive for each of the two fiscal years in the 
     period beginning on the October 1 next succeeding such 
     promulgation.
       ``(3) The term `United States' means (but only for purposes 
     of this subsection) the fifty States and the District of 
     Columbia.
       ``(b) The population of the several States and of the 
     United States shall be determined on the basis of the most 
     recent data available, to be furnished by the Department of 
     Commerce by October 1 of the year preceding the fiscal year 
     for which funds are appropriated pursuant to statutory 
     authorizations.


                            ``nonduplication

       ``Sec. 10. In determining the amount of any State's Federal 
     share of expenditures for planning, administration, and 
     services incurred by it under a State plan approved in 
     accordance with section 101, there shall be disregarded (1) 
     any portion of such expenditures which are financed by 
     Federal funds provided under any other provision of law, and 
     (2) the amount of any non-Federal funds required to be 
     expended as a condition of receipt of such Federal funds. No 
     payment may be made from funds provided under one provision 
     of this Act relating to any cost with respect to which any 
     payment is made under any other provision of this Act, except 
     that this section shall not be construed to limit or reduce 
     fees for services rendered by community rehabilitation 
     programs.


                      ``application of other laws

       ``Sec. 11. The provisions of the Act of December 5, 1974 
     (Public Law 93-510) and of title V of the Act of October 15, 
     1977 (Public Law 95-134) shall not apply to the 
     administration of the provisions of this Act or to the 
     administration of any program or activity under this Act.


                      ``administration of the act

       ``Sec. 12. (a) In carrying out the purposes of this Act, 
     the Commissioner may--
       ``(1) provide consultative services and technical 
     assistance to public or nonprofit private agencies and 
     organizations, including assistance to enable such agencies 
     and organizations to facilitate meaningful and effective 
     participation by individuals with disabilities in workforce 
     investment activities;
       ``(2) provide short-term training and technical 
     instruction, including training for the personnel of 
     community rehabilitation programs, centers for independent 
     living, and other providers of services (including job 
     coaches);
       ``(3) conduct special projects and demonstrations;
       ``(4) collect, prepare, publish, and disseminate special 
     educational or informational materials, including reports of 
     the projects for which funds are provided under this Act; and
       ``(5) provide monitoring and conduct evaluations.
       ``(b)(1) In carrying out the duties under this Act, the 
     Commissioner may utilize the services and facilities of any 
     agency of the Federal Government and of any other public or 
     nonprofit agency or organization, in accordance with 
     agreements between the Commissioner and the head thereof, and 
     may pay therefor, in advance or by way of reimbursement, as 
     may be provided in the agreement.
       ``(2) In carrying out the provisions of this Act, the 
     Commissioner shall appoint such task forces as may be 
     necessary to collect and disseminate information in order to 
     improve the ability of the Commissioner to carry out the 
     provisions of this Act.
       ``(c) The Commissioner may promulgate such regulations as 
     are considered appropriate to carry out the Commissioner's 
     duties under this Act.
       ``(d) The Secretary shall promulgate regulations regarding 
     the requirements for the implementation of an order of 
     selection for vocational rehabilitation services under 
     section 101(a)(5)(A) if such services cannot be provided to 
     all eligible individuals with disabilities who apply for such 
     services.
       ``(e) Not later than 180 days after the date of enactment 
     of the Rehabilitation Act Amendments of 1998, the Secretary 
     shall receive public comment and promulgate regulations to 
     implement the amendments made by the Rehabilitation Act 
     Amendments of 1998.
       ``(f) In promulgating regulations to carry out this Act, 
     the Secretary shall promulgate only regulations that are 
     necessary to administer and ensure compliance with the 
     specific requirements of this Act.
       ``(g) There are authorized to be appropriated to carry out 
     this section such sums as may be necessary.


                               ``reports

       ``Sec. 13. (a) Not later than one hundred and eighty days 
     after the close of each fiscal year, the Commissioner shall 
     prepare and submit to the President and to the Congress a 
     full and complete report on the activities carried out under 
     this Act, including the activities and staffing of the 
     information clearinghouse under section 15.
       ``(b) The Commissioner shall collect information to 
     determine whether the purposes of this Act are being met and 
     to assess the performance of programs carried out under this 
     Act. The Commissioner shall take whatever action is necessary 
     to assure that the identity of each individual for which 
     information is supplied under this section is kept 
     confidential, except as otherwise required by law (including 
     regulation).
       ``(c) In preparing the report, the Commissioner shall 
     annually collect and include in the report information based 
     on the information submitted by States in accordance with 
     section 101(a)(10), including information on administrative 
     costs as required by section 101(a)(10)(D). The Commissioner 
     shall, to the maximum extent appropriate, include in the 
     report all information that is required to be submitted in 
     the reports described in section 136(d) of the Workforce 
     Investment Act of 1998 and that pertains to the employment of 
     individuals with disabilities.


                              ``evaluation

       ``Sec. 14. (a) For the purpose of improving program 
     management and effectiveness, the Secretary, in consultation 
     with the Commissioner, shall evaluate all the programs 
     authorized by this Act, their general effectiveness in 
     relation to their cost, their impact on related programs, and 
     their structure and mechanisms for delivery of services, 
     using appropriate methodology and evaluative research 
     designs. The Secretary shall establish and use standards for 
     the evaluations required by this subsection. Such an 
     evaluation shall be conducted by a person not immediately 
     involved in the administration of the program evaluated.
       ``(b) In carrying out evaluations under this section, the 
     Secretary shall obtain the opinions of program and project 
     participants about the strengths and weaknesses of the 
     programs and projects.
       ``(c) The Secretary shall take the necessary action to 
     assure that all studies, evaluations, proposals, and data 
     produced or developed with Federal funds under this Act shall 
     become the property of the United States.
       ``(d) Such information as the Secretary may determine to be 
     necessary for purposes of the evaluations conducted under 
     this section shall be made available upon request of the 
     Secretary, by the departments and agencies of the executive 
     branch.
       ``(e)(1) To assess the linkages between vocational 
     rehabilitation services and economic and noneconomic 
     outcomes, the Secretary shall continue to conduct a 
     longitudinal study of a national sample of applicants for the 
     services.
       ``(2) The study shall address factors related to attrition 
     and completion of the program through which the services are 
     provided and factors within and outside the program affecting 
     results. Appropriate comparisons shall be used to contrast 
     the experiences of similar persons who do not obtain the 
     services.
       ``(3) The study shall be planned to cover the period 
     beginning on the application of individuals with disabilities 
     for the services, through the eligibility determination and 
     provision of services for the individuals, and a further 
     period of not less than 2 years after the termination of 
     services.
       ``(f)(1) The Commissioner shall identify and disseminate 
     information on exemplary practices concerning vocational 
     rehabilitation.
       ``(2) To facilitate compliance with paragraph (1), the 
     Commissioner shall conduct studies and analyses that identify 
     exemplary practices concerning vocational rehabilitation, 
     including studies in areas relating to providing informed 
     choice in the rehabilitation process, promoting consumer 
     satisfaction, promoting job placement and retention, 
     providing supported employment, providing services to 
     particular disability populations, financing personal 
     assistance services, providing assistive technology devices 
     and assistive technology services, entering into cooperative 
     agreements, establishing standards and certification for 
     community rehabilitation programs, converting from 
     nonintegrated to integrated employment, and providing 
     caseload management.
       ``(g) There are authorized to be appropriated to carry out 
     this section such sums as may be necessary.


                      ``information clearinghouse

       ``Sec. 15. (a) The Secretary shall establish a central 
     clearinghouse for information and resource availability for 
     individuals with disabilities which shall provide information 
     and data regarding--
       ``(1) the location, provision, and availability of services 
     and programs for individuals with disabilities, including 
     such information and data provided by State workforce 
     investment boards regarding such services and programs 
     authorized under title I of such Act;
       ``(2) research and recent medical and scientific 
     developments bearing on disabilities (and their prevention, 
     amelioration, causes, and cures); and
       ``(3) the current numbers of individuals with disabilities 
     and their needs.
     The clearinghouse shall also provide any other relevant 
     information and data which the Secretary considers 
     appropriate.

[[Page H6650]]

       ``(b) The Commissioner may assist the Secretary to develop 
     within the Department of Education a coordinated system of 
     information and data retrieval, which will have the capacity 
     and responsibility to provide information regarding the 
     information and data referred to in subsection (a) of this 
     section to the Congress, public and private agencies and 
     organizations, individuals with disabilities and their 
     families, professionals in fields serving such individuals, 
     and the general public.
       ``(c) The office established to carry out the provisions of 
     this section shall be known as the `Office of Information and 
     Resources for Individuals with Disabilities'.
       ``(d) There are authorized to be appropriated to carry out 
     this section such sums as may be necessary.


                          ``transfer of funds

       ``Sec. 16. (a) Except as provided in subsection (b) of this 
     section, no funds appropriated under this Act for any program 
     or activity may be used for any purpose other than that for 
     which the funds were specifically authorized.
       ``(b) No more than 1 percent of funds appropriated for 
     discretionary grants, contracts, or cooperative agreements 
     authorized by this Act may be used for the purpose of 
     providing non-Federal panels of experts to review 
     applications for such grants, contracts, or cooperative 
     agreements.


                         ``state administration

       ``Sec. 17. The application of any State rule or policy 
     relating to the administration or operation of programs 
     funded by this Act (including any rule or policy based on 
     State interpretation of any Federal law, regulation, or 
     guideline) shall be identified as a State imposed 
     requirement.


                        ``review of applications

       ``Sec. 18. Applications for grants in excess of $100,000 in 
     the aggregate authorized to be funded under this Act, other 
     than grants primarily for the purpose of conducting 
     dissemination or conferences, shall be reviewed by panels of 
     experts which shall include a majority of non-Federal 
     members. Non-Federal members may be provided travel, per 
     diem, and consultant fees not to exceed the daily equivalent 
     of the rate of pay for level 4 of the Senior Executive 
     Service Schedule under section 5382 of title 5, United States 
     Code.

     ``SEC. 19. CARRYOVER.

       ``(a) In General.--Except as provided in subsection (b), 
     and notwithstanding any other provision of law--
       ``(1) any funds appropriated for a fiscal year to carry out 
     any grant program under part B of title I, section 509 
     (except as provided in section 509(b)), part B of title VI, 
     part B or C of chapter 1 of title VII, or chapter 2 of title 
     VII (except as provided in section 752(b)), including any 
     funds reallotted under any such grant program, that are not 
     obligated and expended by recipients prior to the beginning 
     of the succeeding fiscal year; or
       ``(2) any amounts of program income, including 
     reimbursement payments under the Social Security Act (42 
     U.S.C. 301 et seq.), received by recipients under any grant 
     program specified in paragraph (1) that are not obligated and 
     expended by recipients prior to the beginning of the fiscal 
     year succeeding the fiscal year in which such amounts were 
     received,
     shall remain available for obligation and expenditure by such 
     recipients during such succeeding fiscal year.
       ``(b) Non-Federal Share.--Such funds shall remain available 
     for obligation and expenditure by a recipient as provided in 
     subsection (a) only to the extent that the recipient complied 
     with any Federal share requirements applicable to the program 
     for the fiscal year for which the funds were appropriated.

     ``SEC. 20. CLIENT ASSISTANCE INFORMATION.

       ``All programs, including community rehabilitation 
     programs, and projects, that provide services to individuals 
     with disabilities under this Act shall advise such 
     individuals who are applicants for or recipients of the 
     services, or the applicants' representatives or individuals' 
     representatives, of the availability and purposes of the 
     client assistance program under section 112, including 
     information on means of seeking assistance under such 
     program.

     ``SEC. 21. TRADITIONALLY UNDERSERVED POPULATIONS.

       ``(a) Findings.--With respect to the programs authorized in 
     titles II through VII, the Congress finds as follows:
       ``(1) Racial profile.--The racial profile of America is 
     rapidly changing. While the rate of increase for white 
     Americans is 3.2 percent, the rate of increase for racial and 
     ethnic minorities is much higher: 38.6 percent for Latinos, 
     14.6 percent for African-Americans, and 40.1 percent for 
     Asian-Americans and other ethnic groups. By the year 2000, 
     the Nation will have 260,000,000 people, one of every three 
     of whom will be either African-American, Latino, or Asian-
     American.
       ``(2) Rate of disability.--Ethnic and racial minorities 
     tend to have disabling conditions at a disproportionately 
     high rate. The rate of work-related disability for American 
     Indians is about one and one-half times that of the general 
     population. African-Americans are also one and one-half times 
     more likely to be disabled than whites and twice as likely to 
     be significantly disabled.
       ``(3) Inequitable treatment.--Patterns of inequitable 
     treatment of minorities have been documented in all major 
     junctures of the vocational rehabilitation process. As 
     compared to white Americans, a larger percentage of African-
     American applicants to the vocational rehabilitation system 
     is denied acceptance. Of applicants accepted for service, a 
     larger percentage of African-American cases is closed without 
     being rehabilitated. Minorities are provided less training 
     than their white counterparts. Consistently, less money is 
     spent on minorities than on their white counterparts.
       ``(4) Recruitment.--Recruitment efforts within vocational 
     rehabilitation at the level of preservice training, 
     continuing education, and in-service training must focus on 
     bringing larger numbers of minorities into the profession in 
     order to provide appropriate practitioner knowledge, role 
     models, and sufficient manpower to address the clearly 
     changing demography of vocational rehabilitation.
       ``(b) Outreach to Minorities.--
       ``(1) In general.--For each fiscal year, the Commissioner 
     and the Director of the National Institute on Disability and 
     Rehabilitation Research (referred to in this subsection as 
     the `Director') shall reserve 1 percent of the funds 
     appropriated for the fiscal year for programs authorized 
     under titles II, III, VI, and VII to carry out this 
     subsection. The Commissioner and the Director shall use the 
     reserved funds to carry out 1 or more of the activities 
     described in paragraph (2) through a grant, contract, or 
     cooperative agreement.
       ``(2) Activities.--The activities carried out by the 
     Commissioner and the Director shall include 1 or more of the 
     following:
       ``(A) Making awards to minority entities and Indian tribes 
     to carry out activities under the programs authorized under 
     titles II, III, VI, and VII.
       ``(B) Making awards to minority entities and Indian tribes 
     to conduct research, training, technical assistance, or a 
     related activity, to improve services provided under this 
     Act, especially services provided to individuals from 
     minority backgrounds.
       ``(C) Making awards to entities described in paragraph (3) 
     to provide outreach and technical assistance to minority 
     entities and Indian tribes to promote their participation in 
     activities funded under this Act, including assistance to 
     enhance their capacity to carry out such activities.
       ``(3) Eligibility.--To be eligible to receive an award 
     under paragraph (2)(C), an entity shall be a State or a 
     public or private nonprofit agency or organization, such as 
     an institution of higher education or an Indian tribe.
       ``(4) Report.--In each fiscal year, the Commissioner and 
     the Director shall prepare and submit to Congress a report 
     that describes the activities funded under this subsection 
     for the preceding fiscal year.
       ``(5) Definitions.--In this subsection:
       ``(A) Historically black college or university.--The term 
     `historically Black college or university' means a part B 
     institution, as defined in section 322(2) of the Higher 
     Education Act of 1965 (20 U.S.C. 1061(2)).
       ``(B) Minority entity.--The term `minority entity' means an 
     entity that is a historically Black college or university, a 
     Hispanic-serving institution of higher education, an American 
     Indian tribal college or university, or another institution 
     of higher education whose minority student enrollment is at 
     least 50 percent.
       ``(c) Demonstration.--In awarding grants, or entering into 
     contracts or cooperative agreements under titles I, II, III, 
     VI, and VII, and section 509, the Commissioner and the 
     Director, in appropriate cases, shall require applicants to 
     demonstrate how the applicants will address, in whole or in 
     part, the needs of individuals with disabilities from 
     minority backgrounds.''.

     SEC. 404. VOCATIONAL REHABILITATION SERVICES.

       Title I of the Rehabilitation Act of 1973 (29 U.S.C. 720 et 
     seq.) is amended to read as follows:
             ``TITLE I--VOCATIONAL REHABILITATION SERVICES

                      ``PART A--GENERAL PROVISIONS

     ``SEC. 100. DECLARATION OF POLICY; AUTHORIZATION OF 
                   APPROPRIATIONS.

       ``(a) Findings; Purpose; Policy.--
       ``(1) Findings.--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 the United States;
       ``(B) as a group, individuals with disabilities experience 
     staggering levels of unemployment and poverty;
       ``(C) individuals with disabilities, including individuals 
     with the most significant disabilities, have demonstrated 
     their ability to achieve gainful employment in integrated 
     settings if appropriate services and supports are provided;
       ``(D) reasons for significant numbers of individuals with 
     disabilities not working, or working at levels 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 carried out 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 private health insurance; and
       ``(iv) lack of education, training, and supports to meet 
     job qualification standards necessary to secure, retain, 
     regain, 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;
       ``(F) the provision of workforce investment activities and 
     vocational rehabilitation services can enable individuals 
     with disabilities, including individuals with the most 
     significant disabilities, to pursue meaningful careers by 
     securing gainful employment commensurate with their abilities 
     and capabilities; and
       ``(G) linkages between the vocational rehabilitation 
     programs established under this title and other components of 
     the statewide workforce investment systems are critical to 
     ensure effective and meaningful participation by individuals

[[Page H6651]]

     with disabilities in workforce investment activities.
       ``(2) Purpose.--The purpose of this title is to assist 
     States in operating statewide comprehensive, coordinated, 
     effective, efficient, and accountable programs of vocational 
     rehabilitation, each of which is--
       ``(A) an integral part of a statewide workforce investment 
     system; and
       ``(B) designed to assess, plan, develop, and provide 
     vocational rehabilitation services for individuals with 
     disabilities, consistent with their strengths, resources, 
     priorities, concerns, abilities, capabilities, interests, and 
     informed choice, so that such individuals may prepare for and 
     engage in gainful employment.
       ``(3) Policy.--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 significant 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 who are applicants for such programs or 
     eligible to participate in such programs must be active and 
     full partners in the vocational rehabilitation process, 
     making meaningful and informed choices--
       ``(i) during assessments for determining eligibility and 
     vocational rehabilitation needs; and
       ``(ii) in the selection of employment outcomes for the 
     individuals, services needed to achieve the outcomes, 
     entities providing such services, and the methods used to 
     secure such services.
       ``(D) Families and other natural supports can play 
     important roles in the success of a vocational rehabilitation 
     program, if the individual with a disability involved 
     requests, desires, or needs such supports.
       ``(E) Vocational rehabilitation counselors that are trained 
     and prepared in accordance with State policies and procedures 
     as described in section 101(a)(7)(B) (referred to 
     individually in this title as a `qualified vocational 
     rehabilitation counselor'), other qualified rehabilitation 
     personnel, and other qualified personnel facilitate the 
     accomplishment of the employment outcomes and objectives of 
     an individual.
       ``(F) Individuals with disabilities and the individuals' 
     representatives are full partners in a 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 the 
     accomplishment of the goals and objectives of the program, 
     including providing vocational rehabilitation services to, 
     among others, individuals with the most significant 
     disabilities.
       ``(b) Authorization of Appropriations.--
       ``(1) In general.--For the purpose of making grants to 
     States under part B 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 1999 through 2003, except that the amount to be 
     appropriated for a fiscal year shall not be less than the 
     amount of the appropriation under this paragraph for the 
     immediately preceding fiscal year, increased by the 
     percentage change in the Consumer Price Index determined 
     under subsection (c) for the immediately preceding fiscal 
     year.
       ``(2) Reference.--The reference in paragraph (1) to grants 
     to States under part B shall not be considered to refer to 
     grants under section 112.
       ``(c) Consumer Price Index.--
       ``(1) Percentage change.--No later than November 15 of each 
     fiscal year (beginning with 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) Application.--
       ``(A) Increase.--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)(1) for the subsequent fiscal year shall 
     be at least the amount appropriated under subsection (b)(1) 
     for the fiscal year in which the publication is made under 
     paragraph (1) increased by such percentage change.
       ``(B) No increase or decrease.--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)(1) for the 
     subsequent fiscal year shall be at least the amount 
     appropriated under subsection (b)(1) for the fiscal year in 
     which the publication is made under paragraph (1).
       ``(3) Definition.--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) Extension.--
       ``(1) In general.--
       ``(A) Authorization or duration of program.--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 or duration is 
     automatically extended for 1 additional year for the program 
     authorized by this title.
       ``(B) Calculation.--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 2003, increased 
     by the percentage change in the Consumer Price Index 
     determined under subsection (c) for the immediately preceding 
     fiscal year, if the percentage change indicates an increase.
       ``(2) Construction.--
       ``(A) Passage of legislation.--For the purposes of 
     paragraph (1)(A), Congress shall not be deemed to have passed 
     legislation unless such legislation becomes law.
       ``(B) Acts or determinations of commissioner.--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 the extension described in 
     that part of paragraph (1) that follows clause (ii) of 
     paragraph (1)(A) is in effect.

     ``SEC. 101. STATE PLANS.

       ``(a) Plan Requirements.--
       ``(1) In general.--
       ``(A) Submission.--To be eligible to participate in 
     programs under this title, a State shall submit to the 
     Commissioner a State plan for vocational rehabilitation 
     services that meets the requirements of this section, on the 
     same date that the State submits a State plan under section 
     112 of the Workforce Investment Act of 1998.
       ``(B) Nonduplication.--The State shall not be required to 
     submit, in the State plan for vocational rehabilitation 
     services, policies, procedures, or descriptions required 
     under this title that have been previously submitted to the 
     Commissioner and that demonstrate that such State meets the 
     requirements of this title, including any policies, 
     procedures, or descriptions submitted under this title as in 
     effect on the day before the effective date of the 
     Rehabilitation Act Amendments of 1998.
       ``(C) Duration.--The State plan shall remain in effect 
     subject to the submission of such modifications as the State 
     determines to be necessary or as the Commissioner may require 
     based on a change in State policy, a change in Federal law 
     (including regulations), an interpretation of this Act by a 
     Federal court or the highest court of the State, or a finding 
     by the Commissioner of State noncompliance with the 
     requirements of this Act, until the State submits and 
     receives approval of a new State plan.
       ``(2) Designated state agency; designated state unit.--
       ``(A) Designated state agency.--The State plan shall 
     designate a State agency as the sole State agency to 
     administer the plan, or to supervise the administration of 
     the plan by a local agency, except that--
       ``(i) where, under State law, the State agency for 
     individuals who are blind or another agency that provides 
     assistance or services to adults who are blind is authorized 
     to provide vocational rehabilitation services to individuals 
     who are blind, that 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 to administer or 
     supervise the administration of the rest of the State plan;
       ``(ii) the Commissioner, on the request of a State, may 
     authorize the designated State agency to share funding and 
     administrative responsibility with another agency of the 
     State or with a local agency in order to permit the 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 
     the joint program, with the requirement of paragraph (4) that 
     the plan be in effect in all political subdivisions of the 
     State; and
       ``(iii) in the case of American Samoa, the appropriate 
     State agency shall be the Governor of American Samoa.
       ``(B) Designated state unit.--The State agency designated 
     under subparagraph (A) shall be--
       ``(i) a State agency primarily concerned with vocational 
     rehabilitation, or vocational and other rehabilitation, of 
     individuals with disabilities; or
       ``(ii) if not such an agency, the State agency (or each 
     State agency if 2 are so designated) shall include a 
     vocational rehabilitation bureau, division, or other 
     organizational unit that--

       ``(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 the designated State 
     agency;
       ``(II) has a full-time director;
       ``(III) has a staff employed on the rehabilitation work of 
     the organizational unit all or substantially all of whom are 
     employed full time on such work; and
       ``(IV) is located at an organizational level and has an 
     organizational status within the designated State agency 
     comparable to that of other major organizational units of the 
     designated State agency.

       ``(C) Responsibility for services for the blind.--If the 
     State has designated only 1 State agency pursuant to 
     subparagraph (A), the State may assign responsibility for the 
     part of the plan under which vocational rehabilitation 
     services are provided for individuals who are blind to an 
     organizational unit of the designated State agency and assign 
     responsibility

[[Page H6652]]

     for the rest of the plan to another organizational unit of 
     the designated State agency, with the provisions of 
     subparagraph (B) applying separately to each of the 
     designated State units.
       ``(3) Non-federal share.--The State plan shall provide for 
     financial participation by the State, or if the State so 
     elects, by the State and local agencies, to provide the 
     amount of the non-Federal share of the cost of carrying out 
     part B.
       ``(4) Statewideness.--The State plan shall provide that the 
     plan shall be in effect in all political subdivisions of the 
     State, except that--
       ``(A) in the case of any activity that, 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 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 the vocational rehabilitation services involved is 
     met from funds made available by a local agency (including 
     funds contributed to such agency by a private agency, 
     organization, or individual); and
       ``(B) in a case in which earmarked funds are used toward 
     the non-Federal share and such funds are earmarked for 
     particular geographic areas within the State, the earmarked 
     funds may be used in such areas if the State notifies the 
     Commissioner that the State cannot provide the full non-
     Federal share without such funds.
       ``(5) Order of selection for vocational rehabilitation 
     services.--In the event that vocational rehabilitation 
     services cannot be provided to all eligible individuals with 
     disabilities in the State who apply for the services, the 
     State plan shall--
       ``(A) show the order to be followed in selecting eligible 
     individuals to be provided vocational rehabilitation 
     services;
       ``(B) provide the justification for the order of selection;
       ``(C) include an assurance that, in accordance with 
     criteria established by the State for the order of selection, 
     individuals with the most significant disabilities will be 
     selected first for the provision of vocational rehabilitation 
     services; and
       ``(D) provide that eligible individuals, who do not meet 
     the order of selection criteria, shall have access to 
     services provided through the information and referral system 
     implemented under paragraph (20).
       ``(6) Methods for administration.--
       ``(A) In general.--The State plan shall provide for such 
     methods of administration as are found by the Commissioner to 
     be necessary for the proper and efficient administration of 
     the plan.
       ``(B) Employment of individuals with disabilities.--The 
     State plan shall provide that the designated State agency, 
     and entities carrying out community rehabilitation programs 
     in the State, who are 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.
       ``(C) Facilities.--The State plan shall provide that 
     facilities used in connection with the delivery of services 
     assisted under the State plan shall comply with the Act 
     entitled `An Act to insure that certain buildings financed 
     with Federal funds are so designed and constructed as to be 
     accessible to the physically handicapped', approved on August 
     12, 1968 (commonly known as the `Architectural Barriers Act 
     of 1968'), with section 504, and with the Americans with 
     Disabilities Act of 1990.
       ``(7) Comprehensive system of personnel development.--The 
     State plan shall--
       ``(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 
     designated 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 designated State unit in the provision of vocational 
     rehabilitation services, including ratios of qualified 
     vocational rehabilitation 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 vocational rehabilitation 
     field, and other relevant factors;

       ``(ii) where appropriate, a description of the manner in 
     which activities will be undertaken under this section to 
     coordinate the system of personnel development with personnel 
     development activities 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 programs of 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 of such students who graduated with 
     certification or licensure, or with credentials to qualify 
     for certification or licensure, as a rehabilitation 
     professional 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, institutions of 
     higher education, 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 
     designated 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 this Act made by the 
     Rehabilitation Act Amendments of 1998;

       ``(B) set forth policies and procedures relating to the 
     establishment and maintenance of standards to ensure that 
     personnel, including rehabilitation professionals and 
     paraprofessionals, needed within the designated State unit 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 that 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 an applicant or eligible 
     individual.
       ``(8) Comparable services and benefits.--
       ``(A) Determination of availability.--
       ``(i) In general.--The State plan shall include an 
     assurance that, prior to providing any vocational 
     rehabilitation service to an eligible individual, except 
     those services specified in paragraph (5)(D) and in 
     paragraphs (1) through (4) and (14) of section 103(a), the 
     designated State unit will determine whether comparable 
     services and benefits are available under any other program 
     (other than a program carried out under this title) unless 
     such a determination would interrupt or delay--

       ``(I) the progress of the individual toward achieving the 
     employment outcome identified in the individualized plan for 
     employment of the individual in accordance with section 
     102(b);
       ``(II) an immediate job placement; or
       ``(III) the provision of such service to any individual at 
     extreme medical risk.

       ``(ii) Awards and scholarships.--For purposes of clause 
     (i), comparable benefits do not include awards and 
     scholarships based on merit.
       ``(B) Interagency agreement.--The State plan shall include 
     an assurance that the Governor of the State, in consultation 
     with the entity in the State responsible for the vocational 
     rehabilitation program and other appropriate agencies, will 
     ensure that an interagency agreement or other mechanism for 
     interagency coordination takes effect between any appropriate 
     public entity, including the State entity responsible for 
     administering the State medicaid program, a public 
     institution of higher education, and a component of the 
     statewide workforce investment system, and the designated 
     State unit, in order to ensure the provision of vocational 
     rehabilitation services described in subparagraph (A) (other 
     than those services specified in paragraph (5)(D), and in 
     paragraphs (1) through (4) and (14) of section 103(a)), that 
     are included in the individualized plan for employment of an 
     eligible individual, including the provision of such 
     vocational rehabilitation services during the pendency of any 
     dispute described in clause (iii). Such agreement or 
     mechanism shall include the following:
       ``(i) Agency financial responsibility.--An identification 
     of, or a description of a method for defining, the financial 
     responsibility of such public entity for providing such 
     services, and a provision stating the financial 
     responsibility of such public entity for providing such 
     services.
       ``(ii) Conditions, terms, and procedures of 
     reimbursement.--Information specifying the conditions, terms, 
     and procedures under which a designated State unit shall be 
     reimbursed by other public entities for providing such 
     services, based on the provisions of such agreement or 
     mechanism.
       ``(iii) Interagency disputes.--Information specifying 
     procedures for resolving interagency disputes under the 
     agreement or other mechanism (including procedures under 
     which the designated State unit may initiate proceedings to 
     secure reimbursement from other public entities or otherwise 
     implement the provisions of the agreement or mechanism).
       ``(iv) Coordination of services procedures.--Information 
     specifying policies and procedures for public entities to 
     determine and identify the interagency coordination 
     responsibilities of each public entity to promote the 
     coordination and timely delivery of vocational rehabilitation 
     services (except those services specified in paragraph (5)(D) 
     and in paragraphs (1) through (4) and (14) of section 
     103(a)).

[[Page H6653]]

       ``(C) Responsibilities of other public entities.--
       ``(i) Responsibilities under other law.--Notwithstanding 
     subparagraph (B), if any public entity other than a 
     designated State unit is obligated under Federal or State 
     law, or assigned responsibility under State policy or under 
     this paragraph, to provide or pay for any services that are 
     also considered to be vocational rehabilitation services 
     (other than those specified in paragraph (5)(D) and in 
     paragraphs (1) through (4) and (14) of section 103(a)), such 
     public entity shall fulfill that obligation or 
     responsibility, either directly or by contract or other 
     arrangement.
       ``(ii) Reimbursement.--If a public entity other than the 
     designated State unit fails to provide or pay for the 
     services described in clause (i) for an eligible individual, 
     the designated State unit shall provide or pay for such 
     services to the individual. Such designated State unit may 
     claim reimbursement for the services from the public entity 
     that failed to provide or pay for such services. Such public 
     entity shall reimburse the designated State unit pursuant to 
     the terms of the interagency agreement or other mechanism 
     described in this paragraph according to the procedures 
     established in such agreement or mechanism pursuant to 
     subparagraph (B)(ii).
       ``(D) Methods.--The Governor of a State may meet the 
     requirements of subparagraph (B) through--
       ``(i) a State statute or regulation;
       ``(ii) a signed agreement between the respective officials 
     of the public entities that clearly identifies the 
     responsibilities of each public entity relating to the 
     provision of services; or
       ``(iii) another appropriate method, as determined by the 
     designated State unit.
       ``(9) Individualized plan for employment.--
       ``(A) Development and implementation.--The State plan shall 
     include an assurance that an individualized plan for 
     employment meeting the requirements of section 102(b) will be 
     developed and implemented in a timely manner for an 
     individual subsequent to the determination of the eligibility 
     of the individual for services under this title, except that 
     in a State operating under an order of selection described in 
     paragraph (5), the plan will be developed and implemented 
     only for individuals meeting the order of selection criteria 
     of the State.
       ``(B) Provision of services.--The State plan shall include 
     an assurance that such services will be provided in 
     accordance with the provisions of the individualized plan for 
     employment.
       ``(10) Reporting requirements.--
       ``(A) In general.--The State plan shall include an 
     assurance that the designated State agency will submit 
     reports in the form and level of detail and at the time 
     required by the Commissioner regarding applicants for, and 
     eligible individuals receiving, services under this title.
       ``(B) Annual reporting.--In specifying the information to 
     be submitted in the reports, the Commissioner shall require 
     annual reporting on the eligible individuals receiving the 
     services, on those specific data elements described in 
     section 136(d)(2) of the Workforce Investment Act of 1998 
     that are determined by the Secretary to be relevant in 
     assessing the performance of designated State units in 
     carrying out the vocational rehabilitation program 
     established under this title.
       ``(C) Additional data.--In specifying the information 
     required to be submitted in the reports, the Commissioner 
     shall require additional data with regard to applicants and 
     eligible individuals related to--
       ``(i) the number of applicants and the number of 
     individuals determined to be eligible or ineligible for the 
     program carried out under this title, including--

       ``(I) the number of individuals determined to be ineligible 
     because they did not require vocational rehabilitation 
     services, as provided in section 102(a); and
       ``(II) the number of individuals determined, on the basis 
     of clear and convincing evidence, to be too severely disabled 
     to benefit in terms of an employment outcome from vocational 
     rehabilitation services;

       ``(ii) the number of individuals who received vocational 
     rehabilitation services through the program, including--

       ``(I) the number who received services under paragraph 
     (5)(D), but not assistance under an individualized plan for 
     employment;
       ``(II) of those recipients who are individuals with 
     significant disabilities, the number who received assistance 
     under an individualized plan for employment consistent with 
     section 102(b); and
       ``(III) of those recipients who are not individuals with 
     significant disabilities, the number who received assistance 
     under an individualized plan for employment consistent with 
     section 102(b);

       ``(iii) of those applicants and eligible recipients who are 
     individuals with significant disabilities--

       ``(I) the number who ended their participation in the 
     program carried out under this title and the number who 
     achieved employment outcomes after receiving vocational 
     rehabilitation services; and
       ``(II) the number who ended their participation in the 
     program and who were employed 6 months and 12 months after 
     securing or regaining employment, or, in the case of 
     individuals whose employment outcome was to retain or advance 
     in employment, who were employed 6 months and 12 months after 
     achieving their employment outcome, including--

       ``(aa) the number who earned the minimum wage rate 
     specified in section 6(a)(1) of the Fair Labor Standards Act 
     of 1938 (29 U.S.C. 206(a)(1)) or another wage level set by 
     the Commissioner, during such employment; and
       ``(bb) the number who received employment benefits from an 
     employer during such employment; and
       ``(iv) of those applicants and eligible recipients who are 
     not individuals with significant disabilities--

       ``(I) the number who ended their participation in the 
     program carried out under this title and the number who 
     achieved employment outcomes after receiving vocational 
     rehabilitation services; and
       ``(II) the number who ended their participation in the 
     program and who were employed 6 months and 12 months after 
     securing or regaining employment, or, in the case of 
     individuals whose employment outcome was to retain or advance 
     in employment, who were employed 6 months and 12 months after 
     achieving their employment outcome, including--

       ``(aa) the number who earned the minimum wage rate 
     specified in section 6(a)(1) of the Fair Labor Standards Act 
     of 1938 (29 U.S.C. 206(a)(1)) or another wage level set by 
     the Commissioner, during such employment; and
       ``(bb) the number who received employment benefits from an 
     employer during such employment.
       ``(D) Costs and results.--The Commissioner shall also 
     require that the designated State agency include in the 
     reports information on--
       ``(i) the costs under this title of conducting 
     administration, providing assessment services, counseling and 
     guidance, and other direct services provided by designated 
     State agency staff, providing services purchased under 
     individualized plans for employment, supporting small 
     business enterprises, establishing, developing, and improving 
     community rehabilitation programs, providing other services 
     to groups, and facilitating use of other programs under this 
     Act and title I of the Workforce Investment Act of 1998 by 
     eligible individuals; and
       ``(ii) the results of annual evaluation by the State of 
     program effectiveness under paragraph (15)(E).
       ``(E) Additional information.--The Commissioner shall 
     require that each designated State unit include in the 
     reports additional information related to the applicants and 
     eligible individuals, obtained either through a complete 
     count or sampling, including--
       ``(i) information on--

       ``(I) age, gender, race, ethnicity, education, category of 
     impairment, severity of disability, and whether the 
     individuals are students with disabilities;

       ``(II) dates of application, determination of eligibility 
     or ineligibility, initiation of the individualized plan for 
     employment, and termination of participation in the program;
       ``(III) earnings at the time of application for the program 
     and termination of participation in the program;
       ``(IV) work status and occupation;
       ``(V) types of services, including assistive technology 
     services and assistive technology devices, provided under the 
     program;
       ``(VI) types of public or private programs or agencies that 
     furnished services under the program; and
       ``(VII) the reasons for individuals terminating 
     participation in the program without achieving an employment 
     outcome; and

       ``(ii) information necessary to determine the success of 
     the State in meeting--

       ``(I) the State performance measures established under 
     section 136(b) of the Workforce Investment Act of 1998, to 
     the extent the measures are applicable to individuals with 
     disabilities; and
       ``(II) the standards and indicators established pursuant to 
     section 106.

       ``(F) Completeness and confidentiality.--The State plan 
     shall include an assurance that the information submitted in 
     the reports will include a complete count, except as provided 
     in subparagraph (E), of the applicants and eligible 
     individuals, in a manner permitting the greatest possible 
     cross-classification of data and that the identity of each 
     individual for which information is supplied under this 
     paragraph will be kept confidential.
       ``(11) Cooperation, collaboration, and coordination.--
       ``(A) Cooperative agreements with other components of 
     statewide workforce investment systems.--The State plan shall 
     provide that the designated State unit or designated State 
     agency shall enter into a cooperative agreement with other 
     entities that are components of the statewide workforce 
     investment system of the State, regarding the system, which 
     agreement may provide for--
       ``(i) provision of intercomponent staff training and 
     technical assistance with regard to--

       ``(I) the availability and benefits of, and information on 
     eligibility standards for, vocational rehabilitation 
     services; and
       ``(II) the promotion of equal, effective, and meaningful 
     participation by individuals with disabilities in workforce 
     investment activities in the State through the promotion of 
     program accessibility, the use of nondiscriminatory policies 
     and procedures, and the provision of reasonable 
     accommodations, auxiliary aids and services, and 
     rehabilitation technology, for individuals with disabilities;

       ``(ii) use of information and financial management systems 
     that link all components of the statewide workforce 
     investment system, that link the components to other 
     electronic networks, including nonvisual electronic networks, 
     and that relate to such subjects as employment statistics, 
     and information on job vacancies, career planning, and 
     workforce investment activities;
       ``(iii) use of customer service features such as common 
     intake and referral procedures, customer databases, resource 
     information, and human services hotlines;
       ``(iv) establishment of cooperative efforts with employers 
     to--

       ``(I) facilitate job placement; and
       ``(II) carry out any other activities that the designated 
     State unit and the employers determine to be appropriate;

[[Page H6654]]

       ``(v) identification of staff roles, responsibilities, and 
     available resources, and specification of the financial 
     responsibility of each component of the statewide workforce 
     investment system with regard to paying for necessary 
     services (consistent with State law and Federal 
     requirements); and
       ``(vi) specification of procedures for resolving disputes 
     among such components.
       ``(B) Replication of cooperative agreements.--The State 
     plan shall provide for the replication of such cooperative 
     agreements at the local level between individual offices of 
     the designated State unit and local entities carrying out 
     activities through the statewide workforce investment system.
       ``(C) Interagency cooperation with other agencies.--The 
     State plan shall include descriptions of interagency 
     cooperation with, and utilization of the services and 
     facilities of, Federal, State, and local agencies and 
     programs, including programs carried out by the Under 
     Secretary for Rural Development of the Department of 
     Agriculture and State use contracting programs, to the extent 
     that such agencies and programs are not carrying out 
     activities through the statewide workforce investment system.
       ``(D) Coordination with education officials.--The State 
     plan shall contain plans, policies, and procedures for 
     coordination between the designated State agency and 
     education officials responsible for the public education of 
     students with disabilities, that are designed to facilitate 
     the transition of the students with disabilities from the 
     receipt of educational services in school to the receipt of 
     vocational rehabilitation services under this title, 
     including information on a formal interagency agreement with 
     the State educational agency that, at a minimum, provides 
     for--
       ``(i) consultation and technical assistance to assist 
     educational agencies in planning for the transition of 
     students with disabilities from school to post-school 
     activities, including vocational rehabilitation services;
       ``(ii) transition planning by personnel of the designated 
     State agency and educational agency personnel for students 
     with disabilities that facilitates the development and 
     completion of their individualized education programs under 
     section 614(d) of the Individuals with Disabilities Education 
     Act (as added by section 101 of Public Law 105-17);
       ``(iii) the roles and responsibilities, including financial 
     responsibilities, of each agency, including provisions for 
     determining State lead agencies and qualified personnel 
     responsible for transition services; and
       ``(iv) procedures for outreach to and identification of 
     students with disabilities who need the transition services.
       ``(E) Coordination with statewide independent living 
     councils and independent living centers.--The State plan 
     shall include an assurance that the designated State unit, 
     the Statewide Independent Living Council established under 
     section 705, and the independent living centers described in 
     part C of title VII within the State have developed working 
     relationships and coordinate their activities.
       ``(F) Cooperative agreement with recipients of grants for 
     services to american indians.--In applicable cases, the State 
     plan shall include an assurance that the State has entered 
     into a formal cooperative agreement with each grant recipient 
     in the State that receives funds under part C. The agreement 
     shall describe strategies for collaboration and coordination 
     in providing vocational rehabilitation services to American 
     Indians who are individuals with disabilities, including--
       ``(i) strategies for interagency referral and information 
     sharing that will assist in eligibility determinations and 
     the development of individualized plans for employment;
       ``(ii) procedures for ensuring that American Indians who 
     are individuals with disabilities and are living near a 
     reservation or tribal service area are provided vocational 
     rehabilitation services; and
       ``(iii) provisions for sharing resources in cooperative 
     studies and assessments, joint training activities, and other 
     collaborative activities designed to improve the provision of 
     services to American Indians who are individuals with 
     disabilities.
       ``(12) Residency.--The State plan shall include an 
     assurance that the State will not impose a residence 
     requirement that excludes from services provided under the 
     plan any individual who is present in the State.
       ``(13) Services to american indians.--The State plan shall 
     include an assurance that, except as otherwise provided in 
     part C, the designated State agency will provide vocational 
     rehabilitation services to American Indians who are 
     individuals with disabilities residing in the State to the 
     same extent as the designated State agency provides such 
     services to other significant populations of individuals with 
     disabilities residing in the State.
       ``(14) Annual review of individuals in extended employment 
     or other employment under special certificate provisions of 
     the fair labor standards act of 1938.--The State plan shall 
     provide for--
       ``(A) an annual review and reevaluation of the status of 
     each individual with a disability served under this title who 
     has achieved an employment outcome either in an extended 
     employment setting in a community rehabilitation program or 
     any other employment under section 14(c) of the Fair Labor 
     Standards Act (29 U.S.C. 214(c)) for 2 years after the 
     achievement of the outcome (and thereafter if requested by 
     the individual or, if appropriate, the individual's 
     representative), to determine the interests, priorities, and 
     needs of the individual with respect to competitive 
     employment or training for competitive employment;
       ``(B) input into the review and reevaluation, and a signed 
     acknowledgment that such review and reevaluation have been 
     conducted, by the individual with a disability, or, if 
     appropriate, the individual's representative; and
       ``(C) maximum efforts, including the identification and 
     provision of vocational rehabilitation services, reasonable 
     accommodations, and other necessary support services, to 
     assist the individuals described in subparagraph (A) in 
     engaging in competitive employment.
       ``(15) Annual state goals and reports of progress.--
       ``(A) Assessments and estimates.--The State plan shall--
       ``(i) include the results of a comprehensive, statewide 
     assessment, jointly conducted by the designated State unit 
     and the State Rehabilitation Council (if the State has such a 
     Council) every 3 years, describing the rehabilitation needs 
     of individuals with disabilities residing within the State, 
     particularly the vocational rehabilitation services needs 
     of--

       ``(I) individuals with the most significant disabilities, 
     including their need for supported employment services;
       ``(II) individuals with disabilities who are minorities and 
     individuals with disabilities who have been unserved or 
     underserved by the vocational rehabilitation program carried 
     out under this title; and
       ``(III) individuals with disabilities served through other 
     components of the statewide workforce investment system 
     (other than the vocational rehabilitation program), as 
     identified by such individuals and personnel assisting such 
     individuals through the components;

       ``(ii) include an assessment of the need to establish, 
     develop, or improve community rehabilitation programs within 
     the State; and
       ``(iii) provide that the State shall submit to the 
     Commissioner a report containing information regarding 
     updates to the assessments, for any year in which the State 
     updates the assessments.
       ``(B) Annual estimates.--The State plan shall include, and 
     shall provide that the State shall annually submit a report 
     to the Commissioner that includes, State estimates of--
       ``(i) the number of individuals in the State who are 
     eligible for services under this title;
       ``(ii) the number of such individuals who will receive 
     services provided with funds provided under part B and under 
     part B of title VI, including, if the designated State agency 
     uses an order of selection in accordance with paragraph (5), 
     estimates of the number of individuals to be served under 
     each priority category within the order; and
       ``(iii) the costs of the services described in clause (i), 
     including, if the designated State agency uses an order of 
     selection in accordance with paragraph (5), the service costs 
     for each priority category within the order.
       ``(C) Goals and priorities.--
       ``(i) In general.--The State plan shall identify the goals 
     and priorities of the State in carrying out the program. The 
     goals and priorities shall be jointly developed, agreed to, 
     and reviewed annually by the designated State unit and the 
     State Rehabilitation Council, if the State has such a 
     Council. Any revisions to the goals and priorities shall be 
     jointly agreed to by the designated State unit and the State 
     Rehabilitation Council, if the State has such a Council. The 
     State plan shall provide that the State shall submit to the 
     Commissioner a report containing information regarding 
     revisions in the goals and priorities, for any year in which 
     the State revises the goals and priorities.
       ``(ii) Basis.--The State goals and priorities shall be 
     based on an analysis of--

       ``(I) the comprehensive assessment described in 
     subparagraph (A), including any updates to the assessment;
       ``(II) the performance of the State on the standards and 
     indicators established under section 106; and
       ``(III) other available information on the operation and 
     the effectiveness of the vocational rehabilitation program 
     carried out in the State, including any reports received from 
     the State Rehabilitation Council, under section 105(c) and 
     the findings and recommendations from monitoring activities 
     conducted under section 107.

       ``(iii) Service and outcome goals for categories in order 
     of selection.--If the designated State agency uses an order 
     of selection in accordance with paragraph (5), the State 
     shall also identify in the State plan service and outcome 
     goals and the time within which these goals may be achieved 
     for individuals in each priority category within the order.
       ``(D) Strategies.--The State plan shall contain a 
     description of the strategies the State will use to address 
     the needs identified in the assessment conducted under 
     subparagraph (A) and achieve the goals and priorities 
     identified in subparagraph (C), including--
       ``(i) the methods to be used to expand and improve services 
     to individuals with disabilities, including how a broad range 
     of assistive technology services and assistive technology 
     devices will be provided to such individuals at each stage of 
     the rehabilitation process and how such services and devices 
     will be provided to such individuals on a statewide basis;
       ``(ii) 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 program;
       ``(iii) where necessary, the plan of the State for 
     establishing, developing, or improving community 
     rehabilitation programs;
       ``(iv) strategies to improve the performance of the State 
     with respect to the evaluation standards and performance 
     indicators established pursuant to section 106; and
       ``(v) strategies for assisting entities carrying out other 
     components of the statewide workforce investment system 
     (other than the vocational rehabilitation program) in 
     assisting individuals with disabilities.
       ``(E) Evaluation and reports of progress.--The State plan 
     shall--

[[Page H6655]]

       ``(i) include the results of an evaluation of the 
     effectiveness of the vocational rehabilitation program, and a 
     joint report by the designated State unit and the State 
     Rehabilitation Council, if the State has such a Council, to 
     the Commissioner on the progress made in improving the 
     effectiveness from the previous year, which evaluation and 
     report shall include--

       ``(I) an evaluation of the extent to which the goals 
     identified in subparagraph (C) were achieved;
       ``(II) a description of strategies that contributed to 
     achieving the goals;
       ``(III) to the extent to which the goals were not achieved, 
     a description of the factors that impeded that achievement; 
     and
       ``(IV) an assessment of the performance of the State on the 
     standards and indicators established pursuant to section 106; 
     and

       ``(ii) provide that the designated State unit and the State 
     Rehabilitation Council, if the State has such a Council, 
     shall jointly submit to the Commissioner an annual report 
     that contains the information described in clause (i).
       ``(16) Public comment.--The State plan shall--
       ``(A) provide that the designated State agency, prior to 
     the adoption of any policies or procedures governing the 
     provision of vocational rehabilitation services under the 
     State plan (including making any amendment to such policies 
     and procedures), shall conduct public meetings throughout the 
     State, after providing adequate notice of the meetings, to 
     provide the public, including individuals with disabilities, 
     an opportunity to comment on the policies or procedures, and 
     actively consult with the Director of the client assistance 
     program carried out under section 112, and, as appropriate, 
     Indian tribes, tribal organizations, and Native Hawaiian 
     organizations on the policies or procedures; and
       ``(B) provide that the designated State agency (or each 
     designated State agency if 2 agencies are designated) and any 
     sole agency administering the plan in a political subdivision 
     of the State, shall take into account, in connection with 
     matters of general policy arising in the administration of 
     the plan, the views of--
       ``(i) individuals and groups of individuals who are 
     recipients of vocational rehabilitation services, or in 
     appropriate cases, the individuals' representatives;
       ``(ii) personnel working in programs that provide 
     vocational rehabilitation services to individuals with 
     disabilities;
       ``(iii) providers of vocational rehabilitation services to 
     individuals with disabilities;
       ``(iv) the director of the client assistance program; and
       ``(v) the State Rehabilitation Council, if the State has 
     such a Council.
       ``(17) Use of funds for construction of facilities.--The 
     State plan shall 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 for the 
     facilities for a fiscal year will not exceed an amount equal 
     to 10 percent of the State's allotment under section 110 for 
     such year;
       ``(B) the provisions of section 306 (as in effect on the 
     day before the date of enactment of the Rehabilitation Act 
     Amendments of 1998) 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 the 
     plan includes such provisions for construction.
       ``(18) Innovation and expansion activities.--The State plan 
     shall--
       ``(A) include an assurance that the State will reserve and 
     use a portion of the funds allotted to the State under 
     section 110--
       ``(i) for the development and implementation of innovative 
     approaches to expand and improve the provision of vocational 
     rehabilitation services to individuals with disabilities 
     under this title, particularly individuals with the most 
     significant disabilities, consistent with the findings of the 
     statewide assessment and goals and priorities of the State as 
     described in paragraph (15); and
       ``(ii) to support the funding of--

       ``(I) the State Rehabilitation Council, if the State has 
     such a Council, consistent with the plan prepared under 
     section 105(d)(1); and
       ``(II) the Statewide Independent Living Council, consistent 
     with the plan prepared under section 705(e)(1);

       ``(B) include a description of how the reserved funds will 
     be utilized; and
       ``(C) provide that the State shall submit to the 
     Commissioner an annual report containing a description of how 
     the reserved funds will be utilized.
       ``(19) Choice.--The State plan shall include an assurance 
     that applicants and eligible individuals or, as appropriate, 
     the applicants' representatives or individuals' 
     representatives, will be provided information and support 
     services to assist the applicants and individuals in 
     exercising informed choice throughout the rehabilitation 
     process, consistent with the provisions of section 102(d).
       ``(20) Information and referral services.--
       ``(A) In general.--The State plan shall include an 
     assurance that the designated State agency will implement an 
     information and referral system adequate to ensure that 
     individuals with disabilities will be provided accurate 
     vocational rehabilitation information and guidance, using 
     appropriate modes of communication, to assist such 
     individuals in preparing for, securing, retaining, or 
     regaining employment, and will be appropriately referred to 
     Federal and State programs (other than the vocational 
     rehabilitation program carried out under this title), 
     including other components of the statewide workforce 
     investment system in the State.
       ``(B) Referrals.--An appropriate referral made through the 
     system shall--
       ``(i) be to the Federal or State programs, including 
     programs carried out by other components of the statewide 
     workforce investment system in the State, best suited to 
     address the specific employment needs of an individual with a 
     disability; and
       ``(ii) include, for each of these programs, provision to 
     the individual of--

       ``(I) a notice of the referral by the designated State 
     agency to the agency carrying out the program;
       ``(II) information identifying a specific point of contact 
     within the agency carrying out the program; and
       ``(III) information and advice regarding the most suitable 
     services to assist the individual to prepare for, secure, 
     retain, or regain employment.

       ``(21) State independent consumer-controlled commission; 
     state rehabilitation council.--
       ``(A) Commission or council.--The State plan shall provide 
     that either--
       ``(i) the designated State agency is an independent 
     commission that--

       ``(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--

       ``(aa) are individuals with physical or mental impairments 
     that substantially limit major life activities; and
       ``(bb) represent individuals with a broad range of 
     disabilities, unless the designated State unit under the 
     direction of the commission is the State agency for 
     individuals who are blind;

       ``(III) includes family members, advocates, or other 
     representatives, of individuals with mental impairments; and
       ``(IV) undertakes the functions set forth in section 
     105(c)(4); or

       ``(ii) the State has established a State Rehabilitation 
     Council that meets the criteria set forth in section 105 and 
     the designated State unit--

       ``(I) in accordance with paragraph (15), jointly develops, 
     agrees to, and reviews annually State goals and priorities, 
     and jointly submits annual reports of progress with the 
     Council;
       ``(II) regularly consults with the Council regarding the 
     development, implementation, and revision of State policies 
     and procedures of general applicability pertaining to the 
     provision of vocational rehabilitation services;
       ``(III) includes in the State plan and in any revision to 
     the State plan, a summary of input provided by the Council, 
     including recommendations from the annual report of the 
     Council described in section 105(c)(5), the review and 
     analysis of consumer satisfaction described in section 
     105(c)(4), and other reports prepared by the Council, and the 
     response of the designated State unit to such input and 
     recommendations, including explanations for rejecting any 
     input or recommendation; and
       ``(IV) transmits to the Council--

       ``(aa) all plans, reports, and other information required 
     under this title to be submitted to the Secretary;
       ``(bb) all policies, and information on all practices and 
     procedures, of general applicability provided to or used by 
     rehabilitation personnel in carrying out this title; and
       ``(cc) copies of due process hearing decisions issued under 
     this title, which shall be transmitted in such a manner as to 
     ensure that the identity of the participants in the hearings 
     is kept confidential.
       ``(B) More than 1 designated state agency.--In the case of 
     a State that, under section 101(a)(2), designates a State 
     agency to administer the part of the State 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 designates a separate 
     State agency to administer the rest of the State plan, the 
     State shall either establish a State Rehabilitation Council 
     for each of the 2 agencies that does not meet the 
     requirements in subparagraph (A)(i), or establish 1 State 
     Rehabilitation Council for both agencies if neither agency 
     meets the requirements of subparagraph (A)(i).
       ``(22) Supported employment state plan supplement.--The 
     State plan shall include an assurance that the State has an 
     acceptable plan for carrying out part B of title VI, 
     including the use of funds under that part to supplement 
     funds made available under part B of this title to pay for 
     the cost of services leading to supported employment.
       ``(23) Annual updates.--The plan shall include an assurance 
     that the State will submit to the Commissioner reports 
     containing annual updates of the information required under 
     paragraph (7) (relating to a comprehensive system of 
     personnel development) and any other updates of the 
     information required under this section that are requested by 
     the Commissioner, and annual reports as provided in 
     paragraphs (15) (relating to assessments, estimates, goals 
     and priorities, and reports of progress) and (18) (relating 
     to innovation and expansion), at such time and in such manner 
     as the Secretary may determine to be appropriate.
       ``(24) Certain contracts and cooperative agreements.--
       ``(A) Contracts with for-profit organizations.--The State 
     plan shall provide that the designated State agency has the 
     authority to enter into contracts with for-profit 
     organizations for the purpose of providing, as vocational 
     rehabilitation services, on-the-job training and related 
     programs for individuals with disabilities under part A of 
     title VI, upon a determination by such agency that such for-
     profit organizations are better qualified to provide such 
     rehabilitation services than nonprofit agencies and 
     organizations.

[[Page H6656]]

       ``(B) Cooperative agreements with private nonprofit 
     organizations.--The State plan shall describe the manner in 
     which cooperative agreements with private nonprofit 
     vocational rehabilitation service providers will be 
     established.
       ``(b) Approval; Disapproval of the State Plan.--
       ``(1) Approval.--The Commissioner shall approve any plan 
     that the Commissioner finds fulfills the conditions specified 
     in this section, and shall disapprove any plan that does not 
     fulfill such conditions.
       ``(2) Disapproval.--Prior to disapproval of the State plan, 
     the Commissioner shall notify the State of the intention to 
     disapprove the plan and shall afford the State reasonable 
     notice and opportunity for a hearing.

     ``SEC. 102. ELIGIBILITY AND INDIVIDUALIZED PLAN FOR 
                   EMPLOYMENT.

       ``(a) Eligibility.--
       ``(1) Criterion for eligibility.--An individual is eligible 
     for assistance under this title if the individual--
       ``(A) is an individual with a disability under section 
     7(20)(A); and
       ``(B) requires vocational rehabilitation services to 
     prepare for, secure, retain, or regain employment.
       ``(2) Presumption of benefit.--
       ``(A) Demonstration.--For purposes of this section, an 
     individual shall be presumed to be an individual that can 
     benefit in terms of an employment outcome from vocational 
     rehabilitation services under section 7(20)(A), unless the 
     designated State unit involved can demonstrate by clear and 
     convincing evidence that such individual is incapable of 
     benefiting in terms of an employment outcome from vocational 
     rehabilitation services due to the severity of the disability 
     of the individual.
       ``(B) Methods.--In making the demonstration required under 
     subparagraph (A), the designated State unit shall explore the 
     individual's abilities, capabilities, and capacity to perform 
     in work situations, through the use of trial work 
     experiences, as described in section 7(2)(D), with 
     appropriate supports provided through the designated State 
     unit, except under limited circumstances when an individual 
     can not take advantage of such experiences. Such experiences 
     shall be of sufficient variety and over a sufficient period 
     of time to determine the eligibility of the individual or to 
     determine the existence of clear and convincing evidence that 
     the individual is incapable of benefiting in terms of an 
     employment outcome from vocational rehabilitation services 
     due to the severity of the disability of the individual.
       ``(3) Presumption of eligibility.--
       ``(A) In general.--For purposes of this section, 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--
       ``(i) considered to be an individual with a significant 
     disability under section 7(21)(A); and
       ``(ii) presumed to be eligible for vocational 
     rehabilitation services under this title (provided that the 
     individual intends to achieve an employment outcome 
     consistent with the unique strengths, resources, priorities, 
     concerns, abilities, capabilities, interests, and informed 
     choice of the individual) unless the designated State unit 
     involved can demonstrate by clear and convincing evidence 
     that such individual is incapable of benefiting in terms of 
     an employment outcome from vocational rehabilitation services 
     due to the severity of the disability of the individual in 
     accordance with paragraph (2).
       ``(B) Construction.--Nothing in this paragraph shall be 
     construed to create an entitlement to any vocational 
     rehabilitation service.
       ``(4) Use of existing information.--
       ``(A) In general.--To the maximum extent appropriate and 
     consistent with the requirements of this part, for purposes 
     of determining the eligibility of an individual for 
     vocational rehabilitation services under this title and 
     developing the individualized plan for employment described 
     in subsection (b) for the individual, the designated State 
     unit shall use information that is existing and current (as 
     of the date of the determination of eligibility or of the 
     development of the individualized plan for employment), 
     including information available from other programs and 
     providers, particularly information used by education 
     officials and the Social Security Administration, information 
     provided by the individual and the family of the individual, 
     and information obtained under the assessment for determining 
     eligibility and vocational rehabilitation needs.
       ``(B) Determinations by officials of other agencies.--
     Determinations made by officials of other agencies, 
     particularly education officials described in section 
     101(a)(11)(D), regarding whether an individual satisfies 1 or 
     more factors relating to whether an individual is an 
     individual with a disability under section 7(20)(A) or an 
     individual with a significant disability under section 
     7(21)(A) shall be used, to the extent appropriate and 
     consistent with the requirements of this part, in assisting 
     the designated State unit in making such determinations.
       ``(C) Basis.--The determination of eligibility for 
     vocational rehabilitation services shall be based on--
       ``(i) the review of existing data described in section 
     7(2)(A)(i); and
       ``(ii) to the extent that such data is unavailable or 
     insufficient for determining eligibility, the provision of 
     assessment activities described in section 7(2)(A)(ii).
       ``(5) Determination of ineligibility.--If an individual who 
     applies for services under this title is determined, based on 
     the review of existing data and, to the extent necessary, the 
     assessment activities described in section 7(2)(A)(ii), not 
     to be eligible for the services, or if an eligible individual 
     receiving services under an individualized plan for 
     employment is determined to be no longer eligible for the 
     services--
       ``(A) the ineligibility determination involved shall be 
     made only after providing an opportunity for full 
     consultation with the individual or, as appropriate, the 
     individual's representative;
       ``(B) the individual or, as appropriate, the individual's 
     representative, shall be informed in writing (supplemented as 
     necessary by other appropriate modes of communication 
     consistent with the informed choice of the individual) of the 
     ineligibility determination, including--
       ``(i) the reasons for the determination; and
       ``(ii) a description of the means by which the individual 
     may express, and seek a remedy for, any dissatisfaction with 
     the determination, including the procedures for review by an 
     impartial hearing officer under subsection (c);
       ``(C) the individual shall be provided with a description 
     of services available from the client assistance program 
     under section 112 and information on how to contact that 
     program; and
       ``(D) any ineligibility determination that is based on a 
     finding that the individual is incapable of benefiting in 
     terms of an employment outcome shall be reviewed--
       ``(i) within 12 months; and
       ``(ii) thereafter, if such a review is requested by the 
     individual or, if appropriate, by the individual's 
     representative.
       ``(6) Timeframe for making an eligibility determination.--
     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 for the services unless--
       ``(A) exceptional and unforeseen circumstances beyond the 
     control of the designated State unit preclude making an 
     eligibility determination within 60 days and the designated 
     State unit and the individual agree to a specific extension 
     of time; or
       ``(B) the designated State unit is exploring an 
     individual's abilities, capabilities, and capacity to perform 
     in work situations under paragraph (2)(B).
       ``(b) Development of an Individualized Plan for 
     Employment.--
       ``(1) Options for developing an individualized plan for 
     employment.--If an individual is determined to be eligible 
     for vocational rehabilitation services as described in 
     subsection (a), the designated State unit shall complete the 
     assessment for determining eligibility and vocational 
     rehabilitation needs, as appropriate, and shall provide the 
     eligible individual or the individual's representative, in 
     writing and in an appropriate mode of communication, with 
     information on the individual's options for developing an 
     individualized plan for employment, including--
       ``(A) information on the availability of assistance, to the 
     extent determined to be appropriate by the eligible 
     individual, from a qualified vocational rehabilitation 
     counselor in developing all or part of the individualized 
     plan for employment for the individual, and the availability 
     of technical assistance in developing all or part of the 
     individualized plan for employment for the individual;
       ``(B) a description of the full range of components that 
     shall be included in an individualized plan for employment;
       ``(C) as appropriate--
       ``(i) an explanation of agency guidelines and criteria 
     associated with financial commitments concerning an 
     individualized plan for employment;
       ``(ii) additional information the eligible individual 
     requests or the designated State unit determines to be 
     necessary; and
       ``(iii) information on the availability of assistance in 
     completing designated State agency forms required in 
     developing an individualized plan for employment; and
       ``(D)(i) a description of the rights and remedies available 
     to such an individual including, if appropriate, recourse to 
     the processes set forth in subsection (c); and
       ``(ii) a description of the availability of a client 
     assistance program established pursuant to section 112 and 
     information about how to contact the client assistance 
     program.
       ``(2) Mandatory procedures.--
       ``(A) Written document.--An individualized plan for 
     employment shall be a written document prepared on forms 
     provided by the designated State unit.
       ``(B) Informed choice.--An individualized plan for 
     employment shall be developed and implemented in a manner 
     that affords eligible individuals the opportunity to exercise 
     informed choice in selecting an employment outcome, the 
     specific vocational rehabilitation services to be provided 
     under the plan, the entity that will provide the vocational 
     rehabilitation services, and the methods used to procure the 
     services, consistent with subsection (d).
       ``(C) Signatories.--An individualized plan for employment 
     shall be--
       ``(i) agreed to, and signed by, such eligible individual 
     or, as appropriate, the individual's representative; and
       ``(ii) approved and signed by a qualified vocational 
     rehabilitation counselor employed by the designated State 
     unit.
       ``(D) Copy.--A copy of the individualized plan for 
     employment for an eligible individual shall be provided to 
     the individual or, as appropriate, to the individual's 
     representative, in writing and, if appropriate, in the native 
     language or mode of communication of the individual or, as 
     appropriate, of the individual's representative.
       ``(E) Review and amendment.--The individualized plan for 
     employment shall be--
       ``(i) reviewed at least annually by--

       ``(I) a qualified vocational rehabilitation counselor; and
       ``(II) the eligible individual or, as appropriate, the 
     individual's representative; and

       ``(ii) amended, as necessary, by the individual or, as 
     appropriate, the individual's representative, in 
     collaboration with a representative of

[[Page H6657]]

     the designated State agency or a qualified vocational 
     rehabilitation counselor (to the extent determined to be 
     appropriate by the individual), if there are substantive 
     changes in the employment outcome, the vocational 
     rehabilitation services to be provided, or the service 
     providers of the services (which amendments shall not take 
     effect until agreed to and signed by the eligible individual 
     or, as appropriate, the individual's representative, and by a 
     qualified vocational rehabilitation counselor employed by the 
     designated State unit).
       ``(3) Mandatory components of an individualized plan for 
     employment.--Regardless of the approach selected by an 
     eligible individual to develop an individualized plan for 
     employment, an individualized plan for employment shall, at a 
     minimum, contain mandatory components consisting of--
       ``(A) a description of the specific employment outcome that 
     is chosen by the eligible individual, consistent with the 
     unique strengths, resources, priorities, concerns, abilities, 
     capabilities, interests, and informed choice of the eligible 
     individual, and, to the maximum extent appropriate, results 
     in employment in an integrated setting;
       ``(B)(i) a description of the specific vocational 
     rehabilitation services that are--
       ``(I) needed to achieve the employment outcome, including, 
     as appropriate, the provision of assistive technology devices 
     and assistive technology services, and personal assistance 
     services, including training in the management of such 
     services; and
       ``(II) provided in the most integrated setting that is 
     appropriate for the service involved and is consistent with 
     the informed choice of the eligible individual; and
       ``(ii) timelines for the achievement of the employment 
     outcome and for the initiation of the services;
       ``(C) a description of the entity chosen by the eligible 
     individual or, as appropriate, the individual's 
     representative, that will provide the vocational 
     rehabilitation services, and the methods used to procure such 
     services;
       ``(D) a description of criteria to evaluate progress toward 
     achievement of the employment outcome;
       ``(E) the terms and conditions of the individualized plan 
     for employment, including, as appropriate, information 
     describing--
       ``(i) the responsibilities of the designated State unit;
       ``(ii) the responsibilities of the eligible individual, 
     including--

       ``(I) the responsibilities the eligible individual will 
     assume in relation to the employment outcome of the 
     individual;
       ``(II) if applicable, the participation of the eligible 
     individual in paying for the costs of the plan; and
       ``(III) the responsibility of the eligible individual with 
     regard to applying for and securing comparable benefits as 
     described in section 101(a)(8); and

       ``(iii) the responsibilities of other entities as the 
     result of arrangements made pursuant to comparable services 
     or benefits requirements as described in section 101(a)(8);
       ``(F) for an eligible individual with the most significant 
     disabilities for whom an employment outcome in a supported 
     employment setting has been determined to be appropriate, 
     information identifying--
       ``(i) the extended services needed by the eligible 
     individual; and
       ``(ii) the source of extended services or, to the extent 
     that the source of the extended services cannot be identified 
     at the time of the development of the individualized plan for 
     employment, a description of the basis for concluding that 
     there is a reasonable expectation that such source will 
     become available; and
       ``(G) as determined to be necessary, a statement of 
     projected need for post-employment services.
       ``(c) Procedures.--
       ``(1) In general.--Each State shall establish procedures 
     for mediation of, and procedures for review through an 
     impartial due process hearing of, determinations made by 
     personnel of the designated State unit that affect the 
     provision of vocational rehabilitation services to applicants 
     or eligible individuals.
       ``(2) Notification.--
       ``(A) Rights and assistance.--The procedures shall provide 
     that an applicant or an eligible individual or, as 
     appropriate, the applicant's representative or individual's 
     representative shall be notified of--
       ``(i) the right to obtain review of determinations 
     described in paragraph (1) in an impartial due process 
     hearing under paragraph (5);
       ``(ii) the right to pursue mediation with respect to the 
     determinations under paragraph (4); and
       ``(iii) the availability of assistance from the client 
     assistance program under section 112.
       ``(B) Timing.--Such notification shall be provided in 
     writing--
       ``(i) at the time an individual applies for vocational 
     rehabilitation services provided under this title;
       ``(ii) at the time the individualized plan for employment 
     for the individual is developed; and
       ``(iii) upon reduction, suspension, or cessation of 
     vocational rehabilitation services for the individual.
       ``(3) Evidence and representation.--The procedures required 
     under this subsection shall, at a minimum--
       ``(A) provide an opportunity for an applicant or an 
     eligible individual, or, as appropriate, the applicant's 
     representative or individual's representative, to submit at 
     the mediation session or hearing evidence and information to 
     support the position of the applicant or eligible individual; 
     and
       ``(B) include provisions to allow an applicant or an 
     eligible individual to be represented in the mediation 
     session or hearing by a person selected by the applicant or 
     eligible individual.
       ``(4) Mediation.--
       ``(A) Procedures.--Each State shall ensure that procedures 
     are established and implemented under this subsection to 
     allow parties described in paragraph (1) to disputes 
     involving any determination described in paragraph (1) to 
     resolve such disputes through a mediation process that, at a 
     minimum, shall be available whenever a hearing is requested 
     under this subsection.
       ``(B) Requirements.--Such procedures shall ensure that the 
     mediation process--
       ``(i) is voluntary on the part of the parties;
       ``(ii) is not used to deny or delay the right of an 
     individual to a hearing under this subsection, or to deny any 
     other right afforded under this title; and
       ``(iii) is conducted by a qualified and impartial mediator 
     who is trained in effective mediation techniques.
       ``(C) List of mediators.--The State shall maintain a list 
     of individuals who are qualified mediators and knowledgeable 
     in laws (including regulations) relating to the provision of 
     vocational rehabilitation services under this title, from 
     which the mediators described in subparagraph (B) shall be 
     selected.
       ``(D) Cost.--The State shall bear the cost of the mediation 
     process.
       ``(E) Scheduling.--Each session in the mediation process 
     shall be scheduled in a timely manner and shall be held in a 
     location that is convenient to the parties to the dispute.
       ``(F) Agreement.--An agreement reached by the parties to 
     the dispute in the mediation process shall be set forth in a 
     written mediation agreement.
       ``(G) Confidentiality.--Discussions that occur during the 
     mediation process shall be confidential and may not be used 
     as evidence in any subsequent due process hearing or civil 
     proceeding. The parties to the mediation process may be 
     required to sign a confidentiality pledge prior to the 
     commencement of such process.
       ``(H) Construction.--Nothing in this subsection shall be 
     construed to preclude the parties to such a dispute from 
     informally resolving the dispute prior to proceedings under 
     this paragraph or paragraph (5), if the informal process used 
     is not used to deny or delay the right of the applicant or 
     eligible individual to a hearing under this subsection or to 
     deny any other right afforded under this title.
       ``(5) Hearings.--
       ``(A) Officer.--A due process hearing described in 
     paragraph (2) shall be conducted by an impartial hearing 
     officer who shall issue a decision based on the provisions of 
     the approved State plan, this Act (including regulations 
     implementing this Act), and State regulations and policies 
     that are consistent with the Federal requirements specified 
     in this title. The officer shall provide the decision in 
     writing to the applicant or eligible individual, or, as 
     appropriate, the applicant's representative or individual's 
     representative, and to the designated State unit.
       ``(B) List.--The designated State unit shall maintain a 
     list of qualified impartial hearing officers who are 
     knowledgeable in laws (including regulations) relating to the 
     provision of vocational rehabilitation services under this 
     title from which the officer described in subparagraph (A) 
     shall be selected. For the purposes of maintaining such list, 
     impartial hearing officers shall be identified jointly by--
       ``(i) the designated State unit; and
       ``(ii) members of the Council or commission, as 
     appropriate, described in section 101(a)(21).
       ``(C) Selection.--Such an impartial hearing officer shall 
     be selected to hear a particular case relating to a 
     determination--
       ``(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 appropriate cases, the Director and the 
     individual's representative.

       ``(D) Procedures for seeking review.--A State may establish 
     procedures to enable a party involved in a hearing under this 
     paragraph to seek an impartial review of the decision of the 
     hearing officer under subparagraph (A) by--
       ``(i) the chief official of the designated State agency if 
     the State has established both a designated State agency and 
     a designated State unit under section 101(a)(2); or
       ``(ii) an official from the office of the Governor.
       ``(E) Review request.--If the State establishes impartial 
     review procedures under subparagraph (D), either party may 
     request the review of the decision of the hearing officer 
     within 20 days after the decision.
       ``(F) Reviewing official.--The reviewing official described 
     in subparagraph (D) shall--
       ``(i) in conducting the review, provide an opportunity for 
     the submission of additional evidence and information 
     relevant to a final decision concerning the matter under 
     review;
       ``(ii) not overturn or modify the decision of the hearing 
     officer, or part of the decision, that supports the position 
     of the applicant or eligible individual unless the reviewing 
     official concludes, based on clear and convincing evidence, 
     that the decision of the impartial hearing officer is clearly 
     erroneous on the basis of being contrary to the approved 
     State plan, this Act (including regulations implementing this 
     Act) or any State regulation or policy that is consistent 
     with the Federal requirements specified in this title; and
       ``(iii) make a final decision with respect to the matter in 
     a timely manner and provide such decision in writing to the 
     applicant or eligible individual, or, as appropriate, the 
     applicant's representative or individual's representative, 
     and to the designated State unit, including a full report of 
     the findings and the grounds for such decision.
       ``(G) Finality of hearing decision.--A decision made after 
     a hearing under subparagraph

[[Page H6658]]

     (A) shall be final, except that a party may request an 
     impartial review if the State has established procedures for 
     such review under subparagraph (D) and a party involved in a 
     hearing may bring a civil action under subparagraph (J).
       ``(H) Finality of review.--A decision made under 
     subparagraph (F) shall be final unless such a party brings a 
     civil action under subparagraph (J).
       ``(I) Implementation.--If a party brings a civil action 
     under subparagraph (J) to challenge a final decision of a 
     hearing officer under subparagraph (A) or to challenge a 
     final decision of a State reviewing official under 
     subparagraph (F), the final decision involved shall be 
     implemented pending review by the court.
       ``(J) Civil action.--
       ``(i) In general.--Any party aggrieved by a final decision 
     described in subparagraph (I), may bring a civil action for 
     review of such decision. The action may be brought in any 
     State court of competent jurisdiction or in a district court 
     of the United States of competent jurisdiction without regard 
     to the amount in controversy.
       ``(ii) Procedure.--In any action brought under this 
     subparagraph, the court--

       ``(I) shall receive the records relating to the hearing 
     under subparagraph (A) and the records relating to the State 
     review under subparagraphs (D) through (F), if applicable;
       ``(II) shall hear additional evidence at the request of a 
     party to the action; and
       ``(III) basing the decision of the court on the 
     preponderance of the evidence, shall grant such relief as the 
     court determines to be appropriate.

       ``(6) Hearing board.--
       ``(A) In general.--A fair hearing board, established by a 
     State before January 1, 1985, and authorized under State law 
     to review determinations or decisions under this Act, is 
     authorized to carry out the responsibilities of the impartial 
     hearing officer under this subsection.
       ``(B) Application.--The provisions of paragraphs (1), (2), 
     and (3) that relate to due process hearings do not apply, and 
     paragraph (5) (other than subparagraph (J)) does not apply, 
     to any State to which subparagraph (A) applies.
       ``(7) Impact on provision of services.--Unless the 
     individual with a disability so requests, or, in an 
     appropriate case, the individual's representative, so 
     requests, pending a decision by a mediator, hearing officer, 
     or reviewing officer under this subsection, the designated 
     State unit shall not institute a suspension, reduction, or 
     termination of services being provided for the individual, 
     including evaluation and assessment services and plan 
     development, unless such services have been obtained through 
     misrepresentation, fraud, collusion, or criminal conduct on 
     the part of the individual, or the individual's 
     representative.
       ``(8) Information collection and report.--
       ``(A) In general.--The Director of the designated State 
     unit shall collect information described in subparagraph (B) 
     and prepare and submit to the Commissioner a report 
     containing such information. 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. The Commissioner shall also collect copies of the 
     final decisions of impartial hearing officers conducting 
     hearings under this subsection and State officials conducting 
     reviews under this subsection.
       ``(B) Information.--The information required to be 
     collected under this subsection includes--
       ``(i) a copy of the standards used by State reviewing 
     officials for reviewing decisions made by impartial hearing 
     officers under this subsection;
       ``(ii) information on the number of hearings and reviews 
     sought from the impartial hearing officers and the State 
     reviewing officials, including the type of complaints and the 
     issues involved;
       ``(iii) information on the number of hearing decisions made 
     under this subsection that were not reviewed by the State 
     reviewing officials; and
       ``(iv) information on the number of the hearing decisions 
     that were reviewed by the State reviewing officials, and, 
     based on such reviews, the number of hearing decisions that 
     were--

       ``(I) sustained in favor of an applicant or eligible 
     individual;
       ``(II) sustained in favor of the designated State unit;
       ``(III) reversed in whole or in part in favor of the 
     applicant or eligible individual; and
       ``(IV) reversed in whole or in part in favor of the 
     designated State unit.

       ``(C) Confidentiality.--The confidentiality of records of 
     applicants and eligible individuals maintained by the 
     designated State unit shall not preclude the access of the 
     Commissioner to those records for the purposes described in 
     subparagraph (A).
       ``(d) Policies and Procedures.--Each designated State 
     agency, in consultation with the State Rehabilitation 
     Council, if the State has such a council, shall, consistent 
     with section 100(a)(3)(C), develop and implement written 
     policies and procedures that enable each individual who is an 
     applicant for or eligible to receive vocational 
     rehabilitation services under this title to exercise informed 
     choice throughout the vocational rehabilitation process 
     carried out under this title, including policies and 
     procedures that require the designated State agency--
       ``(1) to inform each such applicant and eligible individual 
     (including students with disabilities who are making the 
     transition from programs under the responsibility of an 
     educational agency to programs under the responsibility of 
     the designated State unit), through appropriate modes of 
     communication, about the availability of, and opportunities 
     to exercise, informed choice, including the availability of 
     support services for individuals with cognitive or other 
     disabilities who require assistance in exercising informed 
     choice, throughout the vocational rehabilitation process;
       ``(2) to assist applicants and eligible individuals in 
     exercising informed choice in decisions related to the 
     provision of assessment services under this title;
       ``(3) to develop and implement flexible procurement 
     policies and methods that facilitate the provision of 
     services, and that afford eligible individuals meaningful 
     choices among the methods used to procure services, under 
     this title;
       ``(4) to provide or assist eligible individuals in 
     acquiring information that enables those individuals to 
     exercise informed choice under this title in the selection 
     of--
       ``(A) the employment outcome;
       ``(B) the specific vocational rehabilitation services 
     needed to achieve the employment outcome;
       ``(C) the entity that will provide the services;
       ``(D) the employment setting and the settings in which the 
     services will be provided; and
       ``(E) the methods available for procuring the services; and
       ``(5) to ensure that the availability and scope of informed 
     choice provided under this section is consistent with the 
     obligations of the designated State agency under this title.

     ``SEC. 103. VOCATIONAL REHABILITATION SERVICES.

       ``(a) Vocational Rehabilitation Services for Individuals.--
     Vocational rehabilitation services provided under this title 
     are any services described in an individualized plan for 
     employment necessary to assist an individual with a 
     disability in preparing for, securing, retaining, or 
     regaining an employment outcome that is consistent with the 
     strengths, resources, priorities, concerns, abilities, 
     capabilities, interests, and informed choice of the 
     individual, including--
       ``(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 and guidance, including information and 
     support services to assist an individual in exercising 
     informed choice consistent with the provisions of section 
     102(d);
       ``(3) referral and other services to secure needed services 
     from other agencies through agreements developed under 
     section 101(a)(11), if such services are not available under 
     this title;
       ``(4) job-related services, including job search and 
     placement assistance, job retention services, followup 
     services, and follow-along services;
       ``(5) vocational and other training services, including the 
     provision of personal and vocational adjustment services, 
     books, tools, and other training materials, except that no 
     training services provided at an institution of higher 
     education shall be paid for with funds under this title 
     unless maximum efforts have been made by the designated State 
     unit and the individual to secure grant assistance, in whole 
     or in part, from other sources to pay for such training;
       ``(6) to the extent that financial support is not readily 
     available from a source (such as through health insurance of 
     the individual or through comparable services and benefits 
     consistent with section 101(a)(8)(A)), other than the 
     designated State unit, diagnosis and treatment of physical 
     and mental impairments, including--
       ``(A) corrective surgery or therapeutic treatment necessary 
     to correct or substantially modify a physical or mental 
     condition that constitutes a substantial impediment to 
     employment, but is of such a 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 who meet State licensure laws and who 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 who meet State licensure 
     laws;
       ``(7) maintenance for additional costs incurred while 
     participating in an assessment for determining eligibility 
     and vocational rehabilitation needs or while receiving 
     services under an individualized plan for employment;
       ``(8) transportation, including adequate training in the 
     use of public transportation vehicles and systems, that is 
     provided in connection with the provision of any other 
     service described in this section and needed by the 
     individual to achieve an employment outcome;
       ``(9) on-the-job or other related personal assistance 
     services provided while an individual is receiving other 
     services described in this section;
       ``(10) interpreter services provided by qualified personnel 
     for individuals who are deaf or hard of hearing, and reader 
     services for individuals who are determined to be blind, 
     after an examination by qualified personnel who meet State 
     licensure laws;
       ``(11) rehabilitation teaching services, and orientation 
     and mobility services, for individuals who are blind;
       ``(12) occupational licenses, tools, equipment, and initial 
     stocks and supplies;
       ``(13) technical assistance and other consultation services 
     to conduct market analyses, develop business plans, and 
     otherwise provide resources, to the extent such resources are 
     authorized to be provided through the statewide workforce 
     investment system, to eligible individuals who are pursuing 
     self-employment or telecommuting or establishing a small 
     business operation as an employment outcome;
       ``(14) rehabilitation technology, including 
     telecommunications, sensory, and other technological aids and 
     devices;

[[Page H6659]]

       ``(15) transition services for students with disabilities, 
     that facilitate the achievement of the employment outcome 
     identified in the individualized plan for employment;
       ``(16) supported employment services;
       ``(17) services to the family of an individual with a 
     disability necessary to assist the individual to achieve an 
     employment outcome; and
       ``(18) specific post-employment services necessary to 
     assist an individual with a disability to, retain, regain, or 
     advance in employment.
       ``(b) Vocational Rehabilitation Services for Groups of 
     Individuals.--Vocational rehabilitation services provided for 
     the benefit of groups of individuals with disabilities may 
     also include the following:
       ``(1) In the case of any type of small business operated by 
     individuals with significant disabilities the operation of 
     which can be improved by management services and supervision 
     provided by the designated State agency, the provision of 
     such services and supervision, along or together with the 
     acquisition by the designated State agency of vending 
     facilities or other equipment and initial stocks and 
     supplies.
       ``(2)(A) The establishment, development, or improvement of 
     community rehabilitation programs, including, under special 
     circumstances, the construction of a facility. Such programs 
     shall be used to provide services that promote integration 
     and competitive employment.
       ``(B) The provision of other services, that promise to 
     contribute substantially to the rehabilitation of a group of 
     individuals but that are not related directly to the 
     individualized plan for employment of any 1 individual with a 
     disability.
       ``(3) The use of telecommunications systems (including 
     telephone, television, satellite, radio, and other similar 
     systems) that have the potential for substantially improving 
     delivery methods of activities described in this section and 
     developing appropriate programming to meet the particular 
     needs of individuals with disabilities.
       ``(4)(A) Special services to provide nonvisual access to 
     information for individuals who are blind, including the use 
     of telecommunications, Braille, sound recordings, or other 
     appropriate media.
       ``(B) Captioned television, films, or video cassettes for 
     individuals who are deaf or hard of hearing.
       ``(C) Tactile materials for individuals who are deaf-blind.
       ``(D) Other special services that provide information 
     through tactile, vibratory, auditory, and visual media.
       ``(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.
       ``(6) Consultative and technical assistance services to 
     assist educational agencies in planning for the transition of 
     students with disabilities from school to post-school 
     activities, including employment.

     ``SEC. 104. NON-FEDERAL SHARE FOR ESTABLISHMENT OF PROGRAM OR 
                   CONSTRUCTION.

       ``For the purpose of determining the amount of payments to 
     States for carrying out part B (or to an Indian tribe under 
     part C), 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 COUNCIL.

       ``(a) Establishment.--
       ``(1) In general.--Except as provided in section 
     101(a)(21)(A)(i), to be eligible to receive financial 
     assistance under this title a State shall establish a State 
     Rehabilitation 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)(2)(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 682(a) of 
     the Individuals with Disabilities Education Act (as added by 
     section 101 of the Individuals with Disabilities Education 
     Act Amendments of 1997; Public Law 105-17);
       ``(iii) at least one representative of the client 
     assistance program established under section 112;
       ``(iv) at least one qualified 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) individuals' representatives of individuals with 
     disabilities who have difficulty in representing themselves 
     or are unable due to their disabilities to represent 
     themselves;

       ``(viii) current or former applicants for, or recipients 
     of, vocational rehabilitation services;
       ``(ix) in a State in which one or more projects are carried 
     out under section 121, at least one representative of the 
     directors of the projects;
       ``(x) at least one representative of the State educational 
     agency responsible for the public education of students with 
     disabilities who are eligible to receive services under this 
     title and part B of the Individuals with Disabilities 
     Education Act; and
       ``(xi) at least one representative of the State workforce 
     investment board.
       ``(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 individual's 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;

       ``(ix) applicants or recipients described in subparagraph 
     (A)(viii);
       ``(x) in a State described in subparagraph (A)(ix), at 
     least one representative described in such subparagraph;
       ``(xi) at least one representative described in 
     subparagraph (A)(x); and
       ``(xii) at least one representative described in 
     subparagraph (A)(xi).
       ``(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 15 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, nonvoting member of the 
     Council.
       ``(3) Appointment.--Members of the Council shall be 
     appointed by the Governor. The Governor 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. In selecting members, the Governor shall 
     consider, to the greatest extent practicable, the extent to 
     which minority populations are represented on the Council.
       ``(4) Qualifications.--
       ``(A) In general.--A majority of Council members shall be 
     persons who are--
       ``(i) individuals with disabilities described in section 
     7(20)(A); and
       ``(ii) not employed by the designated State unit.
       ``(B) Separate council.--In the case of a separate Council 
     established under subsection (a)(2), a majority of Council 
     members shall be persons who are--
       ``(i) blind; and
       ``(ii) 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 
     chief executive officer 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 Governor) 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, other 
     than a representative described in clause (iii) or (ix) of 
     paragraph (1)(A), or clause (iii) or (x) of paragraph (1)(B), 
     may serve more than two consecutive full terms.
       ``(7) Vacancies.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     any vacancy occurring in the

[[Page H6660]]

     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.
       ``(B) Delegation.--The Governor may delegate the authority 
     to fill such a vacancy to the remaining members of the 
     Council after making the original appointment.
       ``(c) Functions of Council.--The Council shall, after 
     consulting with the State workforce investment board--
       ``(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 employment outcomes under this 
     title;
       ``(2) in partnership with the designated State unit--
       ``(A) develop, agree to, and review State goals and 
     priorities in accordance with section 101(a)(15)(C); and
       ``(B) evaluate the effectiveness of the vocational 
     rehabilitation program and submit reports of progress to the 
     Commissioner in accordance with section 101(a)(15)(E);
       ``(3) advise the designated State agency and the designated 
     State unit regarding activities authorized to be carried out 
     under this title, and assist in the preparation of the State 
     plan and amendments to the plan, applications, reports, needs 
     assessments, and evaluations required by this title;
       ``(4) to the extent feasible, conduct a review and analysis 
     of the effectiveness of, and consumer satisfaction with--
       ``(A) the functions performed by the designated State 
     agency;
       ``(B) vocational rehabilitation services provided by State 
     agencies and other public and private entities responsible 
     for providing vocational rehabilitation services to 
     individuals with disabilities under this Act; and
       ``(C) employment outcomes achieved by eligible individuals 
     receiving services under this title, including the 
     availability of health and other employment benefits in 
     connection with such employment outcomes;
       ``(5) prepare and submit an annual report to the Governor 
     and the Commissioner on the status of vocational 
     rehabilitation programs operated within the State, and make 
     the report available to the public;
       ``(6) to avoid duplication of efforts and enhance the 
     number of individuals served, coordinate activities with the 
     activities of other councils within the State, including the 
     Statewide Independent Living Council established under 
     section 705, the advisory panel established under section 
     612(a)(21) of the Individual with Disabilities Education Act 
     (as amended by section 101 of the Individuals with 
     Disabilities Education Act Amendments of 1997; Public Law 
     105-17), the State Developmental Disabilities Council 
     described in section 124 of the Developmental Disabilities 
     Assistance and Bill of Rights Act (42 U.S.C. 6024), the State 
     mental health planning council established under section 
     1914(a) of the Public Health Service Act (42 U.S.C. 300x-
     4(a)), and the State workforce investment board;
       ``(7) provide for coordination and the establishment of 
     working relationships between the designated State agency and 
     the Statewide Independent Living Council and centers for 
     independent living within the State; and
       ``(8) perform such other functions, consistent with the 
     purpose of this title, as the State Rehabilitation 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 and sufficient 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 
     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 
     allocated to the Council by the designated State unit under 
     this title (except for funds appropriated to carry out the 
     client assistance program under section 112 and funds 
     reserved pursuant to section 110(c) to carry out part C) 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.

     ``SEC. 106. EVALUATION STANDARDS AND PERFORMANCE INDICATORS.

       ``(a) Establishment.--
       ``(1) In general.--
       ``(A) Establishment of standards and indicators.--The 
     Commissioner shall, not later than July 1, 1999, establish 
     and publish evaluation standards and performance indicators 
     for the vocational rehabilitation program carried out under 
     this title.
       ``(B) Review and revision.--Effective July 1, 1999, the 
     Commissioner shall review and, if necessary, revise the 
     evaluation standards and performance indicators every 3 
     years. Any revisions of 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. Any revisions of the standards and 
     indicators shall be subject to the publication, review, and 
     comment provisions of paragraph (3).
       ``(C) Bases.--Effective July 1, 1999, to the maximum extent 
     practicable, the standards and indicators shall be consistent 
     with the core indicators of performance established under 
     section 136(b) of the Workforce Investment Act of 1998.
       ``(2) Measures.--The standards and indicators shall include 
     outcome and related measures of program performance that 
     facilitate 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 1999, 
     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 onsite 
     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) State goals established under section 101(a)(15) and 
     the extent to which the State has achieved such goals;
       ``(E) plans and reports prepared under section 106(b);

[[Page H6661]]

       ``(F) consumer satisfaction reviews and analyses described 
     in section 105(c)(4);
       ``(G) information provided by the State Rehabilitation 
     Council established under section 105, if the State has such 
     a Council, or by the commission described in section 
     101(a)(21)(A)(i), if the State has such a commission;
       ``(H) reports; and
       ``(I) budget and financial management data.
       ``(3) Procedures for monitoring.--In conducting monitoring 
     under this section the Commissioner shall conduct--
       ``(A) onsite visits, including onsite 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 Council, if 
     the State has such a Council or with the commission described 
     in section 101(a)(21)(A)(i), if the State has such a 
     commission;
       ``(D) reviews of individual case files, including 
     individualized plans for employment and ineligibility 
     determinations; and
       ``(E) meetings with qualified vocational 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) such other areas as may be identified by the public 
     or through meetings with the State Rehabilitation Council, if 
     the State has such a Council or with the commission described 
     in section 101(a)(21)(A)(i), if the State has such a 
     commission; and
       ``(D) such other areas of inquiry as the Commissioner may 
     consider appropriate.
       ``(5) Reports.--If the Commissioner issues a report 
     detailing the findings of an annual review or onsite 
     monitoring conducted under this section, the report shall be 
     made available to the State Rehabilitation Council, if the 
     State has such a Council, for use in the development and 
     modification of the State plan described in section 101.
       ``(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 B 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 
     (c), 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) 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, and the Commonwealth of 
     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 100(b)(1), 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.
       ``(b)(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

[[Page H6662]]

     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.
       ``(c)(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 C.
       ``(2) The sum referred to in paragraph (1) shall be, as 
     determined by the Secretary--
       ``(A) not less than three-quarters of 1 percent and not 
     more than 1.5 percent of the amount referred to in paragraph 
     (1), for fiscal year 1999; and
       ``(B) not less than 1 percent and not more than 1.5 percent 
     of the amount referred to in paragraph (1), for each of 
     fiscal years 2000 through 2003.


                          ``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.
       ``(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.
       ``(B) 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 subparagraph (B) or section 101(a)(17) 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 
     (h), 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 services provided 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 
     subparagraph, 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)(i) 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 the individuals' 
     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.
       ``(ii) If, after the date of enactment of the 
     Rehabilitation Act Amendments of 1998--
       ``(I) a designated State agency undergoes any change in the 
     organizational structure of the agency that results in the 
     creation of 1 or more new State agencies or departments or 
     results in the merger of the designated State agency with 1 
     or more other State agencies or departments; and
       ``(II) an agency (including an office or other unit) within 
     the designated State agency was conducting a client 
     assistance program before the change under the last sentence 
     of subparagraph (A),
     the Governor shall redesignate the agency conducting the 
     program. In conducting the redesignation, the Governor shall 
     designate to conduct the program an agency that is 
     independent of any agency that provides treatment, services, 
     or rehabilitation to individuals with disabilities under this 
     Act.
       ``(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.
       ``(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, and the Commonwealth of the 
     Northern Mariana Islands.
       ``(C) For the purpose of this paragraph, the term `State' 
     does not include American Samoa, Guam, the Virgin Islands, 
     and the Commonwealth of the Northern Mariana Islands.
       ``(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, the Secretary shall increase each of the minimum 
     allotments under clause (i) by a percentage that shall not 
     exceed the percentage increase in the total amount 
     appropriated under such subsection between the preceding 
     fiscal year and the fiscal year involved.
       ``(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

[[Page H6663]]

     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)(A) Each program shall contain provisions designed to 
     assure that to the maximum extent possible alternative means 
     of dispute resolution are available for use at the discretion 
     of an applicant or client of the program prior to resorting 
     to litigation or formal adjudication to resolve a dispute 
     arising under this section.
       ``(B) In subparagraph (A), the term `alternative means of 
     dispute resolution' means any procedure, including good faith 
     negotiation, conciliation, facilitation, mediation, 
     factfinding, and arbitration, and any combination of 
     procedures, that is used in lieu of litigation in a court or 
     formal adjudication in an administrative forum, to resolve a 
     dispute arising under this section.
       ``(4) For purposes of any 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 1999 through 2003 to carry 
     out the provisions of this section.

      ``Part C--American Indian Vocational Rehabilitation Services


              ``vocational rehabilitation services grants

       ``Sec. 121. (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 or near 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 or near 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 more than 60 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 or near 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 D--Vocational Rehabilitation Services Client Information

     ``SEC. 131. DATA SHARING.

       ``(a) In General.--
       ``(1) Memorandum of understanding.--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--
       ``(A) that concern clients of designated State agencies; 
     and
       ``(B) that are data maintained either by--
       ``(i) the Rehabilitation Services Administration, as 
     required by section 13; or
       ``(ii) the Social Security Administration, from its Summary 
     Earnings and Records and Master Beneficiary Records.
       ``(2) Employment statistics.--The Secretary of Labor shall 
     provide the Commissioner with employment statistics specified 
     in section 15 of the Wagner-Peyser Act, that facilitate 
     evaluation by the Commissioner of the program carried out 
     under part B, and allow the Commissioner to compare the 
     progress of individuals with disabilities who are assisted 
     under the program in securing, retaining, regaining, and 
     advancing in employment with the progress made by individuals 
     who are assisted under title I of the Workforce Investment 
     Act of 1998.
       ``(b) Treatment of Information.--For purposes of the 
     exchange described in subsection (a)(1), the data described 
     in subsection (a)(1)(B)(ii) 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 the Rehabilitation Services Administration and the Social 
     Security Administration.''.

     SEC. 405. RESEARCH AND TRAINING.

       Title II of the Rehabilitation Act of 1973 (29 U.S.C. 760 
     et seq.) is amended to read as follows:

                   ``TITLE II--RESEARCH AND TRAINING


                        ``declaration of purpose

       ``Sec. 200. The purpose of this title is to--
       ``(1) provide for research, demonstration projects, 
     training, and related activities to maximize the full 
     inclusion and integration into society, employment, 
     independent living, family support, and economic and social 
     self-sufficiency of individuals with disabilities of all 
     ages, with particular emphasis on improving the effectiveness 
     of services authorized under this Act;
       ``(2) provide for a comprehensive and coordinated approach 
     to the support and conduct of such research, demonstration 
     projects, training, and related activities and to ensure that 
     the approach is in accordance with the 5-year plan developed 
     under section 202(h);
       ``(3) promote the transfer of rehabilitation technology to 
     individuals with disabilities through research and 
     demonstration projects relating to--
       ``(A) the procurement process for the purchase of 
     rehabilitation technology;
       ``(B) the utilization of rehabilitation technology on a 
     national basis;
       ``(C) specific adaptations or customizations of products to 
     enable individuals with disabilities to live more 
     independently; and
       ``(D) the development or transfer of assistive technology;
       ``(4) ensure the widespread distribution, in usable 
     formats, of practical scientific and technological 
     information--
       ``(A) generated by research, demonstration projects, 
     training, and related activities; and
       ``(B) regarding state-of-the-art practices, improvements in 
     the services authorized under this Act, rehabilitation 
     technology, and new knowledge regarding disabilities,
     to rehabilitation professionals, individuals with 
     disabilities, and other interested parties, including the 
     general public;
       ``(5) identify effective strategies that enhance the 
     opportunities of individuals with disabilities to engage in 
     employment, including employment involving telecommuting and 
     self-employment; and
       ``(6) increase opportunities for researchers who are 
     members of traditionally underserved populations, including 
     researchers who are members of minority groups and 
     researchers who are individuals with disabilities.


                   ``authorization of appropriations

       ``Sec. 201. (a) There are authorized to be appropriated--
       ``(1) for the purpose of providing for the expenses of the 
     National Institute on Disability and Rehabilitation Research 
     under section 202, which shall include the expenses of the 
     Rehabilitation Research Advisory Council under section 205, 
     and shall not include the expenses of such Institute to carry 
     out section 204, such sums as may be necessary for each of 
     fiscal years 1999 through 2003; and
       ``(2) to carry out section 204, such sums as may be 
     necessary for each of fiscal years 1999 through 2003.
       ``(b) Funds appropriated under this title shall remain 
     available until expended.


     ``national institute on disability and rehabilitation research

       ``Sec. 202. (a)(1) There is established within the 
     Department of Education a National Institute on Disability 
     and Rehabilitation Research (hereinafter in this title 
     referred to as the `Institute'), which shall be headed by a 
     Director (hereinafter in this title referred to as the 
     `Director'), in order to--
       ``(A) promote, coordinate, and provide for--
       ``(i) research;
       ``(ii) demonstration projects and training; and
       ``(iii) related activities,
     with respect to individuals with disabilities;
       ``(B) more effectively carry out activities through the 
     programs under section 204 and activities under this section;

[[Page H6664]]

       ``(C) widely disseminate information from the activities 
     described in subparagraphs (A) and (B); and
       ``(D) provide leadership in advancing the quality of life 
     of individuals with disabilities.
       ``(2) In the performance of the functions of the office, 
     the Director shall be directly responsible to the Secretary 
     or to the same Under Secretary or Assistant Secretary of the 
     Department of Education to whom the Commissioner is 
     responsible under section 3(a).
       ``(b) The Director, through the Institute, shall be 
     responsible for--
       ``(1) administering the programs described in section 204 
     and activities under this section;
       ``(2) widely disseminating findings, conclusions, and 
     recommendations, resulting from research, demonstration 
     projects, training, and related activities (referred to in 
     this title as `covered activities') funded by the Institute, 
     to--
       ``(A) other Federal, State, tribal, and local public 
     agencies;
       ``(B) private organizations engaged in research relating to 
     rehabilitation or providing rehabilitation services;
       ``(C) rehabilitation practitioners; and
       ``(D) individuals with disabilities and the individuals' 
     representatives;
       ``(3) coordinating, through the Interagency Committee 
     established by section 203 of this Act, all Federal programs 
     and policies relating to research in rehabilitation;
       ``(4) widely disseminating educational materials and 
     research results, concerning ways to maximize the full 
     inclusion and integration into society, employment, 
     independent living, family support, and economic and social 
     self-sufficiency of individuals with disabilities, to--
       ``(A) public and private entities, including--
       ``(i) elementary and secondary schools (as defined in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965; and
       ``(ii) institutions of higher education;
       ``(B) rehabilitation practitioners;
       ``(C) individuals with disabilities (especially such 
     individuals who are members of minority groups or of 
     populations that are unserved or underserved by programs 
     under this Act); and
       ``(D) the individuals' representatives for the individuals 
     described in subparagraph (C);
       ``(5)(A) conducting an education program to inform the 
     public about ways of providing for the rehabilitation of 
     individuals with disabilities, including information relating 
     to--
       ``(i) family care;
       ``(ii) self-care; and
       ``(iii) assistive technology devices and assistive 
     technology services; and
       ``(B) as part of the program, disseminating engineering 
     information about assistive technology devices;
       ``(6) conducting conferences, seminars, and workshops 
     (including in-service training programs and programs for 
     individuals with disabilities) concerning advances in 
     rehabilitation research and rehabilitation technology 
     (including advances concerning the selection and use of 
     assistive technology devices and assistive technology 
     services), pertinent to the full inclusion and integration 
     into society, employment, independent living, family support, 
     and economic and social self-sufficiency of individuals with 
     disabilities;
       ``(7) taking whatever action is necessary to keep the 
     Congress fully and currently informed with respect to the 
     implementation and conduct of programs and activities carried 
     out under this title, including dissemination activities;
       ``(8) producing, in conjunction with the Department of 
     Labor, the National Center for Health Statistics, the Bureau 
     of the Census, the Health Care Financing Administration, the 
     Social Security Administration, the Bureau of Indian Affairs, 
     the Indian Health Service, and other Federal departments and 
     agencies, as may be appropriate, statistical reports and 
     studies on the employment, self-employment, telecommuting, 
     health, income, and other demographic characteristics of 
     individuals with disabilities, including information on 
     individuals with disabilities who live in rural or inner-city 
     settings, with particular attention given to underserved 
     populations, and widely disseminating such reports and 
     studies to rehabilitation professionals, individuals with 
     disabilities, the individuals' representatives, and others to 
     assist in the planning, assessment, and evaluation of 
     vocational and other rehabilitation services for individuals 
     with disabilities;
       ``(9) conducting research on consumer satisfaction with 
     vocational rehabilitation services for the purpose of 
     identifying effective rehabilitation programs and policies 
     that promote the independence of individuals with 
     disabilities and achievement of long-term vocational goals;
       ``(10) conducting research to examine the relationship 
     between the provision of specific services and successful, 
     sustained employment outcomes, including employment outcomes 
     involving self-employment and telecommuting; and
       ``(11) coordinating activities with the Attorney General 
     regarding the provision of information, training, or 
     technical assistance regarding the Americans with 
     Disabilities Act of 1990 (42 U.S.C. 12101 et seq.) to ensure 
     consistency with the plan for technical assistance required 
     under section 506 of such Act (42 U.S.C. 12206).
       ``(c)(1) The Director, acting through the Institute or 1 or 
     more entities funded by the Institute, shall provide for the 
     development and dissemination of models to address consumer-
     driven information needs related to assistive technology 
     devices and assistive technology services.
       ``(2) The development and dissemination of models may 
     include--
       ``(A) convening groups of individuals with disabilities, 
     family members and advocates of such individuals, commercial 
     producers of assistive technology, and entities funded by the 
     Institute to develop, assess, and disseminate knowledge about 
     information needs related to assistive technology;
       ``(B) identifying the types of information regarding 
     assistive technology devices and assistive technology 
     services that individuals with disabilities find especially 
     useful;
       ``(C) evaluating current models, and developing new models, 
     for transmitting the information described in subparagraph 
     (B) to consumers and to commercial producers of assistive 
     technology; and
       ``(D) disseminating through 1 or more entities funded by 
     the Institute, the models described in subparagraph (C) and 
     findings regarding the information described in subparagraph 
     (B) to consumers and commercial producers of assistive 
     technology.
       ``(d)(1) The Director of the Institute shall be appointed 
     by the Secretary. The Director shall be an individual with 
     substantial experience in rehabilitation and in research 
     administration.
       ``(2) The Director, subject to the approval of the 
     President, may appoint, for terms not to exceed three years, 
     without regard to the provisions of title 5, United States 
     Code, governing appointment in the competitive service, and 
     may compensate, without regard to the provisions of chapter 
     51 and subchapter III of chapter 53 of such title relating to 
     classification and General Schedule pay rates, such technical 
     and professional employees of the Institute as the Director 
     determines to be necessary to accomplish the functions of the 
     Institute and also appoint and compensate without regard to 
     such provisions, in a number not to exceed one-fifth of the 
     number of full-time, regular technical and professional 
     employees of the Institute.
       ``(3) The Director may obtain the services of consultants, 
     without regard to the provisions of title 5, United States 
     Code, governing appointments in the competitive service.
       ``(e) The Director, pursuant to regulations which the 
     Secretary shall prescribe, may establish and maintain 
     fellowships with such stipends and allowances, including 
     travel and subsistence expenses provided for under title 5, 
     United States Code, as the Director considers necessary to 
     procure the assistance of highly qualified research fellows, 
     including individuals with disabilities, from the United 
     States and foreign countries.
       ``(f)(1) The Director shall provide for scientific peer 
     review of all applications for financial assistance for 
     research, training, and demonstration projects over which the 
     Director has authority. The scientific peer review shall be 
     conducted by individuals who are not Federal employees, who 
     are scientists or other experts in the rehabilitation field 
     (including the independent living field), including 
     knowledgeable individuals with disabilities, and the 
     individuals' representatives, and who are competent to review 
     applications for the financial assistance.
       ``(2) In providing for such scientific peer review, the 
     Secretary shall provide for training, as necessary and 
     appropriate, to facilitate the effective participation of 
     those individuals selected to participate in such review.
       ``(g) Not less than 90 percent of the funds appropriated 
     under this title for any fiscal year shall be expended by the 
     Director to carry out activities under this title through 
     grants, contracts, or cooperative agreements. Up to 10 
     percent of the funds appropriated under this title for any 
     fiscal year may be expended directly for the purpose of 
     carrying out the functions of the Director under this 
     section.
       ``(h)(1) The Director shall--
       ``(A) by October 1, 1998 and every fifth October 1 
     thereafter, prepare and publish in the Federal Register for 
     public comment a draft of a 5-year plan that outlines 
     priorities for rehabilitation research, demonstration 
     projects, training, and related activities and explains the 
     basis for such priorities;
       ``(B) by June 1, 1999, and every fifth June 1 thereafter, 
     after considering public comments, submit the plan in final 
     form to the appropriate committees of Congress;
       ``(C) at appropriate intervals, prepare and submit 
     revisions in the plan to the appropriate committees of 
     Congress; and
       ``(D) annually prepare and submit progress reports on the 
     plan to the appropriate committees of Congress.
       ``(2) Such plan shall--
       ``(A) identify any covered activity that should be 
     conducted under this section and section 204 respecting the 
     full inclusion and integration into society of individuals 
     with disabilities, especially in the area of employment;
       ``(B) determine the funding priorities for covered 
     activities to be conducted under this section and section 
     204;
       ``(C) specify appropriate goals and timetables for covered 
     activities to be conducted under this section and section 
     204;
       ``(D) be developed by the Director--
       ``(i) after consultation with the Rehabilitation Research 
     Advisory Council established under section 205;
       ``(ii) in coordination with the Commissioner;
       ``(iii) after consultation with the National Council on 
     Disability established under title IV, the Secretary of 
     Education, officials responsible for the administration of 
     the Developmental Disabilities Assistance and Bill of Rights 
     Act (42 U.S.C. 6000 et seq.), and the Interagency Committee 
     on Disability Research established under section 203; and
       ``(iv) after full consideration of the input of individuals 
     with disabilities and the individuals' representatives, 
     organizations representing individuals with disabilities, 
     providers of services furnished under this Act, researchers 
     in the rehabilitation field, and any other persons or 
     entities the Director considers to be appropriate;
       ``(E) specify plans for widespread dissemination of the 
     results of covered activities, in accessible formats, to 
     rehabilitation practitioners, individuals with disabilities, 
     and the individuals' representatives; and
       ``(F) specify plans for widespread dissemination of the 
     results of covered activities that concern individuals with 
     disabilities who are members of minority groups or of 
     populations that

[[Page H6665]]

     are unserved or underserved by programs carried out under 
     this Act.
       ``(i) In order to promote cooperation among Federal 
     departments and agencies conducting research programs, the 
     Director shall consult with the administrators of such 
     programs, and with the Interagency Committee established by 
     section 203, regarding the design of research projects 
     conducted by such entities and the results and applications 
     of such research.
       ``(j)(1) The Director shall take appropriate actions to 
     provide for a comprehensive and coordinated research program 
     under this title. In providing such a program, the Director 
     may undertake joint activities with other Federal entities 
     engaged in research and with appropriate private entities. 
     Any Federal entity proposing to establish any research 
     project related to the purposes of this Act shall consult, 
     through the Interagency Committee established by section 203, 
     with the Director as Chairperson of such Committee and 
     provide the Director with sufficient prior opportunity to 
     comment on such project.
       ``(2) Any person responsible for administering any program 
     of the National Institutes of Health, the Department of 
     Veterans Affairs, the National Science Foundation, the 
     National Aeronautics and Space Administration, the Office of 
     Special Education and Rehabilitative Services, or of any 
     other Federal entity, shall, through the Interagency 
     Committee established by section 203, consult and cooperate 
     with the Director in carrying out such program if the program 
     is related to the purposes of this title.
       ``(3) The Director shall support, directly or by grant or 
     contract, a center associated with an institution of higher 
     education, for research and training concerning the delivery 
     of vocational rehabilitation services to rural areas.
       ``(k) The Director shall make grants to institutions of 
     higher education for the training of rehabilitation 
     researchers, including individuals with disabilities, with 
     particular attention to research areas that support the 
     implementation and objectives of this Act and that improve 
     the effectiveness of services authorized under this Act.


                        ``interagency committee

       ``Sec. 203. (a)(1) In order to promote coordination and 
     cooperation among Federal departments and agencies conducting 
     rehabilitation research programs, there is established within 
     the Federal Government an Interagency Committee on Disability 
     Research (hereinafter in this section referred to as the 
     `Committee'), chaired by the Director and comprised of such 
     members as the President may designate, including the 
     following (or their designees): the Director, the 
     Commissioner of the Rehabilitation Services Administration, 
     the Assistant Secretary for Special Education and 
     Rehabilitative Services, the Secretary of Education, the 
     Secretary of Veterans Affairs, the Director of the National 
     Institutes of Health, the Director of the National Institute 
     of Mental Health, the Administrator of the National 
     Aeronautics and Space Administration, the Secretary of 
     Transportation, the Assistant Secretary of the Interior for 
     Indian Affairs, the Director of the Indian Health Service, 
     and the Director of the National Science Foundation.
       ``(2) The Committee shall meet not less than four times 
     each year.
       ``(b) After receiving input from individuals with 
     disabilities and the individuals' representatives, the 
     Committee shall identify, assess, and seek to coordinate all 
     Federal programs, activities, and projects, and plans for 
     such programs, activities, and projects with respect to the 
     conduct of research related to rehabilitation of individuals 
     with disabilities.
       ``(c) The Committee shall annually submit to the President 
     and to the appropriate committees of the Congress a report 
     making such recommendations as the Committee deems 
     appropriate with respect to coordination of policy and 
     development of objectives and priorities for all Federal 
     programs relating to the conduct of research related to 
     rehabilitation of individuals with disabilities.


                ``research and other covered activities

       ``Sec. 204. (a)(1) To the extent consistent with priorities 
     established in the 5-year plan described in section 202(h), 
     the Director may make grants to and contracts with States and 
     public or private agencies and organizations, including 
     institutions of higher education, Indian tribes, and tribal 
     organizations, to pay part of the cost of projects for the 
     purpose of planning and conducting research, demonstration 
     projects, training, and related activities, the purposes of 
     which are to develop methods, procedures, and rehabilitation 
     technology, that maximize the full inclusion and integration 
     into society, employment, independent living, family support, 
     and economic and social self-sufficiency of individuals with 
     disabilities, especially individuals with the most 
     significant disabilities, and improve the effectiveness of 
     services authorized under this Act.
       ``(2)(A) In carrying out this section, the Director shall 
     emphasize projects that support the implementation of titles 
     I, III, V, VI, and VII, including projects addressing the 
     needs described in the State plans submitted under section 
     101 or 704 by State agencies.
       ``(B) Such projects, as described in the State plans 
     submitted by State agencies, may include--
       ``(i) medical and other scientific, technical, 
     methodological, and other investigations into the nature of 
     disability, methods of analyzing it, and restorative 
     techniques, including basic research where related to 
     rehabilitation techniques or services;
       ``(ii) studies and analysis of industrial, vocational, 
     social, recreational, psychiatric, psychological, economic, 
     and other factors affecting rehabilitation of individuals 
     with disabilities;
       ``(iii) studies and analysis of special problems of 
     individuals who are homebound and individuals who are 
     institutionalized;
       ``(iv) studies, analyses, and demonstrations of 
     architectural and engineering design adapted to meet the 
     special needs of individuals with disabilities;
       ``(v) studies, analyses, and other activities related to 
     supported employment;
       ``(vi) related activities which hold promise of increasing 
     knowledge and improving methods in the rehabilitation of 
     individuals with disabilities and individuals with the most 
     significant disabilities, particularly individuals with 
     disabilities, and individuals with the most significant 
     disabilities, who are members of populations that are 
     unserved or underserved by programs under this Act; and
       ``(vii) studies, analyses, and other activities related to 
     job accommodations, including the use of rehabilitation 
     engineering and assistive technology.
       ``(b)(1) In addition to carrying out projects under 
     subsection (a), the Director may make grants under this 
     subsection (referred to in this subsection as `research 
     grants') to pay part or all of the cost of the research or 
     other specialized covered activities described in paragraphs 
     (2) through (18). A research grant made under any of 
     paragraphs (2) through (18) may only be used in a manner 
     consistent with priorities established in the 5-year plan 
     described in section 202(h).
       ``(2)(A) Research grants may be used for the establishment 
     and support of Rehabilitation Research and Training Centers, 
     for the purpose of providing an integrated program of 
     research, which Centers shall--
       ``(i) be operated in collaboration with institutions of 
     higher education or providers of rehabilitation services or 
     other appropriate services; and
       ``(ii) serve as centers of national excellence and national 
     or regional resources for providers and individuals with 
     disabilities and the individuals' representatives.
       ``(B) The Centers shall conduct research and training 
     activities by--
       ``(i) conducting coordinated and advanced programs of 
     research in rehabilitation targeted toward the production of 
     new knowledge that will improve rehabilitation methodology 
     and service delivery systems, alleviate or stabilize 
     disabling conditions, and promote maximum social and economic 
     independence of individuals with disabilities, especially 
     promoting the ability of the individuals to prepare for, 
     secure, retain, regain, or advance in employment;
       ``(ii) providing training (including graduate, pre-service, 
     and in-service training) to assist individuals to more 
     effectively provide rehabilitation services;
       ``(iii) providing training (including graduate, pre-
     service, and in-service training) for rehabilitation research 
     personnel and other rehabilitation personnel; and
       ``(iv) serving as an informational and technical assistance 
     resource to providers, individuals with disabilities, and the 
     individuals' representatives, through conferences, workshops, 
     public education programs, in-service training programs, and 
     similar activities.
       ``(C) The research to be carried out at each such Center 
     may include--
       ``(i) basic or applied medical rehabilitation research;
       ``(ii) research regarding the psychological and social 
     aspects of rehabilitation, including disability policy;
       ``(iii) research related to vocational rehabilitation;
       ``(iv) continuation of research that promotes the 
     emotional, social, educational, and functional growth of 
     children who are individuals with disabilities;
       ``(v) continuation of research to develop and evaluate 
     interventions, policies, and services that support families 
     of those children and adults who are individuals with 
     disabilities; and
       ``(vi) continuation of research that will improve services 
     and policies that foster the productivity, independence, and 
     social integration of individuals with disabilities, and 
     enable individuals with disabilities, including individuals 
     with mental retardation and other developmental disabilities, 
     to live in their communities.
       ``(D) Training of students preparing to be rehabilitation 
     personnel shall be an important priority for such a Center.
       ``(E) The Director shall make grants under this paragraph 
     to establish and support both comprehensive centers dealing 
     with multiple disabilities and centers primarily focused on 
     particular disabilities.
       ``(F) Grants made under this paragraph may be used to 
     provide funds for services rendered by such a Center to 
     individuals with disabilities in connection with the research 
     and training activities.
       ``(G) Grants made under this paragraph may be used to 
     provide faculty support for teaching--
       ``(i) rehabilitation-related courses of study for credit; 
     and
       ``(ii) other courses offered by the Centers, either 
     directly or through another entity.
       ``(H) The research and training activities conducted by 
     such a Center shall be conducted in a manner that is 
     accessible to and usable by individuals with disabilities.
       ``(I) The Director shall encourage the Centers to develop 
     practical applications for the findings of the research of 
     the Centers.
       ``(J) In awarding grants under this paragraph, the Director 
     shall take into consideration the location of any proposed 
     Center and the appropriate geographic and regional allocation 
     of such Centers.
       ``(K) To be eligible to receive a grant under this 
     paragraph, each such institution or provider described in 
     subparagraph (A) shall--
       ``(i) be of sufficient size, scope, and quality to 
     effectively carry out the activities in an efficient

[[Page H6666]]

     manner consistent with appropriate State and Federal law; and
       ``(ii) demonstrate the ability to carry out the training 
     activities either directly or through another entity that can 
     provide such training.
       ``(L) The Director shall make grants under this paragraph 
     for periods of 5 years, except that the Director may make a 
     grant for a period of less than 5 years if--
       ``(i) the grant is made to a new recipient; or
       ``(ii) the grant supports new or innovative research.
       ``(M) Grants made under this paragraph shall be made on a 
     competitive basis. To be eligible to receive a grant under 
     this paragraph, a prospective grant recipient shall submit an 
     application to the Director at such time, in such manner, and 
     containing such information as the Director may require.
       ``(N) In conducting scientific peer review under section 
     202(f) of an application for the renewal of a grant made 
     under this paragraph, the peer review panel shall take into 
     account the past performance of the applicant in carrying out 
     the grant and input from individuals with disabilities and 
     the individuals' representatives.
       ``(O) An institution or provider that receives a grant 
     under this paragraph to establish such a Center may not 
     collect more than 15 percent of the amount of the grant 
     received by the Center in indirect cost charges.
       ``(3)(A) Research grants may be used for the establishment 
     and support of Rehabilitation Engineering Research Centers, 
     operated by or in collaboration with institutions of higher 
     education or nonprofit organizations, to conduct research or 
     demonstration activities, and training activities, regarding 
     rehabilitation technology, including rehabilitation 
     engineering, assistive technology devices, and assistive 
     technology services, for the purposes of enhancing 
     opportunities for better meeting the needs of, and addressing 
     the barriers confronted by, individuals with disabilities in 
     all aspects of their lives.
       ``(B) In order to carry out the purposes set forth in 
     subparagraph (A), such a Center shall carry out the research 
     or demonstration activities by--
       ``(i) developing and disseminating innovative methods of 
     applying advanced technology, scientific achievement, and 
     psychological and social knowledge to--
       ``(I) solve rehabilitation problems and remove 
     environmental barriers through planning and conducting 
     research, including cooperative research with public or 
     private agencies and organizations, designed to produce new 
     scientific knowledge, and new or improved methods, equipment, 
     and devices; and
       ``(II) study new or emerging technologies, products, or 
     environments, and the effectiveness and benefits of such 
     technologies, products, or environments;
       ``(ii) demonstrating and disseminating--
       ``(I) innovative models for the delivery, to rural and 
     urban areas, of cost-effective rehabilitation technology 
     services that promote utilization of assistive technology 
     devices; and
       ``(II) other scientific research to assist in meeting the 
     employment and independent living needs of individuals with 
     significant disabilities; or
       ``(iii) conducting research or demonstration activities 
     that facilitate service delivery systems change by 
     demonstrating, evaluating, documenting, and disseminating--
       ``(I) consumer responsive and individual and family-
     centered innovative models for the delivery to both rural and 
     urban areas, of innovative cost-effective rehabilitation 
     technology services that promote utilization of 
     rehabilitation technology; and
       ``(II) other scientific research to assist in meeting the 
     employment and independent living needs of, and addressing 
     the barriers confronted by, individuals with disabilities, 
     including individuals with significant disabilities.
       ``(C) To the extent consistent with the nature and type of 
     research or demonstration activities described in 
     subparagraph (B), each Center established or supported 
     through a grant made available under this paragraph shall--
       ``(i) cooperate with programs established under the 
     Technology-Related Assistance for Individuals With 
     Disabilities Act of 1988 (29 U.S.C. 2201 et seq.) and other 
     regional and local programs to provide information to 
     individuals with disabilities and the individuals' 
     representatives to--
       ``(I) increase awareness and understanding of how 
     rehabilitation technology can address their needs; and
       ``(II) increase awareness and understanding of the range of 
     options, programs, services, and resources available, 
     including financing options for the technology and services 
     covered by the area of focus of the Center;
       ``(ii) provide training opportunities to individuals, 
     including individuals with disabilities, to become 
     researchers of rehabilitation technology and practitioners of 
     rehabilitation technology in conjunction with institutions of 
     higher education and nonprofit organizations; and
       ``(iii) respond, through research or demonstration 
     activities, to the needs of individuals with all types of 
     disabilities who may benefit from the application of 
     technology within the area of focus of the Center.
       ``(D)(i) In establishing Centers to conduct the research or 
     demonstration activities described in subparagraph (B)(iii), 
     the Director may establish one Center in each of the 
     following areas of focus:
       ``(I) Early childhood services, including early 
     intervention and family support.
       ``(II) Education at the elementary and secondary levels, 
     including transition from school to postschool activities.
       ``(III) Employment, including supported employment, and 
     reasonable accommodations and the reduction of environmental 
     barriers as required by the Americans with Disabilities Act 
     of 1990 (42 U.S.C. 12101 et seq.) and title V.
       ``(IV) Independent living, including transition from 
     institutional to community living, maintenance of community 
     living on leaving the work force, self-help skills, and 
     activities of daily living.
       ``(ii) Each Center conducting the research or demonstration 
     activities described in subparagraph (B)(iii) shall have an 
     advisory committee, of which the majority of members are 
     individuals with disabilities who are users of rehabilitation 
     technology, and the individuals' representatives.
       ``(E) Grants made under this paragraph shall be made on a 
     competitive basis and shall be for a period of 5 years, 
     except that the Director may make a grant for a period of 
     less than 5 years if--
       ``(i) the grant is made to a new recipient; or
       ``(ii) the grant supports new or innovative research.
       ``(F) To be eligible to receive a grant under this 
     paragraph, a prospective grant recipient shall submit an 
     application to the Director at such time, in such manner, and 
     containing such information as the Director may require.
       ``(G) Each Center established or supported through a grant 
     made available under this paragraph shall--
       ``(i) cooperate with State agencies and other local, State, 
     regional, and national programs and organizations developing 
     or delivering rehabilitation technology, including State 
     programs funded under the Technology-Related Assistance for 
     Individuals With Disabilities Act of 1988 (29 U.S.C. 2201 et 
     seq.); and
       ``(ii) prepare and submit to the Director as part of an 
     application for continuation of a grant, or as a final 
     report, a report that documents the outcomes of the program 
     of the Center in terms of both short- and long-term impact on 
     the lives of individuals with disabilities, and such other 
     information as may be requested by the Director.
       ``(4)(A) Research grants may be used to conduct a program 
     for spinal cord injury research, including conducting such a 
     program by making grants to public or private agencies and 
     organizations to pay part or all of the costs of special 
     projects and demonstration projects for spinal cord injuries, 
     that will--
       ``(i) ensure widespread dissemination of research findings 
     among all Spinal Cord Injury Centers, to rehabilitation 
     practitioners, individuals with spinal cord injury, the 
     individuals' representatives, and organizations receiving 
     financial assistance under this paragraph;
       ``(ii) provide encouragement and support for initiatives 
     and new approaches by individual and institutional 
     investigators; and
       ``(iii) establish and maintain close working relationships 
     with other governmental and voluntary institutions and 
     organizations engaged in similar efforts in order to unify 
     and coordinate scientific efforts, encourage joint planning, 
     and promote the interchange of data and reports among spinal 
     cord injury investigations.
       ``(B) Any agency or organization carrying out a project or 
     demonstration project assisted by a grant under this 
     paragraph that provides services to individuals with spinal 
     cord injuries shall--
       ``(i) establish, on an appropriate regional basis, a 
     multidisciplinary system of providing vocational and other 
     rehabilitation services, specifically designed to meet the 
     special needs of individuals with spinal cord injuries, 
     including acute care as well as periodic inpatient or 
     outpatient followup and services;
       ``(ii) demonstrate and evaluate the benefits to individuals 
     with spinal cord injuries served in, and the degree of cost-
     effectiveness of, such a regional system;
       ``(iii) demonstrate and evaluate existing, new, and 
     improved methods and rehabilitation technology essential to 
     the care, management, and rehabilitation of individuals with 
     spinal cord injuries; and
       ``(iv) demonstrate and evaluate methods of community 
     outreach for individuals with spinal cord injuries and 
     community education in connection with the problems of such 
     individuals in areas such as housing, transportation, 
     recreation, employment, and community activities.
       ``(C) In awarding grants under this paragraph, the Director 
     shall take into account the location of any proposed Spinal 
     Cord Injury Center and the appropriate geographic and 
     regional allocation of such Centers.
       ``(5) Research grants may be used to conduct a program for 
     end-stage renal disease research, to include support of 
     projects and demonstrations for providing special services 
     (including transplantation and dialysis), artificial kidneys, 
     and supplies necessary for the rehabilitation of individuals 
     with such disease and which will--
       ``(A) ensure dissemination of research findings;
       ``(B) provide encouragement and support for initiatives and 
     new approaches by individuals and institutional 
     investigators; and
       ``(C) establish and maintain close working relationships 
     with other governmental and voluntary institutions and 
     organizations engaged in similar efforts,

     in order to unify and coordinate scientific efforts, 
     encourage joint planning, and promote the interchange of data 
     and reports among investigators in the field of end-stage 
     renal disease. No person shall be selected to participate in 
     such program who is eligible for services for such disease 
     under any other provision of law.
       ``(6) Research grants may be used to conduct a program for 
     international rehabilitation research, demonstration, and 
     training for the purpose of developing new knowledge and 
     methods in the rehabilitation of individuals with 
     disabilities in the United States, cooperating with and 
     assisting in developing and sharing information found useful 
     in other nations in the rehabilitation of individuals with 
     disabilities, and initiating a program to exchange experts 
     and technical

[[Page H6667]]

     assistance in the field of rehabilitation of individuals with 
     disabilities with other nations as a means of increasing the 
     levels of skill of rehabilitation personnel.
       ``(7) Research grants may be used to conduct a research 
     program concerning 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 programming to meet the particular 
     needs of individuals with disabilities.
       ``(8) Research grants may be used to conduct a program of 
     joint projects with the National Institutes of Health, the 
     National Institute of Mental Health, the Health Services 
     Administration, the Administration on Aging, the National 
     Science Foundation, the Veterans' Administration, the 
     Department of Health and Human Services, the National 
     Aeronautics and Space Administration, other Federal agencies, 
     and private industry in areas of joint interest involving 
     rehabilitation.
       ``(9) Research grants may be used to conduct a program of 
     research related to the rehabilitation of children, or older 
     individuals, who are individuals with disabilities, including 
     older American Indians who are individuals with disabilities. 
     Such research program may include projects designed to assist 
     the adjustment of, or maintain as residents in the community, 
     older workers who are individuals with disabilities on 
     leaving the work force.
       ``(10) Research grants may be used to conduct a research 
     program to develop and demonstrate innovative methods to 
     attract and retain professionals to serve in rural areas in 
     the rehabilitation of individuals with disabilities, 
     including individuals with significant disabilities.
       ``(11) Research grants may be used to conduct a model 
     research and demonstration project designed to assess the 
     feasibility of establishing a center for producing and 
     distributing to individuals who are deaf or hard of hearing 
     captioned video cassettes providing a broad range of 
     educational, cultural, scientific, and vocational 
     programming.
       ``(12) Research grants may be used to conduct a model 
     research and demonstration program to develop innovative 
     methods of providing services for preschool age children who 
     are individuals with disabilities, including--
       ``(A) early intervention, assessment, parent counseling, 
     infant stimulation, early identification, diagnosis, and 
     evaluation of children who are individuals with significant 
     disabilities up to the age of five, with a special emphasis 
     on children who are individuals with significant disabilities 
     up to the age of three;
       ``(B) such physical therapy, language development, 
     pediatric, nursing, psychological, and psychiatric services 
     as are necessary for such children; and
       ``(C) appropriate services for the parents of such 
     children, including psychological and psychiatric services, 
     parent counseling, and training.
       ``(13) Research grants may be used to conduct a model 
     research and training program under which model training 
     centers shall be established to develop and use more advanced 
     and effective methods of evaluating and addressing the 
     employment needs of individuals with disabilities, including 
     programs that--
       ``(A) provide training and continuing education for 
     personnel involved with the employment of individuals with 
     disabilities;
       ``(B) develop model procedures for testing and evaluating 
     the employment needs of individuals with disabilities;
       ``(C) develop model training programs to teach individuals 
     with disabilities skills which will lead to appropriate 
     employment;
       ``(D) develop new approaches for job placement of 
     individuals with disabilities, including new followup 
     procedures relating to such placement;
       ``(E) provide information services regarding education, 
     training, employment, and job placement for individuals with 
     disabilities; and
       ``(F) develop new approaches and provide information 
     regarding job accommodations, including the use of 
     rehabilitation engineering and assistive technology.
       ``(14) Research grants may be used to conduct a 
     rehabilitation research program under which financial 
     assistance is provided in order to--
       ``(A) test new concepts and innovative ideas;
       ``(B) demonstrate research results of high potential 
     benefits;
       ``(C) purchase prototype aids and devices for evaluation;
       ``(D) develop unique rehabilitation training curricula; and
       ``(E) be responsive to special initiatives of the Director.

     No single grant under this paragraph may exceed $50,000 in 
     any fiscal year and all payments made under this paragraph in 
     any fiscal year may not exceed 5 percent of the amount 
     available for this section to the National Institute on 
     Disability and Rehabilitation Research in any fiscal year. 
     Regulations and administrative procedures with respect to 
     financial assistance under this paragraph shall, to the 
     maximum extent possible, be expedited.
       ``(15) Research grants may be used to conduct studies of 
     the rehabilitation needs of American Indian populations and 
     of effective mechanisms for the delivery of rehabilitation 
     services to Indians residing on and off reservations.
       ``(16) Research grants may be used to conduct a 
     demonstration program under which one or more projects 
     national in scope shall be established to develop procedures 
     to provide incentives for the development, manufacturing, and 
     marketing of orphan technological devices, including 
     technology transfer concerning such devices, designed to 
     enable individuals with disabilities to achieve independence 
     and access to gainful employment.
       ``(17)(A) Research grants may be used to conduct a research 
     program related to quality assurance in the area of 
     rehabilitation technology.
       ``(B) Activities carried out under the research program may 
     include--
       ``(i) the development of methodologies to evaluate 
     rehabilitation technology products and services and the 
     dissemination of the methodologies to consumers and other 
     interested parties;
       ``(ii) identification of models for service provider 
     training and evaluation and certification of the 
     effectiveness of the models;
       ``(iii) identification and dissemination of outcome 
     measurement models for the assessment of rehabilitation 
     technology products and services; and
       ``(iv) development and testing of research-based tools to 
     enhance consumer decisionmaking about rehabilitation 
     technology products and services.
       ``(18) Research grants may be used to provide for research 
     and demonstration projects and related activities that 
     explore the use and effectiveness of specific alternative or 
     complementary medical practices for individuals with 
     disabilities. Such projects and activities may include 
     projects and activities designed to--
       ``(A) determine the use of specific alternative or 
     complementary medical practices among individuals with 
     disabilities and the perceived effectiveness of the 
     practices;
       ``(B) determine the specific information sources, 
     decisionmaking methods, and methods of payment used by 
     individuals with disabilities who access alternative or 
     complementary medical services;
       ``(C) develop criteria to screen and assess the validity of 
     research studies of such practices for individuals with 
     disabilities; and
       ``(D) determine the effectiveness of specific alternative 
     or complementary medical practices that show promise for 
     promoting increased functioning, prevention of secondary 
     disabilities, or other positive outcomes for individuals with 
     certain types of disabilities, by conducting controlled 
     research studies.
       ``(c)(1) In carrying out evaluations of covered activities 
     under this section, the Director is authorized to make 
     arrangements for site visits to obtain information on the 
     accomplishments of the projects.
       ``(2) The Director shall not make a grant under this 
     section that exceeds $500,000 unless the peer review of the 
     grant application has included a site visit.


               ``rehabilitation research advisory council

       ``Sec. 205. (a) Establishment.--Subject to the availability 
     of appropriations, the Secretary shall establish in the 
     Department of Education a Rehabilitation Research Advisory 
     Council (referred to in this section as the `Council') 
     composed of 12 members appointed by the Secretary.
       ``(b) Duties.--The Council shall advise the Director with 
     respect to research priorities and the development and 
     revision of the 5-year plan required by section 202(h).
       ``(c) Qualifications.--Members of the Council shall be 
     generally representative of the community of rehabilitation 
     professionals, the community of rehabilitation researchers, 
     the community of individuals with disabilities, and the 
     individuals' representatives. At least one-half of the 
     members shall be individuals with disabilities or the 
     individuals' representatives.
       ``(d) Terms of Appointment.--
       ``(1) Length of term.--Each member of the Council shall 
     serve for a term of up to 3 years, determined by the 
     Secretary, except that--
       ``(A) 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
       ``(B) the terms of service of the members initially 
     appointed shall be (as specified by the Secretary) for such 
     fewer number of years as will provide for the expiration of 
     terms on a staggered basis.
       ``(2) Number of terms.--No member of the Council may serve 
     more than two consecutive full terms. Members may serve after 
     the expiration of their terms until their successors have 
     taken office.
       ``(e)  Vacancies.--Any vacancy occurring in the membership 
     of the Council shall be filled in the same manner as the 
     original appointment for the position being vacated. The 
     vacancy shall not affect the power of the remaining members 
     to execute the duties of the Council.
       ``(f) Payment and Expenses.--
       ``(1) Payment.--Each member of the Council who is not an 
     officer or full-time employee of the Federal Government shall 
     receive a payment of $150 for each day (including travel 
     time) during which the member is engaged in the performance 
     of duties for the Council. All members of the Council who are 
     officers or full-time employees of the United States shall 
     serve without compensation in addition to compensation 
     received for their services as officers or employees of the 
     United States.
       ``(2) Travel expenses.--Each member of the Council may 
     receive travel expenses, including per diem in lieu of 
     subsistence, as authorized by section 5703 of title 5, United 
     States Code, for employees serving intermittently in the 
     Government service, for each day the member is engaged in the 
     performance of duties away from the home or regular place of 
     business of the member.
       ``(g) Detail of Federal Employees.--On the request of the 
     Council, the Secretary may detail, with or without 
     reimbursement, any of the personnel of the Department of 
     Education to the Council to assist the Council in carrying 
     out its duties. Any detail shall not interrupt or otherwise 
     affect the civil service status or privileges of the Federal 
     employee.
       ``(h) Technical Assistance.--On the request of the Council, 
     the Secretary shall provide such technical assistance to the 
     Council as the Council determines to be necessary to carry 
     out its duties.

[[Page H6668]]

       ``(i) Termination.--Section 14 of the Federal Advisory 
     Committee Act (5 U.S.C. App.) shall not apply with respect to 
     the Council.''.

     SEC. 406. PROFESSIONAL DEVELOPMENT AND SPECIAL PROJECTS AND 
                   DEMONSTRATIONS.

       Title III of the Rehabilitation Act of 1973 (29 U.S.C. 770 
     et seq.) is amended to read as follows:
    ``TITLE III--PROFESSIONAL DEVELOPMENT AND SPECIAL PROJECTS AND 
                             DEMONSTRATIONS

     ``SEC. 301. DECLARATION OF PURPOSE AND COMPETITIVE BASIS OF 
                   GRANTS AND CONTRACTS.

       ``(a) Purpose.--It is the purpose of this title to 
     authorize grants and contracts to--
       ``(1)(A) provide academic training to ensure that skilled 
     personnel are available to provide rehabilitation services to 
     individuals with disabilities through vocational, medical, 
     social, and psychological rehabilitation programs (including 
     supported employment programs), through economic and business 
     development programs, through independent living services 
     programs, and through client assistance programs; and
       ``(B) provide training to maintain and upgrade basic skills 
     and knowledge of personnel (including personnel specifically 
     trained to deliver services to individuals with disabilities 
     whose employment outcome is self-employment or telecommuting) 
     employed to provide state-of-the-art service delivery and 
     rehabilitation technology services;
       ``(2) conduct special projects and demonstrations that 
     expand and improve the provision of rehabilitation and other 
     services (including those services provided through community 
     rehabilitation programs) authorized under this Act, or that 
     otherwise further the purposes of this Act, including related 
     research and evaluation;
       ``(3) provide vocational rehabilitation services to 
     individuals with disabilities who are migrant or seasonal 
     farmworkers;
       ``(4) initiate recreational programs to provide 
     recreational activities and related experiences for 
     individuals with disabilities to aid such individuals in 
     employment, mobility, socialization, independence, and 
     community integration; and
       ``(5) provide training and information to individuals with 
     disabilities and the individuals' representatives, and other 
     appropriate parties to develop the skills necessary for 
     individuals with disabilities to gain access to the 
     rehabilitation system and statewide workforce investment 
     systems and to become active decisionmakers in the 
     rehabilitation process.
       ``(b) Competitive Basis of Grants and Contracts.--The 
     Secretary shall ensure that all grants and contracts are 
     awarded under this title on a competitive basis.

     ``SEC. 302. TRAINING.

       ``(a) Grants and Contracts for Personnel Training.--
       ``(1) Authority.--The Commissioner shall make grants to, 
     and enter into contracts with, States and public or nonprofit 
     agencies and organizations (including institutions of higher 
     education) to pay part of the cost of projects to provide 
     training, traineeships, and related activities, including the 
     provision of technical assistance, that are designed to 
     assist in increasing the numbers of, and upgrading the skills 
     of, qualified personnel (especially rehabilitation 
     counselors) who are trained in providing vocational, medical, 
     social, and psychological rehabilitation services, who are 
     trained to assist individuals with communication and related 
     disorders, who are trained to provide other services provided 
     under this Act, to individuals with disabilities, and who may 
     include--
       ``(A) personnel specifically trained in providing 
     employment assistance to individuals with disabilities 
     through job development and job placement services;
       ``(B) personnel specifically trained to identify, assess, 
     and meet the individual rehabilitation needs of individuals 
     with disabilities, including needs for rehabilitation 
     technology;
       ``(C) personnel specifically trained to deliver services to 
     individuals who may benefit from receiving independent living 
     services;
       ``(D) personnel specifically trained to deliver services in 
     the client assistance programs;
       ``(E) personnel specifically trained to deliver services, 
     through supported employment programs, to individuals with a 
     most significant disability; and
       ``(F) personnel specifically trained to deliver services to 
     individuals with disabilities pursuing self-employment, 
     business ownership, and telecommuting; and
       ``(G) personnel trained in performing other functions 
     necessary to the provision of vocational, medical, social, 
     and psychological rehabilitation services, and other services 
     provided under this Act.
       ``(2) Authority to provide scholarships.--Grants and 
     contracts under paragraph (1) may be expended for 
     scholarships and may include necessary stipends and 
     allowances.
       ``(3) Related federal statutes.--In carrying out this 
     subsection, the Commissioner may make grants to and enter 
     into contracts with States and public or nonprofit agencies 
     and organizations, including institutions of higher 
     education, to furnish training regarding provisions of 
     Federal statutes, including section 504, title I of the 
     Americans with Disabilities Act of 1990 (42 U.S.C. 12111 et 
     seq.), and the provisions of titles II and XVI of the Social 
     Security Act (42 U.S.C. 401 et seq. and 1381 et seq.), that 
     are related to work incentives for individuals with 
     disabilities.
       ``(4) Training for statewide workforce systems personnel.--
     The Commissioner may make grants to and enter into contracts 
     under this subsection with States and public or nonprofit 
     agencies and organizations, including institutions of higher 
     education, to furnish training to personnel providing 
     services to individuals with disabilities under title I of 
     the Workforce Investment Act of 1998. Under this paragraph, 
     personnel may be trained--
       ``(A) in evaluative skills to determine whether an 
     individual with a disability may be served by the State 
     vocational rehabilitation program or another component of a 
     statewide workforce investment system; or
       ``(B) to assist individuals with disabilities seeking 
     assistance through one-stop delivery systems described in 
     section 134(c) of the Workforce Investment Act of 1998.
       ``(5) Joint funding.--Training and other activities 
     provided under paragraph (4) for personnel may be jointly 
     funded with the Department of Labor, using funds made 
     available under title I of the Workforce Investment Act of 
     1998.
       ``(b) Grants and Contracts for Academic Degrees and 
     Academic Certificate Granting Training Projects.--
       ``(1) Authority.--
       ``(A) In general.--The Commissioner may make grants to, and 
     enter into contracts with, States and public or nonprofit 
     agencies and organizations (including institutions of higher 
     education) to pay part of the costs of academic training 
     projects to provide training that leads to an academic degree 
     or academic certificate. In making such grants or entering 
     into such contracts, the Commissioner shall target funds to 
     areas determined under subsection (e) to have shortages of 
     qualified personnel.
       ``(B) Types of projects.--Academic training projects 
     described in this subsection may include--
       ``(i) projects to train personnel in the areas of assisting 
     and supporting individuals with disabilities pursuing self-
     employment, business ownership, and telecommuting, and of 
     vocational rehabilitation counseling, rehabilitation 
     technology, rehabilitation medicine, rehabilitation nursing, 
     rehabilitation social work, rehabilitation psychiatry, 
     rehabilitation psychology, rehabilitation dentistry, physical 
     therapy, occupational therapy, speech pathology and 
     audiology, physical education, therapeutic recreation, 
     community rehabilitation programs, or prosthetics and 
     orthotics;
       ``(ii) projects to train personnel to provide--

       ``(I) services to individuals with specific disabilities or 
     individuals with disabilities who have specific impediments 
     to rehabilitation, including individuals who are members of 
     populations that are unserved or underserved by programs 
     under this Act;
       ``(II) job development and job placement services to 
     individuals with disabilities;
       ``(III) supported employment services, including services 
     of employment specialists for individuals with disabilities;
       ``(IV) specialized services for individuals with 
     significant disabilities; or
       ``(V) recreation for individuals with disabilities;

       ``(iii) projects to train personnel in other fields 
     contributing to the rehabilitation of individuals with 
     disabilities; and
       ``(iv) projects to train personnel in the use, 
     applications, and benefits of rehabilitation technology.
       ``(2) Application.--No grant shall be awarded or contract 
     entered into under this subsection unless the applicant has 
     submitted to the Commissioner an application at such time, in 
     such form, in accordance with such procedures, and including 
     such information as the Secretary may require, including--
       ``(A) a description of how the designated State unit or 
     units will participate in the project to be funded under the 
     grant or contract, including, as appropriate, participation 
     on advisory committees, as practicum sites, in curriculum 
     development, and in other ways so as to build closer 
     relationships between the applicant and the designated State 
     unit and to encourage students to pursue careers in public 
     vocational rehabilitation programs;
       ``(B) the identification of potential employers that 
     provide employment that meets the requirements of paragraph 
     (5)(A)(i); and
       ``(C) an assurance that data on the employment of graduates 
     or trainees who participate in the project is accurate.
       ``(3) Limitation.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     no grant or contract under this subsection may be used to 
     provide any one course of study to an individual for a period 
     of more than 4 years.
       ``(B) Exception.--If a grant or contract recipient under 
     this subsection determines that an individual has a 
     disability which seriously affects the completion of training 
     under this subsection, the grant or contract recipient may 
     extend the period referred to in subparagraph (A).
       ``(4) Authority to provide scholarships.--Grants and 
     contracts under paragraph (1) may be expanded to provide 
     services that include the provision of scholarships and 
     necessary stipends and allowances.
       ``(5) Agreements.--
       ``(A) Contents.--A recipient of a grant or contract under 
     this subsection shall provide assurances to the Commissioner 
     that each individual who receives a scholarship, for any 
     academic year beginning after June 1, 1992, utilizing funds 
     provided under such grant or contract shall enter into an 
     agreement with the recipient under which the individual 
     shall--
       ``(i) maintain employment--

       ``(I) in a nonprofit rehabilitation agency or related 
     agency or in a State rehabilitation agency or related agency, 
     including a professional corporation or professional practice 
     group through which the individual has a service arrangement 
     with the designated State agency;
       ``(II) on a full- or part-time basis; and
       ``(III) for a period of not less than the full-time 
     equivalent of 2 years for each year for which assistance 
     under this section was received by the individual,

     within a period, beginning after the recipient completes the 
     training for which the scholarship

[[Page H6669]]

     was awarded, of not more than the sum of the number of years 
     in the period described in subclause (III) and 2 additional 
     years; and
       ``(ii) repay all or part of any scholarship received, plus 
     interest, if the individual does not fulfill the requirements 
     of clause (i),
     except as the Commissioner by regulation may provide for 
     repayment exceptions and deferrals.
       ``(B) Enforcement.--The Commissioner shall be responsible 
     for the enforcement of each agreement entered into under 
     subparagraph (A) upon completion of the training involved 
     under such subparagraph.
       ``(c) Grants to Historically Black Colleges and 
     Universities.--The Commissioner, in carrying out this 
     section, shall make grants to historically Black colleges and 
     universities and other institutions of higher education whose 
     minority student enrollment is at least 50 percent of the 
     total enrollment of the institution.
       ``(d) Application.--A grant may not be awarded to a State 
     or other organization under this section unless the State or 
     organization has submitted an application to the Commissioner 
     at such time, in such form, in accordance with such 
     procedures, and containing such information as the 
     Commissioner may require. Any such application shall include 
     a detailed description of strategies that will be utilized to 
     recruit and train individuals so as to reflect the diverse 
     populations of the United States as part of the effort to 
     increase the number of individuals with disabilities, and 
     individuals who are from linguistically and culturally 
     diverse backgrounds, who are available to provide 
     rehabilitation services.
       ``(e) Evaluation and Collection of Data.--The Commissioner 
     shall evaluate the impact of the training programs conducted 
     under this section, and collect information on the training 
     needs of, and data on shortages of qualified personnel 
     necessary to provide services to individuals with 
     disabilities. The Commissioner shall prepare and submit to 
     Congress, by September 30 of each fiscal year, a report 
     setting forth and justifying in detail how the funds made 
     available for training under this section for the fiscal year 
     prior to such submission are allocated by professional 
     discipline and other program areas. The report shall also 
     contain findings on such personnel shortages, how funds 
     proposed for the succeeding fiscal year will be allocated 
     under the President's budget proposal, and how the findings 
     on personnel shortages justify the allocations.
       ``(f) Grants for the Training of Interpreters.--
       ``(1) Authority.--
       ``(A) In general.--For the purpose of training a sufficient 
     number of qualified interpreters to meet the communications 
     needs of individuals who are deaf or hard of hearing, and 
     individuals who are deaf-blind, the Commissioner, acting 
     through a Federal office responsible for deafness and 
     communicative disorders, may award grants to public or 
     private nonprofit agencies or organizations to pay part of 
     the costs--
       ``(i) for the establishment of interpreter training 
     programs; or
       ``(ii) to enable such agencies or organizations to provide 
     financial assistance for ongoing interpreter training 
     programs.
       ``(B) Geographic areas.--The Commissioner shall award 
     grants under this subsection for programs in geographic areas 
     throughout the United States that the Commissioner considers 
     appropriate to best carry out the objectives of this section.
       ``(C) Priority.--In awarding grants under this subsection, 
     the Commissioner shall give priority to public or private 
     nonprofit agencies or organizations with existing programs 
     that have a demonstrated capacity for providing interpreter 
     training services.
       ``(D) Funding.--The Commissioner may award grants under 
     this subsection through the use of--
       ``(i) amounts appropriated to carry out this section; or
       ``(ii) pursuant to an agreement with the Director of the 
     Office of the Special Education Program (established under 
     section 603 of the Individuals with Disabilities Education 
     Act (as amended by section 101 of the Individuals with 
     Disabilities Education Act Amendments of 1997 (Public Law 
     105-17))), amounts appropriated under section 686 of the 
     Individuals with Disabilities Education Act.
       ``(2) Application.--A grant may not be awarded to an agency 
     or organization under paragraph (1) unless the agency or 
     organization has submitted an application to the Commissioner 
     at such time, in such form, in accordance with such 
     procedures, and containing such information as the 
     Commissioner may require, including--
       ``(A) a description of the manner in which an interpreter 
     training program will be developed and operated during the 5-
     year period following the date on which a grant is received 
     by the applicant under this subsection;
       ``(B) a demonstration of the applicant's capacity or 
     potential for providing training for interpreters for 
     individuals who are deaf or hard of hearing, and individuals 
     who are deaf-blind;
       ``(C) assurances that any interpreter trained or retrained 
     under a program funded under the grant will meet such minimum 
     standards of competency as the Commissioner may establish for 
     purposes of this subsection; and
       ``(D) such other information as the Commissioner may 
     require.
       ``(g) Technical Assistance and In-Service Training.--
       ``(1) Technical assistance.--The Commissioner is authorized 
     to provide technical assistance to State designated agencies 
     and community rehabilitation programs, directly or through 
     contracts with State designated agencies or nonprofit 
     organizations.
       ``(2) Compensation.--An expert or consultant appointed or 
     serving under contract pursuant to this section shall be 
     compensated at a rate, subject to approval of the 
     Commissioner, that shall not exceed the daily equivalent of 
     the rate of pay for level 4 of the Senior Executive Service 
     Schedule under section 5382 of title 5, United States Code. 
     Such an expert or consultant may be allowed travel and 
     transportation expenses in accordance with section 5703 of 
     title 5, United States Code.
       ``(3) In-service training of rehabilitation personnel.--
       ``(A) Projects.--Subject to subparagraph (B), at least 15 
     percent of the sums appropriated to carry out this section 
     shall be allocated to designated State agencies to be used, 
     directly or indirectly, for projects for in-service training 
     for rehabilitation personnel, consistent with the needs 
     identified through the comprehensive system for personnel 
     development required by section 101(a)(7), including projects 
     designed--
       ``(i) to address recruitment and retention of qualified 
     rehabilitation professionals;
       ``(ii) to provide for succession planning;
       ``(iii) to provide for leadership development and capacity 
     building; and
       ``(iv) for fiscal years 1999 and 2000, to provide training 
     regarding the Workforce Investment Act of 1998 and the 
     amendments to this Act made by the Rehabilitation Act 
     Amendments of 1998.
       ``(B) Limitation.--If the allocation to designated State 
     agencies required by subparagraph (A) would result in a lower 
     level of funding for projects being carried out on the date 
     of enactment of the Rehabilitation Act Amendments of 1998 by 
     other recipients of funds under this section, the 
     Commissioner may allocate less than 15 percent of the sums 
     described in subparagraph (A) to designated State agencies 
     for such in-service training.
       ``(h) Provision of Information.--The Commissioner, subject 
     to the provisions of section 306, may require that recipients 
     of grants or contracts under this section provide 
     information, including data, with regard to the impact of 
     activities funded under this section.
       ``(i) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for each of the fiscal years 1999 
     through 2003.

     ``SEC. 303. DEMONSTRATION AND TRAINING PROGRAMS.

       ``(a) Demonstration Projects To Increase Client Choice.--
       ``(1) Grants.--The Commissioner may make grants to States 
     and public or nonprofit agencies and organizations to pay all 
     or part of the costs of projects to demonstrate ways to 
     increase client choice in the rehabilitation process, 
     including the selection of providers of vocational 
     rehabilitation services.
       ``(2) Use of funds.--An entity that receives a grant under 
     this subsection shall use the grant only--
       ``(A) for activities that are directly related to planning, 
     operating, and evaluating the demonstration projects; and
       ``(B) to supplement, and not supplant, funds made available 
     from Federal and non-Federal sources for such projects.
       ``(3) Application.--Any eligible entity that desires to 
     receive a grant under this subsection shall submit an 
     application at such time, in such manner, and containing such 
     information and assurances as the Commissioner may require, 
     including--
       ``(A) a description of--
       ``(i) how the entity intends to promote increased client 
     choice in the rehabilitation process, including a 
     description, if appropriate, of how an applicant will 
     determine the cost of any service or product offered to an 
     eligible client;
       ``(ii) how the entity intends to ensure that any vocational 
     rehabilitation service or related service is provided by a 
     qualified provider who is accredited or meets such other 
     quality assurance and cost-control criteria as the State may 
     establish; and
       ``(iii) the outreach activities to be conducted by the 
     applicant to obtain eligible clients; and
       ``(B) assurances that a written plan will be established 
     with the full participation of the client, which plan shall, 
     at a minimum, include--
       ``(i) a statement of the vocational rehabilitation goals to 
     be achieved;
       ``(ii) a statement of the specific vocational 
     rehabilitation services to be provided, the projected dates 
     for their initiation, and the anticipated duration of each 
     such service; and
       ``(iii) objective criteria, an evaluation procedure, and a 
     schedule, for determining whether such goals are being 
     achieved.
       ``(4) Award of grants.--In selecting entities to receive 
     grants under paragraph (1), the Commissioner shall take into 
     consideration--
       ``(A) the diversity of strategies used to increase client 
     choice, including selection among qualified service 
     providers;
       ``(B) the geographic distribution of projects; and
       ``(C) the diversity of clients to be served.
       ``(5) Records.--Entities that receive grants under 
     paragraph (1) shall maintain such records as the Commissioner 
     may require and comply with any request from the Commissioner 
     for such records.
       ``(6) Direct services.--At least 80 percent of the funds 
     awarded for any project under this subsection shall be used 
     for direct services, as specifically chosen by eligible 
     clients.
       ``(7) Evaluation.--The Commissioner may conduct an 
     evaluation of the demonstration projects with respect to the 
     services provided, clients served, client outcomes obtained, 
     implementation issues addressed, the cost-effectiveness of 
     the project, and the effects of increased choice on clients 
     and service providers. The Commissioner may reserve funds for 
     the evaluation for a fiscal year from the amounts 
     appropriated to carry out projects under this section for the 
     fiscal year.

[[Page H6670]]

       ``(8) Definitions.--For the purposes of this subsection:
       ``(A) Direct services.--The term `direct services' means 
     vocational rehabilitation services, as described in section 
     103(a).
       ``(B) Eligible client.--The term `eligible client' means an 
     individual with a disability, as defined in section 7(20)(A), 
     who is not currently receiving services under an 
     individualized plan for employment established through a 
     designated State unit.
       ``(b) Special Demonstration Programs.--
       ``(1) Grants; contracts.--The Commissioner, subject to the 
     provisions of section 306, may provide grants to, or enter 
     into contracts with, eligible entities to pay all or part of 
     the cost of programs that expand and improve the provision of 
     rehabilitation and other services authorized under this Act 
     or that further the purposes of the Act, including related 
     research and evaluation activities.
       ``(2) Eligible entities; terms and conditions.--
       ``(A) Eligible entities.--To be eligible to receive a 
     grant, or enter into a contract, under paragraph (1), an 
     entity shall be a State vocational rehabilitation agency, 
     community rehabilitation program, Indian tribe or tribal 
     organization, or other public or nonprofit agency or 
     organization, or as the Commissioner determines appropriate, 
     a for-profit organization. The Commissioner may limit 
     competitions to 1 or more types of organizations described in 
     this subparagraph.
       ``(B) Terms and conditions.--A grant or contract under 
     paragraph (1) shall contain such terms and conditions as the 
     Commissioner may require.
       ``(3) Application.--An eligible entity that desires to 
     receive a grant, or enter into a contract, under paragraph 
     (1) shall submit an application to the Secretary at such 
     time, in such form, and containing such information and 
     assurances as the Commissioner may require, including, if the 
     Commissioner determines appropriate, a description of how the 
     proposed project or demonstration program--
       ``(A) is based on current research findings, which may 
     include research conducted by the National Institute on 
     Disability and Rehabilitation Research, the National 
     Institutes of Health, and other public or private 
     organizations; and
       ``(B) is of national significance.
       ``(4) Types of projects.--The programs that may be funded 
     under this subsection may include--
       ``(A) special projects and demonstrations of service 
     delivery;
       ``(B) model demonstration projects;
       ``(C) technical assistance projects;
       ``(D) systems change projects;
       ``(E) special studies and evaluations; and
       ``(F) dissemination and utilization activities.
       ``(5) Priority for competitions.--
       ``(A) In general.--In announcing competitions for grants 
     and contracts under this subsection, the Commissioner shall 
     give priority consideration to--
       ``(i) special projects and demonstration programs of 
     service delivery for adults who are either low-functioning 
     and deaf or low-functioning and hard of hearing;
       ``(ii) supported employment, including community-based 
     supported employment programs to meet the needs of 
     individuals with the most significant disabilities or to 
     provide technical assistance to States and community 
     organizations to improve and expand the provision of 
     supported employment services; and
       ``(iii) model transitional planning services for youths 
     with disabilities.
       ``(B) Additional competitions.--In announcing competitions 
     for grants and contracts under this subsection, the 
     Commissioner may require that applicants address 1 or more of 
     the following:
       ``(i) Age ranges.
       ``(ii) Types of disabilities.
       ``(iii) Types of services.
       ``(iv) Models of service delivery.
       ``(v) Stage of the rehabilitation process.
       ``(vi) The needs of underserved populations, unserved and 
     underserved areas, individuals with significant disabilities, 
     low-incidence disability population or individuals residing 
     in federally designated empowerment zones and enterprise 
     communities.
       ``(vii) Expansion of employment opportunities for 
     individuals with disabilities.
       ``(viii) Systems change projects to promote meaningful 
     access of individuals with disabilities to employment-related 
     services under title I of the Workforce Investment Act of 
     1998 and under other Federal laws.
       ``(ix) Innovative methods of promoting achievement of high-
     quality employment outcomes.
       ``(x) The demonstration of the effectiveness of early 
     intervention activities in improving employment outcomes.
       ``(xi) Alternative methods of providing affordable 
     transportation services to individuals with disabilities who 
     are employed, seeking employment, or receiving vocational 
     rehabilitation services from public or private organizations 
     and who reside in geographic areas in which public 
     transportation or paratransit service is not available.
       ``(6) Use of funds for continuation awards.--The 
     Commissioner may use funds made available to carry out this 
     section for continuation awards for projects that were funded 
     under sections 12 and 311 (as such sections were in effect on 
     the day before the date of the enactment of the 
     Rehabilitation Act Amendments of 1998).
       ``(c) Parent Information and Training Program.--
       ``(1) Grants.--The Commissioner is authorized to make 
     grants to private nonprofit organizations for the purpose of 
     establishing programs to provide training and information to 
     enable individuals with disabilities, and the parents, family 
     members, guardians, advocates, or other authorized 
     representatives of the individuals to participate more 
     effectively with professionals in meeting the vocational, 
     independent living, and rehabilitation needs of individuals 
     with disabilities. Such grants shall be designed to meet the 
     unique training and information needs of the individuals 
     described in the preceding sentence, who live in the area to 
     be served, particularly those who are members of populations 
     that have been unserved or underserved by programs under this 
     Act.
       ``(2) Use of grants.--An organization that receives a grant 
     to establish training and information programs under this 
     subsection shall use the grant to assist individuals with 
     disabilities, and the parents, family members, guardians, 
     advocates, or authorized representatives of the individuals--
       ``(A) to better understand vocational rehabilitation and 
     independent living programs and services;
       ``(B) to provide followup support for transition and 
     employment programs;
       ``(C) to communicate more effectively with transition and 
     rehabilitation personnel and other relevant professionals;
       ``(D) to provide support in the development of the 
     individualized plan for employment;
       ``(E) to provide support and expertise in obtaining 
     information about rehabilitation and independent living 
     programs, services, and resources that are appropriate; and
       ``(F) to understand the provisions of this Act, 
     particularly provisions relating to employment, supported 
     employment, and independent living.
       ``(3) Award of grants.--The Commissioner shall ensure that 
     grants under this subsection--
       ``(A) shall be distributed geographically to the greatest 
     extent possible throughout all States; and
       ``(B) shall be targeted to individuals with disabilities, 
     and the parents, family members, guardians, advocates, or 
     authorized representatives of the individuals, in both urban 
     and rural areas or on a State or regional basis.
       ``(4) Eligible organizations.--In order to receive a grant 
     under this subsection, an organization--
       ``(A) shall submit an application to the Commissioner at 
     such time, in such manner, and containing such information as 
     the Commissioner may require, including information 
     demonstrating the capacity and expertise of the 
     organization--
       ``(i) to coordinate training and information activities 
     with Centers for Independent Living;
       ``(ii) to coordinate and work closely with parent training 
     and information centers established pursuant to section 
     682(a) of the Individuals with Disabilities Education Act (as 
     added by section 101 of the Individuals with Disabilities 
     Education Act Amendments of 1997; Public Law 105-17); and
       ``(iii) to effectively conduct the training and information 
     activities authorized under this subsection;
       ``(B)(i) shall be governed by a board of directors--
       ``(I) that includes professionals in the field of 
     vocational rehabilitation; and
       ``(II) on which a majority of the members are individuals 
     with disabilities or the parents, family members, guardians, 
     advocates, or authorized representatives of the individuals; 
     or
       ``(ii)(I) shall have a membership that represents the 
     interests of individuals with disabilities; and
       ``(II) shall establish a special governing committee that 
     meets the requirements specified in subclauses (I) and (II) 
     of clause (i) to operate a training and information program 
     under this subsection; and
       ``(C) shall serve individuals with a full range of 
     disabilities, and the parents, family members, guardians, 
     advocates, or authorized representatives of the individuals.
       ``(5) Consultation.--Each organization carrying out a 
     program receiving assistance under this subsection shall 
     consult with appropriate agencies that serve or assist 
     individuals with disabilities, and the parents, family 
     members, guardians, advocates, or authorized representatives 
     of the individuals, located in the jurisdiction served by the 
     program.
       ``(6) Coordination.--The Commissioner shall provide 
     coordination and technical assistance by grant or cooperative 
     agreement for establishing, developing, and coordinating the 
     training and information programs. To the extent practicable, 
     such assistance shall be provided by the parent training and 
     information centers established pursuant to section 682(a) of 
     the Individuals with Disabilities Education Act (as added by 
     section 101 of the Individuals with Disabilities Education 
     Act Amendments of 1997; Public Law 105-17).
       ``(7) Review.--
       ``(A) Quarterly review.--The board of directors or special 
     governing committee of an organization receiving a grant 
     under this subsection shall meet at least once in each 
     calendar quarter to review the training and information 
     program, and each such committee shall directly advise the 
     governing board regarding the views and recommendations of 
     the committee.
       ``(B) Review for grant renewal.--If a nonprofit private 
     organization requests the renewal of a grant under this 
     subsection, the board of directors or the special governing 
     committee shall prepare and submit to the Commissioner a 
     written review of the training and information program 
     conducted by the organization during the preceding fiscal 
     year.
       ``(d) Braille Training Programs.--
       ``(1) Establishment.--The Commissioner shall make grants 
     to, and enter into contracts with, States and public or 
     nonprofit agencies and organizations, including institutions 
     of higher education, to pay all or part of the cost of 
     training in the use of braille for personnel

[[Page H6671]]

     providing vocational rehabilitation services or educational 
     services to youth and adults who are blind.
       ``(2) Projects.--Such grants shall be used for the 
     establishment or continuation of projects that may provide--
       ``(A) development of braille training materials;
       ``(B) in-service or pre-service training in the use of 
     braille, the importance of braille literacy, and methods of 
     teaching braille to youth and adults who are blind; and
       ``(C) activities to promote knowledge and use of braille 
     and nonvisual access technology for blind youth and adults 
     through a program of training, demonstration, and evaluation 
     conducted with leadership of experienced blind individuals, 
     including the use of comprehensive, state-of-the-art 
     technology.
       ``(3) Application.--To be eligible to receive a grant, or 
     enter into a contract, under paragraph (1), an agency or 
     organization shall submit an application to the Commissioner 
     at such time, in such manner, and containing such information 
     as the Commissioner may require.
       ``(e) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for each of the fiscal years 1999 
     through 2003.

     ``SEC. 304. MIGRANT AND SEASONAL FARMWORKERS.

       ``(a) Grants.--
       ``(1) Authority.--The Commissioner, subject to the 
     provisions of section 306, may make grants to eligible 
     entities to pay up to 90 percent of the cost of projects or 
     demonstration programs for the provision of vocational 
     rehabilitation services to individuals with disabilities who 
     are migrant or seasonal farmworkers, as determined in 
     accordance with rules prescribed by the Secretary of Labor, 
     and to the family members who are residing with such 
     individuals (whether or not such family members are 
     individuals with disabilities).
       ``(2) Eligible entities.--To be eligible to receive a grant 
     under paragraph (1), an entity shall be--
       ``(A) a State designated agency;
       ``(B) a nonprofit agency working in collaboration with a 
     State agency described in subparagraph (A); or
       ``(C) a local agency working in collaboration with a State 
     agency described in subparagraph (A).
       ``(3) Maintenance and transportation.--
       ``(A) In general.--Amounts provided under a grant under 
     this section may be used to provide for the maintenance of 
     and transportation for individuals and family members 
     described in paragraph (1) as necessary for the 
     rehabilitation of such individuals.
       ``(B) Requirement.--Maintenance payments under this 
     paragraph shall be provided in a manner consistent with any 
     maintenance payments provided to other individuals with 
     disabilities in the State under this Act.
       ``(4) Assurance of cooperation.--To be eligible to receive 
     a grant under this section an entity shall provide assurances 
     (satisfactory to the Commissioner) that in the provision of 
     services under the grant there will be appropriate 
     cooperation between the grantee and other public or nonprofit 
     agencies and organizations having special skills and 
     experience in the provision of services to migrant or 
     seasonal farmworkers or their families.
       ``(5) Coordination with other programs.--The Commissioner 
     shall administer this section in coordination with other 
     programs serving migrant and seasonal farmworkers, including 
     programs under title I of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6301 et seq.), section 330 
     of the Public Health Service Act (42 U.S.C. 254b), the 
     Migrant and Seasonal Agricultural Worker Protection Act (29 
     U.S.C. 1801 et seq.), and the Workforce Investment Act of 
     1998.
       ``(b) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out this section, for each of the fiscal years 1999 
     through 2003.

     ``SEC. 305. RECREATIONAL PROGRAMS.

       ``(a) Grants.--
       ``(1) Authority.--
       ``(A) In general.--The Commissioner, subject to the 
     provisions of section 306, shall make grants to States, 
     public agencies, and nonprofit private organizations to pay 
     the Federal share of the cost of the establishment and 
     operation of recreation programs to provide individuals with 
     disabilities with recreational activities and related 
     experiences to aid in the employment, mobility, 
     socialization, independence, and community integration of 
     such individuals.
       ``(B) Recreation programs.--The recreation programs that 
     may be funded using assistance provided under a grant under 
     this section may include vocational skills development, 
     leisure education, leisure networking, leisure resource 
     development, physical education and sports, scouting and 
     camping, 4-H activities, construction of facilities for 
     aquatic rehabilitation therapy, music, dancing, handicrafts, 
     art, and homemaking. When possible and appropriate, such 
     programs and activities should be provided in settings with 
     peers who are not individuals with disabilities.
       ``(C) Design of program.--Programs and activities carried 
     out under this section shall be designed to demonstrate ways 
     in which such programs assist in maximizing the independence 
     and integration of individuals with disabilities.
       ``(2) Maximum term of grant.--A grant under this section 
     shall be made for a period of not more than 3 years.
       ``(3) Availability of nongrant resources.--
       ``(A) In general.--A grant may not be made to an applicant 
     under this section unless the applicant provides assurances 
     that, with respect to costs of the recreation program to be 
     carried out under the grant, the applicant, to the maximum 
     extent practicable, will make available non-Federal resources 
     (in cash or in-kind) to pay the non-Federal share of such 
     costs.
       ``(B) Federal share.--The Federal share of the costs of the 
     recreation programs carried out under this section shall be--
       ``(i) with respect to the first year in which assistance is 
     provided under a grant under this section, 100 percent;
       ``(ii) with respect to the second year in which assistance 
     is provided under a grant under this section, 75 percent; and
       ``(iii) with respect to the third year in which assistance 
     is provided under a grant under this section, 50 percent.
       ``(4) Application.--To be eligible to receive a grant under 
     this section, a State, agency, or organization shall submit 
     an application to the Commissioner at such time, in such 
     manner, and containing such information as the Commissioner 
     may require, including a description of--
       ``(A) the manner in which the findings and results of the 
     project to be funded under the grant, particularly 
     information that facilitates the replication of the results 
     of such projects, will be made generally available; and
       ``(B) the manner in which the service program funded under 
     the grant will be continued after Federal assistance ends.
       ``(5) Level of services.--Recreation programs funded under 
     this section shall maintain, at a minimum, the same level of 
     services over a 3-year project period.
       ``(6) Reports by grantees.--
       ``(A) Requirement.--The Commissioner shall require that 
     each recipient of a grant under this section annually prepare 
     and submit to the Commissioner a report concerning the 
     results of the activities funded under the grant.
       ``(B) Limitation.--The Commissioner may not make financial 
     assistance available to a grant recipient for a subsequent 
     year until the Commissioner has received and evaluated the 
     annual report of the recipient under subparagraph (A) for the 
     current year.
       ``(b) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section, such 
     sums as may be necessary for each of the fiscal years 1999 
     through 2003.

     ``SEC. 306. MEASURING OF PROJECT OUTCOMES AND PERFORMANCE.

       ``The Commissioner may require that recipients of grants 
     under this title submit information, including data, as 
     determined by the Commissioner to be necessary to measure 
     project outcomes and performance, including any data needed 
     to comply with the Government Performance and Results Act.''.

     SEC. 407. NATIONAL COUNCIL ON DISABILITY.

       Title IV of the Rehabilitation Act of 1973 (29 U.S.C. 780 
     et seq.) is amended to read as follows:

               ``TITLE IV--NATIONAL COUNCIL ON DISABILITY


           ``establishment of national council on disability

       ``Sec. 400. (a)(1)(A) There is established within the 
     Federal Government a National Council on Disability 
     (hereinafter in this title referred to as the `National 
     Council'), which shall be composed of fifteen members 
     appointed by the President, by and with the advice and 
     consent of the Senate.
       ``(B) The President shall select members of the National 
     Council after soliciting recommendations from representatives 
     of--
       ``(i) organizations representing a broad range of 
     individuals with disabilities; and
       ``(ii) organizations interested in individuals with 
     disabilities.
       ``(C) The members of the National Council shall be 
     individuals with disabilities, parents or guardians of 
     individuals with disabilities, or other individuals who have 
     substantial knowledge or experience relating to disability 
     policy or programs. The members of the National Council shall 
     be appointed so as to be representative of individuals with 
     disabilities, national organizations concerned with 
     individuals with disabilities, providers and administrators 
     of services to individuals with disabilities, individuals 
     engaged in conducting medical or scientific research relating 
     to individuals with disabilities, business concerns, and 
     labor organizations. A majority of the members of the 
     National Council shall be individuals with disabilities. The 
     members of the National Council shall be broadly 
     representative of minority and other individuals and groups.
       ``(2) The purpose of the National Council is to promote 
     policies, programs, practices, and procedures that--
       ``(A) guarantee equal opportunity for all individuals with 
     disabilities, regardless of the nature or severity of the 
     disability; and
       ``(B) empower individuals with disabilities to achieve 
     economic self-sufficiency, independent living, and inclusion 
     and integration into all aspects of society.
       ``(b)(1) Each member of the National Council shall serve 
     for a term of 3 years, except that the terms of service of 
     the members initially appointed after the date of enactment 
     of the Rehabilitation, Comprehensive Services, and 
     Developmental Disabilities Amendments of 1978 shall be (as 
     specified by the President) for such fewer number of years as 
     will provide for the expiration of terms on a staggered 
     basis.
       ``(2)(A) No member of the National Council may serve more 
     than two consecutive full terms beginning on the date of 
     commencement of the first full term on the Council. Members 
     may serve after the expiration of their terms until their 
     successors have taken office.
       ``(B) As used in this paragraph, the term `full term' means 
     a term of 3 years.
       ``(3) Any member appointed to fill a vacancy occurring 
     before the expiration of the term for which such member's 
     predecessor was appointed shall be appointed only for the 
     remainder of such term.
       ``(c) The President shall designate the Chairperson from 
     among the members appointed to

[[Page H6672]]

     the National Council. The National Council shall meet at the 
     call of the Chairperson, but not less often than four times 
     each year.
       ``(d) Eight members of the National Council shall 
     constitute a quorum and any vacancy in the National Council 
     shall not affect its power to function.


                      ``duties of national council

       ``Sec. 401. (a) The National Council shall--
       ``(1) provide advice to the Director with respect to the 
     policies and conduct of the National Institute on Disability 
     and Rehabilitation Research, including ways to improve 
     research concerning individuals with disabilities and the 
     methods of collecting and disseminating findings of such 
     research;
       ``(2) provide advice to the Commissioner with respect to 
     the policies of and conduct of the Rehabilitation Services 
     Administration;
       ``(3) advise the President, the Congress, the Commissioner, 
     the appropriate Assistant Secretary of the Department of 
     Education, and the Director of the National Institute on 
     Disability and Rehabilitation Research on the development of 
     the programs to be carried out under this Act;
       ``(4) provide advice regarding priorities for the 
     activities of the Interagency Disability Coordinating Council 
     and review the recommendations of such Council for 
     legislative and administrative changes to ensure that such 
     recommendations are consistent with the purposes of the 
     Council to promote the full integration, independence, and 
     productivity of individuals with disabilities;
       ``(5) review and evaluate on a continuing basis--
       ``(A) policies, programs, practices, and procedures 
     concerning individuals with disabilities conducted or 
     assisted by Federal departments and agencies, including 
     programs established or assisted under this Act or under the 
     Developmental Disabilities Assistance and Bill of Rights Act; 
     and
       ``(B) all statutes and regulations pertaining to Federal 
     programs which assist such individuals with disabilities;

     in order to assess the effectiveness of such policies, 
     programs, practices, procedures, statutes, and regulations in 
     meeting the needs of individuals with disabilities;
       ``(6) assess the extent to which such policies, programs, 
     practices, and procedures facilitate or impede the promotion 
     of the policies set forth in subparagraphs (A) and (B) of 
     section 400(a)(2);
       ``(7) gather information about the implementation, 
     effectiveness, and impact of the Americans with Disabilities 
     Act of 1990 (42 U.S.C. 12101 et seq.);
       ``(8) make recommendations to the President, the Congress, 
     the Secretary, the Director of the National Institute on 
     Disability and Rehabilitation Research, and other officials 
     of Federal agencies or other Federal entities, respecting 
     ways to better promote the policies set forth in section 
     400(a)(2);
       ``(9) provide to the Congress on a continuing basis advice, 
     recommendations, legislative proposals, and any additional 
     information that the National Council or the Congress deems 
     appropriate; and
       ``(10) review and evaluate on a continuing basis new and 
     emerging disability policy issues affecting individuals with 
     disabilities at the Federal, State, and local levels, and in 
     the private sector, including the need for and coordination 
     of adult services, access to personal assistance services, 
     school reform efforts and the impact of such efforts on 
     individuals with disabilities, access to health care, and 
     policies that operate as disincentives for the individuals to 
     seek and retain employment.
       ``(b)(1) Not later than October 31, 1998, and annually 
     thereafter, the National Council shall prepare and submit to 
     the President and the appropriate committees of the Congress 
     a report entitled `National Disability Policy: A Progress 
     Report'.
       ``(2) The report shall assess the status of the Nation in 
     achieving the policies set forth in section 400(a)(2), with 
     particular focus on the new and emerging issues impacting on 
     the lives of individuals with disabilities. The report shall 
     present, as appropriate, available data on health, housing, 
     employment, insurance, transportation, recreation, training, 
     prevention, early intervention, and education. The report 
     shall include recommendations for policy change.
       ``(3) In determining the issues to focus on and the 
     findings, conclusions, and recommendations to include in the 
     report, the National Council shall seek input from the 
     public, particularly individuals with disabilities, 
     representatives of organizations representing a broad range 
     of individuals with disabilities, and organizations and 
     agencies interested in individuals with disabilities.


               ``compensation of national council members

       ``Sec. 402. (a) Members of the National Council shall be 
     entitled to receive compensation at a rate equal to the rate 
     of pay for level 4 of the Senior Executive Service Schedule 
     under section 5382 of title 5, United States Code, including 
     travel time, for each day they are engaged in the performance 
     of their duties as members of the National Council.
       ``(b) Members of the National Council who are full-time 
     officers or employees of the United States shall receive no 
     additional pay on account of their service on the National 
     Council except for compensation for travel expenses as 
     provided under subsection (c) of this section.
       ``(c) While away from their homes or regular places of 
     business in the performance of services for the National 
     Council, members of the National Council shall be allowed 
     travel expenses, including per diem in lieu of subsistence, 
     in the same manner as persons employed intermittently in the 
     Government service are allowed expenses under section 5703 of 
     title 5, United States Code.


                      ``staff of national council

       ``Sec. 403. (a)(1) The Chairperson of the National Council 
     may appoint and remove, without regard to the provisions of 
     title 5, United States Code, governing appointments, the 
     provisions of chapter 75 of such title (relating to adverse 
     actions), the provisions of chapter 77 of such title 
     (relating to appeals), or the provisions of chapter 51 and 
     subchapter III of chapter 53 of such title (relating to 
     classification and General Schedule pay rates), an Executive 
     Director to assist the National Council to carry out its 
     duties. The Executive Director shall be appointed from among 
     individuals who are experienced in the planning or operation 
     of programs for individuals with disabilities.
       ``(2) The Executive Director is authorized to hire 
     technical and professional employees to assist the National 
     Council to carry out its duties.
       ``(b)(1) The National Council may procure temporary and 
     intermittent services to the same extent as is authorized by 
     section 3109(b) of title 5, United States Code (but at rates 
     for individuals not to exceed the daily equivalent of the 
     rate of pay for level 4 of the Senior Executive Service 
     Schedule under section 5382 of title 5, United States Code).
       ``(2) The National Council may--
       ``(A) accept voluntary and uncompensated services, 
     notwithstanding the provisions of section 1342 of title 31, 
     United States Code;
       ``(B) in the name of the Council, solicit, accept, employ, 
     and dispose of, in furtherance of this Act, any money or 
     property, real or personal, or mixed, tangible or 
     nontangible, received by gift, devise, bequest, or otherwise; 
     and
       ``(C) enter into contracts and cooperative agreements with 
     Federal and State agencies, private firms, institutions, and 
     individuals for the conduct of research and surveys, 
     preparation of reports and other activities necessary to the 
     discharge of the Council's duties and responsibilities.
       ``(3) Not more than 10 per centum of the total amounts 
     available to the National Council in each fiscal year may be 
     used for official representation and reception.
       ``(c) The Administrator of General Services shall provide 
     to the National Council on a reimbursable basis such 
     administrative support services as the Council may request.
       ``(d)(1) It shall be the duty of the Secretary of the 
     Treasury to invest such portion of the amounts made available 
     under subsection (a)(2)(B) as is not, in the Secretary's 
     judgment, required to meet current withdrawals. Such 
     investments may be made only in interest-bearing obligations 
     of the United States or in obligations guaranteed as to both 
     principal and interest by the United States.
       ``(2) The amounts described in paragraph (1), and the 
     interest on, and the proceeds from the sale or redemption of, 
     the obligations described in paragraph (1) shall be available 
     to the National Council to carry out this title.


              ``administrative powers of national council

       ``Sec. 404. (a) The National Council may prescribe such 
     bylaws and rules as may be necessary to carry out its duties 
     under this title.
       ``(b) The National Council may hold such hearings, sit and 
     act at such times and places, take such testimony, and 
     receive such evidence as it deems advisable.
       ``(c) The National Council may appoint advisory committees 
     to assist the National Council in carrying out its duties. 
     The members thereof shall serve without compensation.
       ``(d) The National Council may use the United States mails 
     in the same manner and upon the same conditions as other 
     departments and agencies of the United States.
       ``(e) The National Council may use, with the consent of the 
     agencies represented on the Interagency Disability 
     Coordinating Council, and as authorized in title V, such 
     services, personnel, information, and facilities as may be 
     needed to carry out its duties under this title, with or 
     without reimbursement to such agencies.


                   ``authorization of appropriations

       ``Sec. 405. There are authorized to be appropriated to 
     carry out this title such sums as may be necessary for each 
     of the fiscal years 1999 through 2003.''.

     SEC. 408. RIGHTS AND ADVOCACY.

       (a) Conforming Amendments to Rights and Advocacy 
     Provisions.--
       (1) Employment.--Section 501 (29 U.S.C. 791) is amended--
       (A) in the third sentence of subsection (a), by striking 
     ``President's Committees on Employment of the Handicapped'' 
     and inserting ``President's Committees on Employment of 
     People With Disabilities''; and
       (B) in subsection (e), by striking ``individualized written 
     rehabilitation program'' and inserting ``individualized plan 
     for employment''.
       (2) Access board.--Section 502 (29 U.S.C. 792) is amended--
       (A) in subsection (a)(1), in the sentence following 
     subparagraph (B), by striking ``Chairperson'' and inserting 
     ``chairperson'';
       (B) in subsection (b)--
       (i) in paragraph (2), by striking ``guidelines'' and 
     inserting ``information'';
       (ii) by striking paragraph (3) and inserting the following:
       ``(3) establish and maintain--
       ``(A) minimum guidelines and requirements for the standards 
     issued pursuant to the Act commonly known as the 
     Architectural Barriers Act of 1968;
       ``(B) minimum guidelines and requirements for the standards 
     issued pursuant to titles II and III of the Americans with 
     Disabilities Act of 1990;
       ``(C) guidelines for accessibility of telecommunications 
     equipment and customer premises equipment under section 255 
     of the Telecommunications Act of 1934 (47 U.S.C. 255); and
       ``(D) standards for accessible electronic and information 
     technology under section 508;'';
       (iii) in paragraph (9), by striking ``; and'' and inserting 
     a semicolon;

[[Page H6673]]

       (iv) in paragraph (10), by striking the period and 
     inserting ``; and''; and
       (v) by adding at the end the following:
       ``(11) carry out the responsibilities specified for the 
     Access Board in section 508.'';
       (C) in subsection (d)(1), by striking ``procedures under 
     this section'' and inserting ``procedures under this 
     subsection'';
       (D) in subsection (g)(2), by striking ``Committee on 
     Education and Labor'' and inserting ``Committee on Education 
     and the Workforce'';
       (E) in subsection (h)(2)(A), by striking ``paragraphs (5) 
     and (7)'' and inserting ``paragraphs (2) and (4)''; and
       (F) in subsection (i), by striking ``fiscal years 1993 
     through 1997'' and inserting ``fiscal years 1999 through 
     2003''.
       (3) Federal grants and contracts.--Section 504(a) (29 
     U.S.C. 794(a)) is amended in the first sentence by striking 
     ``section 7(8)'' and inserting ``section 7(20)''.
       (4) Secretarial responsibilities.--Section 506(a) (29 
     U.S.C. 794b(a)) is amended--
       (A) by striking the second sentence and inserting the 
     following: ``Any concurrence of the Access Board under 
     paragraph (2) shall reflect its consideration of cost studies 
     carried out by States.''; and
       (B) in the second sentence of subsection (c), by striking 
     ``provided under this paragraph'' and inserting ``provided 
     under this subsection''.
       (b) Electronic and Information Technology Regulations.--
     Section 508 (29 U.S.C. 794d) is amended to read as follows:

     ``SEC. 508. ELECTRONIC AND INFORMATION TECHNOLOGY.

       ``(a) Requirements for Federal Departments and Agencies.--
       ``(1) Accessibility.--
       ``(A) Development, procurement, maintenance, or use of 
     electronic and information technology.--When developing, 
     procuring, maintaining, or using electronic and information 
     technology, each Federal department or agency, including the 
     United States Postal Service, shall ensure, unless an undue 
     burden would be imposed on the department or agency, that the 
     electronic and information technology allows, regardless of 
     the type of medium of the technology--
       ``(i) individuals with disabilities who are Federal 
     employees to have access to and use of information and data 
     that is comparable to the access to and use of the 
     information and data by Federal employees who are not 
     individuals with disabilities; and
       ``(ii) individuals with disabilities who are members of the 
     public seeking information or services from a Federal 
     department or agency to have access to and use of information 
     and data that is comparable to the access to and use of the 
     information and data by such members of the public who are 
     not individuals with disabilities.
       ``(B) Alternative means efforts.--When development, 
     procurement, maintenance, or use of electronic and 
     information technology that meets the standards published by 
     the Access Board under paragraph (2) would impose an undue 
     burden, the Federal department or agency shall provide 
     individuals with disabilities covered by paragraph (1) with 
     the information and data involved by an alternative means of 
     access that allows the individual to use the information and 
     data.
       ``(2) Electronic and information technology standards.--
       ``(A) In general.--Not later than 18 months after the date 
     of enactment of the Rehabilitation Act Amendments of 1998, 
     the Architectural and Transportation Barriers Compliance 
     Board (referred to in this section as the `Access Board'), 
     after consultation with the Secretary of Education, the 
     Administrator of General Services, the Secretary of Commerce, 
     the Chairman of the Federal Communications Commission, the 
     Secretary of Defense, and the head of any other Federal 
     department or agency that the Access Board determines to be 
     appropriate, including consultation on relevant research 
     findings, and after consultation with the electronic and 
     information technology industry and appropriate public or 
     nonprofit agencies or organizations, including organizations 
     representing individuals with disabilities, shall issue and 
     publish standards setting forth--
       ``(i) for purposes of this section, a definition of 
     electronic and information technology that is consistent with 
     the definition of information technology specified in section 
     5002(3) of the Clinger-Cohen Act of 1996 (40 U.S.C. 1401(3)); 
     and
       ``(ii) the technical and functional performance criteria 
     necessary to implement the requirements set forth in 
     paragraph (1).
       ``(B) Review and amendment.--The Access Board shall 
     periodically review and, as appropriate, amend the standards 
     required under subparagraph (A) to reflect technological 
     advances or changes in electronic and information technology.
       ``(3) Incorporation of standards.--Not later than 6 months 
     after the Access Board publishes the standards required under 
     paragraph (2), the Federal Acquisition Regulatory Council 
     shall revise the Federal Acquisition Regulation and each 
     Federal department or agency shall revise the Federal 
     procurement policies and directives under the control of the 
     department or agency to incorporate those standards. Not 
     later than 6 months after the Access Board revises any 
     standards required under paragraph (2), the Council shall 
     revise the Federal Acquisition Regulation and each 
     appropriate Federal department or agency shall revise the 
     procurement policies and directives, as necessary, to 
     incorporate the revisions.
       ``(4) Acquisition planning.--In the event that a Federal 
     department or agency determines that compliance with the 
     standards issued by the Access Board under paragraph (2) 
     relating to procurement imposes an undue burden, the 
     documentation by the department or agency supporting the 
     procurement shall explain why compliance creates an undue 
     burden.
       ``(5) Exemption for national security systems.--This 
     section shall not apply to national security systems, as that 
     term is defined in section 5142 of the Clinger-Cohen Act of 
     1996 (40 U.S.C. 1452).
       ``(6) Construction.--
       ``(A) Equipment.--In a case in which the Federal Government 
     provides access to the public to information or data through 
     electronic and information technology, nothing in this 
     section shall be construed to require a Federal department or 
     agency--
       ``(i) to make equipment owned by the Federal Government 
     available for access and use by individuals with disabilities 
     covered by paragraph (1) at a location other than that where 
     the electronic and information technology is provided to the 
     public; or
       ``(ii) to purchase equipment for access and use by 
     individuals with disabilities covered by paragraph (1) at a 
     location other than that where the electronic and information 
     technology is provided to the public.
       ``(B) Software and peripheral devices.-- Except as required 
     to comply with standards issued by the Access Board under 
     paragraph (2), nothing in paragraph (1) requires the 
     installation of specific accessibility-related software or 
     the attachment of a specific accessibility-related peripheral 
     device at a workstation of a Federal employee who is not an 
     individual with a disability.
       ``(b) Technical Assistance.--The Administrator of General 
     Services and the Access Board shall provide technical 
     assistance to individuals and Federal departments and 
     agencies concerning the requirements of this section.
       ``(c) Agency Evaluations.--Not later than 6 months after 
     the date of enactment of the Rehabilitation Act Amendments of 
     1998, the head of each Federal department or agency shall 
     evaluate the extent to which the electronic and information 
     technology of the department or agency is accessible to and 
     usable by individuals with disabilities described in 
     subsection (a)(1), compared to the access to and use of the 
     technology by individuals described in such subsection who 
     are not individuals with disabilities, and submit a report 
     containing the evaluation to the Attorney General.
       ``(d) Reports.--
       ``(1) Interim report.--Not later than 18 months after the 
     date of enactment of the Rehabilitation Act Amendments of 
     1998, the Attorney General shall prepare and submit to the 
     President a report containing information on and 
     recommendations regarding the extent to which the electronic 
     and information technology of the Federal Government is 
     accessible to and usable by individuals with disabilities 
     described in subsection (a)(1).
       ``(2) Biennial reports.--Not later than 3 years after the 
     date of enactment of the Rehabilitation Act Amendments of 
     1998, and every 2 years thereafter, the Attorney General 
     shall prepare and submit to the President and Congress a 
     report containing information on and recommendations 
     regarding the state of Federal department and agency 
     compliance with the requirements of this section, including 
     actions regarding individual complaints under subsection (f).
       ``(e) Cooperation.--Each head of a Federal department or 
     agency (including the Access Board, the Equal Employment 
     Opportunity Commission, and the General Services 
     Administration) shall provide to the Attorney General such 
     information as the Attorney General determines is necessary 
     to conduct the evaluations under subsection (c) and prepare 
     the reports under subsection (d).
       ``(f) Enforcement.--
       ``(1) General.--
       ``(A) Complaints.--Effective 2 years after the date of 
     enactment of the Rehabilitation Act Amendments of 1998, any 
     individual with a disability may file a complaint alleging 
     that a Federal department or agency fails to comply with 
     subsection (a)(1) in providing electronic and information 
     technology.
       ``(B) Application.--This subsection shall apply only to 
     electronic and information technology that is procured by a 
     Federal department or agency not less than 2 years after the 
     date of enactment of the Rehabilitation Act Amendments of 
     1998.
       ``(2) Administrative complaints.--Complaints filed under 
     paragraph (1) shall be filed with the Federal department or 
     agency alleged to be in noncompliance. The Federal department 
     or agency receiving the complaint shall apply the complaint 
     procedures established to implement section 504 for resolving 
     allegations of discrimination in a federally conducted 
     program or activity.
       ``(3) Civil actions.--The remedies, procedures, and rights 
     set forth in sections 505(a)(2) and 505(b) shall be the 
     remedies, procedures, and rights available to any individual 
     with a disability filing a complaint under paragraph (1).
       ``(g) Application to Other Federal Laws.--This section 
     shall not be construed to limit any right, remedy, or 
     procedure otherwise available under any provision of Federal 
     law (including sections 501 through 505) that provides 
     greater or equal protection for the rights of individuals 
     with disabilities than this section.''.
       (c) Protection and Advocacy of Individual Rights.--Section 
     509 (29 U.S.C. 794e) is amended to read as follows:

     ``SEC. 509. PROTECTION AND ADVOCACY OF INDIVIDUAL RIGHTS.

       ``(a) Purpose and Construction.--
       ``(1) Purpose.--The purpose of this section is to support a 
     system in each State to protect the legal and human rights of 
     individuals with disabilities who--

[[Page H6674]]

       ``(A) need services that are beyond the scope of services 
     authorized to be provided by the client assistance program 
     under section 112; and
       ``(B)(i) are ineligible for protection and advocacy 
     programs under part C of the Developmental Disabilities 
     Assistance and Bill of Rights Act (42 U.S.C. 6041 et seq.) 
     because the individuals do not have a developmental 
     disability, as defined in section 102 of such Act (42 U.S.C. 
     6002); and
       ``(ii) are ineligible for services under the Protection and 
     Advocacy for Mentally Ill Individuals Act of 1986 (42 U.S.C. 
     10801 et seq.) because the individuals are not individuals 
     with mental illness, as defined in section 102 of such Act 
     (42 U.S.C. 10802).
       ``(2) Construction.--This section shall not be construed to 
     require the provision of protection and advocacy services 
     that can be provided under the Technology-Related Assistance 
     for Individuals With Disabilities Act of 1988 (42 U.S.C. 2201 
     et seq.).
       ``(b) Appropriations Less Than $5,500,000.--For any fiscal 
     year in which the amount appropriated to carry out this 
     section is less than $5,500,000, the Commissioner may make 
     grants from such amount to eligible systems within States to 
     plan for, develop outreach strategies for, and carry out 
     protection and advocacy programs authorized under this 
     section for individuals with disabilities who meet the 
     requirements of subparagraphs (A) and (B) of subsection 
     (a)(1).
       ``(c) Appropriations of $5,500,000 or More.--
       ``(1) Reservations.--
       ``(A) Technical assistance.--For any fiscal year in which 
     the amount appropriated to carry out this section equals or 
     exceeds $5,500,000, the Commissioner shall set aside not less 
     than 1.8 percent and not more than 2.2 percent of the amount 
     to provide training and technical assistance to the systems 
     established under this section.
       ``(B) Grant for the eligible system serving the american 
     indian consortium.--For any fiscal year in which the amount 
     appropriated to carry out this section equals or exceeds 
     $10,500,000, the Commissioner shall reserve a portion, and 
     use the portion to make a grant for the eligible system 
     serving the American Indian consortium. The Commission shall 
     make the grant in an amount of not less than $50,000 for the 
     fiscal year.
       ``(2) Allotments.--For any such fiscal year, after the 
     reservations required by paragraph (1) have been made, the 
     Commissioner shall make allotments from the remainder of such 
     amount in accordance with paragraph (3) to eligible systems 
     within States to enable such systems to carry out protection 
     and advocacy programs authorized under this section for 
     individuals referred to in subsection (b).
       ``(3) Systems within states.--
       ``(A) Population basis.--Except as provided in subparagraph 
     (B), from such remainder for each such fiscal year, the 
     Commissioner shall make an allotment to the eligible system 
     within a State of an amount bearing the same ratio to such 
     remainder 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 section, and except as 
     provided in paragraph (4), the allotment to any system under 
     subparagraph (A) shall be not less than $100,000 or one-third 
     of one percent of the remainder for the fiscal year for which 
     the allotment is made, whichever is greater, and the 
     allotment to any system under this section for any fiscal 
     year that is less than $100,000 or one-third of one percent 
     of such remainder shall be increased to the greater of the 
     two amounts.
       ``(4) Systems within other jurisdictions.--
       ``(A) In general.--For the purposes of paragraph (3)(B), 
     Guam, American Samoa, the United States Virgin Islands, and 
     the Commonwealth of the Northern Mariana Islands shall not be 
     considered to be States.
       ``(B) Allotment.--The eligible system within a jurisdiction 
     described in subparagraph (A) shall be allotted under 
     paragraph (3)(A) not less than $50,000 for the fiscal year 
     for which the allotment is made.
       ``(5) Adjustment for inflation.--For any fiscal year, 
     beginning in fiscal year 1999, in which the total amount 
     appropriated to carry out this section exceeds the total 
     amount appropriated to carry out this section for the 
     preceding fiscal year, the Commissioner shall increase each 
     of the minimum grants or allotments under paragraphs (1)(B), 
     (3)(B), and (4)(B) by a percentage that shall not exceed the 
     percentage increase in the total amount appropriated to carry 
     out this section between the preceding fiscal year and the 
     fiscal year involved.
       ``(d) Proportional Reduction.--To provide minimum 
     allotments to systems within States (as increased under 
     subsection (c)(5)) under subsection (c)(3)(B), or to provide 
     minimum allotments to systems within States (as increased 
     under subsection (c)(5)) under subsection (c)(4)(B), the 
     Commissioner shall proportionately reduce the allotments of 
     the remaining systems within States under subsection (c)(3), 
     with such adjustments as may be necessary to prevent the 
     allotment of any such remaining system within a State from 
     being reduced to less than the minimum allotment for a system 
     within a State (as increased under subsection (c)(5)) under 
     subsection (c)(3)(B), or the minimum allotment for a State 
     (as increased under subsection (c)(5)) under subsection 
     (c)(4)(B), as appropriate.
       ``(e) Reallotment.--Whenever the Commissioner determines 
     that any amount of an allotment to a system within a State 
     for any fiscal year described in subsection (c)(1) will not 
     be expended by such system in carrying out the provisions of 
     this section, the Commissioner shall make such amount 
     available for carrying out the provisions of this section to 
     one or more of the systems 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 
     system 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 system (as determined under 
     the preceding provisions of this section) for such year.
       ``(f) Application.--In order to receive assistance under 
     this section, an eligible system shall submit an application 
     to the Commissioner, at such time, in such form and manner, 
     and containing such information and assurances as the 
     Commissioner determines necessary to meet the requirements of 
     this section, including assurances that the eligible system 
     will--
       ``(1) have in effect a system to protect and advocate the 
     rights of individuals with disabilities;
       ``(2) have the same general authorities, including access 
     to records and program income, as are set forth in part C of 
     the Developmental Disabilities Assistance and Bill of Rights 
     Act (42 U.S.C. 6041 et seq.);
       ``(3) have the authority to pursue legal, administrative, 
     and other appropriate remedies or approaches to ensure the 
     protection of, and advocacy for, the rights of such 
     individuals within the State or the American Indian 
     consortium who are individuals described in subsection 
     (a)(1);
       ``(4) provide information on and make referrals to programs 
     and services addressing the needs of individuals with 
     disabilities in the State or the American Indian consortium;
       ``(5) develop a statement of objectives and priorities on 
     an annual basis, and provide to the public, including 
     individuals with disabilities and, as appropriate, the 
     individuals' representatives, an opportunity to comment on 
     the objectives and priorities established by, and activities 
     of, the system including--
       ``(A) the objectives and priorities for the activities of 
     the system for each year and the rationale for the 
     establishment of such objectives and priorities; and
       ``(B) the coordination of programs provided through the 
     system under this section with the advocacy programs of the 
     client assistance program under section 112, the State long-
     term care ombudsman program established under the Older 
     Americans Act of 1965 (42 U.S.C. 3001 et seq.), the 
     Developmental Disabilities Assistance and Bill of Rights Act 
     (42 U.S.C. 6000 et seq.), and the Protection and Advocacy for 
     Mentally Ill Individuals Act of 1986 (42 U.S.C. 10801 et 
     seq.);
       ``(6) establish a grievance procedure for clients or 
     prospective clients of the system to ensure that individuals 
     with disabilities are afforded equal opportunity to access 
     the services of the system; and
       ``(7) provide assurances to the Commissioner that funds 
     made available under this section will be used to supplement 
     and not supplant the non-Federal funds that would otherwise 
     be made available for the purpose for which Federal funds are 
     provided.
       ``(g) Carryover and Direct Payment.--
       ``(1) Direct payment.--Notwithstanding any other provision 
     of law, the Commissioner shall pay directly to any system 
     that complies with the provisions of this section, the amount 
     of the allotment of the State or the grant for the eligible 
     system that serves the American Indian consortium involved 
     under this section, unless the State or American Indian 
     consortium provides otherwise.
       ``(2) Carryover.--Any amount paid to an eligible system 
     that serves a State or American Indian consortium for a 
     fiscal year that remains unobligated at the end of such year 
     shall remain available to such system that serves the State 
     or American Indian consortium for obligation during the next 
     fiscal year for the purposes for which such amount was paid.
       ``(h) Limitation on Disclosure Requirements.--For purposes 
     of any audit, report, or evaluation of the performance of the 
     program established under this section, the Commissioner 
     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.
       ``(i) Administrative Cost.--In any State in which an 
     eligible system is located within a State agency, a State may 
     use a portion of any allotment under subsection (c) for the 
     cost of the administration of the system required by this 
     section. Such portion may not exceed 5 percent of the 
     allotment.
       ``(j) Delegation.--The Commissioner may delegate the 
     administration of this program to the Commissioner of the 
     Administration on Developmental Disabilities within the 
     Department of Health and Human Services.
       ``(k) Report.--The Commissioner shall annually prepare and 
     submit to the Committee on Education and the Workforce of the 
     House of Representatives and the Committee on Labor and Human 
     Resources of the Senate a report describing the types of 
     services and activities being undertaken by programs funded 
     under this section, the total number of individuals served 
     under this section, the types of disabilities represented by 
     such individuals, and the types of issues being addressed on 
     behalf of such individuals.
       ``(l) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for each of the fiscal years 1999 
     through 2003.
       ``(m) Definitions.--As used in this section:
       ``(1) Eligible system.--The term `eligible system' means a 
     protection and advocacy system that is established under part 
     C of the Developmental Disabilities Assistance and Bill of 
     Rights Act (42 U.S.C. 6041 et seq.) and that meets the 
     requirements of subsection (f).
       ``(2) American indian consortium.--The term `American 
     Indian consortium' means a consortium established as 
     described in section 142 of the Developmental Disabilities 
     Assistance and Bill of Rights Act (42 U.S.C. 6042).''.

[[Page H6675]]

     SEC. 409. EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH 
                   DISABILITIES.

       Title VI of the Rehabilitation Act of 1973 (29 U.S.C. 795 
     et seq.) is amended to read as follows:
 ``TITLE VI--EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH DISABILITIES

     ``SEC. 601. SHORT TITLE.

       ``This title may be cited as the `Employment Opportunities 
     for Individuals With Disabilities Act'.

                    ``Part A--Projects With Industry


                        ``projects with industry

       ``Sec. 611. (a)(1) The purpose of this part is to create 
     and expand job and career opportunities for individuals with 
     disabilities in the competitive labor market by engaging the 
     talent and leadership of private industry as partners in the 
     rehabilitation process, to identify competitive job and 
     career opportunities and the skills needed to perform such 
     jobs, to create practical job and career readiness and 
     training programs, and to provide job placements and career 
     advancement.
       ``(2) The Commissioner, in consultation with the Secretary 
     of Labor and with designated State units, may award grants to 
     individual employers, community rehabilitation program 
     providers, labor unions, trade associations, Indian tribes, 
     tribal organizations, designated State units, and other 
     entities to establish jointly financed Projects With Industry 
     to create and expand job and career opportunities for 
     individuals with disabilities, which projects shall--
       ``(A) provide for the establishment of business advisory 
     councils, that shall--
       ``(i) be comprised of--
       ``(I) representatives of private industry, business 
     concerns, and organized labor;
       ``(II) individuals with disabilities and representatives of 
     individuals with disabilities; and
       ``(III) a representative of the appropriate designated 
     State unit;
       ``(ii) identify job and career availability within the 
     community, consistent with the current and projected local 
     employment opportunities identified by the local workforce 
     investment board for the community under section 118(b)(1)(B) 
     of the Workforce Investment Act of 1998;
       ``(iii) identify the skills necessary to perform the jobs 
     and careers identified; and
       ``(iv) prescribe training programs designed to develop 
     appropriate job and career skills, or job placement programs 
     designed to identify and develop job placement and career 
     advancement opportunities, for individuals with disabilities 
     in fields related to the job and career availability 
     identified under clause (ii);
       ``(B) provide job development, job placement, and career 
     advancement services;
       ``(C) to the extent appropriate, provide for--
       ``(i) training in realistic work settings in order to 
     prepare individuals with disabilities for employment and 
     career advancement in the competitive market; and
       ``(ii) to the extent practicable, the modification of any 
     facilities or equipment of the employer involved that are 
     used primarily by individuals with disabilities, except that 
     a project shall not be required to provide for such 
     modification if the modification is required as a reasonable 
     accommodation under the Americans with Disabilities Act of 
     1990 (42 U.S.C. 12101 et seq.); and
       ``(D) provide individuals with disabilities with such 
     support services as may be required in order to maintain the 
     employment and career advancement for which the individuals 
     have received training under this part.
       ``(3)(A) An individual shall be eligible for services 
     described in paragraph (2) if the individual is determined to 
     be an individual described in section 102(a)(1), and if the 
     determination is made in a manner consistent with section 
     102(a).
       ``(B) Such a determination may be made by the recipient of 
     a grant under this part, to the extent the determination is 
     appropriate and available and consistent with the 
     requirements of section 102(a).
       ``(4) The Commissioner shall enter into an agreement with 
     the grant recipient regarding the establishment of the 
     project. Any agreement shall be jointly developed by the 
     Commissioner, the grant recipient, and, to the extent 
     practicable, the appropriate designated State unit and the 
     individuals with disabilities (or the individuals' 
     representatives) involved. Such agreements shall specify the 
     terms of training and employment under the project, provide 
     for the payment by the Commissioner of part of the costs of 
     the project (in accordance with subsection (c)), and contain 
     the items required under subsection (b) and such other 
     provisions as the parties to the agreement consider to be 
     appropriate.
       ``(5) Any agreement shall include a description of a plan 
     to annually conduct a review and evaluation of the operation 
     of the project in accordance with standards developed by the 
     Commissioner under subsection (d), and, in conducting the 
     review and evaluation, to collect data and information of the 
     type described in subparagraphs (A) through (C) of section 
     101(a)(10), as determined to be appropriate by the 
     Commissioner.
       ``(6) The Commissioner may include, as part of agreements 
     with grant recipients, authority for such grant recipients to 
     provide technical assistance to--
       ``(A) assist employers in hiring individuals with 
     disabilities; or
       ``(B) improve or develop relationships between--
       ``(i) grant recipients or prospective grant recipients; and
       ``(ii) employers or organized labor; or
       ``(C) assist employers in understanding and meeting the 
     requirements of the Americans with Disabilities Act of 1990 
     (42 U.S.C. 12101 et seq.) as the Act relates to employment of 
     individuals with disabilities.
       ``(b) No payment shall be made by the Commissioner under 
     any agreement with a grant recipient entered into under 
     subsection (a) unless such agreement--
       ``(1) provides an assurance that individuals with 
     disabilities placed under such agreement shall receive at 
     least the applicable minimum wage;
       ``(2) provides an assurance that any individual with a 
     disability placed under this part shall be afforded terms and 
     benefits of employment equal to terms and benefits that are 
     afforded to the similarly situated nondisabled co-workers of 
     the individual, and that such individuals with disabilities 
     shall not be segregated from their co-workers; and
       ``(3) provides an assurance that an annual evaluation 
     report containing information specified under subsection 
     (a)(5) shall be submitted as determined to be appropriate by 
     the Commissioner.
       ``(c) Payments under this section with respect to any 
     project may not exceed 80 per centum of the costs of the 
     project.
       ``(d)(1) The Commissioner shall develop standards for the 
     evaluation described in subsection (a)(5) and shall review 
     and revise the evaluation standards as necessary, subject to 
     paragraph (2).
       ``(2) In revising the standards for evaluation to be used 
     by the grant recipients, the Commissioner shall obtain and 
     consider recommendations for such standards from State 
     vocational rehabilitation agencies, current and former grant 
     recipients, professional organizations representing business 
     and industry, organizations representing individuals with 
     disabilities, individuals served by grant recipients, 
     organizations representing community rehabilitation program 
     providers, and labor organizations.
       ``(e)(1)(A) A grant may be awarded under this section for a 
     period of up to 5 years and such grant may be renewed.
       ``(B) Grants under this section shall be awarded on a 
     competitive basis. To be eligible to receive such a grant, a 
     prospective grant recipient shall submit an application to 
     the Commissioner at such time, in such manner, and containing 
     such information as the Commissioner may require.
       ``(2) The Commissioner shall, to the extent practicable, 
     ensure an equitable distribution of payments made under this 
     section among the States. To the extent funds are available, 
     the Commissioner shall award grants under this section to new 
     projects that will serve individuals with disabilities in 
     States, portions of States, Indian tribes, or tribal 
     organizations, that are currently unserved or underserved by 
     projects.
       ``(f)(1) The Commissioner shall, as necessary, develop and 
     publish in the Federal Register, in final form, indicators of 
     what constitutes minimum compliance consistent with the 
     evaluation standards under subsection (d)(1).
       ``(2) Each grant recipient shall report to the Commissioner 
     at the end of each project year the extent to which the grant 
     recipient is in compliance with the evaluation standards.
       ``(3)(A) The Commissioner shall annually conduct onsite 
     compliance reviews of at least 15 percent of grant 
     recipients. The Commissioner shall select grant recipients 
     for review on a random basis.
       ``(B) The Commissioner shall use the indicators in 
     determining compliance with the evaluation standards.
       ``(C) The Commissioner shall ensure that at least one 
     member of a team conducting such a review shall be an 
     individual who--
       ``(i) is not an employee of the Federal Government; and
       ``(ii) has experience or expertise in conducting projects.
       ``(D) The Commissioner shall ensure that--
       ``(i) a representative of the appropriate designated State 
     unit shall participate in the review; and
       ``(ii) no person shall participate in the review of a grant 
     recipient if--
       ``(I) the grant recipient provides any direct financial 
     benefit to the reviewer; or
       ``(II) participation in the review would give the 
     appearance of a conflict of interest.
       ``(4) In making a determination concerning any subsequent 
     grant under this section, the Commissioner shall consider the 
     past performance of the applicant, if applicable. The 
     Commissioner shall use compliance indicators developed under 
     this subsection that are consistent with program evaluation 
     standards developed under subsection (d) to assess minimum 
     project performance for purposes of making continuation 
     awards in the third, fourth, and fifth years.
       ``(5) Each fiscal year the Commissioner shall include in 
     the annual report to Congress required by section 13 an 
     analysis of the extent to which grant recipients have 
     complied with the evaluation standards. The Commissioner may 
     identify individual grant recipients in the analysis. In 
     addition, the Commissioner shall report the results of onsite 
     compliance reviews, identifying individual grant recipients.
       ``(g) The Commissioner may provide, directly or by way of 
     grant, contract, or cooperative agreement, technical 
     assistance to--
       ``(1) entities conducting projects for the purpose of 
     assisting such entities in--
       ``(A) the improvement of or the development of 
     relationships with private industry or labor; or
       ``(B) the improvement of relationships with State 
     vocational rehabilitation agencies; and
       ``(2) entities planning the development of new projects.
       ``(h) As used in this section:
       ``(1) The term `agreement' means an agreement described in 
     subsection (a)(4).
       ``(2) The term `project' means a Project With Industry 
     established under subsection (a)(2).
       ``(3) The term `grant recipient' means a recipient of a 
     grant under subsection (a)(2).


[[Page H6676]]




                   ``authorization of appropriations

       ``Sec. 612. There are authorized to be appropriated to 
     carry out the provisions of this part, such sums as may be 
     necessary for each of fiscal years 1999 through 2003.

 ``Part B--Supported Employment Services for Individuals With the Most 
                        Significant Disabilities

     ``SEC. 621. PURPOSE.

       ``It is the purpose of this part to authorize allotments, 
     in addition to grants for vocational rehabilitation services 
     under title I, to assist States in developing collaborative 
     programs with appropriate entities to provide supported 
     employment services for individuals with the most significant 
     disabilities to enable such individuals to achieve the 
     employment outcome of supported employment.

     ``SEC. 622. ALLOTMENTS.

       ``(a) In General.--
       ``(1) States.--The Secretary shall allot the sums 
     appropriated for each fiscal year to carry out this part 
     among the States on the basis of relative population of each 
     State, except that--
       ``(A) no State shall receive less than $250,000, or one-
     third of one percent of the sums appropriated for the fiscal 
     year for which the allotment is made, whichever is greater; 
     and
       ``(B) if the sums appropriated to carry out this part for 
     the fiscal year exceed by $1,000,000 or more the sums 
     appropriated to carry out this part in fiscal year 1992, no 
     State shall receive less than $300,000, or one-third of one 
     percent of the sums appropriated for the fiscal year for 
     which the allotment is made, whichever is greater.
       ``(2) Certain territories.--
       ``(A) In general.--For the purposes of this subsection, 
     Guam, American Samoa, the United States Virgin Islands, and 
     the Commonwealth of the Northern Mariana Islands shall not be 
     considered to be States.
       ``(B) Allotment.--Each jurisdiction described in 
     subparagraph (A) shall be allotted not less than one-eighth 
     of one percent of the amounts appropriated for the fiscal 
     year for which the allotment is made.
       ``(b) 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 provisions 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.

     ``SEC. 623. AVAILABILITY OF SERVICES.

       ``Funds provided under this part may be used to provide 
     supported employment services to individuals who are eligible 
     under this part. Funds provided under this part, or title I, 
     may not be used to provide extended services to individuals 
     who are eligible under this part or title I.

     ``SEC. 624. ELIGIBILITY.

       ``An individual shall be eligible under this part to 
     receive supported employment services authorized under this 
     Act if--
       ``(1) the individual is eligible for vocational 
     rehabilitation services;
       ``(2) the individual is determined to be an individual with 
     a most significant disability; and
       ``(3) a comprehensive assessment of rehabilitation needs of 
     the individual described in section 7(2)(B), including an 
     evaluation of rehabilitation, career, and job needs, 
     identifies supported employment as the appropriate employment 
     outcome for the individual.

     ``SEC. 625. STATE PLAN.

       ``(a) State Plan Supplements.--To be eligible for an 
     allotment under this part, a State shall submit to the 
     Commissioner, as part of the State plan under section 101, a 
     State plan supplement for providing supported employment 
     services authorized under this Act to individuals who are 
     eligible under this Act to receive the services. Each State 
     shall make such annual revisions in the plan supplement as 
     may be necessary.
       ``(b) Contents.--Each such plan supplement shall--
       ``(1) designate each designated State agency as the agency 
     to administer the program assisted under this part;
       ``(2) summarize the results of the comprehensive, statewide 
     assessment conducted under section 101(a)(15)(A)(i), with 
     respect to the rehabilitation needs of individuals with 
     significant disabilities and the need for supported 
     employment services, including needs related to coordination;
       ``(3) describe the quality, scope, and extent of supported 
     employment services authorized under this Act to be provided 
     to individuals who are eligible under this Act to receive the 
     services and specify the goals and plans of the State with 
     respect to the distribution of funds received under section 
     622;
       ``(4) demonstrate evidence of the efforts of the designated 
     State agency to identify and make arrangements (including 
     entering into cooperative agreements) with other State 
     agencies and other appropriate entities to assist in the 
     provision of supported employment services;
       ``(5) demonstrate evidence of the efforts of the designated 
     State agency to identify and make arrangements (including 
     entering into cooperative agreements) with other public or 
     nonprofit agencies or organizations within the State, 
     employers, natural supports, and other entities with respect 
     to the provision of extended services;
       ``(6) provide assurances that--
       ``(A) funds made available under this part will only be 
     used to provide supported employment services authorized 
     under this Act to individuals who are eligible under this 
     part to receive the services;
       ``(B) the comprehensive assessments of individuals with 
     significant disabilities conducted under section 102(b)(1) 
     and funded under title I will include consideration of 
     supported employment as an appropriate employment outcome;
       ``(C) an individualized plan for employment, as required by 
     section 102, will be developed and updated using funds under 
     title I in order to--
       ``(i) specify the supported employment services to be 
     provided;
       ``(ii) specify the expected extended services needed; and
       ``(iii) identify the source of extended services, which may 
     include natural supports, or to the extent that it is not 
     possible to identify the source of extended services at the 
     time the individualized plan for employment is developed, a 
     statement describing the basis for concluding that there is a 
     reasonable expectation that such sources will become 
     available;
       ``(D) the State will use funds provided under this part 
     only to supplement, and not supplant, the funds provided 
     under title I, in providing supported employment services 
     specified in the individualized plan for employment;
       ``(E) services provided under an individualized plan for 
     employment will be coordinated with services provided under 
     other individualized plans established under other Federal or 
     State programs;
       ``(F) to the extent jobs skills training is provided, the 
     training will be provided on site; and
       ``(G) supported employment services will include placement 
     in an integrated setting for the maximum number of hours 
     possible based on the unique strengths, resources, 
     priorities, concerns, abilities, capabilities, interests, and 
     informed choice of individuals with the most significant 
     disabilities;
       ``(7) provide assurances that the State agencies designated 
     under paragraph (1) will expend not more than 5 percent of 
     the allotment of the State under this part for administrative 
     costs of carrying out this part; and
       ``(8) contain such other information and be submitted in 
     such manner as the Commissioner may require.

     ``SEC. 626. RESTRICTION.

       ``Each State agency designated under section 625(b)(1) 
     shall collect the information required by section 101(a)(10) 
     separately for eligible individuals receiving supported 
     employment services under this part and for eligible 
     individuals receiving supported employment services under 
     title I.

     ``SEC. 627. SAVINGS PROVISION.

       ``(a) Supported Employment Services.--Nothing in this Act 
     shall be construed to prohibit a State from providing 
     supported employment services in accordance with the State 
     plan submitted under section 101 by using funds made 
     available through a State allotment under section 110.
       ``(b) Postemployment Services.--Nothing in this part shall 
     be construed to prohibit a State from providing discrete 
     postemployment services in accordance with the State plan 
     submitted under section 101 by using funds made available 
     through a State allotment under section 110 to an individual 
     who is eligible under this part.

     ``SEC. 628. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     part such sums as may be necessary for each of fiscal years 
     1999 through 2003.''.

     SEC. 410. INDEPENDENT LIVING SERVICES AND CENTERS FOR 
                   INDEPENDENT LIVING.

       Title VII of the Rehabilitation Act of 1973 (29 U.S.C. 796 
     et seq.) is amended to read as follows:
 ``TITLE VII--INDEPENDENT LIVING SERVICES AND CENTERS FOR INDEPENDENT 
                                 LIVING

         ``CHAPTER 1--INDIVIDUALS WITH SIGNIFICANT DISABILITIES

                      ``PART A--GENERAL PROVISIONS

     ``SEC. 701. PURPOSE.

       ``The purpose of this chapter is to promote a philosophy of 
     independent living, including a philosophy of consumer 
     control, peer support, self-help, self-determination, equal 
     access, and individual and system advocacy, in order to 
     maximize the leadership, empowerment, independence, and 
     productivity of individuals with disabilities, and the 
     integration and full inclusion of individuals with 
     disabilities into the mainstream of American society, by--
       ``(1) providing financial assistance to States for 
     providing, expanding, and improving the provision of 
     independent living services;
       ``(2) providing financial assistance to develop and support 
     statewide networks of centers for independent living; and
       ``(3) providing financial assistance to States for 
     improving working relationships among State independent 
     living rehabilitation service programs, centers for 
     independent living, Statewide Independent Living Councils 
     established under section 705, State vocational 
     rehabilitation programs receiving assistance under title I, 
     State programs of supported employment services receiving 
     assistance under part B of title VI, client assistance 
     programs receiving assistance under section 112, programs 
     funded under other titles of this Act, programs funded under 
     other Federal law, and programs funded through non-Federal 
     sources.

     ``SEC. 702. DEFINITIONS.

       ``As used in this chapter:
       ``(1) Center for independent living.--The term `center for 
     independent living' means a consumer-controlled, community-
     based, cross-disability, nonresidential private nonprofit 
     agency that--
       ``(A) is designed and operated within a local community by 
     individuals with disabilities; and
       ``(B) provides an array of independent living services.

[[Page H6677]]

       ``(2) Consumer control.--The term `consumer control' means, 
     with respect to a center for independent living, that the 
     center vests power and authority in individuals with 
     disabilities.

     ``SEC. 703. ELIGIBILITY FOR RECEIPT OF SERVICES.

       ``Services may be provided under this chapter to any 
     individual with a significant disability, as defined in 
     section 7(21)(B).

     ``SEC. 704. STATE PLAN.

       ``(a) In General.--
       ``(1) Requirement.--To be eligible to receive financial 
     assistance under this chapter, a State shall submit to the 
     Commissioner, and obtain approval of, a State plan containing 
     such provisions as the Commissioner may require, including, 
     at a minimum, the provisions required in this section.
       ``(2) Joint development.--The plan under paragraph (1) 
     shall be jointly developed and signed by--
       ``(A) the director of the designated State unit; and
       ``(B) the chairperson of the Statewide Independent Living 
     Council, acting on behalf of and at the direction of the 
     Council.
       ``(3) Periodic review and revision.--The plan shall provide 
     for the review and revision of the plan, not less than once 
     every 3 years, to ensure the existence of appropriate 
     planning, financial support and coordination, and other 
     assistance to appropriately address, on a statewide and 
     comprehensive basis, needs in the State for--
       ``(A) the provision of State independent living services;
       ``(B) the development and support of a statewide network of 
     centers for independent living; and
       ``(C) working relationships between--
       ``(i) programs providing independent living services and 
     independent living centers; and
       ``(ii) the vocational rehabilitation program established 
     under title I, and other programs providing services for 
     individuals with disabilities.
       ``(4) Date of submission.--The State shall submit the plan 
     to the Commissioner 90 days before the completion date of the 
     preceding plan. If a State fails to submit such a plan that 
     complies with the requirements of this section, the 
     Commissioner may withhold financial assistance under this 
     chapter until such time as the State submits such a plan.
       ``(b) Statewide Independent Living Council.--The plan shall 
     provide for the establishment of a Statewide Independent 
     Living Council in accordance with section 705.
       ``(c) Designation of State Unit.--The plan shall designate 
     the designated State unit of such State as the agency that, 
     on behalf of the State, shall--
       ``(1) receive, account for, and disburse funds received by 
     the State under this chapter based on the plan;
       ``(2) provide administrative support services for a program 
     under part B, and a program under part C in a case in which 
     the program is administered by the State under section 723;
       ``(3) keep such records and afford such access to such 
     records as the Commissioner finds to be necessary with 
     respect to the programs; and
       ``(4) submit such additional information or provide such 
     assurances as the Commissioner may require with respect to 
     the programs.
       ``(d) Objectives.--The plan shall--
       ``(1) specify the objectives to be achieved under the plan 
     and establish timelines for the achievement of the 
     objectives; and
       ``(2) explain how such objectives are consistent with and 
     further the purpose of this chapter.
       ``(e) Independent Living Services.--The plan shall provide 
     that the State will provide independent living services under 
     this chapter to individuals with significant disabilities, 
     and will provide the services to such an individual in 
     accordance with an independent living plan mutually agreed 
     upon by an appropriate staff member of the service provider 
     and the individual, unless the individual signs a waiver 
     stating that such a plan is unnecessary.
       ``(f) Scope and Arrangements.--The plan shall describe the 
     extent and scope of independent living services to be 
     provided under this chapter to meet such objectives. If the 
     State makes arrangements, by grant or contract, for providing 
     such services, such arrangements shall be described in the 
     plan.
       ``(g) Network.--The plan shall set forth a design for the 
     establishment of a statewide network of centers for 
     independent living that comply with the standards and 
     assurances set forth in section 725.
       ``(h) Centers.--In States in which State funding for 
     centers for independent living equals or exceeds the amount 
     of funds allotted to the State under part C, as provided in 
     section 723, the plan shall include policies, practices, and 
     procedures governing the awarding of grants to centers for 
     independent living and oversight of such centers consistent 
     with section 723.
       ``(i) Cooperation, Coordination, and Working Relationships 
     Among Various Entities.--The plan shall set forth the steps 
     that will be taken to maximize the cooperation, coordination, 
     and working relationships among--
       ``(1) the independent living rehabilitation service 
     program, the Statewide Independent Living Council, and 
     centers for independent living; and
       ``(2) the designated State unit, other State agencies 
     represented on such Council, other councils that address the 
     needs of specific disability populations and issues, and 
     other public and private entities determined to be 
     appropriate by the Council.
       ``(j) Coordination of Services.--The plan shall describe 
     how services funded under this chapter will be coordinated 
     with, and complement, other services, in order to avoid 
     unnecessary duplication with other Federal, State, and local 
     programs.
       ``(k) Coordination Between Federal and State Sources.--The 
     plan shall describe efforts to coordinate Federal and State 
     funding for centers for independent living and independent 
     living services.
       ``(l) Outreach.--With respect to services and centers 
     funded under this chapter, the plan shall set forth steps to 
     be taken regarding outreach to populations that are unserved 
     or underserved by programs under this title, including 
     minority groups and urban and rural populations.
       ``(m) Requirements.--The plan shall provide satisfactory 
     assurances that all recipients of financial assistance under 
     this chapter will--
       ``(1) notify all individuals seeking or receiving services 
     under this chapter about the availability of the client 
     assistance program under section 112, the purposes of the 
     services provided under such program, and how to contact such 
     program;
       ``(2) take affirmative action to employ and advance in 
     employment qualified individuals with disabilities on the 
     same terms and conditions required with respect to the 
     employment of such individuals under the provisions of 
     section 503;
       ``(3) adopt such fiscal control and fund accounting 
     procedures as may be necessary to ensure the proper 
     disbursement of and accounting for funds paid to the State 
     under this chapter;
       ``(4)(A) maintain records that fully disclose--
       ``(i) the amount and disposition by such recipient of the 
     proceeds of such financial assistance;
       ``(ii) the total cost of the project or undertaking in 
     connection with which such financial assistance is given or 
     used; and
       ``(iii) the amount of that portion of the cost of the 
     project or undertaking supplied by other sources;
       ``(B) maintain such other records as the Commissioner 
     determines to be appropriate to facilitate an effective 
     audit;
       ``(C) afford such access to records maintained under 
     subparagraphs (A) and (B) as the Commissioner determines to 
     be appropriate; and
       ``(D) submit such reports with respect to such records as 
     the Commissioner determines to be appropriate;
       ``(5) provide access to the Commissioner and the 
     Comptroller General or any of their duly authorized 
     representatives, for the purpose of conducting audits and 
     examinations, of any books, documents, papers, and records of 
     the recipients that are pertinent to the financial assistance 
     received under this chapter; and
       ``(6) provide for public hearings regarding the contents of 
     the plan during both the formulation and review of the plan.
       ``(n) Evaluation.--The plan shall establish a method for 
     the periodic evaluation of the effectiveness of the plan in 
     meeting the objectives established in subsection (d), 
     including evaluation of satisfaction by individuals with 
     disabilities.

     ``SEC. 705. STATEWIDE INDEPENDENT LIVING COUNCIL.

       ``(a) Establishment.--To be eligible to receive financial 
     assistance under this chapter, each State shall establish a 
     Statewide Independent Living Council (referred to in this 
     section as the `Council'). The Council shall not be 
     established as an entity within a State agency.
       ``(b) Composition and Appointment.--
       ``(1) Appointment.--Members of the Council shall be 
     appointed by the Governor. The Governor 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.
       ``(2) Composition.--The Council shall include--
       ``(A) at least one director of a center for independent 
     living chosen by the directors of centers for independent 
     living within the State;
       ``(B) as ex officio, nonvoting members--
       ``(i) a representative from the designated State unit; and
       ``(ii) representatives from other State agencies that 
     provide services for individuals with disabilities; and
       ``(C) in a State in which 1 or more projects are carried 
     out under section 121, at least 1 representative of the 
     directors of the projects.
       ``(3) Additional members.--The Council may include--
       ``(A) other representatives from centers for independent 
     living;
       ``(B) parents and guardians of individuals with 
     disabilities;
       ``(C) advocates of and for individuals with disabilities;
       ``(D) representatives from private businesses;
       ``(E) representatives from organizations that provide 
     services for individuals with disabilities; and
       ``(F) other appropriate individuals.
       ``(4) Qualifications.--
       ``(A) In general.--The Council shall be composed of 
     members--
       ``(i) who provide statewide representation;
       ``(ii) who represent a broad range of individuals with 
     disabilities from diverse backgrounds;
       ``(iii) who are knowledgeable about centers for independent 
     living and independent living services; and
       ``(iv) a majority of whom are persons who are--

       ``(I) individuals with disabilities described in section 
     7(20)(B); and
       ``(II) not employed by any State agency or center for 
     independent living.

       ``(B) Voting members.--A majority of the voting members of 
     the Council shall be--
       ``(i) individuals with disabilities described in section 
     7(20)(B); and
       ``(ii) not employed by any State agency or center for 
     independent living.
       ``(5) Chairperson.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the Council shall select a chairperson from among the voting 
     membership of the Council.

[[Page H6678]]

       ``(B) Designation by governor.--In States in which the 
     Governor does not have veto power pursuant to State law, the 
     Governor shall designate a voting member of the Council to 
     serve as the chairperson of the Council or shall require the 
     Council to so designate such a voting member.
       ``(6) Terms of appointment.--
       ``(A) Length of term.--Each member of the Council shall 
     serve for a term of 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 Governor) 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.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     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.
       ``(B) Delegation.--The Governor may delegate the authority 
     to fill such a vacancy to the remaining voting members of the 
     Council after making the original appointment.
       ``(c) Duties.--The Council shall--
       ``(1) jointly develop and sign (in conjunction with the 
     designated State unit) the State plan required in section 
     704;
       ``(2) monitor, review, and evaluate the implementation of 
     the State plan;
       ``(3) coordinate activities with the State Rehabilitation 
     Council established under section 105, if the State has such 
     a Council, or the commission described in section 
     101(a)(21)(A), if the State has such a commission, and 
     councils that address the needs of specific disability 
     populations and issues under other Federal law;
       ``(4) ensure that all regularly scheduled meetings of the 
     Statewide Independent Living Council are open to the public 
     and sufficient advance notice is provided; and
       ``(5) submit to the Commissioner such periodic reports as 
     the Commissioner may reasonably request, and keep such 
     records, and afford such access to such records, as the 
     Commissioner finds necessary to verify such reports.
       ``(d) 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.
       ``(e) Plan.--
       ``(1) In general.--The Council shall prepare, in 
     conjunction with the designated State unit, a plan for the 
     provision of such resources, including such staff and 
     personnel, as may be necessary and sufficient to carry out 
     the functions of the Council under this section, with funds 
     made available under this chapter, and under section 110 
     (consistent with section 101(a)(18)), and from other public 
     and private sources. 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) 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 the 
     functions of the Council under this section.
       ``(3) 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 agency or any 
     other agency or office of the State, that would create a 
     conflict of interest.
       ``(f) Compensation and Expenses.--The Council may use such 
     resources 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 Council duties.

     ``SEC. 706. RESPONSIBILITIES OF THE COMMISSIONER.

       ``(a) Approval of State Plans.--
       ``(1) In general.--The Commissioner shall approve any State 
     plan submitted under section 704 that the Commissioner 
     determines meets the requirements of section 704, and shall 
     disapprove any such plan that does not meet such 
     requirements, as soon as practicable after receiving the 
     plan. Prior to such disapproval, the Commissioner shall 
     notify the State of the intention to disapprove the plan, and 
     shall afford such State reasonable notice and opportunity for 
     a hearing.
       ``(2) Procedures.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the provisions of subsections (c) and (d) of section 107 
     shall apply to any State plan submitted to the Commissioner 
     under section 704.
       ``(B) Application.--For purposes of the application 
     described in subparagraph (A), all references in such 
     provisions--
       ``(i) to the Secretary shall be deemed to be references to 
     the Commissioner; and
       ``(ii) to section 101 shall be deemed to be references to 
     section 704.
       ``(b) Indicators.--Not later than October 1, 1993, the 
     Commissioner shall develop and publish in the Federal 
     Register indicators of minimum compliance consistent with the 
     standards set forth in section 725.
       ``(c) Onsite Compliance Reviews.--
       ``(1) Reviews.--The Commissioner shall annually conduct 
     onsite compliance reviews of at least 15 percent of the 
     centers for independent living that receive funds under 
     section 722 and shall periodically conduct such a review of 
     each such center. The Commissioner shall annually conduct 
     onsite compliance reviews of at least one-third of the 
     designated State units that receive funding under section 
     723, and, to the extent necessary to determine the compliance 
     of such a State unit with subsections (f) and (g) of section 
     723, centers that receive funding under section 723 in such 
     State. The Commissioner shall select the centers and State 
     units described in this paragraph for review on a random 
     basis.
       ``(2) Qualifications of employees conducting reviews.--The 
     Commissioner shall--
       ``(A) to the maximum extent practicable, carry out such a 
     review by using employees of the Department who are 
     knowledgeable about the provision of independent living 
     services;
       ``(B) ensure that the employee of the Department with 
     responsibility for supervising such a review shall have such 
     knowledge; and
       ``(C) ensure that at least one member of a team conducting 
     such a review shall be an individual who--
       ``(i) is not a government employee; and
       ``(ii) has experience in the operation of centers for 
     independent living.
       ``(d) Reports.--The Commissioner shall include, in the 
     annual report required under section 13, information on the 
     extent to which centers for independent living receiving 
     funds under part C have complied with the standards and 
     assurances set forth in section 725. The Commissioner may 
     identify individual centers for independent living in the 
     analysis. The Commissioner shall report the results of onsite 
     compliance reviews, identifying individual centers for 
     independent living and other recipients of assistance under 
     this chapter.

                 ``PART B--INDEPENDENT LIVING SERVICES

     ``SEC. 711. ALLOTMENTS.

       ``(a) In General.--
       ``(1) States.--
       ``(A) Population basis.--Except as provided in 
     subparagraphs (B) and (C), from sums appropriated for each 
     fiscal year to carry out this part, the Commissioner shall 
     make an allotment to each State whose State plan has been 
     approved under section 706 of an amount bearing the same 
     ratio to such sums as the population of the State bears to 
     the population of all States.
       ``(B) Maintenance of 1992 amounts.--Subject to the 
     availability of appropriations to carry out this part, the 
     amount of any allotment made under subparagraph (A) to a 
     State for a fiscal year shall not be less than the amount of 
     an allotment made to the State for fiscal year 1992 under 
     part A of this title, as in effect on the day before the date 
     of enactment of the Rehabilitation Act Amendments of 1992.
       ``(C) Minimums.--Subject to the availability of 
     appropriations to carry out this part, and except as provided 
     in subparagraph (B), the allotment to any State under 
     subparagraph (A) shall be not less than $275,000 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 $275,000 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)(C), 
     Guam, American Samoa, the United States Virgin Islands, and 
     the Commonwealth of the Northern Mariana Islands 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.
       ``(3) Adjustment for inflation.--For any fiscal year, 
     beginning in fiscal year 1999, 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, the Commissioner shall increase the minimum allotment 
     under paragraph (1)(C) by a percentage that shall not exceed 
     the percentage increase in the total amount appropriated to 
     carry out this part between the preceding fiscal year and the 
     fiscal year involved.
       ``(b) Proportional Reduction.--To provide allotments to 
     States in accordance with subsection (a)(1)(B), to provide 
     minimum allotments to States (as increased under subsection 
     (a)(3)) under subsection (a)(1)(C), 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 
     amount required by subsection (a)(1)(B).
       ``(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 in carrying out the 
     provisions of this part, the Commissioner shall make such 
     amount available for carrying out the provisions 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.

     ``SEC. 712. PAYMENTS TO STATES FROM ALLOTMENTS.

       ``(a) Payments.--From the allotment of each State for a 
     fiscal year under section 711, the State shall be paid the 
     Federal share of the expenditures incurred during such year 
     under its State plan approved under section 706. Such 
     payments may be made (after necessary adjustments on account 
     of previously made overpayments or underpayments) in advance 
     or by way

[[Page H6679]]

     of reimbursement, and in such installments and on such 
     conditions as the Commissioner may determine.
       ``(b) Federal Share.--
       ``(1) In general.--The Federal share with respect to any 
     State for any fiscal year shall be 90 percent of the 
     expenditures incurred by the State during such year under its 
     State plan approved under section 706.
       ``(2) Non-federal share.--The non-Federal share of the cost 
     of any project that receives assistance through an allotment 
     under this part may be provided in cash or in kind, fairly 
     evaluated, including plant, equipment, or services.

     ``SEC. 713. AUTHORIZED USES OF FUNDS.

       ``The State may use funds received under this part to 
     provide the resources described in section 705(e), relating 
     to the Statewide Independent Living Council, and may use 
     funds received under this part--
       ``(1) to provide independent living services to individuals 
     with significant disabilities;
       ``(2) to demonstrate ways to expand and improve independent 
     living services;
       ``(3) to support the operation of centers for independent 
     living that are in compliance with the standards and 
     assurances set forth in subsections (b) and (c) of section 
     725;
       ``(4) to support activities to increase the capacities of 
     public or nonprofit agencies and organizations and other 
     entities to develop comprehensive approaches or systems for 
     providing independent living services;
       ``(5) to conduct studies and analyses, gather information, 
     develop model policies and procedures, and present 
     information, approaches, strategies, findings, conclusions, 
     and recommendations to Federal, State, and local policymakers 
     in order to enhance independent living services for 
     individuals with disabilities;
       ``(6) to train individuals with disabilities and 
     individuals providing services to individuals with 
     disabilities and other persons regarding the independent 
     living philosophy; and
       ``(7) to provide outreach to populations that are unserved 
     or underserved by programs under this title, including 
     minority groups and urban and rural populations.

     ``SEC. 714. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     part such sums as may be necessary for each of the fiscal 
     years 1999 through 2003.

                ``PART C--CENTERS FOR INDEPENDENT LIVING

     ``SEC. 721. PROGRAM AUTHORIZATION.

       ``(a) In General.--From the funds appropriated for fiscal 
     year 1999 and for each subsequent fiscal year to carry out 
     this part, the Commissioner shall allot such sums as may be 
     necessary to States and other entities in accordance with 
     subsections (b) through (d).
       ``(b) Training.--
       ``(1) Grants; contracts; other arrangements.--For any 
     fiscal year in which the funds appropriated to carry out this 
     part exceed the funds appropriated to carry out this part for 
     fiscal year 1993, the Commissioner shall first reserve from 
     such excess, to provide training and technical assistance to 
     eligible agencies, centers for independent living, and 
     Statewide Independent Living Councils for such fiscal year, 
     not less than 1.8 percent, and not more than 2 percent, of 
     the funds appropriated to carry out this part for the fiscal 
     year involved.
       ``(2) Allocation.--From the funds reserved under paragraph 
     (1), the Commissioner shall make grants to, and enter into 
     contracts and other arrangements with, entities that have 
     experience in the operation of centers for independent living 
     to provide such training and technical assistance with 
     respect to planning, developing, conducting, administering, 
     and evaluating centers for independent living.
       ``(3) Funding priorities.--The Commissioner shall conduct a 
     survey of Statewide Independent Living Councils and centers 
     for independent living regarding training and technical 
     assistance needs in order to determine funding priorities for 
     such grants, contracts, and other arrangements.
       ``(4) Review.--To be eligible to receive a grant or enter 
     into a contract or other arrangement under this subsection, 
     such an entity shall submit an application to the 
     Commissioner at such time, in such manner, and containing a 
     proposal to provide such training and technical assistance, 
     and containing such additional information as the 
     Commissioner may require. The Commissioner shall provide for 
     peer review of grant applications by panels that include 
     persons who are not government employees and who have 
     experience in the operation of centers for independent 
     living.
       ``(5) Prohibition on combined funds.--No funds reserved by 
     the Commissioner under this subsection may be combined with 
     funds appropriated under any other Act or part of this Act if 
     the purpose of combining funds is to make a single 
     discretionary grant or a single discretionary payment, unless 
     such funds appropriated under this chapter are separately 
     identified in such grant or payment and are used for the 
     purposes of this chapter.
       ``(c) In General.--
       ``(1) States.--
       ``(A) Population basis.--After the reservation required by 
     subsection (b) has been made, and except as provided in 
     subparagraphs (B) and (C), from the remainder of the amounts 
     appropriated for each such fiscal year to carry out this 
     part, the Commissioner shall make an allotment to each State 
     whose State plan has been approved under section 706 of an 
     amount bearing the same ratio to such remainder as the 
     population of the State bears to the population of all 
     States.
       ``(B) Maintenance of 1992 amounts.--Subject to the 
     availability of appropriations to carry out this part, the 
     amount of any allotment made under subparagraph (A) to a 
     State for a fiscal year shall not be less than the amount of 
     financial assistance received by centers for independent 
     living in the State for fiscal year 1992 under part B of this 
     title, as in effect on the day before the date of enactment 
     of the Rehabilitation Act Amendments of 1992.
       ``(C) Minimums.--Subject to the availability of 
     appropriations to carry out this part and except as provided 
     in subparagraph (B), for a fiscal year in which the amounts 
     appropriated to carry out this part exceed the amounts 
     appropriated for fiscal year 1992 to carry out part B of this 
     title, as in effect on the day before the date of enactment 
     of the Rehabilitation Act Amendments of 1992--
       ``(i) if such excess is not less than $8,000,000, the 
     allotment to any State under subparagraph (A) shall be not 
     less than $450,000 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 
     $450,000 or one-third of one percent of such sums shall be 
     increased to the greater of the two amounts;
       ``(ii) if such excess is not less than $4,000,000 and is 
     less than $8,000,000, the allotment to any State under 
     subparagraph (A) shall be not less than $400,000 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 $400,000 or one-third of one percent 
     of such sums shall be increased to the greater of the two 
     amounts; and
       ``(iii) if such excess is less than $4,000,000, the 
     allotment to any State under subparagraph (A) shall approach, 
     as nearly as possible, the greater of the two amounts 
     described in clause (ii).
       ``(2) Certain territories.--
       ``(A) In general.--For the purposes of paragraph (1)(C), 
     Guam, American Samoa, the United States Virgin Islands, and 
     the Commonwealth of the Northern Mariana Islands 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 remainder for the 
     fiscal year for which the allotment is made.
       ``(3) Adjustment for inflation.--For any fiscal year, 
     beginning in fiscal year 1999, 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, the Commissioner shall increase the minimum allotment 
     under paragraph (1)(C) by a percentage that shall not exceed 
     the percentage increase in the total amount appropriated to 
     carry out this part between the preceding fiscal year and the 
     fiscal year involved.
       ``(4) Proportional reduction.--To provide allotments to 
     States in accordance with paragraph (1)(B), to provide 
     minimum allotments to States (as increased under paragraph 
     (3)) under paragraph (1)(C), or to provide minimum allotments 
     to States under paragraph (2)(B), the Commissioner shall 
     proportionately reduce the allotments of the remaining States 
     under paragraph (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 amount required by 
     paragraph (1)(B).
       ``(d) 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 provisions 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.

     ``SEC. 722. GRANTS TO CENTERS FOR INDEPENDENT LIVING IN 
                   STATES IN WHICH FEDERAL FUNDING EXCEEDS STATE 
                   FUNDING.

       ``(a) Establishment.--
       ``(1) In general.--Unless the director of a designated 
     State unit awards grants under section 723 to eligible 
     agencies in a State for a fiscal year, the Commissioner shall 
     award grants under this section to such eligible agencies for 
     such fiscal year from the amount of funds allotted to the 
     State under subsection (c) or (d) of section 721 for such 
     year.
       ``(2) Grants.--The Commissioner shall award such grants, 
     from the amount of funds so allotted, to such eligible 
     agencies for the planning, conduct, administration, and 
     evaluation of centers for independent living that comply with 
     the standards and assurances set forth in section 725.
       ``(b) Eligible Agencies.--In any State in which the 
     Commissioner has approved the State plan required by section 
     704, the Commissioner may make a grant under this section to 
     any eligible agency that--
       ``(1) has the power and authority to carry out the purpose 
     of this part and perform the functions set forth in section 
     725 within a community and to receive and administer funds 
     under this part, funds and contributions from private or 
     public sources that may be used in support of a center for 
     independent living, and funds from other public and private 
     programs;
       ``(2) is determined by the Commissioner to be able to plan, 
     conduct, administer, and evaluate a center for independent 
     living consistent with the standards and assurances set forth 
     in section 725; and
       ``(3) submits an application to the Commissioner at such 
     time, in such manner, and containing such information as the 
     Commissioner may require.

[[Page H6680]]

       ``(c) Existing Eligible Agencies.--In the administration of 
     the provisions of this section, the Commissioner shall award 
     grants to any eligible agency that has been awarded a grant 
     under this part by September 30, 1997, unless the 
     Commissioner makes a finding that the agency involved fails 
     to meet program and fiscal standards and assurances set forth 
     in section 725.
       ``(d) New Centers for Independent Living.--
       ``(1) In general.--If there is no center for independent 
     living serving a region of the State or a region is 
     underserved, and the increase in the allotment of the State 
     is sufficient to support an additional center for independent 
     living in the State, the Commissioner may award a grant under 
     this section to the most qualified applicant proposing to 
     serve such region, consistent with the provisions in the 
     State plan setting forth the design of the State for 
     establishing a statewide network of centers for independent 
     living.
       ``(2) Selection.--In selecting from among applicants for a 
     grant under this section for a new center for independent 
     living, the Commissioner--
       ``(A) shall consider comments regarding the application, if 
     any, by the Statewide Independent Living Council in the State 
     in which the applicant is located;
       ``(B) shall consider the ability of each such applicant to 
     operate a center for independent living based on--
       ``(i) evidence of the need for such a center;
       ``(ii) any past performance of such applicant in providing 
     services comparable to independent living services;
       ``(iii) the plan for satisfying or demonstrated success in 
     satisfying the standards and the assurances set forth in 
     section 725;
       ``(iv) the quality of key personnel and the involvement of 
     individuals with significant disabilities;
       ``(v) budgets and cost-effectiveness;
       ``(vi) an evaluation plan; and
       ``(vii) the ability of such applicant to carry out the 
     plans; and
       ``(C) shall give priority to applications from applicants 
     proposing to serve geographic areas within each State that 
     are currently unserved or underserved by independent living 
     programs, consistent with the provisions of the State plan 
     submitted under section 704 regarding establishment of a 
     statewide network of centers for independent living.
       ``(3) Current centers.--Notwithstanding paragraphs (1) and 
     (2), a center for independent living that receives assistance 
     under part B for a fiscal year shall be eligible for a grant 
     for the subsequent fiscal year under this subsection.
       ``(e) Order of Priorities.--The Commissioner shall be 
     guided by the following order of priorities in allocating 
     funds among centers for independent living within a State, to 
     the extent funds are available:
       ``(1) The Commissioner shall support existing centers for 
     independent living, as described in subsection (c), that 
     comply with the standards and assurances set forth in section 
     725, at the level of funding for the previous year.
       ``(2) The Commissioner shall provide for a cost-of-living 
     increase for such existing centers for independent living.
       ``(3) The Commissioner shall fund new centers for 
     independent living, as described in subsection (d), that 
     comply with the standards and assurances set forth in section 
     725.
       ``(f) Nonresidential Agencies.--A center that provides or 
     manages residential housing after October 1, 1994, shall not 
     be considered to be an eligible agency under this section.
       ``(g) Review.--
       ``(1) In general.--The Commissioner shall periodically 
     review each center receiving funds under this section to 
     determine whether such center is in compliance with the 
     standards and assurances set forth in section 725. If the 
     Commissioner determines that any center receiving funds under 
     this section is not in compliance with the standards and 
     assurances set forth in section 725, the Commissioner shall 
     immediately notify such center that it is out of compliance.
       ``(2) Enforcement.--The Commissioner shall terminate all 
     funds under this section to such center 90 days after the 
     date of such notification unless the center submits a plan to 
     achieve compliance within 90 days of such notification and 
     such plan is approved by the Commissioner.

     ``SEC. 723. GRANTS TO CENTERS FOR INDEPENDENT LIVING IN 
                   STATES IN WHICH STATE FUNDING EQUALS OR EXCEEDS 
                   FEDERAL FUNDING.

       ``(a) Establishment.--
       ``(1) In general.--
       ``(A) Initial year.--
       ``(i) Determination.--The director of a designated State 
     unit, as provided in paragraph (2), or the Commissioner, as 
     provided in paragraph (3), shall award grants under this 
     section for an initial fiscal year if the Commissioner 
     determines that the amount of State funds that were earmarked 
     by a State for a preceding fiscal year to support the general 
     operation of centers for independent living meeting the 
     requirements of this part equaled or exceeded the amount of 
     funds allotted to the State under subsection (c) or (d) of 
     section 721 for such year.
       ``(ii) Grants.--The director or the Commissioner, as 
     appropriate, shall award such grants, from the amount of 
     funds so allotted for the initial fiscal year, to eligible 
     agencies in the State for the planning, conduct, 
     administration, and evaluation of centers for independent 
     living that comply with the standards and assurances set 
     forth in section 725.
       ``(iii) Regulation.--The Commissioner shall by regulation 
     specify the preceding fiscal year with respect to which the 
     Commissioner will make the determinations described in clause 
     (i) and subparagraph (B), making such adjustments as may be 
     necessary to accommodate State funding cycles such as 2-year 
     funding cycles or State fiscal years that do not coincide 
     with the Federal fiscal year.
       ``(B) Subsequent years.--For each year subsequent to the 
     initial fiscal year described in subparagraph (A), the 
     director of the designated State unit shall continue to have 
     the authority to award such grants under this section if the 
     Commissioner determines that the State continues to earmark 
     the amount of State funds described in subparagraph (A)(i). 
     If the State does not continue to earmark such an amount for 
     a fiscal year, the State shall be ineligible to make grants 
     under this section after a final year following such fiscal 
     year, as defined in accordance with regulations established 
     by the Commissioner, and for each subsequent fiscal year.
       ``(2) Grants by designated state units.--In order for the 
     designated State unit to be eligible to award the grants 
     described in paragraph (1) and carry out this section for a 
     fiscal year with respect to a State, the designated State 
     agency shall submit an application to the Commissioner at 
     such time, and in such manner as the Commissioner may 
     require, including information about the amount of State 
     funds described in paragraph (1) for the preceding fiscal 
     year. If the Commissioner makes a determination described in 
     subparagraph (A)(i) or (B), as appropriate, of paragraph (1), 
     the Commissioner shall approve the application and designate 
     the director of the designated State unit to award the grant 
     and carry out this section.
       ``(3) Grants by commissioner.--If the designated State 
     agency of a State described in paragraph (1) does not submit 
     and obtain approval of an application under paragraph (2), 
     the Commissioner shall award the grant described in paragraph 
     (1) to eligible agencies in the State in accordance with 
     section 722.
       ``(b) Eligible Agencies.--In any State in which the 
     Commissioner has approved the State plan required by section 
     704, the director of the designated State unit may award a 
     grant under this section to any eligible agency that--
       ``(1) has the power and authority to carry out the purpose 
     of this part and perform the functions set forth in section 
     725 within a community and to receive and administer funds 
     under this part, funds and contributions from private or 
     public sources that may be used in support of a center for 
     independent living, and funds from other public and private 
     programs;
       ``(2) is determined by the director to be able to plan, 
     conduct, administer, and evaluate a center for independent 
     living, consistent with the standards and assurances set 
     forth in section 725; and
       ``(3) submits an application to the director at such time, 
     in such manner, and containing such information as the head 
     of the designated State unit may require.
       ``(c) Existing Eligible Agencies.--In the administration of 
     the provisions of this section, the director of the 
     designated State unit shall award grants under this section 
     to any eligible agency that has been awarded a grant under 
     this part by September 30, 1997, unless the director makes a 
     finding that the agency involved fails to comply with the 
     standards and assurances set forth in section 725.
       ``(d) New Centers for Independent Living.--
       ``(1) In general.--If there is no center for independent 
     living serving a region of the State or the region is 
     unserved or underserved, and the increase in the allotment of 
     the State is sufficient to support an additional center for 
     independent living in the State, the director of the 
     designated State unit may award a grant under this section 
     from among eligible agencies, consistent with the provisions 
     of the State plan under section 704 setting forth the design 
     of the State for establishing a statewide network of centers 
     for independent living.
       ``(2) Selection.--In selecting from among eligible agencies 
     in awarding a grant under this part for a new center for 
     independent living--
       ``(A) the director of the designated State unit and the 
     chairperson of, or other individual designated by, the 
     Statewide Independent Living Council acting on behalf of and 
     at the direction of the Council, shall jointly appoint a peer 
     review committee that shall rank applications in accordance 
     with the standards and assurances set forth in section 725 
     and criteria jointly established by such director and such 
     chairperson or individual;
       ``(B) the peer review committee shall consider the ability 
     of each such applicant to operate a center for independent 
     living, and shall recommend an applicant to receive a grant 
     under this section, based on--
       ``(i) evidence of the need for a center for independent 
     living, consistent with the State plan;
       ``(ii) any past performance of such applicant in providing 
     services comparable to independent living services;
       ``(iii) the plan for complying with, or demonstrated 
     success in complying with, the standards and the assurances 
     set forth in section 725;
       ``(iv) the quality of key personnel of the applicant and 
     the involvement of individuals with significant disabilities 
     by the applicant;
       ``(v) the budgets and cost-effectiveness of the applicant;
       ``(vi) the evaluation plan of the applicant; and
       ``(vii) the ability of such applicant to carry out the 
     plans; and
       ``(C) the director of the designated State unit shall award 
     the grant on the basis of the recommendations of the peer 
     review committee if the actions of the committee are 
     consistent with Federal and State law.
       ``(3) Current centers.--Notwithstanding paragraphs (1) and 
     (2), a center for independent living that receives assistance 
     under part B for a fiscal year shall be eligible for a grant 
     for the subsequent fiscal year under this subsection.
       ``(e) Order of Priorities.--Unless the director of the 
     designated State unit and the chairperson of the Council or 
     other individual designated by the Council acting on behalf 
     of and

[[Page H6681]]

     at the direction of the Council jointly agree on another 
     order of priority, the director shall be guided by the 
     following order of priorities in allocating funds among 
     centers for independent living within a State, to the extent 
     funds are available:
       ``(1) The director of the designated State unit shall 
     support existing centers for independent living, as described 
     in subsection (c), that comply with the standards and 
     assurances set forth in section 725, at the level of funding 
     for the previous year.
       ``(2) The director of the designated State unit shall 
     provide for a cost-of-living increase for such existing 
     centers for independent living.
       ``(3) The director of the designated State unit shall fund 
     new centers for independent living, as described in 
     subsection (d), that comply with the standards and assurances 
     set forth in section 725.
       ``(f) Nonresidential Agencies.--A center that provides or 
     manages residential housing after October 1, 1994, shall not 
     be considered to be an eligible agency under this section.
       ``(g) Review.--
       ``(1) In general.--The director of the designated State 
     unit shall periodically review each center receiving funds 
     under this section to determine whether such center is in 
     compliance with the standards and assurances set forth in 
     section 725. If the director of the designated State unit 
     determines that any center receiving funds under this section 
     is not in compliance with the standards and assurances set 
     forth in section 725, the director of the designated State 
     unit shall immediately notify such center that it is out of 
     compliance.
       ``(2) Enforcement.--The director of the designated State 
     unit shall terminate all funds under this section to such 
     center 90 days after--
       ``(A) the date of such notification; or
       ``(B) in the case of a center that requests an appeal under 
     subsection (i), the date of any final decision under 
     subsection (i),
     unless the center submits a plan to achieve compliance within 
     90 days and such plan is approved by the director, or if 
     appealed, by the Commissioner.
       ``(h)  Onsite Compliance Review.--The director of the 
     designated State unit shall annually conduct onsite 
     compliance reviews of at least 15 percent of the centers for 
     independent living that receive funding under this section in 
     the State. Each team that conducts onsite compliance review 
     of centers for independent living shall include at least one 
     person who is not an employee of the designated State agency, 
     who has experience in the operation of centers for 
     independent living, and who is jointly selected by the 
     director of the designated State unit and the chairperson of 
     or other individual designated by the Council acting on 
     behalf of and at the direction of the Council. A copy of this 
     review shall be provided to the Commissioner.
       ``(i) Adverse Actions.--If the director of the designated 
     State unit proposes to take a significant adverse action 
     against a center for independent living, the center may seek 
     mediation and conciliation to be provided by an individual or 
     individuals who are free of conflicts of interest identified 
     by the chairperson of or other individual designated by the 
     Council. If the issue is not resolved through the mediation 
     and conciliation, the center may appeal the proposed adverse 
     action to the Commissioner for a final decision.

     ``SEC. 724. CENTERS OPERATED BY STATE AGENCIES.

       ``A State that receives assistance for fiscal year 1993 
     with respect to a center in accordance with subsection (a) of 
     this section (as in effect on the day before the date of 
     enactment of the Rehabilitation Act Amendments of 1998) may 
     continue to receive assistance under this part for fiscal 
     year 1994 or a succeeding fiscal year if, for such fiscal 
     year--
       ``(1) no nonprofit private agency--
       ``(A) submits an acceptable application to operate a center 
     for independent living for the fiscal year before a date 
     specified by the Commissioner; and
       ``(B) obtains approval of the application under section 722 
     or 723; or
       ``(2) after funding all applications so submitted and 
     approved, the Commissioner determines that funds remain 
     available to provide such assistance.

     ``SEC. 725. STANDARDS AND ASSURANCES FOR CENTERS FOR 
                   INDEPENDENT LIVING.

       ``(a) In General.--Each center for independent living that 
     receives assistance under this part shall comply with the 
     standards set out in subsection (b) and provide and comply 
     with the assurances set out in subsection (c) in order to 
     ensure that all programs and activities under this part are 
     planned, conducted, administered, and evaluated in a manner 
     consistent with the purposes of this chapter and the 
     objective of providing assistance effectively and 
     efficiently.
       ``(b) Standards.--
       ``(1) Philosophy.--The center shall promote and practice 
     the independent living philosophy of--
       ``(A) consumer control of the center regarding 
     decisionmaking, service delivery, management, and 
     establishment of the policy and direction of the center;
       ``(B) self-help and self-advocacy;
       ``(C) development of peer relationships and peer role 
     models; and
       ``(D) equal access of individuals with significant 
     disabilities to society and to all services, programs, 
     activities, resources, and facilities, whether public or 
     private and regardless of the funding source.
       ``(2) Provision of services.--The center shall provide 
     services to individuals with a range of significant 
     disabilities. The center shall provide services on a cross-
     disability basis (for individuals with all different types of 
     significant disabilities, including individuals with 
     significant disabilities who are members of populations that 
     are unserved or underserved by programs under this title). 
     Eligibility for services at any center for independent living 
     shall be determined by the center, and shall not be based on 
     the presence of any one or more specific significant 
     disabilities.
       ``(3) Independent living goals.--The center shall 
     facilitate the development and achievement of independent 
     living goals selected by individuals with significant 
     disabilities who seek such assistance by the center.
       ``(4) Community options.--The center shall work to increase 
     the availability and improve the quality of community options 
     for independent living in order to facilitate the development 
     and achievement of independent living goals by individuals 
     with significant disabilities.
       ``(5) Independent living core services.--The center shall 
     provide independent living core services and, as appropriate, 
     a combination of any other independent living services.
       ``(6) Activities to increase community capacity.--The 
     center shall conduct activities to increase the capacity of 
     communities within the service area of the center to meet the 
     needs of individuals with significant disabilities.
       ``(7) Resource development activities.--The center shall 
     conduct resource development activities to obtain funding 
     from sources other than this chapter.
       ``(c) Assurances.--The eligible agency shall provide at 
     such time and in such manner as the Commissioner may require, 
     such satisfactory assurances as the Commissioner may require, 
     including satisfactory assurances that--
       ``(1) the applicant is an eligible agency;
       ``(2) the center will be designed and operated within local 
     communities by individuals with disabilities, including an 
     assurance that the center will have a Board that is the 
     principal governing body of the center and a majority of 
     which shall be composed of individuals with significant 
     disabilities;
       ``(3) the applicant will comply with the standards set 
     forth in subsection (b);
       ``(4) the applicant will establish clear priorities through 
     annual and 3-year program and financial planning objectives 
     for the center, including overall goals or a mission for the 
     center, a work plan for achieving the goals or mission, 
     specific objectives, service priorities, and types of 
     services to be provided, and a description that shall 
     demonstrate how the proposed activities of the applicant are 
     consistent with the most recent 3-year State plan under 
     section 704;
       ``(5) the applicant will use sound organizational and 
     personnel assignment practices, including taking affirmative 
     action to employ and advance in employment qualified 
     individuals with significant disabilities on the same terms 
     and conditions required with respect to the employment of 
     individuals with disabilities under section 503;
       ``(6) the applicant will ensure that the majority of the 
     staff, and individuals in decisionmaking positions, of the 
     applicant are individuals with disabilities;
       ``(7) the applicant will practice sound fiscal management, 
     including making arrangements for an annual independent 
     fiscal audit, notwithstanding section 7502(a)(2)(A) of title 
     31, United States Code;
       ``(8) the applicant will conduct annual self-evaluations, 
     prepare an annual report, and maintain records adequate to 
     measure performance with respect to the standards, containing 
     information regarding, at a minimum--
       ``(A) the extent to which the center is in compliance with 
     the standards;
       ``(B) the number and types of individuals with significant 
     disabilities receiving services through the center;
       ``(C) the types of services provided through the center and 
     the number of individuals with significant disabilities 
     receiving each type of service;
       ``(D) the sources and amounts of funding for the operation 
     of the center;
       ``(E) the number of individuals with significant 
     disabilities who are employed by, and the number who are in 
     management and decisionmaking positions in, the center; and
       ``(F) a comparison, when appropriate, of the activities of 
     the center in prior years with the activities of the center 
     in the most recent year;
       ``(9) individuals with significant disabilities who are 
     seeking or receiving services at the center will be notified 
     by the center of the existence of, the availability of, and 
     how to contact, the client assistance program;
       ``(10) aggressive outreach regarding services provided 
     through the center will be conducted in an effort to reach 
     populations of individuals with significant disabilities that 
     are unserved or underserved by programs under this title, 
     especially minority groups and urban and rural populations;
       ``(11) staff at centers for independent living will receive 
     training on how to serve such unserved and underserved 
     populations, including minority groups and urban and rural 
     populations;
       ``(12) the center will submit to the Statewide Independent 
     Living Council a copy of its approved grant application and 
     the annual report required under paragraph (8);
       ``(13) the center will prepare and submit a report to the 
     designated State unit or the Commissioner, as the case may 
     be, at the end of each fiscal year that contains the 
     information described in paragraph (8) and information 
     regarding the extent to which the center is in compliance 
     with the standards set forth in subsection (b); and
       ``(14) an independent living plan described in section 
     704(e) will be developed unless the individual who would 
     receive services under the plan signs a waiver stating that 
     such a plan is unnecessary.

     ``SEC. 726. DEFINITIONS.

       ``As used in this part, the term `eligible agency' means a 
     consumer-controlled, community-

[[Page H6682]]

     based, cross-disability, nonresidential private nonprofit 
     agency.

     ``SEC. 727. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     part such sums as may be necessary for each of the fiscal 
     years 1999 through 2003.

``CHAPTER 2--INDEPENDENT LIVING SERVICES FOR OLDER INDIVIDUALS WHO ARE 
                                 BLIND

     ``SEC. 751. DEFINITION.

       ``For purposes of this chapter, the term `older individual 
     who is blind' means an individual age 55 or older whose 
     significant visual impairment makes competitive employment 
     extremely difficult to attain but for whom independent living 
     goals are feasible.

     ``SEC. 752. PROGRAM OF GRANTS.

       ``(a) In General.--
       ``(1) Authority for grants.--Subject to subsections (b) and 
     (c), the Commissioner may make grants to States for the 
     purpose of providing the services described in subsection (d) 
     to older individuals who are blind.
       ``(2) Designated state agency.--The Commissioner may not 
     make a grant under subsection (a) unless the State involved 
     agrees that the grant will be administered solely by the 
     agency described in section 101(a)(2)(A)(i).
       ``(b) Contingent Competitive Grants.--Beginning with fiscal 
     year 1993, in the case of any fiscal year for which the 
     amount appropriated under section 753 is less than 
     $13,000,000, grants made under subsection (a) shall be--
       ``(1) discretionary grants made on a competitive basis to 
     States; or
       ``(2) grants made on a noncompetitive basis to pay for the 
     continuation costs of activities for which a grant was 
     awarded--
       ``(A) under this chapter; or
       ``(B) under part C, as in effect on the day before the date 
     of enactment of the Rehabilitation Act Amendments of 1992.
       ``(c) Contingent Formula Grants.--
       ``(1) In general.--In the case of any fiscal year for which 
     the amount appropriated under section 753 is equal to or 
     greater than $13,000,000, grants under subsection (a) shall 
     be made only to States and shall be made only from allotments 
     under paragraph (2).
       ``(2) Allotments.--For grants under subsection (a) for a 
     fiscal year described in paragraph (1), the Commissioner 
     shall make an allotment to each State in an amount determined 
     in accordance with subsection (j), and shall make a grant to 
     the State of the allotment made for the State if the State 
     submits to the Commissioner an application in accordance with 
     subsection (i).
       ``(d) Services Generally.--The Commissioner may not make a 
     grant under subsection (a) unless the State involved agrees 
     that the grant will be expended only for purposes of--
       ``(1) providing independent living services to older 
     individuals who are blind;
       ``(2) conducting activities that will improve or expand 
     services for such individuals; and
       ``(3) conducting activities to help improve public 
     understanding of the problems of such individuals.
       ``(e) Independent Living Services.--Independent living 
     services for purposes of subsection (d)(1) include--
       ``(1) services to help correct blindness, such as--
       ``(A) outreach services;
       ``(B) visual screening;
       ``(C) surgical or therapeutic treatment to prevent, 
     correct, or modify disabling eye conditions; and
       ``(D) hospitalization related to such services;
       ``(2) the provision of eyeglasses and other visual aids;
       ``(3) the provision of services and equipment to assist an 
     older individual who is blind to become more mobile and more 
     self-sufficient;
       ``(4) mobility training, braille instruction, and other 
     services and equipment to help an older individual who is 
     blind adjust to blindness;
       ``(5) guide services, reader services, and transportation;
       ``(6) any other appropriate service designed to assist an 
     older individual who is blind in coping with daily living 
     activities, including supportive services and rehabilitation 
     teaching services;
       ``(7) independent living skills training, information and 
     referral services, peer counseling, and individual advocacy 
     training; and
       ``(8) other independent living services.
       ``(f) Matching Funds.--
       ``(1) In general.--The Commissioner may not make a grant 
     under subsection (a) unless the State involved agrees, with 
     respect to the costs of the program to be carried out by the 
     State pursuant to such subsection, to make available 
     (directly or through donations from public or private 
     entities) non-Federal contributions toward such costs in an 
     amount that is not less than $1 for each $9 of Federal funds 
     provided in the grant.
       ``(2) Determination of amount contributed.--Non-Federal 
     contributions required in paragraph (1) may be in cash or in 
     kind, fairly evaluated, including plant, equipment, or 
     services. Amounts provided by the Federal Government, or 
     services assisted or subsidized to any significant extent by 
     the Federal Government, may not be included in determining 
     the amount of such non-Federal contributions.
       ``(g) Certain Expenditures of Grants.--A State may expend a 
     grant under subsection (a) to carry out the purposes 
     specified in subsection (d) through grants to public and 
     nonprofit private agencies or organizations.
       ``(h) Requirement Regarding State Plan.--The Commissioner 
     may not make a grant under subsection (a) unless the State 
     involved agrees that, in carrying out subsection (d)(1), the 
     State will seek to incorporate into the State plan under 
     section 704 any new methods and approaches relating to 
     independent living services for older individuals who are 
     blind.
       ``(i) Application for Grant.--
       ``(1) In general.--The Commissioner may not make a grant 
     under subsection (a) unless an application for the grant is 
     submitted to the Commissioner and the application is in such 
     form, is made in such manner, and contains such agreements, 
     assurances, and information as the Commissioner determines to 
     be necessary to carry out this section (including agreements, 
     assurances, and information with respect to any grants under 
     subsection (j)(4)).
       ``(2) Contents.--An application for a grant under this 
     section shall contain--
       ``(A) an assurance that the agency described in subsection 
     (a)(2) will prepare and submit to the Commissioner a report, 
     at the end of each fiscal year, with respect to each project 
     or program the agency operates or administers under this 
     section, whether directly or through a grant or contract, 
     which report shall contain, at a minimum, information on--
       ``(i) the number and types of older individuals who are 
     blind and are receiving services;
       ``(ii) the types of services provided and the number of 
     older individuals who are blind and are receiving each type 
     of service;
       ``(iii) the sources and amounts of funding for the 
     operation of each project or program;
       ``(iv) the amounts and percentages of resources committed 
     to each type of service provided;
       ``(v) data on actions taken to employ, and advance in 
     employment, qualified individuals with significant 
     disabilities, including older individuals who are blind; and
       ``(vi) a comparison, if appropriate, of prior year 
     activities with the activities of the most recent year;
       ``(B) an assurance that the agency will--
       ``(i) provide services that contribute to the maintenance 
     of, or the increased independence of, older individuals who 
     are blind; and
       ``(ii) engage in--

       ``(I) capacity-building activities, including collaboration 
     with other agencies and organizations;
       ``(II) activities to promote community awareness, 
     involvement, and assistance; and
       ``(III) outreach efforts; and

       ``(C) an assurance that the application is consistent with 
     the State plan for providing independent living services 
     required by section 704.
       ``(j) Amount of Formula Grant.--
       ``(1) In general.--Subject to the availability of 
     appropriations, the amount of an allotment under subsection 
     (a) for a State for a fiscal year shall be the greater of--
       ``(A) the amount determined under paragraph (2); or
       ``(B) the amount determined under paragraph (3).
       ``(2) Minimum allotment.--
       ``(A) States.--In the case of the several States, the 
     District of Columbia, and the Commonwealth of Puerto Rico, 
     the amount referred to in subparagraph (A) of paragraph (1) 
     for a fiscal year is the greater of--
       ``(i) $225,000; or
       ``(ii) an amount equal to one-third of one percent of the 
     amount appropriated under section 753 for the fiscal year and 
     available for allotments under subsection (a).
       ``(B) Certain territories.--In the case of Guam, American 
     Samoa, the United States Virgin Islands, and the Commonwealth 
     of the Northern Mariana Islands, the amount referred to in 
     subparagraph (A) of paragraph (1) for a fiscal year is 
     $40,000.
       ``(3) Formula.--The amount referred to in subparagraph (B) 
     of paragraph (1) for a State for a fiscal year is the product 
     of--
       ``(A) the amount appropriated under section 753 and 
     available for allotments under subsection (a); and
       ``(B) a percentage equal to the quotient of--
       ``(i) an amount equal to the number of individuals residing 
     in the State who are not less than 55 years of age; divided 
     by
       ``(ii) an amount equal to the number of individuals 
     residing in the United States who are not less than 55 years 
     of age.
       ``(4) Disposition of certain amounts.--
       ``(A) Grants.--From the amounts specified in subparagraph 
     (B), the Commissioner may make grants to States whose 
     population of older individuals who are blind has a 
     substantial need for the services specified in subsection (d) 
     relative to the populations in other States of older 
     individuals who are blind.
       ``(B) Amounts.--The amounts referred to in subparagraph (A) 
     are any amounts that are not paid to States under subsection 
     (a) as a result of--
       ``(i) the failure of any State to submit an application 
     under subsection (i);
       ``(ii) the failure of any State to prepare within a 
     reasonable period of time such application in compliance with 
     such subsection; or
       ``(iii) any State informing the Commissioner that the State 
     does not intend to expend the full amount of the allotment 
     made for the State under subsection (a).
       ``(C) Conditions.--The Commissioner may not make a grant 
     under subparagraph (A) unless the State involved agrees that 
     the grant is subject to the same conditions as grants made 
     under subsection (a).

     ``SEC. 753. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     chapter such sums as may be necessary for each of the fiscal 
     years 1999 through 2003.''.

     SEC. 411. REPEAL.

       Title VIII of the Rehabilitation Act of 1973 (29 U.S.C. 797 
     et seq.) is repealed.

     SEC. 412. HELEN KELLER NATIONAL CENTER ACT.

       (a) General Authorization of Appropriations.--The first 
     sentence of section 205(a) of the Helen Keller National 
     Center Act (29 U.S.C. 1904(a)) is amended by striking ``1993 
     through 1997'' and inserting ``1999 through 2003''.
       (b) Helen Keller National Center Federal Endowment Fund.--
     The first sentence of section 208(h) of such Act (29 U.S.C. 
     1907(h)) is

[[Page H6683]]

     amended by striking ``1993 through 1997'' and inserting 
     ``1999 through 2003''.
       (c) Registry.--Such Act (29 U.S.C. 1901 et seq.) is amended 
     by adding at the end the following:

     ``SEC. 209. REGISTRY.

       ``(a) In General.--To assist the Center in providing 
     services to individuals who are deaf-blind, the Center may 
     establish and maintain registries of such individuals in each 
     of the regional field offices of the network of the Center.
       ``(b) Voluntary Provision of Information.--No individual 
     who is deaf-blind may be required to provide information to 
     the Center for any purpose with respect to a registry 
     established under subsection (a).
       ``(c) Nondisclosure.--The Center (including the network of 
     the Center) may not disclose information contained in a 
     registry established under subsection (a) to any individual 
     or organization that is not affiliated with the Center, 
     unless the individual to whom the information relates 
     provides specific written authorization for the Center to 
     disclose the information.
       ``(d) Privacy Rights.--The requirements of section 552a of 
     title 5, United States Code (commonly known as the `Privacy 
     Act of 1974') shall apply to personally identifiable 
     information contained in the registries established by the 
     Center under subsection (a), in the same manner and to the 
     same extent as such requirements apply to a record of an 
     agency.
       ``(e) Removal of Information.--On the request of an 
     individual, the Center shall remove all information relating 
     to the individual from any registry established under 
     subsection (a).''.

     SEC. 413. PRESIDENT'S COMMITTEE ON EMPLOYMENT OF PEOPLE WITH 
                   DISABILITIES.

       Section 2(2) of the joint resolution approved July 11, 1949 
     (63 Stat. 409, chapter 302; 36 U.S.C. 155b(2)) is amended by 
     inserting ``solicit,'' before ``accept,''.

     SEC. 414. CONFORMING AMENDMENTS.

       (a) Randolph-Sheppard Act.--Section 2(e) of the Act of June 
     20, 1936 (commonly known as the ``Randolph-Sheppard Act'') 
     (49 Stat. 1559, chapter 638; 20 U.S.C. 107a(e)) is amended by 
     striking ``section 101(a)(1)(A)'' and inserting ``section 
     101(a)(2)(A)''.
       (b) Technology-Related Assistance for Individuals With 
     Disabilities Act of 1988.--
       (1) Section 101(b) of the Technology-Related Assistance for 
     Individuals With Disabilities Act of 1988 (29 U.S.C. 2211(b)) 
     is amended--
       (A) in paragraph (7)(A)(ii)(II), by striking 
     ``individualized written rehabilitation program'' and 
     inserting ``individualized plan for employment''; and
       (B) in paragraph (9)(B), by striking ``(as defined in 
     section 7(25) of such Act (29 U.S.C. 706(25)))'' and 
     inserting ``(as defined in section 7 of such Act)''.
       (2) Section 102(e)(23)(A) of such Act (29 U.S.C. 
     2212(e)(23)(A)) is amended by striking ``the assurance 
     provided by the State in accordance with section 101(a)(36) 
     of the Rehabilitation Act of 1973 (29 U.S.C. 721(a)(36))'' 
     and inserting ``the portion of the State plan provided by the 
     State in accordance with section 101(a)(21) of the 
     Rehabilitation Act of 1973''.
       (c) Title 38, United States Code.--Sections 3904(b) and 
     7303(b) of title 38, United States Code, are amended by 
     striking ``section 204(b)(2) of the Rehabilitation Act of 
     1973 (29 U.S.C. 762(b)(2)) (relating to the establishment and 
     support of Rehabilitation Engineering Research Centers)'' and 
     inserting ``section 204(b)(3) of the Rehabilitation Act of 
     1973 (relating to the establishment and support of 
     Rehabilitation Engineering Research Centers)''.
       (d) National School Lunch Act.--Section 27(a)(1)(B) of the 
     National School Lunch Act (42 U.S.C. 1769h(a)(1)(B)) is 
     amended by striking ``section 7(8) of the Rehabilitation Act 
     of 1973 (29 U.S.C. 706(8))'' and inserting ``section 7 of the 
     Rehabilitation Act of 1973''.
       (e) Domestic Volunteer Service Act of 1973.--Section 
     421(11) of the Domestic Volunteer Service Act of 1973 (42 
     U.S.C. 5061(11)) is amended by striking ``section 7(8)(B) of 
     the Rehabilitation Act of 1973 (29 U.S.C. 706(8)(B))'' and 
     inserting ``section 7(20)(B) of the Rehabilitation Act of 
     1973''.
       (f) Energy Conservation and Production Act.--Section 412(5) 
     of the Energy Conservation and Production Act (42 U.S.C. 
     6862(5)) is amended by striking ``a handicapped individual as 
     defined in section 7(7) of the Rehabilitation Act of 1973'' 
     and inserting ``an individual with a disability, as defined 
     in section 7 of the Rehabilitation Act of 1973''.
       (g) National and Community Service Act of 1990.--Section 
     101(12) of the National and Community Service Act of 1990 (42 
     U.S.C. 12511(12)) is amended by striking ``section 7(8)(B) of 
     the Rehabilitation Act of 1973 (29 U.S.C. 706(8)(B))'' and 
     inserting ``section 7(20)(B) of the Rehabilitation Act of 
     1973''.
                      TITLE V--GENERAL PROVISIONS

     SEC. 501. STATE UNIFIED PLAN.

       (a) Definition of Appropriate Secretary.--In this section, 
     the term ``appropriate Secretary'' means the head of the 
     Federal agency who exercises administrative authority over an 
     activity or program described in subsection (b).
       (b) State Unified Plan.--
       (1) In general.--A State may develop and submit to the 
     appropriate Secretaries a State unified plan for 2 or more of 
     the activities or programs set forth in paragraph (2), except 
     that the State may include in the plan the activities 
     described in paragraph (2)(A) only with the prior approval of 
     the legislature of the State. The State unified plan shall 
     cover 1 or more of the activities set forth in subparagraphs 
     (A) through (D) of paragraph (2) and may cover 1 or more of 
     the activities set forth in subparagraphs (E) through (O) of 
     paragraph (2).
       (2) Activities.--The activities and programs referred to in 
     paragraph (1) are as follows:
       (A) Secondary vocational education programs authorized 
     under the Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2301 et seq.).
       (B) Postsecondary vocational education programs authorized 
     under the Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2301 et seq.).
       (C) Activities authorized under title I.
       (D) Activities authorized under title II.
       (E) Programs authorized under section 6(d) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2015(d)).
       (F) Work programs authorized under section 6(o) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2015(o)).
       (G) Activities authorized under chapter 2 of title II of 
     the Trade Act of 1974 (19 U.S.C. 2271 et seq.).
       (H) Programs authorized under the Wagner-Peyser Act (29 
     U.S.C. 49 et seq.).
       (I) Programs authorized under title I of the Rehabilitation 
     Act of 1973 (29 U.S.C. 720 et seq.), other than section 112 
     of such Act (29 U.S.C. 732).
       (J) Activities authorized under chapter 41 of title 38, 
     United States Code.
       (K) Programs authorized under State unemployment 
     compensation laws (in accordance with applicable Federal 
     law).
       (L) Programs authorized under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.).
       (M) Programs authorized under title V of the Older 
     Americans Act of 1965 (42 U.S.C. 3056 et seq.).
       (N) Training activities carried out by the Department of 
     Housing and Urban Development.
       (O) Programs authorized under the Community Services Block 
     Grant Act (42 U.S.C. 9901 et seq.).
       (c) Requirements.--
       (1) In general.--The portion of a State unified plan 
     covering an activity or program described in subsection (b) 
     shall be subject to the requirements, if any, applicable to a 
     plan or application for assistance under the Federal statute 
     authorizing the activity or program.
       (2) Additional submission not required.--A State that 
     submits a State unified plan covering an activity or program 
     described in subsection (b) that is approved under subsection 
     (d) shall not be required to submit any other plan or 
     application in order to receive Federal funds to carry out 
     the activity or program.
       (3) Coordination.--A State unified plan shall include--
       (A) a description of the methods used for joint planning 
     and coordination of the programs and activities included in 
     the unified plan; and
       (B) an assurance that the methods included an opportunity 
     for the entities responsible for planning or administering 
     such programs and activities to review and comment on all 
     portions of the unified plan.
       (d) Approval by the Appropriate Secretaries.--
       (1) Jurisdiction.--The appropriate Secretary shall have the 
     authority to approve the portion of the State unified plan 
     relating to the activity or program over which the 
     appropriate Secretary exercises administrative authority. On 
     the approval of the appropriate Secretary, the portion of the 
     plan relating to the activity or program shall be implemented 
     by the State pursuant to the applicable portion of the State 
     unified plan.
       (2) Approval.--
       (A) In general.--A portion of the State unified plan 
     covering an activity or program described in subsection (b) 
     that is submitted to the appropriate Secretary under this 
     section shall be considered to be approved by the appropriate 
     Secretary at the end of the 90-day period beginning on the 
     day the appropriate Secretary receives the portion, unless 
     the appropriate Secretary makes a written determination, 
     during the 90-day period, that the portion is not consistent 
     with the requirements of the Federal statute authorizing the 
     activity or program including the criteria for approval of a 
     plan or application, if any, under such statute or the plan 
     is not consistent with the requirements of subsection (c)(3).
       (B) Special rule.--In subparagraph (A), the term ``criteria 
     for approval of a State plan'', relating to activities 
     carried out under title I or II or under the Carl D. Perkins 
     Vocational and Applied Technology Education Act (20 U.S.C. 
     2301 et seq.), includes a requirement for agreement between 
     the State and the appropriate Secretary regarding State 
     performance measures, including levels of performance.

     SEC. 502. DEFINITIONS FOR INDICATORS OF PERFORMANCE.

       (a) In General.--In order to ensure nationwide 
     comparability of performance data, the Secretary of Labor and 
     the Secretary of Education, after consultation with the 
     representatives described in subsection (b), shall issue 
     definitions for indicators of performance and levels of 
     performance established under titles I and II.
       (b) Representatives.--The representatives referred to in 
     subsection (a) are representatives of States (as defined in 
     section 101) and political subdivisions, business and 
     industry, employees, eligible providers of employment and 
     training activities (as defined in section 101), educators, 
     participants in activities carried out under this Act, State 
     Directors of adult education, providers of adult education, 
     providers of literacy services, individuals with expertise in 
     serving the employment and training needs of eligible youth 
     (as defined in section 101), parents, and other interested 
     parties, with expertise regarding activities authorized under 
     this Act.

     SEC. 503. INCENTIVE GRANTS.

       (a) In General.--Beginning on July 1, 2000, the Secretary 
     shall award a grant to each State that exceeds the State 
     adjusted levels of performance for title I, the expected 
     levels of performance for title II, and the levels of 
     performance for programs under Public Law 88-210 (as

[[Page H6684]]

     amended; 20 U.S.C. 2301 et seq.), for the purpose of carrying 
     out an innovative program consistent with the requirements of 
     any 1 or more of the programs within title I, title II, or 
     such Public Law, respectively.
       (b) Application.--
       (1) In general.--The Secretary may provide a grant to a 
     State under subsection (a) only if the State submits an 
     application to the Secretary for the grant that meets the 
     requirements of paragraph (2).
       (2) Requirements.--The Secretary may review an application 
     described in paragraph (1) only to ensure that the 
     application contains the following assurances:
       (A) The legislature of the State was consulted with respect 
     to the development of the application.
       (B) The application was approved by the Governor, the 
     eligible agency (as defined in section 203), and the State 
     agency responsible for programs established under Public Law 
     88-210 (as amended; 20 U.S.C. 2301 et seq.).
       (C) The State and the eligible agency, as appropriate, 
     exceeded the State adjusted levels of performance for title 
     I, the expected levels of performance for title II, and the 
     levels of performance for programs under Public Law 88-210 
     (as amended; 20 U.S.C. 2301 et seq.).
       (c) Amount.--
       (1) Minimum and maximum grant amounts.--Subject to 
     paragraph (2), a grant provided to a State under subsection 
     (a) shall be awarded in an amount that is not less than 
     $750,000 and not more than $3,000,000.
       (2) Proportionate reduction.--If the amount available for 
     grants under this section for a fiscal year is insufficient 
     to award a grant to each State or eligible agency that is 
     eligible for a grant, the Secretary shall reduce the minimum 
     and maximum grant amount by a uniform percentage.

     SEC. 504. PRIVACY.

       (a) Section 144 of the General Education Provisions Act.--
     Nothing in this Act shall be construed to supersede the 
     privacy protections afforded parents and students under 
     section 444 of the General Education Provisions Act (20 
     U.S.C. 1232g), as added by the Family Educational Rights and 
     Privacy Act of 1974 (section 513 of Public Law 93-380; 88 
     Stat. 571).
       (b) Prohibition on Development of National Database.--
       (1) In general.--Nothing in this Act shall be construed to 
     permit the development of a national database of personally 
     identifiable information on individuals receiving services 
     under title I of this Act.
       (2) Limitation.--Nothing in paragraph (1) shall be 
     construed to prevent the proper administration of national 
     programs under subtitles C and D of title I of this Act or to 
     carry out program management activities consistent with title 
     I of this Act.

     SEC. 505. BUY-AMERICAN REQUIREMENTS.

       (a) Compliance With Buy American Act.--None of the funds 
     made available in this Act may be expended by an entity 
     unless the entity agrees that in expending the funds the 
     entity will comply with the Buy American Act (41 U.S.C. 10a 
     et seq.).
       (b) Sense of Congress; Requirement Regarding Notice.--
       (1) Purchase of american-made equipment and products.--In 
     the case of any equipment or product that may be authorized 
     to be purchased with financial assistance provided using 
     funds made available under this Act, it is the sense of 
     Congress that entities receiving the assistance should, in 
     expending the assistance, purchase only American-made 
     equipment and products.
       (2) Notice to recipients of assistance.--In providing 
     financial assistance using funds made available under this 
     Act, the head of each Federal agency shall provide to each 
     recipient of the assistance a notice describing the statement 
     made in paragraph (1) by Congress.
       (c) Prohibition of Contracts With Persons Falsely Labeling 
     Products as Made in America.--If it has been finally 
     determined by a court or Federal agency that any person 
     intentionally affixed a label bearing a ``Made in America'' 
     inscription, or any inscription with the same meaning, to any 
     product sold in or shipped to the United States that is not 
     made in the United States, the person shall be ineligible to 
     receive any contract or subcontract made with funds made 
     available in this subtitle, pursuant to the debarment, 
     suspension, and ineligibility procedures described in 
     sections 9.400 through 9.409 of title 48, Code of Federal 
     Regulations as such sections are in effect on the date of 
     enactment of this Act, or pursuant to any successor 
     regulations.

     SEC. 506. TRANSITION PROVISIONS.

       (a) Workforce Investment Systems.--The Secretary of Labor 
     shall take such actions as the Secretary determines to be 
     appropriate to provide for the orderly transition from any 
     authority under the Job Training Partnership Act (29 U.S.C. 
     1501 et seq.) to the workforce investment systems established 
     under title I of this Act. Such actions shall include the 
     provision of guidance relating to the designation of State 
     workforce investment boards, local workforce investment 
     areas, and local workforce investment boards described in 
     such title.
       (b) Adult Education and Literacy Programs.--
       (1) In general.--The Secretary of Education shall take such 
     actions as the Secretary determines to be appropriate to 
     provide for the transition from any authority under the Adult 
     Education Act (20 U.S.C. 1201 et seq.) to any authority under 
     the Adult Education and Family Literacy Act (as added by 
     title II of this Act).
       (2) Limitation.--The authority to take actions under 
     paragraph (1) shall apply only for the 1-year period 
     beginning on the date of the enactment of this Act.
       (c) Regulations.--
       (1) Interim final regulations.--Not later than 180 days 
     after the date of the enactment of this Act, the Secretary of 
     Labor shall develop and publish in the Federal Register 
     interim final regulations relating to the transition to, and 
     implementation of, this Act.
       (2) Final regulations.--Not later than December 31, 1999, 
     the Secretary shall develop and publish in the Federal 
     Register final regulations relating to the transition to, and 
     implementation of, this Act.
       (d) Expenditure of Funds During Transition.--
       (1) In general.--Subject to paragraph (2) and in accordance 
     with regulations developed under subsection (b), States, 
     grant recipients, administrative entities, and other 
     recipients of financial assistance under the Job Training 
     Partnership Act (29 U.S.C. 1501 et seq.) or under this Act 
     may expend funds received under the Job Training Partnership 
     Act or under this Act, prior to July 1, 2000, in order to 
     plan and implement programs and activities authorized under 
     this Act.
       (2) Additional requirements.--Not to exceed 2 percent of 
     any allotment to any State from amounts appropriated under 
     the Job Training Partnership Act or under this Act for fiscal 
     year 1998 or 1999 may be made available to carry out 
     paragraph (1) and not less than 50 percent of any such amount 
     used to carry out paragraph (1) shall be made available to 
     local entities for the purposes described in such paragraph.
       (e) Reorganization.--Not later than 1 year after the date 
     of the enactment of this Act, the Secretary of Labor shall 
     reorganize and align functions within the Department of Labor 
     and within the Employment and Training Administration in 
     order to carry out the duties and responsibilities required 
     by this Act (and related laws) in an effective and efficient 
     manner.

     SEC. 507. EFFECTIVE DATE.

       Except as otherwise provided in this Act, this Act and the 
     amendments made by this Act, shall take effect on the date of 
     the enactment of this Act.
       And the Senate agree to the same.

     Bill Goodling.
     Howard ``Buck'' McKeon.
     Frank Riggs.
     Linsey Graham.
     Bob Schaffer.
     W.L. Clay.
     M.G. Martinez.
     Dale Kildee.
                                Managers on the Part of the House.

     Jim Jeffords.
     Dan Coats.
     Judd Gregg.
     Bill Frist.
     Mike DeWine.
     Michael B. Enzi.
     Tim Hutchinson.
     Susan Collins.
     John Warner.
     Mitch McConnell.
     Edward M. Kennedy.
     Paul Wellstone.
     Jack Reed.
                               Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The managers on the part of the House and the Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendment of the Senate to the bill (H.R. 1385) to 
     consolidate, coordinate, and improve employment, training, 
     literacy, and vocational rehabilitation programs in the 
     United States, and for other purposes, submit the following 
     joint statement to the House and the Senate in explanation of 
     the effect of the action agreed upon by the managers and 
     recommended in the accompanying conference report:

                 TITLE I--WORKFORCE INVESTMENT SYSTEMS

                    Workforce Investment Definitions

       The House bill provides definitions of the following terms: 
     `adult education and literacy activities'; `basic skills 
     deficient'; `case management'; `chief elected official'; 
     `citizenship skills'; `community based organization'; 
     `dislocated worker'; `displaced homemaker'; `economic 
     development agencies'; `employment, training, and literacy 
     programs'; `English literacy program'; `family'; `family 
     literacy services'; `full service eligible provider'; 
     `Governor'; `human resource programs'; `individual of limited 
     English proficiency'; `individual with a disability'; 
     `institution of higher education'; `labor market area'; 
     `literacy'; `local benchmarks'; `local board'; `local 
     educational agency'; `local workforce development area'; 
     `lower living standard income level'; `nontraditional 
     employment'; `offender'; `on-the-job training'; `outlying 
     area'; `participant'; `postsecondary institution'; `public 
     assistance'; `rapid response assistance'; `representatives of 
     employees'; `school dropout'; `Secretaries'; `skill grant'; 
     `appropriate Secretary'; `State'; `State adjusted 
     benchmarks'; `State benchmark'; `State educational agency'; 
     `statewide system'; `supportive services'; `termination'; 
     `unemployed individuals'; `unit of general local government'; 
     `veteran'; `vocational education'; and `youth corps program'.
       The Senate amendment provides definitions of the following 
     terms: `adult'; `adult education'; `area vocational education 
     school'; `chief elected official'; `disadvantaged adult'; 
     `dislocated worker'; `displaced homemaker'; `economic 
     development agencies'; `educational service agency'; 
     `elementary school'; `local educational agency'; `eligible 
     agency'; `eligible institution'; `eligible provider'; 
     `employment and training activity'; `English literacy 
     program'; `Governor';

[[Page H6685]]

     `individual of limited English proficiency'; `individual with 
     a disability'; `institution of higher education'; `literacy'; 
     `local area'; `local partnership'; `local performance 
     measure'; `low-income individual'; `lower living standard 
     income level'; `nontraditional employment'; `on-the-job-
     training'; `out-of-school youth'; `outlying area'; 
     `participant'; `postsecondary educational institution'; 
     `poverty line'; `public assistance'; `rapid response 
     activity'; `school dropout'; `secondary school'; `Secretary'; 
     `State'; `State educational agency'; `State performance 
     measure'; `statewide partnership'; `supportive services'; 
     `tribally controlled community college'; `unit of general 
     local government'; `veteran'; `vocational education'; 
     `vocational rehabilitation program'; `vocational student 
     organization'; `welfare recipient'; `workforce investment 
     activity'; `youth'; `youth activity'; and `youth 
     partnership'.
       In the Conference agreement, the House recedes on the 
     definition of `adult' with an amendment to change the age 
     from 22 to 18; the Senate recedes on the definition of `adult 
     education'; the Senate recedes on the definition of `area 
     vocational education schools'; the Senate recedes on the 
     definition of `basic skills deficient' with an amendment to 
     add writing to the definition; the Senate recedes on the 
     definition of `case management'; the House recedes on the 
     definition of `chief elected official'; the House recedes on 
     the definition of `citizenship skills'; the Senate recedes on 
     the definition of `community-based organization' with an 
     amendment to clarify that the community-based organization 
     has demonstrated effectiveness in the field of workforce 
     development; the House and Senate add a definition of 
     `customized training'; the House recedes on the definition of 
     `disadvantaged adult'; the House recedes on the definition of 
     `dislocated worker'; the House recedes on the `definition 
     of `displaced homemaker'; the Senate recedes on the 
     definition of `economic development agencies'; the House 
     recedes on the definition of `educational service agency'; 
     the Senate recedes on the definition of `elementary 
     school'; the House recedes on the definition of `eligible 
     agency'; the Senate recedes on part A, and the House 
     recedes on part B of the definition of `eligible 
     provider'; the House and Senate have the same definition 
     of `employment and training activity'; the House recedes 
     on the definition of `English literacy program'; the 
     Senate recedes on the definition of `family'; the Senate 
     recedes on the definition of `family literacy Services'; 
     the House recedes on the definition of `full service 
     eligible providers'; the Senate recedes on the definition 
     of `Governor'; the House recedes on the definition of 
     `human resource programs'; the House recedes on the 
     definition of `individual of limited English proficiency'; 
     the House recedes on the definition of `individual with a 
     disability'; the House and Senate have the same definition 
     of `institution of higher education'; the Senate recedes 
     on the definition of `labor market area'; the House 
     recedes on the definition of `literacy'; the House recedes 
     on the definition of `local area'; the Senate recedes on 
     the definition of `local board' with an amendment to 
     change the term to `local workforce investment board'; the 
     House recedes on the definition of `local benchmarks' with 
     an amendment to change the term to `local performance 
     measures'; the Senate recedes on the definition of `local 
     educational agency'; the Senate recedes on the definition 
     of `local partnership'; the House recedes on the 
     definition of `low-income individual'; the House recedes 
     on the definition of `lower living standard income level'; 
     the House and Senate agree to use the current law 
     definition of an older individual to define `older 
     worker'; the House recedes on the definition of 
     `nontraditional employment' with an amendment to strike 
     `in titles I and III' from the definition; the Senate 
     recedes on the definition of `offender'; the Senate 
     recedes on the definition of `on-the-job training'; the 
     House recedes on the definition of `out-of-schoolyouth' 
     with an amendment to remove literacy from the list; the 
     House recedes on the definition of `outlying area'; the 
     Senate recedes on the definition of `participant'; the 
     House recedes on the definition of `postsecondary 
     educational institutions'; the House recedes on the 
     definition of `poverty line'; the Senate recedes on the 
     definition of `public assistance'; the House recedes on 
     the definition of `rapid response activity'; the House 
     recedes on the definition of `representatives of 
     employees'; the House recedes on the definition of `school 
     dropout'; the Senate recedes on the definition of 
     `Secretary' with an amendment to not include the Secretary 
     of Education; the House recedes on the definition of 
     `secondary school' with an amendment; the House recedes on 
     the definition of `skill grant'; the Senate recedes on the 
     definition of `State'; the House recedes on the definition 
     of `State adjusted benchmarks'; the House recedes on the 
     definition of `State benchmark'; the Senate recedes on the 
     definition of `State educational agency'; the House 
     recedes on the definition of `State performance measure'; 
     the House recedes on the definition of `Statewide 
     partnership' with an amendment to change the term to 
     `State board'; the House recedes on the definition of 
     `Statewide system'; the Senate recedes on the definition 
     of `supportive services' with an amendment to add housing; 
     the Senate recedes on the definition of `termination'; the 
     House recedes on the definition of `tribally controlled 
     community college'; the Senate recedes on the definition 
     of `unemployed individuals'; the House recedes on the 
     definition of `unit of general local government'; the 
     House recedes on the definition of `veteran'; the House 
     and Senate recede to strike the definition of `vocational 
     education'; the House recedes on the definition of 
     `vocational rehabilitation program'; the Senate recedes on 
     the definition of `vocational student organization'; the 
     Senate recedes on the definition of `welfare recipient'; 
     the House recedes on the definition of `workforce 
     investment activity'; the House recedes on the definition 
     of `youth' with an amendment to change the term to 
     `eligible youth'; the House recedes on the definition of 
     `youth activity'; the House recedes on the definition of 
     `youth corps program'; the House recedes with an amendment 
     to the definition of `youth partnership' to change the 
     term to `youth council'.

                            State Provisions

     State workforce investment boards
       The House bill requires States to establish a collaborative 
     process consisting of the Governor, representatives of the 
     State legislature, and representatives appointed by the 
     Governor, with: business; local elected officials; local 
     education agencies; postsecondary institutions; organizations 
     representing participants (including community-based 
     organizations); service providers; parents; employers; State 
     Education Agency; State agencies responsible for vocational 
     rehabilitation; welfare; vocational, adult and postsecondary 
     education; such other agency officials as the Governor may 
     designate (including economic development); and the Veterans' 
     Employment and Training Service, to develop a single State 
     plan for the three block grants, for programs authorized 
     under the Wagner-Peyser Act, and a performance measurement 
     system for the three block grant. The collaborative process 
     would also be used to carry out other duties including 
     designation of local workforce development areas, development 
     of criteria for appointment of local workforce development 
     boards, and development of criteria for the Statewide full-
     service employment and training delivery system.
       The Senate amendment establishes a Statewide partnership 
     with composition similar to the House provision except: (1) 
     it adds individuals with experience relating to youth 
     activities; it expands the illustrative list of additional 
     State agencies to include the Employment Service and others; 
     refers to representatives of ``labor organizations'' rather 
     than ``employees'', and (2) it does not include 
     representatives of local educational agencies, postsecondary 
     institutions, organizations representing participants, 
     service providers, parents, or the State agency responsible 
     for welfare or veterans. In addition, the Senate requires 
     that the chair of the partnership be a representative of 
     business.
       The Conference agreement establishes a State Workforce 
     Investment Board composed of the Governor; members of the 
     State legislature; a majority of representatives of business; 
     chief elected officials; representatives of individuals with 
     experience relating to youth activities; representatives of 
     individuals with experience and expertise in the delivery of 
     workforce investment activities (including chief executive 
     officers of community colleges and community-based 
     organizations); and officials of the lead State agency with 
     responsibility for programs, services, and activities carried 
     out by one-stop partners. The Conference agreement adds a 
     conflict of interest provision which prohibits members of the 
     State board from voting on matters regarding the provision of 
     services by such member, matters that would provide direct 
     financial benefit to such member or their immediate family, 
     and other activities considered in conflict of interest by 
     the Governor. Additionally, the Conference agreement contains 
     a sunshine provision that requires information regarding 
     activities of the State board, the plan prior to submission, 
     its membership, and minutes of its formal meetings, to be 
     made available to the public.
     State plan
       The House bill requires State to submit a 3-year plan that 
     describes the statewide system as well as activities under 
     the Wagner-Peyser Act and the Adult Education Act. The State 
     plan must include long-term goals for the workforce 
     development system and benchmarks for achieving those goals 
     and ensuring continuous improvement.
       With respect to approval of the State plan, the House bill 
     provides that the State plan be approved unless the 
     appropriate Secretary makes a written determination within 90 
     days of receipt that the plan is inconsistent with a specific 
     provision of the Act.
       The Senate amendment contains provisions similar to the 
     House bill, except that the plan does not include Adult 
     Education or reference to long-term goals. The Senate 
     amendment includes similar plan controls regarding the 
     identification and description of the State workforce system, 
     descriptions and assurance on criteria for appointments, 
     processes for public comment, and data and reporting.
       With respect to approval of the State plan, the Senate 
     amendment provides that the State plan be approved unless the 
     appropriate Secretary makes a written determination within 60 
     days of receipt that the plan is: (1) inconsistent with the 
     provisions of the title; (2) in the case of the Wagner-Peyser 
     portion of the plan, does not meet the plan approval standard 
     under that Act; or (3) the State and the Secretary have not 
     reached agreement on the expected levels of performance.

[[Page H6686]]

       The Conference agreement requires States to submit a plan 
     that outlines a 5-year strategy for the statewide workforce 
     investment system, including activities under Wagner-Peyser. 
     The contents of the State plan follow the House and Senate 
     provisions, specifically with respect to a description of the 
     State board, performance accountability, state workforce and 
     economic development information, and identification of local 
     areas. Additionally, States are given the authority to 
     require regional planning by workforce development areas in a 
     single labor market area, economic development region or 
     other appropriate contiguous sub-area of the state.
       With respect to approval of the State plan, the Conference 
     agreement generally follows the Senate amendment except to 
     provide that State plans are considered approved unless the 
     Secretary makes a written determination within 90 days of 
     receipt of the State plan that the plan is inconsistent with 
     the provisions of the title.

                            Local Provisions

     Local workforce investment areas
       The House bill requires that States desiring to receive a 
     grant under this Act, designate local geographic areas, 
     called workforce development areas, for the purpose of 
     distributing funds. The House bill allows Governors to 
     determine where geographic lines are drawn to form local 
     workforce areas and guarantees automatic designation of 
     single local units of government with populations of 500,000 
     or more who apply for designation.
       The Senate amendment follows the House bill, with the 
     exceptions that units of government with populations of 
     500,000 or more may request designation only with the 
     agreement of the political subdivisions within the county 
     with populations of 200,000 or more. Additionally, single 
     units of general local government with populations of 200,000 
     or more that were previously Service Delivery Areas under the 
     Job Training Partnership Act (JTPA) are given an automatic 
     right to request designation as local areas. Such areas may 
     appeal a denial of designation to the Secretary, who may 
     grant the designation if the local area has demonstrated 
     effectiveness and meets certain other criteria.
       The Conference agreement requires States to designate local 
     workforce areas through the process described in the State 
     plan, and after consultation which chief elected officials. 
     In making such designations, the Governor must take into 
     consideration several factors such as labor market areas. The 
     Conference agreement also requires the Governor to approve a 
     request for designation from any single unit of general local 
     government with a population of 500,000 or more. 
     Additionally, Governors are required to approve a request for 
     temporary designation, as a local area, from any unit, or 
     combination of units, of local governments with a population 
     of 200,000 or more that was a service delivery area under 
     JTPA and performed successfully and has sustained fiscal 
     integrity. Such temporary designation is limited to 2 years, 
     after which the designation is to be extended until the 
     end of the duration of the State plan if, for the period 
     of the temporary designation, the Governor determines the 
     area substantially met (as defined by the State board) the 
     local performance measures for the area and sustained the 
     fiscal integrity of the program. A process for appeal to 
     the Secretary of Labor is outlined. Additionally, the 
     Governor may approve any request from any unit, or 
     combination of units, of local government, based upon a 
     recommendation of the State board.
     Local workforce investment boards
       The House bill establishes local workforce development 
     boards which are comprised of a majority of representatives 
     of business; representatives of local educational entities; 
     representatives of community-based organizations, 
     representatives of employees (which may include labor); and 
     other representatives of the public (which may include 
     program participants, parents, individuals with disabilities, 
     older workers, veterans, or organizations serving such 
     individuals). Boards may also include representatives of 
     local welfare agencies, economic development agencies, and 
     the local employment services system.
       With respect to functions of local workforce investment 
     boards, the House bill includes development of the local 
     plan, selection of one-stop providers, identification of 
     training providers, budgeting, program oversight, designation 
     of administrative entity, and negotiation of local 
     benchmarks. Additionally, local boards are authorized to act 
     as the fiscal agent to receive and disburse funds, or may 
     designate an alternate administrative entity to serve as the 
     fiscal agent.
       The Senate amendment establishes local workforce investment 
     partnerships which are comprised of a majority of 
     representatives of business; chief officers of postsecondary, 
     adult and vocational education; chief officers of labor 
     organizations; and chief officers of economic development 
     agencies. Boards may also include chief officers from one-
     stop partners and other individuals or entities.
       With respect to functions of local workforce investment 
     boards, the Senate amendment adds to the House provisions: 
     (1) promotion of the participation of private sector 
     employment and the use of intermediaries to assist employers 
     in meeting hiring needs; (2) coordination of the workforce 
     investment activities with economic development strategies; 
     and (3) assistance in the development of the labor market 
     information system as functions of the local partnership. The 
     Senate amendment does not include the designation of an 
     administrative entity as a function of the local workforce 
     investment board. Additionally, although the chief local 
     elected official is the fiscal agent for funds allocated to 
     the local area, the fiscal agent is required to disburse 
     funds for workforce investment activities at the direction of 
     the local partnerships.
       In addition, the Senate amendment establishes a youth 
     partnership in each local area to work, with the approval of 
     the local partnership, on planning, awarding and oversight of 
     grants for the youth programs. The youth partnerships are 
     required to include parents as well as representatives of the 
     local partnership, youth service agencies, public housing 
     authorities, youth organizations, business, and Job Corps.
       The Conference agreement establishes local workforce 
     investment boards whose members are appointed by the chief 
     elected officials and which are comprised of a majority of 
     representatives of business; representatives of local 
     educational entities; representatives of labor organizations; 
     representatives of community-based organizations; 
     representatives of economic development agencies; and 
     representatives of each of the one-stop partners. Boards may 
     also include others as determined by the local elected 
     official. The Conference agreement includes language to 
     require the actions of the Board to be available to the 
     public and includes conflict of interest language for members 
     of the Board.
       In the Conference agreement, Governors may require regional 
     planning, sharing of employment statistics, arrangements of 
     the delivery of service, and performance measurements across 
     labor market areas, regardless of workforce investment area 
     designation, in order to ensure maximum efficiency in the 
     delivery of employment and training services.
       With respect to functions of local workforce investment 
     boards, the Conference agreement generally follows the House 
     and Senate provisions to include: development of the local 
     plan; designation, certification and oversight of one-stop 
     operators; the provision of grants for youth activities; 
     identification of eligible providers of intensive and 
     training services; development and entry into memorandums of 
     understanding with one-stop partners; development of a 
     budget; negotiation of local performance measures; program 
     oversight and assistance in development of a statewide 
     employment statistics system; and coordination of employer 
     linkages with workforce investment activities and promotion 
     of the participation of private employers with the statewide 
     workforce investment system.
       With respect to youth partnerships, the Conference 
     agreement establishes a ``youth council'' similar to the 
     youth partnership established by the Senate amendment. The 
     youth council would operate as a subgroup within each local 
     workforce investment board and would be responsible for the 
     selection and oversight of local youth programs.
     Local plan
       The House bill requires the local workforce development 
     board and the local elected official to develop a 3-year 
     local strategic plan to be submitted to the Governor for 
     approval, describing the employment and job skills needs of 
     the local area, the employment and training activities to be 
     funded, local performance measures, and the local full 
     service employment and training delivery system. The House 
     bill also includes specific provisions relating to involving 
     others in development of disadvantaged youth programs.
       The Senate amendment requires the local workforce 
     investment partnership, in partnership with the local elected 
     official, to develop a local plan similar to that in the 
     House bill, to be submitted to the Governor for approval.
       The Conference agreement follows the House and Senate 
     provisions with the exception to allow for development of a 
     5-year local plan. The submitted local plan is required to 
     include an identification of the workforce investment and job 
     skill needs of the local area; a description of the one-stop 
     delivery system; the local levels of performance; the type 
     and availability of adult and dislocated worker employment 
     and training activities; a description of how the local board 
     will coordinate statewide rapid response activities; a 
     description of available local youth activities; a 
     description of the process for providing for public comment; 
     identification of the local fiscal agent; and other such 
     information required by the Governor.

               Workforce Investment Activities Providers

     Establishment of one-stop delivery systems
       The House bill requires local workforce development areas 
     to establish a full service employment and training delivery 
     system to provide both individuals and employers access to 
     services through a network of eligible providers. Services 
     are available to participants regardless of where they 
     initially enter the full-service system. The design of the 
     full service system is determined by States and local 
     communities, and requires that there be at least one 
     physical location in each local workforce development area 
     where participants can receive all of the core services, 
     and through which they may access more intensive 
     employment and training services. Any entity located in a 
     local area

[[Page H6687]]

     may be designated by the local board to provide services. 
     Such entities may include institutions of higher 
     education; local employment services offices established 
     under the Wagner-Peyser Act; private, nonprofit 
     organizations (including community-based organizations); 
     private for-profit entities; agencies of local government; 
     and other organizations of demonstrated effectiveness 
     (which may include local chambers of commerce).
       The Senate amendment requires States to establish at least 
     one one-stop customer service center in each local area where 
     the activities of the local participating entities must be 
     accessible to all individuals seeking assistance. One-stop 
     partners are designated by the local partnership and local 
     chief elected official. Each one-stop partner must enter into 
     an operating agreement with the local partnership and the 
     one-stop operator. One-stop operators are selected by the 
     local partnership and the chief elected official and may be 
     public or private entities. One-stop centers administer the 
     individual training accounts and provide core services. 
     Entities eligible to be designated as providers of services 
     are similar to those in the House bill except that 
     nontraditional public secondary schools and area vocational 
     education schools are eligible for designation.
       The Conference agreement requires there be established a 
     one-stop delivery system in each local workforce investment 
     area. Such local systems shall provide core services, and 
     access to intensive services, training and related services. 
     Programs carried out by one-stop partners are required to 
     make available to participants, through such system, the core 
     services applicable to such programs administered by the one-
     stop partner or additional partners. The local board, chief 
     elected official, and Governor are encouraged to retain 
     existing one-stop delivery systems where such systems have 
     been established and are effectively and efficiently meeting 
     the workforce investment needs of the local area, and are 
     performing to the satisfaction of the local board, chief 
     elected official and the Governor. Additionally, the 
     Conference agreement prohibits the designation or 
     certification of elementary and secondary schools as one-stop 
     operators.
     Identification of eligible providers of training services
       The House bill requires eligible providers of adult or 
     dislocated worker services to submit specified performance-
     based information relating to outcomes of their participants, 
     such as completion rates, and placement. Any eligible 
     provider may lose eligibility if they fail to meet 
     performance criteria established by the Governor. 
     Additionally providers of on-the-job training and 
     apprenticeship programs registered with the National 
     Apprenticeship Act are exempt from certain requirements.
       The Senate amendment is similar to the House bill, but does 
     not include an exemption for registered apprenticeship 
     programs from certain requirements.
       In the Conference agreement local boards would be 
     authorized to identify providers of training services at the 
     local level based upon minimum criteria established by the 
     Governor. To be eligible, providers submit an application to 
     the local workforce investment board which includes 
     performance and cost information. The local workforce 
     investment board submits the list of such providers to the 
     State, which may remove a provider in the event such provider 
     fails to meet minimum levels of performance. Otherwise, such 
     provider is considered an eligible provider. A participant 
     with an Individual Training Account (ITA) may attend any 
     provider on the State list. A program operated under title 
     IV, and apprenticeship programs (registered with the National 
     Apprenticeship Act), are automatically eligible for the first 
     year, and may remain on such State list unless they fail to 
     meet the specified performance levels.
     Identification of eligible providers of youth activities.
       The House bill authorizes the local workforce investment 
     board to identify eligible providers of youth activities. 
     Adult mentoring is required as an element of youth programs.
       The Senate amendment authorizes the youth partnership to 
     identify providers of youth activities.
       The Conference agreement authorizes the local youth 
     council, working through the local workforce investment 
     board, to competitively award grants or contract to eligible 
     youth providers.

                            Youth Activities

     Authorization/State allotments
       The House bill reserves .25 percent for outlying areas. The 
     remaining 99.75 percent is allotted to States under a formula 
     based on \1/3\ unemployment individuals in areas of 
     substantial unemployment (greater than 6.5 percent), \1/3\ 
     excess number of unemployed individuals (greater than 4.5 
     percent), and \1/3\ disadvantaged youth. No State is allowed 
     to receive less than 90 percent or more than 130 percent of 
     the amount they received in the preceding fiscal year. A 
     minimum allotment of .25 percent applies for small states.
       The Senate amendment contains a trigger when appropriations 
     exceed $1 billion. If the funding level is less than $1 
     billion, the first .25 percent is reserved for outlying 
     areas. Of the remaining 99.75 percent, the first $15 million 
     is reserved for Native American youth activities. The 
     remaining funds are then allotted to States under a formula 
     based on \1/3\ unemployed individuals in areas of substantial 
     unemployment, \1/3\ excess number of unemployed individuals, 
     and \1/3\ economically disadvantaged youth. If the funding 
     level is in excess of $1 billion, before any amounts are 
     reserved or allotted to States, up to $250 million is 
     assigned for Youth Opportunity grants, $10 million for 
     migrant youth activities, and $10 million for youth 
     academies. The remainder is then allotted per the above 
     specifications. No State is allowed to receive less than 90 
     percent or more than 130 percent of the amount they received 
     in the preceding fiscal year. A minimum allotment of .40 
     percent applies for small states.
       The Conference agreement generally follows the Senate 
     amendment with the exception that, from funding dedicated for 
     Youth Opportunity grants ($250 million in grants for high-
     poverty areas when State block grant funding exceeds $1 
     billion), 4 percent is guaranteed for migrant youth programs. 
     Additionally, the Conference agreement holds all States 
     harmless at 100 percent of their FY 1998 funding allotments. 
     A small State minimum of .3 percent would apply, as long as 
     States receive their FY 1998 allotted levels. For new funds 
     in excess of the FY 1998 funding levels, a .4 percent small 
     State minimum would apply. However, ``small States'' are 
     limited to those defined as ``small States'' under JTPA.
     Within State allocations
       The House bill reserves 25 percent of youth funds at the 
     State level, 15 percent of which is for State youth 
     activities with the remaining 10 percent to be used to make 
     matching grants for school dropouts. The remaining 75 percent 
     of State grant funds would be driven to the local level. Of 
     that amount 70 percent, or more, would be disbursed based on 
     a formula of \1/3\ unemployed, \1/3\ excess unemployed, and 
     \1/3\ economically disadvantaged adults. The remaining 30 
     percent, or less, would be disbursed by a method determined 
     through the State collaborative process.
       The Senate amendment sends 85 percent of youth State grant 
     funds to the local level in one of two ways as determined by 
     the State. Either all 85 percent of the funds are driven to 
     the local level through a formula based on \1/3\ unemployed 
     individuals in areas of substantial unemployment, \1/3\ 
     excess number of unemployed individuals, \1/3\ disadvantaged 
     adults (min. 90%); or States can choose to send 70 percent or 
     more of those funds through the above formula with up to the 
     remaining 30 percent being disbursed through a formula 
     incorporating other factors relating to excess poverty and 
     employment. This optional formula would be developed through 
     the Statewide partnership and approved by the Secretary. The 
     remaining 15 percent is reserved for Statewide activities. 
     States may reserve not more than 15 percent from each of the 
     three funding streams for statewide activities, with no more 
     than 5 percent of that amount being used for administration. 
     Funds from all three funding streams reserved for statewide 
     activities and administration would be pooled at the state 
     level, with statewide activities benefiting adults, 
     dislocated workers, and youth.
       The Conference agreement generally follows the Senate 
     amendment except that consideration of rural, urban and 
     suburban areas are included in the factors relating to excess 
     poverty and employment used in the alternative formula.
     Use of funds
       The House bill requires programs providing youth activities 
     to include summer employment linked directly to academic and 
     occupational learning; postsecondary educational or training 
     opportunities; an objective assessment of the academic and 
     skill levels and service needs of each participant; service 
     strategies that identify the employment goal; adult 
     mentoring; the integration of academic, occupational and 
     work-based learning opportunities; comprehensive guidance and 
     counseling; and the involvement of employers and parents in 
     the design and implementation of such programs.
       The Senate amendment requires youth activities to include a 
     summer jobs program; tutoring and instruction leading to the 
     completion of secondary school; dropout prevention; and 
     alternative secondary school for out-of-school youth in 
     addition to employment skills training.
       The Conference agreement program requirements for youth 
     activities follow the House bill and Senate amendment. 
     Program elements shall consist of tutoring, study skills 
     training, and instruction leading to completion of secondary 
     school (including dropout prevention strategies) alternative 
     secondary school services; summer employment opportunities 
     directly linked to academic and occupational learning; paid 
     and unpaid work experiences as appropriate (including 
     internships and job shadowing); occupational skill training; 
     leadership development opportunities; supportive services; 
     adult mentoring; follow-up services; and comprehensive 
     guidance and counseling (which may include drug and alcohol 
     abuse counseling and referral). Additionally, at least 30 
     percent of youth funds must be used to provide services to 
     out-of-school youth.
     Youth opportunity grants
       The House bill authorizes, as a demonstration activity, 
     projects that assist in providing comprehensive services to 
     increase the employment rates of out-of-school youth residing 
     in targeted high-poverty areas within Empowerment Zones and 
     Enterprise Communities. In addition, the House bill reserves 
     10 percent of youth funds at the State level to

[[Page H6688]]

     be used for out-of-school youth projects in high-poverty 
     areas.
       The Senate amendment reserves amounts appropriated for 
     youth in excess of $1 billion (up to $250 million) for Youth 
     Opportunity grants, which the Secretary may provide to assist 
     youth in high-poverty areas located in Empowerment Zones/
     Enterprise Communities, high-poverty areas located on Indian 
     reservations, or other high-poverty areas designated by the 
     States.
       The Conference agreement follows the Senate amendment.

     Adult and Dislocated Worker Employment and Training Activities

     Authorization/State allotments
       The House bill establishes a single delivery system for all 
     adults and dislocated workers while maintaining separate 
     funding streams for each. For the Adult funding, .25 percent 
     is reserved for outlying areas. The remaining 99.75 percent 
     is allotted to States under a formula based on \1/3\ 
     unemployed individuals in areas of substantial unemployment, 
     \1/3\ excess number of unemployed individuals and \1/3\ 
     economically disadvantaged adults. No State is allowed to 
     receive less than 90 percent or more than 130 percent of the 
     amount they received in the preceding fiscal year. A minimum 
     allotment of .25 percent applies for small states.
       For dislocated workers, the House bill allots 80 percent to 
     States, first reserving .25 percent for outlying areas, under 
     a formula based on \1/3\ unemployed individuals in areas of 
     substantial unemployment, \1/3\ excess number of unemployment 
     individuals, and \1/3\ long-term unemployment. No State is 
     allowed to receive less than 90 percent or more than 130 
     percent of the amount they received in the preceding fiscal 
     year. A minimum allotment of .25 percent applies for small 
     states. The Department of Labor reserves the remaining 20 
     percent for skill upgrading and emergency grants.
       The Senate amendment reserves .25 percent for outlying 
     areas for adult activities. The remaining 99.75 percent is 
     disbursed to States under a formula based on \1/3\ unemployed 
     individuals in areas of substantial unemployment, \1/3\ 
     excess number of unemployed individuals, and \1/3\ 
     disadvantaged adults. No State is allowed to receive less 
     than 90 percent or more than 130 percent of the amount they 
     received in the preceding fiscal year. A minimum allotment of 
     .40 percent applies for small states.
       For dislocated workers, States receive 80 percent of funds 
     disbursed under a formula based on \1/3\ unemployed 
     individuals in areas of substantial unemployment, \1/3\ 
     excess unemployed individuals and \1/3\ long-term (15 weeks 
     or more) unemployment. The Department of Labor is allowed to 
     reserve 20 percent of the amount available for allotment to 
     States for outlying areas, dislocated worker demonstration 
     projects, emergency grants, and dislocated worker activities 
     technical assistance.
       The Conference agreement generally follows the Senate 
     amendment except that the Conference agreement holds all 
     States harmless at 100 percent of their FY 1998 funding 
     allotments. A small State minimum of .3 percent would apply, 
     as long as States receive their FY 1998 allotted levels. For 
     new funds in excess of the FY 1998 funding levels, a .4 
     percent small State minimum would apply. However, ``small 
     States'' are limited to those defined as ``small States'' 
     under JTPA.
     Within State allocations
       The House bill separately allocates funds to local 
     workforce development areas for both adult and dislocated 
     worker funding streams based upon State-determined formulas. 
     Under the Adult funding stream, 15 percent of funds would be 
     held at the State level for adult activities only. The 
     remaining 85 percent of funds would go to the local level. Of 
     that amount, 70 percent or more would be disbursed based on a 
     formula based on \1/3\ unemployed, \1/3\ excess unemployed 
     and \1/3\ economically disadvantaged adults. The remaining 30 
     percent, or less, would be disbursed by a method determined 
     through the State collaborative process. The House bill 
     includes a cap of 10 percent for local administration. 
     Additionally, 20 percent of funds may be transferred between 
     the adult and dislocated workers streams with approval of the 
     Governor.
       For dislocated workers, the House bill allows the State to 
     reserve up to 30 percent for dislocated worker activities. 
     The remaining 70 percent, or more, would be driven to the 
     local level. Of that amount, 70 percent would be disbursed 
     based on a formula of \1/3\ unemployed, \1/3\ excess 
     unemployed, and \1/3\ economically disadvantaged adults. The 
     remaining 30 percent, or less, would be disbursed by a method 
     determined through the State collaborative process.
       The Senate amendment sends 85 percent of adult State grant 
     funds to the local level in one of two ways that the State 
     determines. Either all 85 percent of the funds are driven to 
     the local level through a formula based on \1/3\ unemployed 
     individuals in areas of substantial unemployment (greater 
     than 6.5 percent), \1/3\ excess number of unemployed 
     individuals, and \1/3\ disadvantaged adults (min. 90%); or 
     States can choose to send 70 percent, or more, of those funds 
     through the above formula with up to the remaining 30 percent 
     being disbursed through a formula incorporating other factors 
     relating to excess proverty and employment. This optional 
     formula would be developed through the Statewide partnership 
     and approved by the Secretary. The remaining 15 percent is 
     reserved for Statewide activities.
       For dislocated workers, the Senate amendments sends 60 
     percent of State grant funds to the local level under a 
     formula determined by the Governor to be based on: (1) 
     insured unemployment data, (2) unemployment concentrations, 
     (3) plant closings and mass layoff data, (4) declining 
     industries data, (5) farmer-rancher economic hardship data, 
     and (6) long-term unemployment data. Twenty-five percent of 
     the State grant is to be used for rapid response activities. 
     The remaining 15 percent is reserved for Statewide 
     activities. The Senate amendment allows a 20 percent 
     transfer, at the local level, between the Adult and 
     Dislocated Worker funding streams.
       Additionally, the Senate amendment allows States to reserve 
     not more than 15 percent from each of the three funding 
     streams (adult, dislocated and youth) for statewide 
     activities, with no more than 5 percent of that amount being 
     used for administration. Funds from all three funding streams 
     reserved for statewide activities and administrative would be 
     pooled at the State level, with Statewide activities 
     benefiting adults, dislocated workers and youth.
       The Conference agreement generally follows the Senate 
     amendment except that consideration of rural, urban and 
     suburban areas is included in the factors relating to excess 
     poverty and employment used in the alternative formula.
     Use of funds
       In the House bill, services available to adults and 
     dislocated workers and the local level include core services 
     and training services. Training services include basic skills 
     training; occupational skills training; on-the-job training; 
     customized training; programs that combine workplace training 
     with related instruction, which may include cooperative 
     education programs; private sector operated training 
     programs; skill upgrading and retraining; entrepreneurial 
     training; employability training; and customized training 
     conducted with a commitment by an employer to employ an 
     individual upon successful completion of the training. 
     Additionally, participants unable to obtain employment 
     through the core services may receive intensive services. 
     (Intensive services include specialized assessments; 
     individuals counseling and career planning; case management; 
     and follow-up services.)
       In the Senate amendment, services available to adults and 
     dislocated workers at the local level include employment 
     skills training; on-the-job training; job readiness training; 
     adult education when combined with one of the other training 
     activities; and other services deemed appropriate by the 
     local partnership. Additionally, core services are provided 
     through the one-stop customer service system. The Senate 
     amendment provides no distinction for intensive services.
       The Conference agreement generally follows the House bill 
     including distinguishing intensive services from other types 
     of services provided.
     Rapid response activities
       The House bill requires rapid response assistance to be 
     provided by the State through an entity designated by the 
     State. The House bill generally follows current law with 
     respect to the activities under rapid response.
       The Senate amendment generally follows the House bill with 
     respect to rapid response.
       The Conference agreement follows House and Senate 
     provisions.
     Individual training accounts
       The House bill requires, for adult training, the use of 
     career grants, which are defined as a voucher or credit, 
     through which a participant chooses training among qualified 
     providers. The House bill specifies four exceptions where 
     training may be provided by contract in lieu of career 
     grants: (1) on-the-job training; (2) where there are an 
     insufficient number of qualified providers; (3) where 
     qualified providers are unable to provide effective services 
     to special populations; or (4) where training is to be 
     provided by community-based organizations. Even where there 
     are exceptions, it is required that participants be provided 
     customer choice to the extent possible.
       The Senate amendment contains provisions similar to the 
     House bill regarding requirements for customer choice, except 
     the term ``Individual Training Account'' is used in lieu of 
     career grant. The two exceptions allow the use of contracting 
     for training services are (1) on-the-job training; and (2) 
     where the Governor issues a written waiver based on evidence 
     that there are no available private or public providers.
       The Conference agreement includes Individual Training 
     Accounts (ITAs). The Conference agreement makes an exception 
     to the use of Individual Training Accounts for on-the-job 
     training; customized training; training services not provided 
     by an eligible provider within the local workforce investment 
     area; and training services offered by community-based 
     organizations or other private organizations that serve 
     ``special participant populations'', defined as those who 
     face multiple barriers to employment (including individuals 
     with substantial language or cultural barriers, offenders, or 
     homeless).

                           General Provisions

     Performance accountability system
       The House bill establishes indicators of performance for 
     all adult, dislocated workers, and youth programs to be 
     applied to

[[Page H6689]]

     States as well as local areas. There are six core indicators 
     relating to adult and dislocated worker programs, and four 
     core indicators relating to the youth program. The Secretary 
     of Labor is required to negotiate the expected levels of 
     performance for each indicator with each State. States then 
     negotiate expected levels of performance with each local 
     area. Negotiations are to take into account special economic 
     and demographic factors. Technical assistance, sanctions, and 
     incentive funds are tied to actual performance.
       The Senate amendment is similar to current law and 
     establishes four core indicators of performance that apply to 
     States and local areas. Indicators of performance apply 
     separately to dislocated workers, economically disadvantaged 
     adults, and youth. Additionally, the Senate amendment 
     specifies performance-related information that is to be 
     reported annually.
       The Conference agreement generally follows the House bill 
     and Senate amendment. The Conference agreement establishes 
     four core indicators of performance relating to adults and 
     dislocated workers and three core indicators of performance 
     relating to activities for eligible youth. The process for 
     negotiating expected levels of performance is similar to the 
     process outlined in the House bill. States failing to meet 
     expected performance levels after one year may request 
     technical assistance or assistance in the development of a 
     performance improvement plan. For States failing to meet 
     expected performance levels for two consecutive years, the 
     Secretary may reduce the amount of that State's grant by up 
     to 5 percent. Funds resulting from such a reduction are to be 
     used to provide financial incentives for States exceeding 
     expected levels of performance.

                               Job Corps

       The House bill retains Job Corps as a national program, but 
     raises the minimum age to 16. The Secretary is required to 
     consult with States and localities prior to establishing 
     procedures for selecting center operators. As part of the 
     selection process, applicants would need to pass a background 
     check. Selection would be based, in part, on previous 
     performance. The House bill outlines some procedures 
     regarding the closure of centers, as well as provisions 
     regarding the ``zero tolerance'' policy.
       The Senate amendment strengthens linkages among Job Corps 
     centers and the State workforce development systems and the 
     local communities in which they are located. Assures that 
     applicants are assigned to Job Corps centers nearest to where 
     they reside, with certain exceptions. The Senate amendment 
     also assures that Job Corps students would learn occupational 
     skills in demand in their ``home'' labor market areas. Job 
     Corps Center performance standards would be established for 
     placement, retention, earning and skill gains of graduates, 
     and students would be provided with follow-up counseling for 
     up to 12 months after graduation.
       The Conference agreement generally follows the Senate 
     amendment.

                           National Programs

     Native American programs
       The House bill generally follows current law and authorizes 
     programs for Native Americans which can include comprehensive 
     workforce and career development activities and supplemental 
     services.
       The Senate amendment generally follows the House bill, with 
     the exception that it maintains the Native American 
     Employment and Training Council from current law.
       The Conference agreement generally follows the House and 
     Senate provisions.
     Migrant and seasonal farmworker programs
       The House bill authorizes a program for migrant and 
     seasonal farmworkers from current law which is authorized to 
     provide comprehensive workforce and career development 
     activities and related services which may include employment, 
     training, educational assistance, literacy assistance, an 
     English literacy program, worker safety training, housing, 
     supportive services, and the continuation of the case 
     management database.
       The Senate amendment generally follows the House bill 
     except that it authorizes additional activities, includes 
     dropout prevention activities, follow-up services for 
     employed individuals, self-employment and related business 
     enterprise development education, and technical assistance 
     relating to capacity enhancement. The Senate amendment does 
     not include the provision of housing as an authorized 
     activity.
       The Conference agreement follows the Senate amendment with 
     the exception that the provision of housing remains as an 
     authorized activity.
     Veterans
       The House bill retains the current law which authorizes the 
     Secretary of Labor to conduct programs to meet the needs of 
     ``Vietnam era veterans'' as well as veterans with service-
     connected disabilities, and veterans who are recently 
     separated from military service.
       The Senate amendment broadens the eligibility provision to 
     add veterans with significant barriers to employment and 
     veterans who served on active duty during war or campaign for 
     which badges have been authorized.
       The Conference agreement follows the Senate amendment.
     Demonstration, pilot, multiservice, research, multistate 
         projects and evaluations
       The House bill contains provisions relating to technical 
     assistance, national partnership grants, research, pilots and 
     demonstration grants, and evaluations, that are similar to 
     current law.
       The Senate amendment requires the Secretary to develop a 
     strategic plan for setting priorities for demonstrations, 
     pilots, multiservice, research, multistate projects. Requires 
     grants and contracts, under this section, to be awarded 
     through a peer review process for awards over $100,000. 
     Dislocated worker projects are separately authorized; not 
     more than 10 percent of dislocated worker funds reserved for 
     the national emergency grants may be used for such projects.
       The Conference agreement generally follows the Senate 
     amendment with the exception that the peer review process 
     applies only to applications for awards in excess of 
     $500,000.
     National emergency grants
       The House bill makes National Emergency Grants available to 
     provide assistance to dislocated workers.
       The Senate amendment expands eligibility for services under 
     the Emergency Grants to include, in addition to dislocated 
     workers, members of the armed forces and certain defense 
     employees that are eligible for services under the current 
     Defense Diversification Program.
       The Conference agreement follows the Senate amendment.
     Civil rights/Labor standards
       The House bill generally incorporates the current law 
     provisions for nondiscrimination; and provisions relating to 
     wages, benefits, health and safety, non-displacement, and 
     grievance procedures.
       The Senate amendment also generally incorporates the 
     current law provisions but adds title IX exemptions to the 
     prohibition on sex discrimination and modifies the religious 
     facility exemption consistent with the National and Community 
     Service Act regulations. The Senate amendment also similarly 
     incorporates many of the labor standards from current law.
       The Conference agreement generally follows the House and 
     Senate provisions.
     Waivers
       The House bill includes authority for the Secretary to 
     waive any statutory or regulatory requirements of the adult 
     and youth training provisions of the Act and Wagner-Peyser, 
     with exceptions for labor standards, nondiscrimination, and 
     related provisions.
       The Senate amendment clarifies that waivers previously 
     granted to States may continue to be in effect under this Act 
     for the duration of the waiver. Additionally, the Senate 
     amendment includes provisions similar to the House bill with 
     respect to general waivers of statutory or regulatory 
     requirements. The Senate amendment also authorizes workforce 
     flexibility plans to allow States to submit to the Secretary 
     plans under which the State may provide waivers to local 
     areas.
       The Conference agreement follows the Senate amendment 
     except for striking all references to ``partnership''.
     Drug testing provision
       The House bill has no provision.
       The Senate amendment requires each eligible provider of 
     training services to administer a drug test (1) on a random 
     basis to individuals who apply to participate in training 
     services, and (2) to participants in training where there is 
     a reasonable suspicion of drug use. Each applicant must agree 
     to submit to such tests and be dismissed from participation 
     if they fail the test.
       The Conference agreement strikes the Senate provision and 
     replaces it with language to clarify that States shall not be 
     prohibited from testing job training participants for the use 
     of controlled substances. The Conference agreement stipulates 
     that States may sanction individuals who test positive, as 
     follows: 1) a six month ban from the program for the first 
     positive test; and 2) similar to the Senate amendment, a 2-
     year ban from the program for subsequent positive tests. 
     Additionally, if States use funds from this Act for such 
     testing, the Conference agreement stipulates that such funds 
     must come from State administrative expenses, which are 
     limited to 5 percent of the total State training allotment.

                               Repealers

       The House bill repeals Parts F, G, H, I, and J of title IV 
     of the Job Training Partnership Act; title V of the Job 
     Training Partnership Act; the National Literacy Act of 1991; 
     and sections 303, 304, 305, and 306 of the Rehabilitation Act 
     of 1973.
       The Senate amendment repeals the Adult Education Act (20 
     U.S.C. 1201); Section 204 of the Immigration Reform and 
     Control Act of 1986 (8 U.S.C. 1255a note); title II of Public 
     Law 95-250 (92 Stat. 172); the Displaced Homemakers Self-
     Sufficiency Assistance Act (29 U.S.C. 2301 et seq.); Section 
     211 of the Appalachian Regional Development Act of 1965 (40 
     U.S.C. App. 211); subtitle C of title VII of the Stewart B. 
     McKinney Homeless Assistance Act (42 U.S.C. 11441 et seq.) 
     except section 738 of such title (42 U.S.C. 11448); 
     subchapter I of chapter 421 of title 49, United States Code; 
     the Job Training Partnership Act (29 U.S.C. 1501 et seq.); 
     title VII of the Stewart B. McKinney Homeless Assistance Act 
     (42 U.S.C. 11421 et seq.), except subtitle B and section 738 
     of such title (42 U.S.C. 11431 et seq. and 11448).
       The Conference agreement follows the Senate amendment.

[[Page H6690]]

         TITLE II--ADULT EDUCATION AND FAMILY LITERACY PROGRAMS

     Title
       The House bill names this Act the ``Adult Education and 
     Family Literacy Act''.
       The Senate amendment names this Act the ``Adult Education 
     and Literacy Act''.
       The Conference agreement adopts the House title.
     Purpose
       The purpose of the House bill is to assist the States to 
     provide educational skills for adults necessary for 
     employment and self-sufficiency, as well as the skills 
     necessary for the educational development of their children.
       The purpose of the Senate amendment is to assist the States 
     to provide education and literacy services to adults to 
     enable them to become literate, complete a secondary 
     education, and obtain the education skills necessary for the 
     educational development of their children.
       The Conference agreement blends the purposes in the House 
     and Senate bills. It provides that the purpose is to assist 
     adults to become literate and obtain the knowledge and skills 
     necessary for employment and self-sufficiency, assist adults 
     who are parents to obtain the educational skills necessary to 
     become full partners in the educational development of their 
     children and assist adults in the completion of a secondary 
     school education.
     Allocation of funds to eligible agencies
       The House bill provides an initial allotment of $100,000 
     for each outlying area and $250,000 for each eligible agency. 
     The additional allotment would be distributed on the basis of 
     a population age 16 through 60, who are without a high school 
     diploma or the equivalent, who are not currently required to 
     be enrolled in school, and who are not currently enrolled in 
     secondary school. No eligible agency allotment would be less 
     than 90 percent of its allotment in the preceding year.
       The Senate amendment provides for initial allotments 
     identical to those in the House bill. Remaining funds are to 
     be distributed on the basis of population age 16 and over, 
     who are without a high school diploma, or the equivalent, who 
     are not currently required to be enrolled in school, and who 
     are not currently enrolled in secondary school.
       The Conference agreement adopts the House provisions.
     Eligible recipients
       The House bill specifies those entities eligible to receive 
     grants from the eligible agency. Grants are to be made on a 
     competitive basis and all eligible entities are to have 
     direct and equitable access to funds.
       The Senate amendment also specifies those entities eligible 
     to receive grants from the eligible agency and includes 
     language regarding direct and equitable access.
       The Conference agreement blends the two lists and specifies 
     the following as entities eligible to receive grants from the 
     eligible agency: a local educational agency; a community-
     based organization of demonstrated effectiveness; an 
     institution of higher education; volunteer literacy 
     organizations of demonstrated effectiveness; a public or 
     private nonprofit agency; other nonprofit institutions which 
     have an ability to provide literacy services to adults and 
     families; a library; public housing authorities; and a 
     consortium of such agencies; organizations or institutions. 
     The agreement adopts the House language requiring grants to 
     be made on a competitive basis and includes language 
     regarding direct and equitable access to eligible providers, 
     including the use of the same announcement and application 
     process.
     Use of funds by eligible agency
       The House bill provides that the eligible agency 
     responsible for the administration of adult education and 
     literacy programs would be authorized to spend funds directly 
     for both program administration and other permissible 
     activities. Other uses of eligible agency funds would 
     include: professional development programs; technical 
     assistance; State or regional literacy resource centers; 
     monitoring and evaluation; incentives for coordination and 
     performance awards, curriculum development; other Statewide 
     activities for adult education and literacy; and support 
     services such as transportation and child care. The House 
     bill would require eligible agencies to use not less than 85 
     percent of available funds for local grants and allows them 
     to reserve not more than 15 percent for State level 
     activities, of which no more than 5 percent or $50,000 could 
     be used for administrative expenses.
       The Senate amendment provides that the eligible agency 
     responsible for the administration of adult education and 
     literacy programs which be authorized to spend funds directly 
     for program administration, State leadership activities, and 
     programs for corrections education and other 
     institutionalized persons. State leadership activities would 
     include: professional development, curriculum development, 
     monitoring and evaluation, development of performance 
     measures, integration of literacy instruction with 
     occupational skill training, developing linkages with 
     postsecondary institutions, State or regional literacy 
     resource centers, and other Statewide activities for adult 
     education and literacy. The Senate would require eligible 
     agencies to use not less than 80 percent of available funds 
     for local grants and allows States to use not more than 20 
     percent for State leadership activities, of which no more 
     than 5 percent of $80,000 could be used for administrative 
     expenses. Of the 80 percent reserved for local grants, the 
     Senate amendment requires that eligible agencies make 
     available not more than 10 percent of the funds reserved for 
     grants to local providers for programs for corrections 
     education and other institutionalized individuals.
       The Conference agreement blends the two lists of activities 
     and would include: the establishment or operation of 
     professional development programs to improve the quality of 
     instruction; the provision of technical assistance to 
     eligible providers; the provision of technology assistance, 
     including staff training, to eligible providers; support of 
     State or regional networks of literacy resource centers; 
     monitoring and evaluation of the quality of and the 
     improvement in, activities and services authorized under this 
     section; developing and disseminating curricula; integration 
     of literacy instruction and occupational skill training and 
     promoting linkages with employers; linkages with 
     postsecondary institutions; incentives for coordination and 
     performance awards; other activities of Statewide 
     significance, and coordination with existing support services 
     designed to increase enrollment in, and successful completion 
     of, adult education and literacy activities. It requires 
     eligible agencies to collaborate where possible and avoid 
     duplicating efforts in order to maximize the impact of 
     activities carried out under this Act. The agreement would 
     require eligible agencies to use not less than 82.5 percent 
     of available funds for local grants, and allow eligible 
     agencies to use not more than 12.5 percent for State 
     leadership activities and not more than 5 percent or $65,000 
     for administrative expenses. The agreement adopts the Senate 
     reservation for corrections education but modifies the 
     program description to encourage dollars to be spent on 
     criminal offenders who will be released within five years and 
     to change the reference to bilingual programs to English 
     literacy programs.
     Priorities and preferences
       The House bill requires eligible agencies to consider a 
     variety of factors in awarding grants to local providers.
       The Senate amendment sets forth a list of priorities and 
     preferences eligible agencies are to consider in funding 
     local adult education and literacy activities.
       The Conference agreement merges the two provisions and 
     requires the following factors to be considered when awarding 
     grants to provide: whether or not they are based on sound 
     research; the past effectiveness of the provider in improving 
     the literacy skills of adults and families; the commitment of 
     the provider to serve those most in need of services; whether 
     or not the program is of sufficient intensity and duration 
     for participants to achieve substantial learning gains, and 
     whether the program effectively employs technology, provides 
     learning in real-life contexts, is staffed by well trained 
     personnel, is coordinated with other available resources, 
     maintains a high-quality information management system, funds 
     communities that have a demonstrated need for English 
     literacy programs, and establishes measurable goals for 
     client outcomes.
     Use of funds by eligible recipients
       The House bill requires eligible recipients receiving a 
     grant to conduct one of the following activities: adult 
     education and literacy services, including services provided 
     on a work site; family services, and English literacy 
     programs. It limits to 5 percent the amount of the grant 
     available for planning, administration, personnel development 
     and interagency coordination.
       The Senate amendment requires grants and contracts to 
     eligible recipients to be used for programs or services that 
     meet the purposes of the Adult Education and Literacy Act, 
     such as adult education and literacy services and English 
     literacy programs. It limits to 5 percent the amount 
     recipients could use for planning, administration, personnel 
     development and interagency coordination.
       The Conference agreement adopts the House language but 
     modifies it slightly to specifically reference workplace 
     literacy services. Adoption of the House language would, for 
     the first time, specifically allow the use of funds for 
     family literacy programs.
     Eligible agency fiscal requirements
       The House bill requires eligible agencies to use their 
     federal grants to supplement and not supplant other public 
     funds spent for adult education and literacy activities. It 
     requires the fiscal effort per student or the aggregate 
     expenditures for adult education and literacy activities 
     within the State to be maintained at a level not less than 90 
     percent of the previous year. Grants to eligible agencies 
     would be reduced in proportion to the amount the eligible 
     agency failed to meet this requirement. One quarter of the 
     federal grant to each eligible agency would be required to be 
     matched with non-federal funds used for adult education and 
     literacy activities.
       The Senate amendment contains similar supplement, not 
     supplant language. It requires aggregate expenditures for 
     adult education and literacy to be maintained at a level not 
     less than 90 percent of the previous year but would not 
     permit grants to any eligible agency failing to reach that 
     level. The Senate amendment requires eligible agencies to 
     provide an amount equal to 25 percent of the total amount of 
     funds expended for adult education in the State from non-
     federal

[[Page H6691]]

     sources. The Senate amendment allows that eligible agency's 
     share to be in cash or in kind, fairly evaluated.
       The Conference agreement adopts the House language on 
     maintenance of effort but amends it to prevent an eligible 
     agency reduction from bringing the per capita expenditure 
     below the national average. The House recedes to the Senate 
     language on supplement not supplant and the State share.
     Eligible agency plan requirements
       The House bill requires the eligible agency plan to include 
     assurances for the coordination of adult education and job 
     training programs within the State, describe the assessment 
     to determine adult education needs, the use of funds, and an 
     evaluation of program effectiveness. It would also provide 
     assurances concerning direct and equitable access to all 
     eligible recipients and an assurance regarding fiscal 
     requirements of the program. Finally, it requires an 
     assurance that at least one grant will be awarded to 
     providers who offer flexible schedules and necessary support 
     services to enable individuals to participate in adult 
     education and literacy activities.
       The Senate amendment would require eligible agencies to 
     submit plans for a 3-year period. Such plans are to include 
     an assessment to determine adult education needs and 
     descriptions of the use of funds, evaluation procedures, the 
     method of selecting local recipients, the measures to be 
     taken to coordinate and avoid duplication of services among 
     various federal education, training and human services 
     programs, a description of the process to be used for public 
     participation and comment with respect to the eligible agency 
     plan and a description of how the eligible agency will 
     develop program strategies for populations such as low-income 
     students, individuals with disabilities, single parents, etc. 
     Each plan would have to provide assurances regarding the 
     fiscal requirements of the program.
       The Conference agreement blends the provisions of the House 
     and Senate bills. It adopts language requiring the submission 
     of a 5-year plan. Plan components would include an assessment 
     to determine adult education needs, a description of the use 
     of funds, evaluation procedures, a description of how the 
     eligible agency will develop program strategies for 
     populations such as low-income students, individuals with 
     disabilities, single parents, etc., assurances for the 
     coordination of adult education and job training programs 
     within the State. It adopts House language requiring an 
     assurance that at least one grant will be awarded to 
     providers who offer flexible schedules and necessary support 
     services to enable individuals to participate in adult 
     education and literacy activities except that it is amended 
     to require that an effort be made to coordinate funds for 
     support services prior to paying for them with adult 
     education dollars.
       It would also provide assurances concerning direct and 
     equitable access to all eligible recipients and an assurance 
     regarding fiscal requirements of the program. The eligible 
     agency plan would also be required to describe the process 
     used for public participation and comment consistent with the 
     Senate amendment.
     Use of phonics
       The House bill contains numerous references to the use of 
     instructional practices using phonemic awareness and 
     systematic phonics.
       The Senate amendment does not contain similar references.
       The Conference agreement adopts the House language but 
     amends such references to include fluency and reading 
     comprehension as well.
     National Institute for Literacy
       The House bill continues the National Institute for 
     Literacy for purposes of providing national literacy 
     leadership, coordinating literacy services, and serving as a 
     national resource for adult education and family literacy by 
     disseminating information and supporting more effective 
     services. Activities are similar to current law but place an 
     emphasis on support for a national electronic database of 
     information and for a network of State or regional adult 
     literacy resource centers. The administrative structure would 
     remain the same, except that the name of the National 
     Institute Board would be changed to the National Institute 
     for Literacy Advisory Board. The House bill requires the 
     Secretary to reserve 1.5 percent of the amount appropriated, 
     but not more than $6,500,000, for the Institute.
       The Senate amendment contains provisions similar to those 
     in the House bill but does not cap funding for the Institute.
       The Conference agreement would continue the National 
     Institute for Literacy based on provisions in the House and 
     Senate bills. There are few changes from current law. The 
     Conferees are especially interested in the Institute taking a 
     leadership role in improving reading instruction for youth 
     and adults based on recent research supported by the National 
     Institute for Health and identified by the National Academy 
     of Sciences. The agreement requires the Secretary to reserve 
     1.5 percent of the amount appropriated, but not more than 
     $8,000,000, for the Institute.
     National activities--Department of Education
       The House bill would authorize the Secretary to carry out 
     national activities to enhance the quality of adult education 
     and family literacy nationwide, including technical 
     assistance to States for developing and using performance 
     measures, research on adult education methods and 
     effectiveness, evaluation and assessment, and demonstration 
     programs. The House bill would reserve 1.5 percent of the 
     amount appropriated, but not more than $6,500,000 to 
     establish and carry out national leadership and evaluation 
     activities.
       The Senate amendment would authorize the Secretary to carry 
     out national leadership and evaluation activities to enhance 
     the quality of adult education and literacy nationwide, 
     including research, demonstration, dissemination, evaluations 
     and assessments, capacity building at the State and local 
     levels, data collection, professional development and 
     technical assistance. The Senate amendment would reserve 1.5 
     percent of the amount appropriated for national leadership 
     and evaluation activities, but does not cap the amount 
     available.
       The Conference agreement blends the House and Senate 
     National leadership activities. Authorized activities would 
     include: technical assistance, dissemination of information 
     on successful practices, improving the quality of adult 
     education and literacy activities, research, demonstration 
     programs, carrying out an independent evaluation and 
     assessment of adult education and literacy activities, 
     support efforts aimed at capacity building, collecting data 
     and other activities to enhance the quality of adult 
     education and literacy nationwide. The agreement requires the 
     Secretary to reserve 1.5 percent of the amount appropriated, 
     but not more than $8,000,000, for national leadership and 
     evaluation activities.
     Accountability
       The House will requires eligible agencies receiving funds 
     under the Adult Education title to identify, in their plan, 
     indicators and related levels of performance to be used to 
     measure the State's progress in meeting the State's long-term 
     goals. Upon submission of the plan, the Secretary of 
     Education is authorized to negotiate with each eligible 
     agency, the expected levels of performance to be achieved.
       The core indicators of performance for adult education and 
     family literacy programs to include measures of achievement 
     in the areas of reading, writing, language acquisition, 
     problem solving, etc.; receipt of a high school diploma or 
     its equivalent; entry into a postsecondary school, job 
     retraining program, employment or career advancement; 
     attainment of the literacy skills and knowledge individuals 
     need to be productive and responsible citizens and become 
     more actively involved with the education of their children, 
     and such other measures as the eligible agency may wish to 
     collect.
       Eligible agencies that exceed the benchmarks or demonstrate 
     continuing progress toward meeting them are eligible to 
     receive incentive grant funds.
       The Senate amendment contains a similar list of performance 
     measures, including demonstrated improvements in literacy 
     skill levels; attainment of secondary school diplomas or 
     their equivalent, and placement in, retention in, or 
     completion of postsecondary education, training, or 
     unsubsidized employment.
       The Conference agreement follows the House bill, although 
     it uses the term ``performance measures'' instead of 
     ``benchmarks.'' It merges the two lists of specific 
     indicators, except that language referring to the literacy 
     skills and knowledge individuals need to be productive and 
     responsible citizens is dropped and ``measures of the success 
     of family literacy programs'' is listed among the other 
     measures eligible agencies may wish to collect.

     TITLE III--WORKFORCE INVESTMENT-RELATED ACTIVITIES

                           Wagner-Peyser Act

     Amendments to Wagner-Peyser
       The House bill retains a separate authorization and funding 
     stream for Wagner-Peyser. It requires public labor exchange 
     activities to be part of the one-stop system, integrates the 
     Wagner-Peyser plan into the State Workforce Development plan, 
     and amends several sections of the Wagner-Peyser Act.
       The Senate amendment also retains a separate authorization 
     and funding stream for Wagner-Peyser and integrates the labor 
     exchange activities and plan into the workforce development 
     system.
       The Conference agreement generally follows the House bill 
     and Senate amendment. The Conference agreement follows the 
     Senate amendment with respect to function of the Secretary 
     and approval of the plan.
     Employment Statistics
       The House bill retains the current labor market information 
     provisions under JTPA.
       The Senate amendment streamlines current provisions related 
     to labor market statistics (LMI), strengthening the role of 
     States and localities, and makes such information beneficial 
     to individuals seeking employment.
       The Conference agreement generally follows the Senate 
     amendment except it renames the section as ``Employment 
     Statistics''.
     21st Century Workforce Commission
       The House bill contains no provision.
       The Senate amendment establishes the 21st Century Workforce 
     Commission to conduct a study of all matters relating to the 
     information technology workforce in the United States. 
     Composed of 21 members, the Commission is required to submit 
     to the President and Congress their report within 6

[[Page H6692]]

     months of their first meeting, and terminate within 90 days 
     of that submission.
       The Conference Agreement generally follows the Senate 
     amendment with modifications to limit the number of 
     Commission members to 15 (8 business, 1 labor, 2 State and 
     local officials, 3 education, and 1 representing the research 
     community in the field of information technology). The 
     Secretaries of Education and Labor would be ex-officio 
     members of the Commission.
     Prohibitions
       The House bills includes provisions that no provisions 
     under this Act may be construed to exercise any direction, 
     supervision, or control over the curriculum, program of 
     instruction, administration, or personnel of any educational 
     institution, school, or school system. The House bill further 
     includes a provision clarifying that nothing in this Act 
     shall be construed to provide a local workforce investment 
     board with the authority to mandate curricula for schools.
       The Senate agreement includes a prohibition that none of 
     the funds under the Act may be used for activities authorized 
     under the School to Work Opportunities Act. The Senate bill 
     also includes a provision clarifying that no funds under this 
     Act may be use to provide an activity for eligible youth who 
     are not school dropouts if participation in the activity 
     would interfere with or replace the regular academic 
     requirements of the youth.
       The Conference agreement generally contains both the House 
     and Senate provisions. Specifically the Conference agreement 
     includes language that ``None of the funds made available 
     under this Act may be used to provide funding under the 
     School-to-Work Opportunities Act of 1994 or to carry out, 
     through programs funded under this Act, activities that were 
     funded under the School-to-Work Opportunities Act of 1994, 
     unless the programs funded under this Act serve only those 
     participants eligible to participate in the programs under 
     this Act.''

            TITLE IV--REHABILITATION ACT AMENDMENTS OF 1998

                           General Provisions

       The House bill addresses several definitions including 
     administrative costs, employment outcome, and public safety 
     officer.
       The Senate amendment addresses each definition considered 
     by the House and several more definitions including: 
     assessment for determining eligibility and vocational 
     rehabilitation needs, construction, extended services, 
     federal share, independent living core services and 
     independent living services, individual with a disability, 
     individual with a most significant disability, individual's 
     representative/applicant's representative, local workforce 
     investment board, the term ``requires vocational 
     rehabilitation services'', significant disability, statewide 
     workforce investment board, supported employment, supported 
     employment services, underemployed, and workforce investment 
     activities.
       The Conference agreement accents the Senate amendment on a 
     majority of definitions with the following few exceptions or 
     qualifications: 1) ``administrative costs'' will be the 
     definition in the current Department of Education 
     regulations; 2) ``construction'' remains unchanged from 
     current law; 3) ``individual's representative/applicant's 
     representative'' does not include the descriptor `advocate'; 
     4) the term ``requires vocational rehabilitation services'' 
     is deleted; and 5) the definition of the term 
     ``underemployed'' is eliminated. Those definitions relating 
     back to other titles of the Workforce Investment Act mirror 
     the meanings and definitions given them in those titles.

              Reports on Program Outcomes and Evaluations

       The House bill requires that the annual report on 
     vocational rehabilitation include data on the administrative 
     costs for the Title I program.
       The Senate amendment expands the performance and 
     accountability information that is collected and reported on 
     the vocational rehabilitation programs. The Senate amendment 
     also requires the Commissioner to conduct studies and make 
     analyses to identify exemplary practices in vocational 
     rehabilitation. These studies would focus on subjects such as 
     informed client choice, customer satisfaction, job placement 
     and retention, assistive technology, and integrated 
     employment.
       The Conference agreement includes the requirement for 
     reporting administrative costs contained in the House bill as 
     well as the additional reporting requirement in the Senate 
     amendment. The Conferees urge the Commissioner to direct 
     current evaluation activities on identifying what works well, 
     rather than continuing to seek to define, or in many cases, 
     redefine, the chronic problems connected to the employment of 
     individuals with disabilities.

                   Vocational Rehabilitation Services

     Statewideness
       The House bill clarifies that the requirement for the State 
     plan to be in effect in all political subdivisions of the 
     State does not apply to cases in which private earmarked 
     funds are used as state matching funds for particular 
     geographic regions of the State, and is permitted without a 
     waiver by the Commissioner.
       The Senate amendment makes no change to current law.
       The Conference agreement follows the clarifications in the 
     House bill. These clarifications are necessary in light of 
     recent Department of Education interpretations of these 
     statutory provisions that are contrary to the legislative 
     intent. The Conference agreement provides that earmarking of 
     private funds for service delivery in particular geographic 
     areas of the State is permitted without a waiver of the 
     State's statewideness obligations by the Commissioner if 
     State funds are unavailable for the Federal match. This 
     exception to the statewideness requirements in section 101 
     (a)(4)(B) is intended to allow States to use funds earmarked 
     for a particular geographic location within the State as part 
     of the State's non-Federal share under title I without 
     obtaining a waiver of Statewideness from the Commissioner.
       In making these changes, the Conferees reaffirm the 
     original purposes of the statewideness provisions and the 
     earmarked funds exception of Title I. The statewideness 
     provision is intended to ensure that, in general, State 
     efforts are not purposely skewed to particular areas of a 
     State, without approval from the Department of Education.

  Information for Individuals Not Covered Under the State's Order of 
                           Selection Criteria

       The House bill makes no change to current law.
       The Senate amendment requires that all individuals eligible 
     for vocational rehabilitation services, including those who 
     do not receive services because the State is under an order 
     of selection, receive at least information and referral 
     services regarding access to the State workforce development 
     system and other information to help the individual prepare 
     for, secure, retain, or regain a job. A State may also 
     provide additional counseling and guidance services.
       The Conference agreement deletes the allowable State 
     activities (but maintains the authority to provide additional 
     counseling and guidance services), expands the required 
     information and referral services to include guidance, and 
     specifies what a proper referral must be. The Conferees 
     intend to alleviate the backlog of eligible individuals who 
     do not receive services from the State vocational 
     rehabilitation program because they do not meet the State's 
     order of selection criteria. Many of these individuals do not 
     receive services from the State workforce system and are 
     inappropriately referred back to the State vocational 
     rehabilitation program because they have a disability. The 
     Conferees expect that through the changes made throughout the 
     Conference agreement in integrating the State workforce 
     system, States will serve individuals with disabilities 
     throughout the entire State workforce system, not only 
     through State vocational rehabilitation program.

               Comprehensive System of Personnel Training

       The House bill modifies the requirements in current law for 
     a comprehensive personnel development system.
       The Senate amendment adopts the majority of changes in the 
     House bill and adds several additional requirements.
       The Conference agreement maintains the requirements 
     contained in current law. The Conferees believe that there is 
     a continued need for a comprehensive system of personnel 
     development, which was included in the Rehabilitation 
     Amendments of 1992, in order to ensure that individuals with 
     disabilities receive assistance from qualified vocational 
     rehabilitation personnel.
     Interagency agreements
       The House bill makes no changes to current law.
       The Senate amendment requires a State's Governor to ensure 
     that the State's vocational rehabilitation agency enters into 
     interagency agreements with appropriate public entities, 
     including the State's workforce investment system, to provide 
     vocational rehabilitation services more efficiently and 
     comprehensibly, to ensure cooperation among agencies which 
     provide vocational rehabilitation services, and to ensure no 
     duplication of services. While the Senate amendment does not 
     detail what the agreements must contain or with whom they 
     must be made, it does include requirements that the 
     agreements contain a dispute resolution process and methods 
     for defining financial responsibility.
       The Conference agreement modifies the Senate amendment by 
     1) allowing the State's vocational rehabilitation chief 
     administrator to consult with the Governor regarding the 
     agreements and 2) specifying certain entities with which the 
     State vocational rehabilitation agency must establish 
     agreements. These entities include public institutions of 
     higher education. The Conferees recognize that colleges and 
     universities already have a responsibility to provide certain 
     services under the Americans with Disabilities Act (ADA). The 
     Conferees encourage State vocational rehabilitation agencies 
     and public institutions of higher education, in developing 
     interagency agreements, to consider the requirements of the 
     ADA and other laws as well as agreements that may currently 
     be in place. However, State vocational rehabilitation 
     agencies should not interpret these ``interagency agreement'' 
     provisions as shifting the obligation for paying for specific 
     vocational rehabilitation services to colleges and 
     universities. State vocational rehabilitation agencies still 
     have that responsibility. Moreover, public institutions of 
     higher education, as parties in interagency agreements, must 
     agree to the terms of the interagency agreements, including 
     the services that they are expected to provide.

[[Page H6693]]

     Cooperative agreements with other components of State 
         workforce investment system
       The House bill makes no changes to current law.
       The Senate amendment provides for cooperative agreements 
     with other parts of a State's workforce investment system to 
     allow for activities such as: staff training and technical 
     assistance regarding vocational rehabilitation services and 
     eligibility, common customer service procedures such as 
     intake and human services hot lines, common dispute 
     resolution procedures, and electronic links to share 
     employment statistics and employment opportunities.
       The Conference agreement mirrors the Senate amendment. The 
     Conferees do not intend that this provision be confused with 
     the provision outlining ``Interagency Agreements.'' 
     Interagency agreements are designed to assure cooperation not 
     only among agencies within a State's workforce investment 
     system, but more importantly outside the system. Interagency 
     agreements also have specific provisions regarding the 
     payment of services among these agencies. This section is 
     designed to make the State vocational rehabilitation system 
     more compatible with the State's workforce system and to 
     underscore the links between the two systems.
     Coordination with education officials
       The House bill changed references in the area of transition 
     services for students with disabilities from Individualized 
     Written Rehabilitation Plan (IWRP) to Individualized 
     Education Program (IEP) so that transition services may be 
     provided under an IEP without requiring the development of a 
     separate IWRP, or Individual Plan for Employment (IPE) as it 
     is referred to in the House bill.
       The Senate amendment requires the State plan to contain 
     plans, policies and procedures for coordination between the 
     vocational rehabilitation agency and local and State 
     education officials in facilitating the transition of 
     students with disabilities from secondary school to the 
     workforce through vocational rehabilitation services.
       The Conference agreement blends the House and Senate 
     provisions. First, the Conference agreement specifically 
     allows transition planning to be provided under an IEP 
     without requiring the development of a separate IPE. Second, 
     the Conferees also reaffirm the intent of the transition 
     services provisions in the 1992 Vocational Rehabilitation 
     Amendments, which according to the Senate report, was not 
     ``to shift the responsibility of service delivery from 
     education to rehabilitation during the transition years'' but 
     rather to define the role of the rehabilitation system as 
     ``primarily one of planning for the student's years after 
     leaving school.'' The Conference agreement encourages State 
     vocational rehabilitation agencies to assist schools in 
     identifying transition services in the development of the IEP 
     (including participation in IEP meetings), and to participate 
     in the cost of transition services for any student with a 
     disability so long as those students have been determined 
     eligible to receive vocational rehabilitation services. The 
     nature of these services and the roles and responsibilities 
     of each party are to be determined at the State or local 
     level. However, State vocational rehabilitation agencies 
     should not interpret the ``interagency agreement'' provisions 
     as shifting the obligation for paying for specific transition 
     services normally provided by those agencies to local school 
     districts. State vocational rehabilitation agencies still 
     have that responsibility. Further, school districts are 
     parties in interagency agreements, and must agree to the 
     terms of the interagency agreements and the services that 
     they are expected to provide.
       The Conferees intend for transition services to cover a 
     wide range of activities that facilitate the transition of 
     secondary school students with disabilities from school to 
     post-school activities.
     Presumption of eligibility for recipients of SSDI and SSI
       The House bill makes no changes to current law.
       The Senate amendment adds new language making individuals 
     who receive SSI or SSDI benefits to be automatically eligible 
     for vocational rehabilitation services.
       The Conference agreement follows the Senate amendment. 
     However, the Conferees do not intend to create any sort of 
     entitlement to vocational rehabilitation services for 
     individuals receiving SSI or SSDI benefits. To actually 
     receive services, a person must have a disability and require 
     vocational rehabilitation services to prepare for, secure, 
     retain, or regain employment. The ``presumption of 
     eligibility'' is only the first step in the overall 
     evaluation of whether or not an individual with a disability 
     will receive vocational rehabilitation services. People 
     receiving SSI or SSDI have already met a much stricter 
     standard as to whether they have a disability. Therefore 
     there is no need to reestablish their eligibility in that 
     regard for vocational rehabilitation. SSI and SSDI recipients 
     must still, however, demonstrate their desire to work in 
     order to receive vocational rehabilitation services. 
     Moreover, the decision on whether an individual actually 
     receives vocational rehabilitation services is based on the 
     availability of funds in accordance with the State's order of 
     selection criteria.
     Individual plans
       The House bill renames the Individualized Written 
     Rehabilitation Plan (IWRP) as the Individual Plan for 
     Employment (IPE). The bill enhances client control by 
     requiring that clients have the opportunity to exercise 
     informed choice in the development and implementation of 
     their plans by selecting employment goals, services, 
     providers, and methods to procure services, as well as 
     providing for extended services.
       The Senate amendment renames the IWRP as the Individual 
     Rehabilitation Employment Plan (IREP), and follows the House 
     bill in providing for informed client choice and extended 
     services. The Senate amendment also establishes mandatory 
     procedures and components for individual plans.
       The Conference agreement follows the Senate amendment, 
     except for adopting the House term of Individual Plan for 
     Employment. The Conference agreement reflects the need to 
     provide greater choice and involvement of vocational 
     rehabilitation clients in developing their service plans. The 
     Conferees expect that these changes will fundamentally change 
     the role of the client-counselor relationship, and that in 
     many cases counselors will serve more as facilitators of plan 
     development.
     Improved and enhanced consumer choice
       The House bill strongly emphasize improved and enhanced 
     consumer choice, especially through new language regarding 
     the vocational rehabilitation consumer's role in his or her 
     Individual Employment Plan.
       The Senate amendment also emphasizes improved and enhanced 
     consumer choice and requires assurances that vocational 
     rehabilitation consumers or their appropriate representative 
     be provided information and support services to assist the 
     consumers in exercising informed choice throughout the 
     rehabilitation process.
       The Conference agreement adopts these views and expands the 
     role of vocational rehabilitation consumers in the decisions 
     regarding their job training. The Conferees believe that a 
     consumer-driven program is most effective in getting people 
     jobs. Therefore, the Conferees endorse increased independence 
     for individuals with disabilities to informed choice.
     State Rehabilitation Council
       The House bill makes no changes to current law.
       The Senate amendment expands the membership of the Council, 
     increases the responsibilities of the Council, and adds 
     additional functions. The Senate amendment also makes several 
     changes to better integrate and coordinate vocational 
     rehabilitation services in the State Workforce system.
       The Conference agreement follows the Senate amendment. In 
     doing so, the Conferees preserve the Council's advisory 
     functions. The Conference agreement adds additional function 
     that follow the Senate amendment in requiring that the 
     Council and State agency jointly develop, agree to, and 
     review State goals and priorities.
     American Indian vocational rehabilitation services
       The House bill makes no changes to current law.
       The Senate amendment gives the Rehabilitation Services 
     Administration the flexibility to make decisions about the 
     duration of individual grants, but also allows for long-term 
     grants that will contribute to the stability and 
     effectiveness of services.
       The Conference agreement follows the Senate amendment and 
     adds language giving tribal vocational rehabilitation 
     agencies the authority to provide vocational rehabilitation 
     services to Native Americans who reside either on or near 
     reservations. However, the Conferees do not intend this 
     authority to require tribal vocational rehabilitation 
     agencies to serve Native Americans not living on a 
     reservation. It merely allows the agencies to do so if they 
     choose.

                         Research and Training

     Research and training improvements
       The House bill eliminates the references to the 
     compensation rate for the Director of the National Institute 
     for Disability and Rehabilitation Research (NIDRR), and 
     eliminates provisions related to the Deputy Director.
       The Senate amendment follows the House bill regarding the 
     appointment of the Director but retains references to the 
     Deputy Director; eliminates provisions that requires the 
     awarding of funds for pediatric rehabilitation and other 
     areas, adds provisions that allow research grants to be made 
     for research programs on the effectiveness of medical 
     practices and on quality assurance in rehabilitation 
     technology, and makes other improvements in focusing research 
     funds on critical areas.
       The Conference agreement follows the House bill regarding 
     the appointment of the Director and Deputy Director of NIDRR. 
     The Conference agreement follows the Senate amendment 
     regarding the elimination of provisions requiring funding for 
     specific projects and in allowing for grants in designated 
     emerging research areas. The Conferees intend that 
     information and findings from work funded by the Institute be 
     effectively disseminated so that it is more accessible to the 
     public, including individuals with disabilities. The 
     Conferees also recognize that individuals with disabilities 
     lack access to uniform, useful information about assistive 
     technology devices and services. The Conferees urge NIDRR to 
     assume a leadership role in promoting the identification, 
     use, and acceptance of uniform information about common 
     devices and services that permit individuals with 
     disabilities to make informed decisions about such devices 
     and services. However, the Conferees believe that

[[Page H6694]]

     it would be inappropriate for NIDRR to contemplate or set 
     standards for such devices and services.

    Professional Development and Special Projects and Demonstrations

     Transfer and elimination of programs
       The House bill eliminates 22 programs by repealing sections 
     303 through 306 in Title III of current law and repealing 
     authorized but unfunded programs in Title VIII.
       The Senate amendment also repeals sections 303 to 306 in 
     Title III, as well as the currently funded Reader Services 
     and Interpreter Services programs, and all programs in Title 
     VIII.
       The Conference agreement consolidates into Title III the 
     currently funded programs authorized under Title VIII. It 
     also retains the currently funded Reader Services and 
     Interpreter Services programs  in Title III, and transfers 
     the Grants for Demonstration Projects to Increase Choice, 
     Braille Training Projects and Parent Information and 
     Training Programs from Title VIII to Title III. Title VIII 
     is repealed completely. Many of these programs were 
     authorized for more than twenty years yet were never 
     funded. The changes in the Conference agreement streamline 
     the training and demonstration projects by consolidating 
     them into a single section with flexible authority to 
     address changing and emerging needs.

                     National Council on Disability

     Duties and administration of the National Council on 
         Disability
       The House bill makes no changes to current law regarding 
     the National Council on Disability, other than extending the 
     authorization for the Council.
       The Senate amendment expands the membership of the Council, 
     modifies the duties of the Council, and makes other changes 
     related to the administration of the Council.
       The Conference agreement follows the Senate amendment, but 
     strikes the expansion of duties at the international level.

                          Rights and Advocacy

     Electronic and information technology regulations
       The House bill requires that the Director of the Office of 
     Management and Budget establish procedures for each federal 
     agency to provide written certification by September 30 of 
     each year that is in compliance with the accessibility 
     guidelines, and to oversee agencies in complying with the 
     requirements. The House bill, however, makes no changes to 
     the guidelines for electronic and information technology 
     accessibility.
       The Senate amendment makes significant changes to current 
     law in the areas of accessibility and electronic and 
     information technology standards. These changes include 
     requiring Federal agencies to procure, maintain, and use 
     electronic and information technology that provides 
     individuals with disabilities with comparable access to what 
     is available to individuals without disabilities. The Senate 
     amendment also requires that the Architectural and 
     Transportation Barriers Compliance Board with issuing 
     electronic and information technology standards, establishes 
     reporting requirements for Federal agencies, establishes, 
     complaint procedures, and clarifies individual rights of 
     action relative to section 505 of the Act.
       The Conference agreement follows the Senate amendment with 
     several changes. The Conference agreement clarifies 
     provisions in order to be consistent with the Clinger-Cohen 
     Act of 1996, clarifies procedures relating to the extent of 
     the Federal government's responsibilities in providing public 
     access to information, and modifies the procedures for filing 
     complaints.

       Employment Opportunities for Individuals With Disabilities

     Expanding employment opportunities
       The House bill makes no changes to current law.
       The Senate amendment emphasizes expanded employment 
     opportunities for individuals with disabilities by authoring 
     funding for two new types of projects: projects in 
     telecommuting and projects in self-employment.
       The Conference agreement deletes the authority related to 
     the new projects in the Senate amendment, reflecting the 
     Conferees' intention to streamline and consolidate programs 
     in the Rehabilitation Act. However, the Conferees agree and 
     fully intend that telecommuting and self-employment be viable 
     employment outcomes for recipients of vocational 
     rehabilitation services who want such opportunities. These 
     amendments are supported by amendments to Title I of the Act.

     Independent Living Services and Centers for Independent Living

     State Independent Living Councils
       The House bill makes no changes to current law.
       The Senate amendment adds at least one representatives of 
     the directors of projects serving American Indians with 
     disabilities to the State Independent Living Councils and 
     clarifies the means by which the minimum allotments are 
     adjusted for inflation, and other technical changes.
       The Conference agreement adopts the Senate amendments.

                      TITLE V--GENERAL PROVISIONS

     Unified plan
       The House bill contains no provision.
       The Senate amendment allows States to submit a unified plan 
     to the Secretary to fulfill the State plan requirements of 
     training activities for adults, dislocated workers and youth; 
     adult education; and secondary and postsecondary vocational 
     education.
       The Conference agreement generally follows the Senate 
     amendment with the exception that the State legislature must 
     approve the inclusion of secondary vocational education in 
     the unified plan.
     Incentive grants
       The House bill authorizes the Secretary of Labor to award 
     incentive grants to States that: (1) exceed levels of 
     performance; (2) demonstrate continuing progress towards 
     exceeding benchmarks; and (3) demonstrate significant 
     progress in the coordination and integration of programs.
       The Senate amendment authorizes the Secretary of Labor to 
     award incentive grants to States that exceed the expected 
     levels of performance for performance measures established 
     under the workforce development and adult education titles 
     and vocational education. Special consideration is to be 
     given to States achieving the highest level of performance 
     related to employment retention and earnings. Funds are to be 
     used for innovative projects.
       The Conference agreement generally follows the Senate 
     amendment except that States must apply for such incentive 
     grants, and are only eligible to receive incentive grants if 
     they consult with their State legislature in development of 
     their application. The application must have the approval of 
     the Governor, the State agency responsible for adult 
     education, and the State agency responsible for vocational 
     education. Grant funds would be required to be spent to carry 
     out innovative training, adult education, or vocational 
     education programs consistent with the requirements of this 
     Act and the Carl D. Perkins Vocational Education Act 
     accordingly. Applications would be developed with the 
     assistance of the State board.
     Authorization of appropriations/Effective date/Transition
       The House bill authorizes such sums for five years (FY 
     1999-FY 2003). The House bill takes effect July 1, 1998. The 
     Secretaries are authorized to take such steps as they 
     determine appropriate to provide for an orderly transition 
     from authorities amended or repealed by the Act.
       The Senate amendment authorizes such sums for six years (FY 
     1999-FY 2004). In general, the Senate amendment takes effect 
     July 1, 1999 (except for the 21st Century Workforce 
     Commission authority which takes effect upon enactment). The 
     Secretary of Labor is authorized to take steps to provide for 
     the orderly transition to the authority of the bill. 
     Additionally, the Governor may use funds made available under 
     any provision of law repealed by the bill to implement the 
     bill prior to its effective date.
       The Conference agreement takes effect upon the date of 
     enactment, unless otherwise set forth in the Act and 
     authorizes such sums for five years (FY 1999-FY 2003). The 
     Conference agreement generally follows the House bill and 
     Senate amendment with respect to transition.

     Bill Goodling.
     Howard ``Buck'' McKeon.
     Frank Riggs.
     Lindsey Graham.
     Bob Schaffer.
     W.L. Clay.
     M.G. Martinez.
     Dale Kildee.
                                Managers on the Part of the House.

     Jim Jeffords.
     Dan Coats.
     Judd Gregg.
     Bill Frist.
     Mike DeWine.
     Michael B. Enzi.
     Tim Hutchinson.
     Susan Collins.
     John Warner.
     Mitch McConnell.
     Edward M. Kennedy.
     Chris Dodd.
     Paul Wellstone.
     Jack Reed.
                               Managers on the Part of the Senate.


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