[Congressional Record (Bound Edition), Volume 150 (2004), Part 11]
[Senate]
[Pages 14882-14903]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 3555. Mrs. BOXER (for herself, Mr. Kennedy, Mr. Byrd, Ms. 
Mikulski, Mrs. Clinton, Mr. Lieberman, Mr. Levin, Mr. Feingold, Mr. 
Corzine, Mr. Schumer, Mr. Leahy, and Mr. Wyden) submitted an amendment 
intended to be proposed by her to the bill S. 2062, to amend the 
procedures that apply to consideration of interstate class actions to 
assure fairer outcomes for class members and defendants, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

     SEC. __. FAIR MINIMUM WAGE.

       (a) Short Title.--This section may be cited as the ``Fair 
     Minimum Wage Act of 2004''.
       (b) Increase in the Minimum Wage.--
       (1) In general.--Section 6(a)(1) of the Fair Labor 
     Standards Act of 1938 (29 U.S.C. 206(a)(1)) is amended to 
     read as follows:

[[Page 14883]]

       ``(1) except as otherwise provided in this section, not 
     less than--
       ``(A) $5.85 an hour, beginning on the 60th day after the 
     date of enactment of the Fair Minimum Wage Act of 2004;
       ``(B) $6.45 an hour, beginning 12 months after that 60th 
     day; and
       ``(C) $7.00 an hour, beginning 24 months after that 60th 
     day;''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall take effect 60 days after the date of enactment of this 
     Act.
       (c) Applicability of Minimum Wage to the Commonwealth of 
     the Northern Mariana Islands.--
       (1) In general.--Section 6 of the Fair Labor Standards Act 
     of 1938 (29 U.S.C. 206) shall apply to the Commonwealth of 
     the Northern Mariana Islands.
       (2) Transition.--Notwithstanding paragraph (1), the minimum 
     wage applicable to the Commonwealth of the Northern Mariana 
     Islands under section 6(a)(1) of the Fair Labor Standards Act 
     of 1938 (29 U.S.C. 206(a)(1)) shall be--
       (A) $3.55 an hour, beginning on the 60th day after the date 
     of enactment of this Act; and
       (B) increased by $0.50 an hour (or such lesser amount as 
     may be necessary to equal the minimum wage under section 
     6(a)(1) of such Act), beginning 6 months after the date of 
     enactment of this Act and every 6 months thereafter until the 
     minimum wage applicable to the Commonwealth of the Northern 
     Mariana Islands under this subsection is equal to the minimum 
     wage set forth in such section.
                                 ______
                                 
  SA 3556. Mr. DURBIN submitted an amendment intended to be proposed by 
him to the bill S. 2062, to amend the procedures that apply to 
consideration of interstate class actions to assure fairer outcomes for 
class members and defendants, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 21, lines 1 and 2, after ``defendant'' insert ``or 
     by the court sua sponte''.
       On page 21, line 9, strike ``solely''.
                                 ______
                                 
  SA 3557. Mr. DURBIN submitted an amendment intended to be proposed by 
him to the bill S. 2062, to amend the procedures that apply to 
consideration of interstate class actions to assure fairer outcomes for 
class members and defendants, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 18, line 7, strike ``or''.
       On page 18, line 8, insert ``over a class action in which'' 
     after ``(B)''.
       On page 18, line 11, strike the period and insert ``; or''.
       On page 18, between lines 11 and 12, insert the following:
       ``(C) except for a class action in which any member of a 
     proposed plaintiff class is a citizen of a State different 
     from any defendant, over a class action in which--
       ``(i) the alleged harm that resulted in injuries to the 
     person or risk to the person's life occurred in the State in 
     which the action is filed;
       ``(ii) the products, goods, or services responsible for 
     causing the injuries to the person or risk to the person's 
     life were sold, marketed, distributed, purchased, or obtained 
     in the State in which the action is filed;
       ``(iii) the time the alleged harm occurred, all the 
     plaintiff class members were citizens of the State in which 
     the action is filed;
       ``(iv) the time the alleged harm occurred, the defendant 
     was registered to do business in the State in which the 
     action is filed; and
       ``(v) the claims asserted allege violations of State law.
                                 ______
                                 
  SA 3558. Mr. DURBIN submitted an amendment intended to be proposed by 
him to the bill S. 2062, to amend the procedures that apply to 
consideration of interstate class actions to assure fairer outcomes for 
class members and defendants, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 26, strike line 21 and insert the following:

     SEC. 9. EXCLUDED ACTIONS.

       (a) In General.--This Act, and the amendments made by this 
     Act, shall not apply to any civil action relating to a 
     tobacco product.
       (b) Defined Term.--As used in this section, the term 
     ``tobacco product'' means--
       (1) a cigarette, as defined in section 3 of the Federal 
     Cigarette Labeling and Advertising Act (15 U.S.C. 1332);
       (2) a little cigar, as defined in section 3 of the Federal 
     Cigarette Labeling and Advertising Act (15 U.S.C. 1332);
       (3) a cigar, as defined in section 5702(a) of the Internal 
     Revenue Code of 1986;
       (4) pipe tobacco;
       (5) loose rolling tobacco and papers used to contain that 
     tobacco;
       (6) a product referred to as smokeless tobacco, as defined 
     in section 9 of the Comprehensive Smokeless Tobacco Health 
     Education Act of 1986 (15 U.S.C.4408); and
       (7) any other form of tobacco intended for human 
     consumption.

     SEC. 10. EFFECTIVE DATE.

                                 ______
                                 
  SA 3559. Mr. ENSIGN (for himself, Mr. Sununu, and Mr. Allen) 
submitted an amendment intended to be proposed by him to the bill S. 
2062, to amend the procedures that apply to consideration of interstate 
class actions to assure fairer outcomes for class members and 
defendants, and for other purposes; which was ordered to lie on the 
table; as follows:

       On page 26, line 23, strike ``commenced'' and insert ``in 
     which the entry of a class certification order (as defined in 
     section 1332(d)(1)(C) of title 28, United States Code) 
     occurs''.
                                 ______
                                 
  SA 3560. Mr. KENNEDY (for himself, Mr. Corzine, Ms. Mikulski, Ms. 
Cantwell, Mrs. Murray, and Mr. Akaka) submitted an amendment intended 
to be proposed by him to the bill S. 2062, to amend the procedures that 
apply to consideration of interstate class actions to assure fairer 
outcomes for class members and defendants, and for other purposes; 
which was ordered to lie on the table; as follows:

       On page 15, strike lines 3 through 7, and insert the 
     following:
       ``(B) the term `class action'--
       ``(i) means any civil action filed under rule 23 of the 
     Federal Rules of Civil Procedure or similar State statute or 
     rule of judicial procedure authorizing an action to be 
     brought by 1 or more representative persons as a class 
     action; and
       ``(ii) does not include--
       ``(I) any class action brought under a State civil rights 
     law prohibiting discrimination on the basis of race, color, 
     religion, sex, national origin, age, disability, or other 
     classification specified in that law; or
       ``(II) any class action or collective action brought to 
     obtain relief under State law for failure to pay the minimum 
     wage, overtime pay, or wages for all time worked, failure to 
     provide rest or meal breaks, or unlawful use of child labor;
                                 ______
                                 
  SA 3561. Mr. ENZI submitted an amendment intended to be proposed by 
him to the bill S. 2062, to amend the procedures that apply to 
consideration of interstate class actions to assure fairer outcomes for 
class members and defendants, and for other purposes; which was ordered 
to lie on the table; as follows:

       At the appropriate place, insert the following:

        DIVISION __--WORKFORCE REINVESTMENT AND ADULT EDUCATION

     SEC. 1. SHORT TITLE.

       This division may be cited as the ``Workforce Reinvestment 
     and Adult Education Act of 2003''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents for this division is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. References.

 TITLE I--AMENDMENTS TO TITLE I OF THE WORKFORCE INVESTMENT ACT OF 1998

Sec. 101. Definitions.
Sec. 102. Purpose.
Sec. 103. State workforce investment boards.
Sec. 104. State plan.
Sec. 105. Local workforce investment areas.
Sec. 106. Local workforce investment boards.
Sec. 107. Local plan.
Sec. 108. Establishment of one-stop delivery systems.
Sec. 109. Eligible providers of training services.
Sec. 110. Eligible providers of youth activities.
Sec. 111. Youth activities.
Sec. 112. Comprehensive program for adults.
Sec. 113. Performance accountability system.
Sec. 114. Authorization of appropriations.
Sec. 115. Job Corps.
Sec. 116. Native American programs.
Sec. 117. Youth challenge grants.
Sec. 118. Technical assistance.
Sec. 119. Demonstration, pilot, multiservice, research and multistate 
              projects.
Sec. 120. Evaluations.
Sec. 121. Authorization of appropriations for national activities.
Sec. 122. Requirements and restrictions.
Sec. 123. Nondiscrimination.
Sec. 124. Administrative provisions.
Sec. 125. General program requirements.

                       TITLE II--ADULT EDUCATION

        Part A--Adult Basic Skills and Family Literacy Education

Sec. 201. Table of contents.
Sec. 202. Amendment.

                Part B--National Institute for Literacy

Sec. 211. Short title; purpose.

[[Page 14884]]

Sec. 212. Establishment.
Sec. 213. Administration.
Sec. 214. Duties.
Sec. 215. Leadership in scientifically based reading instruction.
Sec. 216. National Institute for Literacy Advisory Board.
Sec. 217. Gifts, bequests, and devises.
Sec. 218. Mails.
Sec. 219. Applicability of certain civil service laws.
Sec. 220. Experts and consultants.
Sec. 221. Report.
Sec. 222. Definitions.
Sec. 223. Authorization of appropriations.
Sec. 224. Reservation.
Sec. 225. Authority to publish.

                       Part C--General Provisions

Sec. 241. Transition.

             TITLE III--AMENDMENTS TO THE WAGNER-PEYSER ACT

Sec. 301. Amendments to the Wagner-Peyser Act.

         TITLE IV--AMENDMENTS TO THE REHABILITATION ACT OF 1973

Sec. 401. Chairperson.
Sec. 402. Rehabilitation Services Administration.
Sec. 403. Director.
Sec. 404. State goals.
Sec. 405. Authorizations of appropriations.
Sec. 406. Helen Keller National Center Act.

                 TITLE V--TRANSITION AND EFFECTIVE DATE

Sec. 501. Transition provisions.
Sec. 502. Effective date.

     SEC. 3. REFERENCES.

       Except as otherwise expressly provided, wherever in this 
     division an amendment or repeal is expressed in terms of an 
     amendment to, or repeal of, a section or other provision, the 
     amendment or repeal shall be considered to be made to a 
     section or other provision of the Workforce Investment Act of 
     1998 (20 U.S.C. 9201 et seq.).

 TITLE I--AMENDMENTS TO TITLE I OF THE WORKFORCE INVESTMENT ACT OF 1998

     SEC. 101. DEFINITIONS.

       Section 101 (29 U.S.C. 2801) is amended--
       (1) in paragraph (8)(C), by striking ``not less than 50 
     percent of the cost of the training'' and inserting ``a 
     significant portion of the cost of training, as determined by 
     the local board'';
       (2) by striking paragraph (13) and redesignating paragraphs 
     (1) through (12) as paragraphs (2) through (13) respectively;
       (3) by inserting the following new paragraph after ``In 
     this title:'':
       ``(1) Accrued expenditures.--The term `accrued 
     expenditures' includes the sum of actual cash disbursements 
     for direct charges for goods and services, the net increase 
     or decrease in the amounts owed by recipients, goods and 
     other property received for services performed by employees, 
     contractors, subgrantees, or other payees, and other amounts 
     becoming owned for which no current service or performance is 
     required.'';
       (4) by striking paragraph (24) and redesignating paragraphs 
     (25) through (32) as paragraphs (24) through (31), 
     respectively;
       (5) in paragraph (24) (as so redesignated)--
       (A) in subparagraph (B), by striking ``higher of--'' and 
     all that follows through such subparagraph and inserting 
     ``poverty line for an equivalent period;''; and
       (B) by redesignating subparagraphs (D) through (F) as 
     subparagraph (E) through (G), respectively, and inserting 
     after subparagraph (C) the following:
       ``(D) receives or is eligible to receive free or reduced 
     price lunch;''; and
       (6) by striking paragraph (33) and redesignating paragraphs 
     (34) through (53) as paragraphs (32) through (51), 
     respectively.

     SEC. 102. PURPOSE.

       Section 106 (29 U.S.C. 2811) is amended by inserting at the 
     end the following: ``It is also the purpose of this subtitle 
     to provide workforce investment activities in a manner that 
     promotes the informed choice of participants and actively 
     involves participants in decisions affecting their 
     participation in such activities.''.

     SEC. 103. STATE WORKFORCE INVESTMENT BOARDS.

       (a) Membership.--
       (1) In general.--Section 111(b) (29 U.S.C. 2821(b)) is 
     amended--
       (A) by amending paragraph (1)(C) to read as follows:
       ``(C) representatives appointed by the Governor, who are--
       ``(i)(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;
       ``(II) in any case in which no lead State agency official 
     has responsibility for such a program or activity, a 
     representative in the State with expertise relating to such 
     program or activity; and
       ``(III) if not included under subclause (I), the director 
     of the State unit, defined in section 7(8)(B) of the 
     Rehabilitation Act of 1973 (29 U.S.C. 705(8)(B)) except that 
     in a State that has established 2 or more designated State 
     units to administer the vocational rehabilitation program, 
     the board representative shall be the director of the 
     designated State unit that serves the most individuals with 
     disabilities in the State;
       ``(ii) the State agency officials responsible for economic 
     development;
       ``(iii) representatives of business in the State who--

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

       ``(iv) chief elected officials (representing both cities 
     and counties, where appropriate);
       ``(v) representatives of labor organizations, who have been 
     nominated by State labor federations; and
       ``(vi) such other representatives and State agency 
     officials as the Governor may designate.''; and
       (B) in paragraph (3), by striking ``paragraph (1)(C)(i)'' 
     and inserting ``paragraph (1)(C)(iii)''.
       (2) Conforming amendment.--Section 111(c) (29 U.S.C 
     2811(c)) is amended by striking ``subsection (b)(1)(C)(i)'' 
     and inserting ``subsection (b)(1)(C)(iii)''.
       (b) Functions.--Section 111(d) (29 U.S.C. 2811(d)) is 
     amended--
       (1) by amending paragraph (3) to read as follows:
       ``(3) development and review of statewide policies 
     affecting the integrated provision of services through the 
     one-stop delivery system described in section 121, 
     including--
       ``(A) the development of criteria for, and the issuance of, 
     certifications of one-stop centers;
       ``(B) the criteria for the allocation of one-stop center 
     infrastructure funding under section 121(h), and oversight of 
     the use of such funds;
       ``(C) approaches to facilitating equitable and efficient 
     cost allocation in one-stop delivery systems; and
       ``(D) such other matters that may promote statewide 
     objectives for, and enhance the performance of, one-stop 
     delivery systems within the State;'';
       (2) in paragraph (4), by inserting ``and the development of 
     State criteria relating to the appointment and certification 
     of local boards under section 117'' after ``section 116'';
       (3) in paragraph (5), by striking ``sections 128(b)(3)(B) 
     and 133(b)(3)(B)'' and inserting ``sections 128(b)(3) and 
     133(b)(3)''; and
       (4) in paragraph (9), by striking ``section 503'' and 
     inserting ``section 136(i)''.
       (c) Elimination of Alternative Entity and Provision of 
     Authority to Hire Staff.--Section 111(e) (29 U.S.C. 2821(e)) 
     is amended to read as follows:
       ``(e) Authority to Hire Staff.--The State board may hire 
     staff to assist in carrying out the functions described in 
     subsection (d).''.

     SEC. 104. STATE PLAN.

       (a) Planning Cycle.--Section 112(a) (29 U.S.C. 2822(a)) is 
     amended by striking ``5-year strategy'' and inserting ``2-
     year strategy''.
       (b) Contents.--Section 112(b)(17)(A) (29 U.S.C. 
     2822(b)(17)(A)) is amended--
       (1) in clause (iii) by striking ``and'';
       (2) by amending clause (iv) to read as follows:
       ``(iv) how the State will serve the employment and training 
     needs of dislocated workers (including displaced homemakers 
     and formerly self-employed and transitioning farmers, 
     ranchers, and fisherman) low income individuals (including 
     recipients of public assistance), homeless individuals, ex-
     offenders, individuals training for nontraditional 
     employment, and other individuals with multiple barriers to 
     employment (including older individuals);''; and
       (3) by adding the following new clause after clause (iv):
       ``(v) how the State will serve the employment and training 
     needs of individuals with disabilities, consistent with 
     section 188 and Executive Order 13217 (relating to community-
     based alternatives for individuals with disabilities) 
     including the provision of outreach, intake, assessments, and 
     service delivery, the development of performance measures, 
     and the training of staff; and''.
       (c) Modification to Plan.--Section 112(d) (29 U.S.C. 
     2822(d)) is amended by striking ``5-year period'' and 
     inserting ``2-year period''.

     SEC. 105. LOCAL WORKFORCE INVESTMENT AREAS.

       (a) Designation of Areas.--
       (1) Considerations.--Section 116(a)(1)(B) (29 U.S.C. 
     2831(a)(1)(B)) is amended by adding at the end the following 
     clause:
       ``(vi) The extent to which such local areas will promote 
     efficiency in the administration and provision of 
     services.''.
       (2) Automatic designation.--Section 116(a)(2) (29 U.S.C. 
     2831(a)(2)) is amended to read as follows:
       ``(2) Automatic designation.--
       ``(A) In general.--Except as provided in subparagraph (B) 
     of this paragraph and subsection (b), the Governor shall 
     approve a request for designation as a local area from--
       ``(i) any unit of general local government with a 
     population of 500,000 or more; and
       ``(ii) an area served by a rural concentrated employment 
     program grant recipient that served as a service delivery 
     area or substate

[[Page 14885]]

     area under the Job training Partnership Act (29 U.S.C. 1501 
     et seq.),

     for the 2-year period covered by a State plan under section 
     112 if such request is made not later than the date of the 
     submission of the State plan.
       ``(B) Continued designation based on performance.--The 
     Governor may deny a request for designation submitted 
     pursuant to subparagraph (A) if such unit of government was 
     designated as a local area for the preceding 2-year period 
     covered by a State plan and the Governor determines that such 
     local area did not perform successfully during such 
     period.''.
       (b) Regional Planning.--Section 116(c)(1) (29 U.S.C. 
     2831(c)(1)) is amended by adding at the end the following: 
     ``The State may require the local boards for the designated 
     region to prepare a single regional plan that incorporates 
     the elements of the local plan under section 118 and that is 
     submitted and approved in lieu of separate local plans under 
     such section.''.

     SEC. 106. LOCAL WORKFORCE INVESTMENT BOARDS.

       (a) Composition.--Section 117(b)(2)(A) (29 U.S.C. 
     2832(b)(2)(A)) is amended--
       (1) in clause (i)(II), by inserting ``, businesses that are 
     in the leading industries in the local area, and large and 
     small businesses in the local area'' after ``local area'';
       (2) by amending clause (ii) to read as follows:
       ``(ii) superintendents of the local secondary school 
     systems, administrators of entities providing adult education 
     and literacy activities, and the presidents or chief 
     executive officers of postsecondary educational institutions 
     (including community colleges, where such entities exist);'';
       (3) in clause (iv), by striking the semicolon and inserting 
     ``and faith-based organizations; and''; and
       (4) by striking clause (vi).
       (b) Authority of Board Members.--Section 117(b)(3) (29 
     U.S.C. 2832(b) is amended--
       (1) in the heading, by inserting ``and representation'' 
     after ``members''; and
       (2) by adding at the end the following: ``The members of 
     the board shall represent diverse geographic sections within 
     the local area.''.
       (c) Functions.--Section 117(d) (29 U.S.C. 2832(d)) is 
     amended--
       (1) in paragraph (2)(B), by striking ``local area'' and all 
     that follows and inserting ``local area.''; and
       (2) in paragraph (4) by inserting ``and ensure the 
     appropriate use and management of the funds provided under 
     this title for such programs, activities, and system'' after 
     ``area''.
       (d) Authority to Establish Councils and Elimination of 
     Requirement for Youth Councils.--Section 117(h) (29 U.S.C. 
     2832(h)) is amended to read as follows:
       ``(h) Establishment of Councils.--The local board may 
     establish councils to provide information and advice to 
     assist the local board in carrying out activities under this 
     title. Such councils may include a council composed of one-
     stop partners to advise the local board on the operation of 
     the one-stop delivery system, a youth council composed of 
     experts and stakeholders in youth programs to advise the 
     local board on activities for youth, and such other councils 
     as the local board determines are appropriate.''.
       (e) Repeal of Alternative Entity Provision.--Section 117 
     (29 U.S.C. 2832) is further amended by striking subsection 
     (i).

     SEC. 107. LOCAL PLAN.

       (a) Planning Cycle.--Section 118(a) (29 U.S.C. 2833(a)) is 
     amended by striking ``5-year'' and inserting ``2-year''.
       (b) Contents.--Section 118(b) (29 U.S.C. 2833(b)) is 
     amended--
       (1) by amending paragraph (2) to read as follows:
       ``(2) a description of the one-stop delivery system to be 
     established or designated in the local area, including 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 meets the employment 
     needs of local employers and participants.''; and
       (2) in paragraph (4), by striking ``and dislocated 
     worker''.

     SEC. 108. ESTABLISHMENT OF ONE-STOP DELIVERY SYSTEMS.

       (a) One-Stop Partners.--
       (1) Required partners.--Section 121(b)(1) (29 U.S.C. 
     2841(b)(1)) is amended--
       (A) in subparagraph (B)--
       (i) by striking clauses (ii) and (v)
       (ii) by redesignating clauses (iii) and (iv) as clauses 
     (ii) and (iii), respectively, and by redesignating clauses 
     (vi) through (xii) as clauses (iv) through (x), respectively;
       (iii) in clause (ix) (as so redesignated), by striking 
     ``and'';
       (iv) in clause (x) (as so redesignated), by striking the 
     period and inserting ``; and''; and
       (v) by inserting after clause (x)(as so redesignated) the 
     following:
       ``(xi) programs authorized under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et. seq.), subject to 
     subparagraph (C).''; and
       (B) by adding after subparagraph (B) the following:
       ``(C) Determination by the governor.--The program referred 
     to in clauses (xi) of subparagraph (B) shall be included as a 
     required partner for purposes of this title in a State unless 
     the Governor of the State notifies the Secretary and the 
     Secretary of Health and Human Services in writing of a 
     determination by the Governor not to include such programs as 
     required partners for purposes of this title in the State.''.
       (2) Additional partners.--Section 121(b)(2)(B) (29 U.S.C. 
     2841(b)(2)(B)) is amended--
       (A) by striking clause (i) and redesignating clauses (ii) 
     through (v) as clauses (i) through (iv) respectively;
       (B) in clause (iii) (as so redesignated) by striking 
     ``and'' at the end;
       (C) in clause (iv) (as so redesignated) by striking the 
     period and inserting a semicolon; and
       (D) by adding at the end the following new clauses:
       ``(v) employment and training programs administered by the 
     Social Security Administration, including the Ticket to Work 
     program (established by Public Law 106-170);
       ``(vi) programs under part D of title IV of the Social 
     Security Act (42 U.S.C. 451 et seq.) (relating to child 
     support enforcement); and
       ``(vii) programs carried out in the local area for 
     individuals with disabilities, including programs carried out 
     by State agencies relating to mental health, mental 
     retardation, and developmental disabilities, State Medicaid 
     agencies, State Independent Living Councils, and Independent 
     Living Centers.''.
       (b) Provision of Services.--Subtitle B of title I is 
     amended--
       (1) by striking subsection (e) of section 121;
       (2) by moving subsection (c) of section 134 from section 
     134, redesignating such subsection as subsection (e), and 
     inserting such subsection (as so redesignated) after 
     subsection (d) of section 121; and
       (3) by amending subsection (e) (as moved and redesignated 
     by paragraph (2))--
       (A) in paragraph (1)(A), by striking ``subsection (d)(2)'' 
     and inserting ``section 134(c)(2)'';
       (B) in paragraph (1)(B)--
       (i) by striking ``subsection (d)'' and inserting ``section 
     134(c)''; and
       (ii) by striking ``subsection (d)(4)(G)'' and inserting 
     ``section 134(c)(4)(G)'';
       (C) in paragraph (1)(C), by striking ``subsection (e)'' and 
     inserting ``section 134(d)'';
       (D) in paragraph (1)(D)--
       (i) by striking ``section 121(b)'' and inserting 
     ``subsection (b)''; and
       (ii) by striking ``and'' at the end; and
       (E) by amending paragraph (1)(E) to read as follows:
       ``(E) shall provide access to the information described in 
     section 15(e) of the Wagner-Peyser Act (29 U.S.C. 49l-
     2(e)).''.
       (c) Certification and Funding of One-Stop Centers.--Section 
     121 (as amended by subsection (b)) is further amended by 
     adding at the end the following new subsections:
       ``(g) Certification of One-Stop Centers.--
       ``(1) In general.--The State board shall establish 
     procedures and criteria for periodically certifying one-stop 
     center for the purpose of awarding the one-stop 
     infrastructure funding described in subsection (h).
       ``(2) Criteria.--The criteria for certification under this 
     subsection shall include minimum standards relating to the 
     scope and degree of service integration achieved by the 
     centers involving the programs provided by the one-stop 
     partners, and how the centers ensure that such providers meet 
     the employment needs of local employers and participants.
       ``(3) Effect of certification.--One-stop centers certified 
     under this subsection shall be eligible to receive the 
     infrastructure grants authorized under subsection (h).
       ``(h) One-Stop Infrastructure Funding.--
       ``(1) Partner contributions.--
       ``(A) Provision of funds.--Notwithstanding any other 
     provision of law, as determined under subparagraph (B), a 
     portion of the Federal funds provided to the State and areas 
     within the State under the Federal laws authorizing the one-
     stop partner programs described in subsection (b)(1)(B) and 
     participating additional partner programs described in 
     (b)(2)(B) for a fiscal year shall be provided to the Governor 
     by such programs to carry out this subsection.
       ``(B) Determination of governor.--Subject to subparagraph 
     (C), the Governor, in consultation with the State board, 
     shall determine the portion of funds to be provided under 
     subparagraph (A) by each one-stop partner and in making such 
     determination shall consider the proportionate use of the 
     one-stop centers by each partner, the costs of administration 
     for purposes not related to one-stop centers for each 
     partner, and other relevant factors described in paragraph 
     (3).
       ``(C) Limitations.--
       ``(i) Provision from administrative funds.--The funds 
     provided under this paragraph by each one-stop partner shall 
     be provided only from funds available for the costs of 
     administration under the program administered by such 
     partner, and shall be subject to the limitations with respect 
     to the portion of funds under such programs that may be used 
     for administration.
       ``(ii) Federal direct spending programs.--Programs that are 
     Federal direct

[[Page 14886]]

     spending under section 250(c)(8) of the Balanced Budget and 
     Emergency Deficit Control Act of 1985 (2 U.S.C. 900(c)(8)) 
     shall not, for purposes of this paragraph, be required to 
     provide an amount in excess of the amount determined to be 
     equivalent to the proportionate use of the one-stop centers 
     by such programs in the State.
       ``(2) Allocation by governor.--From the funds provided 
     under paragraph (1), the Governor shall allocate funds to 
     local areas in accordance with the formula established under 
     paragraph (3) for the purposes of assisting in paying the 
     costs of the infrastructure of One-Stop centers certified 
     under subsection (g).
       ``(3) Allocation formula.--The State board shall develop a 
     formula to be used by the Governor to allocate the funds 
     described in paragraph (1). The formula shall include such 
     factors as the State board determines are appropriate, which 
     may include factors such as the number of centers in the 
     local area that have been certified, the population served by 
     such centers, and the performance of such centers.
       ``(4) Costs of infrastructure.--For purposes of this 
     subsection, the term `costs of infrastructure' means the 
     nonpersonnel costs that are necessary for the general 
     operation of a one-stop center, including the rental costs of 
     the facilities, the costs of utilities and maintenance, 
     equipment (including adaptive technology for individuals with 
     disabilities), strategic planning activities for the center, 
     and common outreach activities.
       ``(i) Other Funds.--
       ``(1) In general.--In addition to the funds provided to 
     carry out subsection (h), a portion of funds made available 
     under Federal law authorizing the one-stop partner programs 
     described in subsection (b)(1)(B) and participating partner 
     programs described in subsection (b)(2)(B), or the noncash 
     resources available under such programs shall be used to pay 
     the costs relating to the operation of the one-stop delivery 
     system that are not paid for from the funds provided under 
     subsection (h), to the extent not inconsistent with the 
     Federal law involved including--
       ``(A) infrastructure costs that are in excess of the funds 
     provided under subsection (h);
       ``(B) common costs that are in addition to the costs of 
     infrastructure; and
       ``(C) the costs of the provision of core services 
     applicable to each program.
       ``(2) Determination and guidance.--The method for 
     determining the appropriate portion of funds to be provided 
     by each program under paragraph (1) shall be determined as 
     part of the memorandum of understanding under subsection (c). 
     The State board shall provide guidance to facilitate the 
     determination of appropriate funding allocation in local 
     areas.''.

     SEC. 109. ELIGIBLE PROVIDERS OF TRAINING SERVICES.

       Section 122 (29 U.S.C. 2842) is amended to read as follows:

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

       ``(a) In General.--The Governor shall establish criteria 
     and procedures regarding the eligibility of providers of 
     training services described in section 134(c)(4) to receive 
     funds provided under section 133(b) for the provision of such 
     training services.
       ``(b) Criteria.--
       ``(1) In general.--The criteria established pursuant to 
     subsection (a) shall take into account the performance of 
     providers of training services with respect to the indicators 
     described in section 136 or other appropriate indicators 
     (taking into consideration the characteristics of the 
     population served and relevant economic conditions), and such 
     other factors as the Governor determines are appropriate to 
     ensure the quality of services, the accountability of 
     providers, how the centers ensure that such providers meet 
     the needs of local employers and participants, and the 
     informed choice of participants under chapter 5. Such 
     criteria shall require that the provider submit appropriate, 
     accurate and timely information to the State for purposes of 
     carrying out subsection (d). The criteria shall also provide 
     for periodic review and renewal of eligibility under this 
     section for providers of training services. The Governor may 
     authorize local areas in the State to establish additional 
     criteria or to modify the criteria established by the 
     Governor under this section for purposes of determining the 
     eligibility of providers of training services to provide such 
     services in the local area.
       ``(2) Limitation.--In carrying out the requirements of this 
     subsection, no personally identifiable information regarding 
     a student, including Social Security number, student 
     identification number, or other identifier, may be disclosed 
     without the prior written consent of the parent or eligible 
     student in compliance with section 444 of the General 
     Education Provisions Act (20 U.S.C. 1232g).
       ``(c) Procedures.--The procedures established under 
     subsection (a) shall identify the application process for a 
     provider of training services to become eligible to receive 
     funds under section 133(b), and identify the respective roles 
     of the State and local areas in receiving and reviewing 
     applications and in making determinations of eligibility 
     based on the criteria established under this section. The 
     procedures shall also establish a process for a provider of 
     training services to appeal a denial or termination of 
     eligibility under this section that includes an opportunity 
     for a hearing and prescribes appropriate time limits to 
     ensure prompt resolution of the appeal.
       ``(d) Information to Assist Participants in Choosing 
     Providers.--In order to facilitate and assist participants 
     under chapter 5 in choosing providers of training services, 
     the Governor shall ensure that an appropriate list or lists 
     of providers determined eligible under this section in the 
     State, accompanied by such information as the Governor 
     determines is appropriate, is provided to the local boards in 
     the State to be made available to such participants and to 
     members of the public through the one-stop delivery system in 
     the State.
       ``(e) Agreements With Other States.--States may enter into 
     agreements, on a reciprocal basis, to permit eligible 
     providers of training services to accept individual training 
     accounts provided in another State.
       ``(f) Recommendations.--In developing the criteria, 
     procedures, and information required under this section, the 
     Governor shall solicit and take into consideration the 
     recommendations of local boards and providers of training 
     services within the State.
       ``(g) Opportunity to Submit Comments.--During the 
     development of the criteria, procedures, and information 
     required under this section, the Governor shall provide an 
     opportunity for interested members of the public, including 
     representatives of business and labor organizations, to 
     submit comments regarding such criteria, procedures, and 
     information.''.

     SEC. 110. ELIGIBLE PROVIDERS OF YOUTH ACTIVITIES.

       Section 123 (29 U.S.C. 2843) is amended to read as follows:

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

       ``(a) In General.--From the funds allocated under section 
     128(b) to a local area, the local board for such area shall 
     award grants or contracts on a competitive basis to providers 
     of youth activities identified based on the criteria in the 
     State plan and shall conduct oversight with respect to such 
     providers.
       ``(b) Exceptions.--A local board may award grants or 
     contracts on a sole-source basis if such board determines 
     there are an insufficient number of eligible providers of 
     training services in the local area involved (such as rural 
     areas) for grants to be awarded on a competitive basis under 
     subsection (a).''.

     SEC. 111. YOUTH ACTIVITIES.

       (a) State Allotments.--
       (1) In general.--Section 127(a) (29 U.S.C. 2852(a)) is 
     amended to read as follows:
       ``(a) Allotment Among States.--
       ``(1) Youth activities.--
       ``(A) Youth challenge grants.--
       ``(i) Reservation of funds.--Of the amount appropriated 
     under section 137(a) for each fiscal year, the Secretary 
     shall reserve 25 percent to provide youth challenge grants 
     under section 169.
       ``(ii) Limitation.--Notwithstanding clause (i), if the 
     amount appropriated under section 137(a) for a fiscal year 
     exceeds $1,000,000,000, the Secretary shall reserve 
     $250,000,000 to provide youth challenge grants under section 
     169.
       ``(B) Outlying areas and native americans.--After 
     determining the amount to be reserved under subparagraph (A), 
     of the remainder of the amount appropriated under section 
     137(a) for each fiscal year the Secretary shall--
       ``(i) reserve not more than \1/4\ of one percent of such 
     amount to provide assistance to the outlying areas to carry 
     out youth activities and statewide workforce investment 
     activities; and
       ``(ii) reserve not more than 1 and \1/2\ percent of such 
     amount to provide youth activities under section 166 
     (relating to Native Americans).
       ``(C) States.--
       ``(i) In general.--Of the remainder of the amount 
     appropriated under section 137(a) for a fiscal year that is 
     available after determining the amounts to be reserved under 
     subparagraphs (A) and (B), the Secretary shall allot--

       ``(I) the amount of the remainder that is less than or 
     equal to the total amount that was allotted to States for 
     fiscal year 2003 under section 127(b)(1)(C) of this Act (as 
     in effect on the day before the date of enactment of the 
     Workforce Reinvestment and Adult Education Act of 2003) in 
     accordance with the requirements of such section 
     127(b)(1)(C); and
       ``(II) the amount of the remainder, if any, in excess of 
     the amount referred to in subclause (I) in accordance with 
     clause (ii).

       ``(ii) formulas for excess funds.--Subject to clauses (iii) 
     and (iv), of the amounts described in clause (i)(II)--

       ``(I) 33 and \1/3\ percent shall be allotted on the basis 
     of the relative number of individuals in the civilian labor 
     force who are ages 16-19 in each State, compared to the total 
     number of individuals in the civilian labor force who are 
     ages 16-19 in all States;
       ``(II) 33 and \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; and

[[Page 14887]]

       ``(III) 33 and \1/3\ percent shall be allotted on the basis 
     of the relative number of disadvantaged youth who are ages 16 
     through 21 in each State, compared to the total number of 
     disadvantaged youth who are ages 16 through 21 in all States.

       ``(iii) Minimum and maximum percentages.--The Secretary 
     shall ensure that no State shall receive an allotment for a 
     fiscal year that is less than 90 percent or greater than 130 
     percent of the allotment percentage of that State for the 
     preceding fiscal year.
       ``(iv) Small state minimum allotment.--Subject to clause 
     (iii), the Secretary shall ensure that no State shall receive 
     an allotment under this paragraph that is less than \3/10\ of 
     1 percent of the amount available under subparagraph (A).
       ``(2) Definitions.--For the purposes of paragraph (1), the 
     following definitions apply:
       ``(A) Allotment percentage.--The term `allotment 
     percentage', used with respect to fiscal year 2004 or a 
     subsequent fiscal year, means a percentage of the remainder 
     described in paragraph (1)(C)(i) that is received through an 
     allotment made under this subsection for the fiscal year. The 
     term, with respect to fiscal year 2003, means the percentage 
     of the amounts allotted to States under this chapter (as in 
     effect on the day before the date of enactment of the 
     Workforce Reinvestment and Adult Education Act of 2003) that 
     is received by the State involved for fiscal year 2003.
       ``(B) Disadvantaged youth.--The term `disadvantaged youth' 
     means an individual who is age 16 through 21 who received an 
     income, or is a member of a family that received a total 
     family income, that, in relation to family size, does not 
     exceed the poverty line.
       ``(3) Special rule.--For purposes of the formulas 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.
       (2) Reallotment.--Section 127 (29 U.S.C. 2552) is further 
     amended--
       (A) by striking subsection (b);
       (B) by redesignating subsection (c) as subsection (b);
       (C) in subsection (b) (as so redesignated)
       (i) by amending paragraph (2) to read as follows:
       ``(2) Amount.--The amount available for reallotment for a 
     program year is equal to the amount by which the unexpended 
     balance, excluding accrued expenditures, at the end of such 
     program year of the total amount of funds available to the 
     State under this section during such program year (including 
     amounts allotted to the State in prior program years that 
     remain available during the program year for which the 
     determination is made) exceeds 30 percent of such total 
     amount.'';
       (ii) in paragraph (3)--

       (I) by striking ``for the prior program year'' and 
     inserting ``for the program year in which the determination 
     is made''; and
       (II) by striking ``such prior program year'' and inserting 
     ``such program year'';

       (iii) by amending paragraph (4) to read as follows:
       ``(4) Eligibility.--For purposes of this subsection, an 
     eligible State means a State which does not have an amount 
     available for reallotment under paragraph (2) for the program 
     year for which the determination under paragraph (2) is 
     made.''.
       (b) Within State Allocations.--
       (1) Reservation for statewide activities.--Section 128(a) 
     is amended to read as follows:
       ``(a) Reservation for Statewide Activities.--
       ``(1) In general.--The Governor of a State shall reserve 
     not more than 10 percent of the amount allotted to the State 
     under section 127(a)(1)(C) for a fiscal year for statewide 
     activities.
       ``(2) Use of funds.--Regardless of whether the amounts are 
     allotted under section 127(a)(1)(C) and reserved under 
     paragraph (1) or allotted under section 132 and reserved 
     under section 133(a), the Governor may use the reserved 
     amounts to carry out statewide youth activities under section 
     129(b) or statewide employment and training activities under 
     section 133.''.
       (2) Within state allocation.--Section 128(b) is amended to 
     read as follows:
       ``(b) Within State Allocation.--
       ``(1) In general.--Of the amounts allotted to the State 
     under section 127(a)(1)(C) and not reserved under subsection 
     (a)(1)--
       ``(A) 80 percent of such amounts shall be allocated by the 
     Governor to local areas in accordance with paragraph (2); and
       ``(B) 20 percent of such amounts shall be allocated by the 
     Governor to local areas in accordance with paragraph (3).
       ``(2) Established formula.--
       ``(A) In general.--Of the amounts described in paragraph 
     (1)(A), the Governor shall allocate--
       ``(i) 33 and \1/3\ percent shall be allotted on the basis 
     of the relative number of individuals in the civilian labor 
     force who are ages 16-19 in each local area, compared to the 
     total number of individuals in the civilian labor force who 
     are ages 16-19 in all local areas in the State;
       ``(ii) 33 and \1/3\ percent shall be allotted on the basis 
     of the relative number of unemployed individuals in each 
     local area, compared to the total number of unemployed 
     individuals in all local areas in the State; and
       ``(iii) 33 and \1/3\ percent on the basis of the relative 
     number of disadvantaged youth who are ages 16 through 21 in 
     each local area, compared to the total number of 
     disadvantaged youth who are ages 16 through 21 in all local 
     areas in the State.
       ``(B) Minimum and maximum percentages.--The Governor shall 
     ensure that no local area shall receive an allocation for a 
     fiscal year under this paragraph that is less than 90 percent 
     or greater than 130 percent of the allocation percentage of 
     the local area for the preceding fiscal year.
       ``(C) Definitions.--
       ``(i) Allocation percentage.--For purposes of this 
     paragraph, the term `allocation percentage', used with 
     respect to fiscal year 2004 or a subsequent fiscal year, 
     means a percentage of amount described in paragraph(1)(A) 
     that is received through an allocation made under this 
     paragraph for the fiscal year. The term, with respect to 
     fiscal year 2003, means the percentage of the amounts 
     allocated to local areas under this chapter (as in effect on 
     the day before the date of enactment of the Workforce 
     Investment Act Amendments of 2003) that is received by the 
     local area involved for fiscal year 2003.
       ``(ii) disadvantaged youth.--The term `disadvantaged youth' 
     means an individual who is age 16 through 21 who received an 
     income, or is a member of a family that received a total 
     family income, that, in relation to family size, does not 
     exceed the poverty line.
       ``(3) Youth discretionary allocation.--The Governor shall 
     allocate to local areas the amounts described in paragraph 
     (1)(B) in accordance with such demographic and economic 
     factors as the Governor, after consultation with the State 
     board and local boards, determines are appropriate.
       ``(4) Local administrative cost limit.--
       ``(A) In general.--Of the amounts 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 boards for the administrative costs of carrying out 
     local workforce investment activities under this chapter or 
     chapter 5.
       ``(B) Use of funds.--Funds made available for 
     administrative costs under subparagraph (A) may be used for 
     the administrative costs of any of the local workforce 
     investment activities described in this chapter or chapter 5, 
     regardless of whether the funds were allocated under this 
     subsection or section 133(b).''.
       (3) Reallocation.--Section 128(c) (29 U.S.C. 2853(c)) is 
     amended--
       (A) in paragraph (1), by striking ``paragraph (2)(A) or (3) 
     of'';
       (B) by amending paragraph (2) to read as follows:
       ``(2) Amount.--The amount available for reallocation for a 
     program year is equal to the amount by which the unexpended 
     balance, excluding accrued expenditures, at the end of such 
     program year of the total amount of funds available to the 
     local area under this section during such program year 
     (including amounts allotted to the local area in prior 
     program years that remain available during the program year 
     for which the determination is made) exceeds 30 percent of 
     such total amount.'';
       (C) by amending paragraph (3)--
       (i) by striking ``subsection (b)(3)'' each place it appears 
     and inserting ``subsection (b)'';
       (ii) by striking ``the prior program year'' and inserting 
     ``the program year in which the determination is made'';
       (iii) by striking ``such prior program year'' and inserting 
     ``such program year''; and
       (iv) by striking the last sentence; and
       (D) by amending paragraph (4) to read as follows:
       ``(4) Eligibility.--For purposes of this subsection, an 
     eligible local area means a local area which does not have an 
     amount available for reallocation under paragraph (2) for the 
     program year for which the determination under paragraph (2) 
     is made.''.
       (c) Youth Participant Eligibility.--Section 129(a) (29 
     U.S.C. 2854(a)) is amended to read as follows:
       ``(a) Youth Participant Eligibility.--
       ``(1) In general.--The individuals participating in 
     activities carried out under this chapter by a local area 
     during any program year shall be individuals who, at the time 
     the eligibility determination is made, are--
       ``(A) not younger than age 16 or older than age 24; and
       ``(B) one or more of the following:
       ``(i) school dropouts;
       ``(ii) recipients of a secondary school diploma or the 
     General Equivalency Diploma (GED) (including recognized 
     alternative standards for individuals with disabilities) who 
     are deficient in basic skills;
       ``(iii) court-involved youth attending an alternative 
     school;
       ``(iv) youth in foster care or who have been in foster 
     care; or
       ``(v) in school youth who are low-income individuals and 
     one or more of the following:

       ``(I) Deficient in literacy skills.
       ``(II) Homeless, runaway, or foster children.

[[Page 14888]]

       ``(III) Pregnant or parents.
       ``(IV) Offenders.
       ``(V) Individuals who require additional assistance to 
     complete an educational program, or to secure and hold 
     employment.

       ``(2) Priority for school dropouts.--A priority in the 
     provision of services under this chapter shall be given to 
     individuals who are school dropouts.
       ``(3) Limitations on activities for in-school youth.--
       ``(A) Percentage of funds.--For any program year, not more 
     than 30 percent of the funds available for statewide 
     activities under subsection (b), and not more than 30 percent 
     of funds available to local areas under subsection (c), may 
     be used to provide activities for in-school youth meeting the 
     requirements of paragraph (1)(B)(v).
       ``(B) Non-school hours required.--Activities carried out 
     under this chapter for in-school youth meeting the 
     requirements of paragraph (1)(B)(v) shall only be carried out 
     in non-school hours or periods when school is not in session 
     (such as before and after school or during summer recess.''.
       (d) Statewide Youth Activities.--Section 129(b) (29 U.S.C. 
     2854(b)) is amended to read as follows:
       ``(b) Statewide Activities.--
       ``(1) In general.--Funds reserved by a Governor for a State 
     as described in sections 128(a) and 133(a)(1) may be used for 
     statewide activities including--
       ``(A) additional assistance to local areas that have high 
     concentrations of eligible youth;
       ``(B) supporting the provision of core services described 
     in section 134(c)(2) in the one-stop delivery system;
       ``(C) conducting evaluations under section 136(e) of 
     activities authorized under this chapter and chapter 5 in 
     coordination with evaluations carried out by the Secretary 
     under section 172, research, and demonstration projects;
       ``(D) providing incentive grants to local areas for 
     regional cooperation among local boards (including local 
     boards in a designated region as described in section 
     116(c)), for local coordination of activities carried out 
     under this Act, and for exemplary performance by local areas 
     on the local performance measures;
       ``(E) providing technical assistance and capacity building 
     to local areas, one-stop operators, one-stop partners, and 
     eligible providers, including the development and training of 
     staff, the development of exemplary program activities, and 
     the provision of technical assistance to local areas that 
     fail to meet local performance measures;
       ``(F) operating a fiscal and management accountability 
     system under section 136(f); and
       ``(G) carrying out monitoring and oversight of activities 
     under this chapter and chapter 5.
       ``(2) Limitation.--Not more than 5 percent of the funds 
     allotted under section 127(b) shall be used by the State for 
     administrative activities carried out under this subsection 
     and section 133(a).
       ``(3) Prohibition.--No funds described in this subsection 
     or in section 134(a) may be used to develop or implement 
     education curricula for school systems in the State.''.
       (e) Local Elements and Requirements.----
       (1) Program design.--Section 129(c)(1) (29 U.S.C. 2854(c) 
     (1)) is amended--
       (A) in the matter preceding subparagraph (A), by striking 
     ``paragraph (2)(A) or (3), as appropriate, of'';
       (B) in subparagraph (B), by inserting ``are directly linked 
     to one or more of the performance outcomes relating to this 
     chapter under section 136, and that'' after ``for each 
     participant that''; and
       (C) in subparagraph (C)--
       (i) by redesignating clauses (i) through (iv) as clauses 
     (ii) through (v), respectively;
       (ii) by inserting before clause (ii) (as so redesignated) 
     the following:
       ``(i) activities leading to the attainment of a secondary 
     school diploma or the General Equivalency Diploma (GED) 
     (including recognized alternative standards for individuals 
     with disabilities);'';
       (iii) in clause (ii) (as redesignated by this 
     subparagraph), by inserting ``and advanced training'' after 
     ``opportunities'';
       (iv) in clause (iii) (as redesignated by this 
     subparagraph), by inserting ``that lead to the attainment of 
     recognized credentials'' after ``learning''; and
       (v) by amending clause (v) (as redesignated by this 
     subparagraph) to read as follows:
       ``(v) effective connections to employers in sectors of the 
     local labor market experiencing high growth in employment 
     opportunities.''.
       (2) Program elements.--Section 129(c)(2) (29 U.S.C. 
     2854(c)(2)) is amended--
       (A) in subparagraph (A), by striking ``secondary school, 
     including dropout prevention strategies'' and inserting 
     ``secondary school diploma or the General Equivalency Diploma 
     (GED) (including recognized alternative standards for 
     individuals with disabilities), including dropout prevention 
     strategies'';
       (B) in subparagraph (I), by striking ``and'' at the end;
       (C) in subparagraph (J), by striking the period at the end 
     and inserting a semicolon; and
       (D) by adding at the end the following:
       ``(K) on-the-job training opportunities; and
       ``(L) financial literacy skills.''.
       (3) Additional requirements.--Section 129(c)(3)(A) (29 
     U.S.C. 2854(c)(3)(A)) is amended in the matter preceding 
     clause (i) by striking ``or applicant who meets the minimum 
     income criteria to be considered an eligible youth'';
       (4) Priority and exceptions.--Section 129(c) (29 U.S.C. 
     2854(c)) is further amended--
       (A) by striking paragraphs (4) and (5);
       (B) by redesignating paragraph (6) as paragraph (4);
       (C) by redesignating paragraph (7) as paragraph (5), and in 
     such redesignated paragraph (5) by striking ``youth 
     councils'' and inserting ``local boards''; and
       (D) by redesignating paragraph (8) as paragraph (6).

     SEC. 112. COMPREHENSIVE PROGRAM FOR ADULTS.

       (a) Title of Chapter 5.--
       (1) The title heading of chapter 5 is amended to read as 
     follows:

   ``CHAPTER 5--COMPREHENSIVE EMPLOYMENT AND TRAINING ACTIVITIES FOR 
                               ADULTS''.

       (2) Conforming amendment.--Table of contents in section 
     1(b) is amended by amending the item related to the heading 
     for chapter 5 to read as follows:

   ``Chapter 5--Comprehensive Employment and Training Activities for 
                               Adults''.

       (b) General Authorization.--Section 131 (29 U.S.C. 2861) is 
     amended--
       (1) by striking ``paragraphs (1)(B) and (2)(B)
     of''; and
       (2) by striking ``, and dislocated workers,''.
       (c) State Allotments.--
       (1) In general.--Section 132(a) (29 U.S.C. 2862(a)) is 
     amended to read as follows:
       ``(a) In General.--The Secretary shall--
       ``(1) reserve 10 percent of the amount appropriated under 
     section 137(b) for a fiscal year, of which--
       ``(A) not less than 75 percent shall be used for national 
     dislocated worker grants under section 173;
       ``(B) not more than 20 percent may be used for 
     demonstration projects under section 171; and
       ``(C) not more than 5 percent may be used to provide 
     technical assistance under section 170; and
       ``(2) make allotments from 90 percent of the amount 
     appropriated under section 137(b) for a fiscal year in 
     accordance with subsection (b).''.
       (2) Allotment among states.--Section 132(b) (29 U.S.C. 
     2862(b)) is amended to read as follows:
       ``(b) Allotment Among States for Adult Employment and 
     Training Activities.--
       ``(1) Reservation for outlying areas.--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 to 
     provide assistance to outlying areas to carry out employment 
     and training activities for adults and statewide workforce 
     investment activities.
       ``(2) States.--Subject to paragraph (5), of the remainder 
     of the amount referred to under subsection (a)(2) for a 
     fiscal year that is available after determining the amount to 
     be reserved under paragraph (1), the Secretary shall allot to 
     the States for employment and training activities for adults 
     and for statewide workforce investment activities--
       ``(A) 26 percent in accordance with paragraph (3); and
       ``(B) 74 percent in accordance with paragraph (4).
       ``(3) Base formula.--
       ``(A) Fiscal year 2004.--
       ``(i) In general.--Subject to clause (ii), the amount 
     referred to in paragraph (2)(A) shall be allotted for fiscal 
     year 2004 on the basis of allotment percentage of each State 
     under section 6 of the Wagner-Peyser Act for fiscal year 
     2003.
       ``(ii) Excess amounts.--If the amount referred to in 
     paragraph (2)(A) for fiscal year 2004 exceeds the amount that 
     was available for allotment to the States under the Wagner-
     Peyser Act for fiscal year 2003, such excess amount shall be 
     allotted on the basis of the relative number of individuals 
     in the civilian labor force in each State, compared to the 
     total number of individuals in the civilian labor force in 
     all States, adjusted to ensure that no State receives less 
     than \3/10\ of one percent of such excess amount.
       ``(iii) Definition.--For purposes of this subparagraph, the 
     term `allotment percentage' means the percentage of the 
     amounts allotted to States under section 6 of the Wagner-
     Peyser Act that is received by the State involved for fiscal 
     year 2003.
       ``(B) Fiscal years 2005 and thereafter.--
       ``(i) In general.--Subject to clause(ii), the amount 
     referred to in paragraph(2)(A) shall be allotted for fiscal 
     year 2005 and each fiscal year thereafter on the basis of the 
     allotment percentage of each State under this paragraph for 
     the preceding fiscal year.
       ``(ii) Excess amounts.--If the amount referred to in 
     paragraph (2)(A) for fiscal year 2005 or any fiscal year 
     thereafter exceeds the amount that was available for 
     allotment under this paragraph for the prior fiscal year, 
     such excess amount shall be allotted on the basis of the 
     relative number of individuals in the civilian labor force in 
     each State,

[[Page 14889]]

     compared to the total number of individuals in the civilian 
     labor force in all States, adjusted to ensure that no State 
     receives less than \3/10\ of one percent of such excess 
     amount.
       ``(iii) Definition.--For purposes of this subparagraph, the 
     term `allotment percentage' means the percentage of the 
     amounts allotted to States under this paragraph in a fiscal 
     year that is received by the State involved for such fiscal 
     year.
       ``(4) Consolidated formula.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), of 
     the amount referred to in paragraph (2)(B)--
       ``(i) 60 percent shall be allotted on the basis of the 
     relative number of unemployed individuals in each State, 
     compared to the total number of unemployed individuals in all 
     States;
       ``(ii) 25 percent shall be allotted on the basis of the 
     relative excess number of unemployed individuals in each 
     State, compared to the total excess number of unemployed 
     individuals in all States; and
       ``(iii) 15 percent shall be allotted on the basis of the 
     relative number of disadvantaged adults in each State, 
     compared to the total number of disadvantaged adults in all 
     States.
       ``(B) Minimum and maximum percentages.--
       ``(i) Minimum percentage.--The Secretary shall ensure that 
     no State shall receive an allotment under this paragraph for 
     a fiscal year that is less than 90 percent of the allotment 
     percentage of the State under this paragraph for the 
     preceding fiscal year.
       ``(ii) Maximum percentage.--Subject to clause (i), the 
     Secretary shall ensure that no State shall receive an 
     allotment for a fiscal year under this paragraph that is more 
     than 130 percent of the allotment of the State under this 
     paragraph for the preceding fiscal year.
       ``(C) Small state minimum allotment.--Subject to 
     subparagraph (B), the Secretary shall ensure that no State 
     shall receive an allotment under this paragraph that is less 
     than \2/10\ of 1 percent of the amount available under 
     subparagraph (A).
       ``(D) Definitions.--For the purposes of this paragraph:
       ``(i) Allotment percentage.--The term `allotment 
     percentage', used with respect to fiscal year 2004 or a 
     subsequent fiscal year, means a percentage of the amounts 
     described in paragraph (2)(B) that is received through an 
     allotment made under this paragraph for the fiscal year. The 
     term, with respect to fiscal year 2003, means the percentage 
     of the amounts allotted to States under this chapter (as in 
     effect on the day before the date of enactment of the 
     Workforce Reinvestment and Adult Education Act of 2003) and 
     under reemployment service grants received by the State 
     involved for fiscal year 2003.
       ``(ii) Disadvantaged adult.--The term `disadvantaged adult' 
     means an individual who is age 22 through 72 who received an 
     income, or is a member of a family that received a total 
     family income, that, in relation to family size, does not 
     exceed the poverty line.
       ``(iii) Excess number.--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 and \1/2\ 
     percent of the civilian labor force in the State.
       ``(5) Adjustments in allotments based on differences with 
     unconsolidated formulas.--
       ``(A) In general.--The Secretary shall ensure that for any 
     fiscal year no State has an allotment difference, as defined 
     in subparagraph (C), that is less than zero. The Secretary 
     shall adjust the amounts allotted to the States under this 
     subsection in accordance with subparagraph (B) if necessary 
     to carry out this subparagraph.
       ``(B) Adjustments in allotments.--
       ``(i) Redistribution of excess amounts.--

       ``(I) in general.--If necessary to carry out subparagraph 
     (A), the Secretary shall reduce the amounts that would be 
     allotted under paragraphs (3) and (4) to States that have an 
     excess allotment difference, as defined in subclause (II), by 
     the amount of such excess, and use such amounts to increase 
     the allotments to States that have an allotment difference 
     less than zero.
       ``(II) Excess amounts.--For purposes of subclause (I), the 
     term `excess' allotment difference means an allotment 
     difference for a State that is--

       ``(aa) in excess of 3 percent of the amount described in 
     subparagraph (C)(i)(II); or
       ``(bb) in excess of a percentage established by the 
     Secretary that is greater than 3 percent of the amount 
     described in subparagraph (C)(i)(II) if the Secretary 
     determines that such greater percentage is sufficient to 
     carry out subparagraph (A).
       ``(ii) Use of amounts available under national reserve 
     account.--If the funds available under clause (i) are 
     insufficient to carry out subparagraph (A), the Secretary 
     shall use funds reserved under section 132(a) in such amounts 
     as are necessary to increase the allotments to States to meet 
     the requirements of subparagraph (A). Such funds shall be 
     used in the same manner as the States use the other funds 
     allotted under this subsection.
       ``(C) Definition of allotment difference.--
       ``(i) In general.--For purposes of this paragraph, the term 
     `allotment difference' means the difference between--

       ``(I) the total amount a State would receive of the amounts 
     available for allotment under subsection (b)(2) for a fiscal 
     year pursuant to paragraphs (3) and (4); and
       ``(II) the total amount the State would receive of the 
     amounts available for allotment under subsection (b)(2) for 
     the fiscal year if such amounts were allotted pursuant to the 
     unconsolidated formulas (applied as described in clause 
     (iii)) that were used in allotting funds for fiscal year 
     2003.

       ``(ii) Unconsolidated formulas.--For purposes of clause 
     (i), the unconsolidated formulas are:

       ``(I) The requirements for the allotment of funds to the 
     States contained in section 132(b)(1)(B) of this Act (as in 
     effect on the day before the date of enactment of the 
     Workforce Reinvestment and Adult Education Act of 2003) that 
     were applicable to the allotment of funds under such section 
     for fiscal year 2003.
       ``(II) The requirements for the allotment of funds to the 
     States contained in section 132(b)(2)(B) of this Act (as in 
     effect on the day before the date of enactment of the 
     Workforce Reinvestment and Adult Education Act of 2003) that 
     were applicable to the allotment of funds under such section 
     for fiscal year 2003.
       ``(III) The requirements for the allotment of funds to the 
     States that were contained in section 6 of the Wagner-Peyser 
     Act (as in effect on the day before the date of enactment of 
     the Workforce Reinvestment and Adult Education Act of 2003) 
     that were applicable to the allotment of funds under such Act 
     for fiscal year 2003.
       ``(IV) The requirements for the allotment of funds to the 
     States that were established by the Secretary for 
     Reemployment Services Grants that were applicable to the 
     allotment of funds for such grants for fiscal year 2003.

       ``(iii) Proportionate application of unconsolidated 
     formulas based on fiscal year 2003.--In calculating the 
     amount under clause (i)(II), each of the unconsolidated 
     formulas identified in clause (ii) shall be applied, 
     respectively, only to the proportionate share of the total 
     amount of funds available for allotment under subsection 
     (b)(2) for a fiscal year that is equal to the proportionate 
     share to which each of the unconsolidated formulas applied 
     with respect to the total amount of funds allotted to the 
     States under all of the unconsolidated formulas in fiscal 
     year 2003.
       ``(iv) Rule of construction.--The amounts used to adjust 
     the allotments to a State under subparagraph (B) for a fiscal 
     year shall not be included in the calculation of the amounts 
     under clause (i) for a subsequent fiscal year, including the 
     calculation of allocation percentages for a preceding fiscal 
     year applicable to paragraphs (3) and (4) and to the 
     unconsolidated formulas described in clause (ii).''.
       (3) Reallotment.--Section 132(c) (29 U.S.C. 2862(c)) is 
     amended--
       (A) by amending paragraph (2) to read as follows:
       ``(2) Amount.--The amount available for reallotment for a 
     program year is equal to the amount by which the unexpended 
     balance, excluding accrued expenditures, at the end of such 
     program year of the total amount of funds available to the 
     State under this section during such program year (including 
     amounts allotted to the State in prior program years that 
     remain available during the program year for which the 
     determination is made) exceeds 30 percent of such total 
     amount.'';
       (B) in paragraph (3)--
       (i) by striking ``for the prior program year'' and 
     inserting ``for the program year in which the determination 
     is made''; and
       (ii) by striking ``such prior program year'' and inserting 
     ``such program year''; and
       (C) by amending paragraph (4) to read as follows:
       ``(4) Eligibility.--For purposes of this subsection, an 
     eligible State means a State that does not have an amount 
     available for reallotment under paragraph (2) for the program 
     year for which the determination under paragraph (2) is 
     made.''.
       (d) Within State Allocations.--
       (1) Reservation for state activities.--Section 133(a) (29 
     U.S.C. 2863(a)) is amended to read as follows:
       ``(a) Reservation for Statewide Activities.--The Governor 
     of a State may reserve up to 50 percent of the total amount 
     allotted to the State under section 132 for a fiscal year to 
     carry out the statewide activities described in section 
     134(a).''.
       (2) Allocations to local areas.--Section 133(b) (29 U.S.C. 
     2863(b)) is amended to read as follows:
       ``(b) Allocations to Local Areas.--
       ``(1) In general.--Of the amounts allotted to the State 
     under section 132(b)(2) and not reserved under subsection 
     (a)--
       ``(A) 85 percent of such amounts shall be allocated by the 
     Governor to local areas in accordance with paragraph (2); and
       ``(B) 15 percent of such amounts shall be allocated by the 
     Governor to local areas in accordance with paragraph (3).
       ``(2) Established formula.--

[[Page 14890]]

       ``(A) In general.--Of the amounts described in paragraph 
     (1)(A), the Governor shall allocate--
       ``(i) 60 percent on the basis of the relative number of 
     unemployed individuals in each local area, compared to the 
     total number of unemployed individuals in all local areas in 
     the State;
       ``(ii) 25 percent on the basis of the relative excess 
     number of unemployed individuals in each local area, compared 
     to the total excess number of unemployed individuals in all 
     local areas in the State; and
       ``(iii) 15 percent shall be allotted on the basis of the 
     relative number of disadvantaged adults in each local area, 
     compared to the total number of disadvantaged adults in all 
     local areas in the State.
       ``(B) Minimum and maximum percentages.--The Governor shall 
     ensure that no local area shall receive an allocation for a 
     fiscal year under this paragraph that is less than 90 percent 
     or greater than 130 percent of the allocation percentage of 
     the local area for the preceding fiscal year.
       ``(C) Definitions.--
       ``(i) Allocation percentage.--The term `allocation 
     percentage', used with respect to fiscal year 2004 or a 
     subsequent fiscal year, means a percentage of amount 
     described in paragraph (1)(A) that is received through an 
     allocation made under this paragraph for the fiscal year. The 
     term, with respect to fiscal year 2003, means the percentage 
     of the amounts allocated to local areas under this chapter 
     (as in effect on the day before the date of enactment of the 
     Workforce Reinvestment and Adult Education Act of 2003) that 
     is received by the local area involved for fiscal year 2003.
       ``(ii) Disadvantaged adult.--The term `disadvantaged adult' 
     means an individual who is age 22 through 72 who received an 
     income, or is a member of a family that received a total 
     family income, that, in relation to family size, does not 
     exceed the poverty line.
       ``(iii) Excess number.--The term `excess number' means, 
     used with respect to the excess number of unemployed 
     individuals within a local area, the number that represents 
     the number of unemployed individuals in excess of 4.5 percent 
     of the civilian labor force in the local area.
       ``(3) Discretionary allocation.--The Governor shall 
     allocate to local areas the amounts described in paragraph 
     (1)(B) based on a formula developed in consultation with the 
     State board and local boards. Such formula shall be objective 
     and geographically equitable and may include such demographic 
     and economic factors as the Governor, after consultation with 
     the State board and local boards, determines are appropriate.
       ``(4) Local administrative cost limit.--
       ``(A) In general.--Of the amounts allocated to a local area 
     under this subsection and section 128(b) for a fiscal year, 
     not more than 10 percent of the amount may be used by the 
     local boards for the administrative costs of carrying out 
     local workforce investment activities under this chapter or 
     chapter 4.
       ``(B) Use of funds.--Funds made available for 
     administrative costs under subparagraph (A) may be used for 
     the administrative costs of any of the local workforce 
     investment activities described in this chapter or chapter 4, 
     regardless of whether the funds were allocated under this 
     subsection or section 128(b).''.
       (3) Reallocation among local areas.--Section 133(c) (29 
     U.S.C. 2863(c)) is amended--
       (A) in paragraph (1), by striking ``paragraph (2)(A) or (3) 
     of'';
       (B) by amending paragraph (2) to read as follows:
       ``(2) Amount.--The amount available for reallocation for a 
     program year is equal to the amount by which the unexpended 
     balance, excluding accrued expenditures, at the end of such 
     program year of the total amount of funds available to the 
     local area under this section during such program year 
     (including amounts allotted to the local area in prior 
     program years that remain available during the program year 
     for which the determination is made) exceeds 30 percent of 
     such total amount.'';
       (C) by amending paragraph (3)--
       (i) by striking ``subsection (b)(3)'' each place it appears 
     and inserting ``subsection (b)'';
       (ii) by striking ``the prior program year'' and inserting 
     ``the program year in which the determination is made'';
       (iii) by striking ``such prior program year'' and inserting 
     ``such program year''; and
       (iv) by striking the last sentence; and
       (D) by amending paragraph (4) to read as follows:
       ``(4) Eligibility.--For purposes of this subsection, an 
     eligible local area means a local area which does not have an 
     amount available for reallocation under paragraph (2) for the 
     program year for which the determination under paragraph (2) 
     is made.''.
       (e) Use of Funds for Employment and Training Activities.--
       (1) Statewide employment and training activities.--
       (A) In general.--Section 134(a)(1) (29 U.S.C. 2864(a)(1) is 
     amended to read as follows:
       ``(1) In general.--
       ``(A) Required use of funds.--Not less than 50 percent of 
     the funds reserved by a Governor under section 133(a) shall 
     be used to support the provision of core services in local 
     areas, consistent with the local plan, through one-stop 
     delivery systems by distributing funds to local areas in 
     accordance with subparagraph (B). Such funds may be used by 
     States to employ State personnel to provide such services in 
     designated local areas in consultation with local boards.
       ``(B) Method of distributing funds.--The method of 
     distributing funds under this paragraph shall be developed in 
     consultation with the State board and local boards. Such 
     method of distribution, which may include the formula 
     established under section 121(h)(3), shall be objective and 
     geographically equitable, and may include factors such as the 
     number of centers in the local area that have been certified, 
     the population served by such centers, and the performance of 
     such centers.
       ``(C) Other use of funds.--Funds reserved by a Governor for 
     a State--
       ``(i) under section 133(a) and not used under subparagraph 
     (A), may be used for statewide activities described in 
     paragraph (2); and
       ``(ii) under section 133(a) and not used under subparagraph 
     (A), and under section 128(a) may be used to carry out any of 
     the statewide employment and training activities described in 
     paragraph (3).''.
       (B) Statewide rapid response activities.--Section 134(a)(2) 
     (29 U.S.C. 2864(a)(2)) is amended to read as follows:
       ``(2) Statewide rapid response activities.--A State shall 
     carry out statewide rapid response activities using funds 
     reserved as described in section 133(a). Such activities 
     shall include--
       ``(A) 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
       ``(B) 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, working in conjunction with the local boards 
     and the chief elected officials in the local areas.''.
       (C) Statewide employment and training activities.--Section 
     134(a)(3) (29 U.S.C. 2864(a)(3)) is amended to read as 
     follows:
       ``(3) Statewide activities.--Funds reserved by a Governor 
     for a State as described in sections 133(a) and 128(a) may be 
     used for statewide activities including--
       ``(A) supporting the provision of core services described 
     in section 134(c)(2) in the one-stop delivery system;
       ``(B) conducting evaluations under section 136(e) of 
     activities authorized under this chapter and chapter 4 in 
     coordination with evaluations carried out by the Secretary 
     under section 172, research, and demonstration projects;
       ``(C) providing incentive grants to local areas for 
     regional cooperation among local boards (including local 
     boards in a designated region as described in section 
     116(c)), for local coordination of activities carried out 
     under this Act, and for exemplary performance by local areas 
     on the local performance measures;
       ``(D) providing technical assistance and capacity building 
     to local areas, one-stop operators, one-stop partners, and 
     eligible providers, including the development and training of 
     staff, the development of exemplary program activities, and 
     the provision of technical assistance to local areas that 
     fail to meet local performance measures;
       ``(E) operating a fiscal and management accountability 
     system under section 136(f);
       ``(F) carrying out monitoring and oversight of activities 
     carried out under this chapter and chapter 4;
       ``(G) implementing innovative programs, such as incumbent 
     worker training programs, programs serving individuals with 
     disabilities consistent with section 188;
       ``(H) developing strategies for effectively serving hard-
     to-serve populations and for integrating programs and 
     services among one-stop partners;
       ``(I) implementing innovative programs for displaced 
     homemakers, which for purposes of this subparagraph 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
       ``(J) implementing programs to increase the number of 
     individuals training for and placed in nontraditional 
     employment.''.
       (D) Limitation on state administrative expenditures.--
     Section 134(a) is further amended by adding the following new 
     paragraph:
       ``(4) Limitation.--Not more than 5 percent of the funds 
     allotted under section 132(b) shall be used by the State for 
     administrative activities carried out under this subsection 
     and section 128(a).''.
       (2) Local employment and training activities.-- Section 
     134(b) (29 U.S.C. 2864(b)) is amended--
       (A) by striking ``under paragraph (2)(A)'' and all that 
     follows through ``section 133(b)(2)(B)'' and inserting 
     ``under section 133(b)'';
       (B) in paragraphs (1) and (2), by striking ``or dislocated 
     workers, respectively'' both places it appears; and

[[Page 14891]]

       (C) by redesignating subsections (d) and (e) as subsections 
     (c) and (d), respectively.
       (3) Required local employment and training activities.--
       (A) Allocated funds.--Section 134(c)(1) (29 U.S.C. 
     2864(c)(1)) (as redesignated by paragraph (2)) is amended to 
     read as follows:
       ``(1) In general.--Funds allocated to a local area for 
     adults under section 133(b) shall be used--
       ``(A) to establish a one-stop delivery system as described 
     in section 121(e);
       ``(B) to provide the core services described in paragraph 
     (2) through the one-stop delivery system in accordance with 
     such paragraph;
       ``(C) to provide the intensive services described in 
     paragraph (3) to adults described in such paragraph; and
       ``(D) to provide training services described in paragraph 
     (4) to adults described in such paragraph.''.
       (B) Core services.--Section 134(c)(2) (29 U.S.C. 
     2864(c)(2)) (as redesignated by paragraph (2)) is amended--
       (i) by striking ``who are adults or dislocated workers'';
       (ii) in subparagraph (A), by striking ``under this 
     subtitle'' and inserting ``under the one-stop partner 
     programs described in section 121(b)'';
       (iii) by amending subparagraph (D) to read as follows:
       ``(D) labor exchange services, including--
       ``(i) job search and placement assistance, and where 
     appropriate career counseling;
       ``(ii) appropriate recruitment services for employers; and
       ``(iii) reemployment services provided to unemployment 
     claimants.'';
       (iv) in subparagraph (I), by inserting ``and the 
     administration of the work test for the unemployment 
     compensation system'' after ``compensation''; and
       (v) by amending subparagraph (J) to read as follows:
       ``(J) assistance in establishing eligibility for 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''.
       (C) Intensive services.--Section 134(c)(3) (29 U.S.C. 
     2864(c)(3) (as redesignated by paragraph (2) of this 
     subsection) is amended--
       (i) by amending subparagraph (A) to read as follows:
       ``(A) In general.--
       ``(i) Eligibility.--Funds allocated to a local area under 
     section 133(b) shall be used to provide intensive services 
     for adults who--

       ``(I) are unemployed and who have been determined by the 
     one-stop operator to be--

       ``(aa) unlikely or unable to obtain suitable employment 
     through core services; and
       ``(bb) in need of intensive services in order to obtain 
     suitable employment; or

       ``(II) are employed, but who are determined by a one-stop 
     operator to be in need of intensive services to obtain or 
     retain suitable employment.

       ``(ii) Definition.--The Governor shall define the term 
     `suitable employment' for purposes of this subparagraph.''; 
     and
       (ii) in subparagraph (C)--

       (I) in clause (v), by striking ``for participants seeking 
     training services under paragraph (4)''; and
       (II) by adding the following clauses after clause (vi):

       ``(vii) Internships and work experience.
       ``(viii) Literacy activities relating to basic work 
     readiness, and financial literacy activities.
       ``(ix) Out-of-area job search assistance and relocation 
     assistance.''.
       (D) Training services.--Section 134(c)(4) (as redesignated 
     by paragraph (2) of this subsection) is amended--
       (i) by amending subparagraph (A) to read as follows:
       ``(A) In general.--
       ``(i) Eligibility.--Funds allocated to a local area under 
     section 133(b) shall be used to provide training services to 
     adults who--

       ``(I) after an interview, evaluation, or assessment, and 
     case management, have been determined by a one-stop operator 
     or one-stop partner, as appropriate, to--

       ``(aa) be unlikely or unable to obtain or retain suitable 
     employment through intensive services under paragraph (3)(A);
       ``(bb) be in need of training services to obtain or retain 
     suitable employment; and
       ``(cc) have the skills and qualifications to successfully 
     participate in the selected program of training services;

       ``(II) 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 
     receiving such services are willing to commute or relocate;
       ``(III) who meet the requirements of subparagraph (B); and
       ``(IV) who are determined eligible in accordance with the 
     priority system in effect under subparagraph (E).

       ``(ii) The Governor shall define the term `suitable 
     employment' for purposes of this subparagraph.'';
       (ii) in subparagraph (B)(i), by striking ``Except'' and 
     inserting ``Notwithstanding section 479B of the Higher 
     Education Act of 1965 (20 U.S.C. 1087uu) and except'';
       (iii) by amending subparagraph (E) to read as follows:
       ``(E) Priority.--
       ``(i) In general.--A priority shall be given to unemployed 
     individuals for the provision of intensive and training 
     services under this subsection.
       ``(ii) Additional priority.--If the funds in the local 
     area, including the funds allocated under section 133(b), for 
     serving recipients of public assistance and other low-income 
     individuals, including single parents, displaced homemakers, 
     and pregnant single women, is limited, the priority for the 
     provision of intensive and training services under this 
     subsection shall include such recipients and individuals.
       ``(iii) Determinations.--The Governor and the appropriate 
     local board shall direct the one-stop operators in the local 
     area with regard to making determinations with respect to the 
     priority of service under this subparagraph.'';
       (iv) in subparagraph (F), by adding the following clause 
     after clause (iii):
       ``(iv) Enhanced individual training accounts.--Each local 
     board may, through one-stop centers, assist individuals 
     receiving individual training accounts through the 
     establishment of such accounts that include, in addition to 
     the funds provided under this paragraph, funds from other 
     programs and sources that will assist the individual in 
     obtaining training services.''; and
       (v) in subparagraph (G)(iv), by redesignating subclause 
     (IV) as subclause (V) and inserting after subclause (III) the 
     following:

       ``(IV) Individuals with disabilities.''.

       (4) Permissible activities.--Section 134(d) (as 
     redesignated by paragraph (2)) is amended--
       (A) by amending paragraph (1) to read as follows:
       ``(1) Discretionary one-stop delivery activities.--
       ``(A) In general.--Funds allocated to a local area under 
     section 133(b) may be used to provide, through the one-stop 
     delivery system--
       ``(i) customized screening and referral of qualified 
     participants in training services to employers;
       ``(ii) customized employment-related services to employers 
     on a fee-for-service basis;
       ``(iii) customer support to navigate among multiple 
     services and activities for special participant populations 
     that face multiple barriers to employment, including 
     individuals with disabilities; and
       ``(iv) employment and training assistance provided in 
     coordination with child support enforcement activities of the 
     State agency carrying out subtitle D of title IV of the 
     Social Security Act.
       ``(B) Work support activities for low-wage workers.--
       ``(i) In general.-- Funds allocated to a local area under 
     133(b) may be used to provide, through the one-stop delivery 
     system and in collaboration with the appropriate programs and 
     resources of the one-stop partners, work support activities 
     designed to assist low-wage workers in retaining and 
     enhancing employment.
       ``(ii) Activities.--The activities described in clause (i) 
     may include assistance in accessing financial supports for 
     which such workers may be eligible and the provision of 
     activities available through the one-stop delivery system in 
     a manner that enhances the opportunities of such workers to 
     participate, such as the provision of employment and training 
     activities during nontraditional hours and the provision of 
     on-site child care while such activities are being 
     provided.''; and
       (B) by adding after paragraph (3) the following new 
     paragraph:
       ``(4) Incumbent worker training programs.--
       ``(A) In general.--The local board may use up to 10 percent 
     of the funds allocated to a local area under section 133(b) 
     to carry out incumbent worker training programs in accordance 
     with this paragraph.
       ``(B) Training activities.--The training programs for 
     incumbent workers under this paragraph shall be carried out 
     by the local area in conjunction with the employers of such 
     workers for the purpose of assisting such workers in 
     obtaining the skills necessary to retain employment and avert 
     layoffs.
       ``(C) Employer match required.--
       ``(i) In general.--Employers participating in programs 
     under this paragraph shall be required to pay a proportion of 
     the costs of providing the training to the incumbent workers. 
     The Governor shall establish, or may authorize the local 
     board to establish, the required portion of such costs, which 
     shall not be less than--

       ``(I) 10 percent of the costs, for employers with 50 or 
     fewer employees;
       ``(II) 25 percent of the costs, for employers with more 
     than 50 employees but fewer than 100 employees; and
       ``(III) 50 percent of the costs, for employers with 100 or 
     more employees.

       ``(ii) Calculation of match.--The wages paid by an employer 
     to a worker while they are attending training may be included 
     as part of the requirement payment of the employer.''.

     SEC. 113. PERFORMANCE ACCOUNTABILITY SYSTEM.

       (a) State Performance Measures.--
       (1) In general.--Section 136(b)(1) (29 U.S.C. 2871(b)(1)) 
     is amended--

[[Page 14892]]

       (A) in subparagraph (A)(i), by striking ``and the customer 
     satisfaction indicator of performance described in paragraph 
     (2)(B)''; and
       (B) in subparagraph (A)(ii), by striking ``paragraph 
     (2)(C)'' and inserting ``paragraph (2)(B)''.
       (2) Indicators of performance.--Section 136(b)(2) (29 
     U.S.C. 2871(b)(2)) is amended--
       (A) in subparagraph (A)(i), by striking ``(except for self-
     service and information activities) and (for participants who 
     are eligible youth age 19 through 21) for youth activities 
     authorized under section 129'';
       (B) by amending subparagraph (A)(i)(IV) to read as follows:

       ``(IV) the efficiency of the program in obtaining the 
     outcomes described in subclauses (I) through (III).'';

       (C) by amending subparagraph (A)(ii) to read as follows:
       ``(ii) Core indicators for eligible youth.--The core 
     indicators of performance for youth activities authorized 
     under section 129 shall consist of--

       ``(I) entry into employment, education or advanced 
     training, or military service;
       ``(II) attainment of secondary school diplomas or the 
     General Equivalency Diploma (GED) (including recognized 
     alternative standards for individuals with disabilities);
       ``(III) attainment of literacy or numeracy skills; and
       ``(IV) the efficiency of the program in obtaining the 
     outcomes described in subclauses (I) through (III).'';

       (D) by striking subparagraph (B);
       (E) by redesignating subparagraph (C) as subparagraph (B), 
     and by adding at the end of such subparagraph (as so 
     redesignated) the following new sentence: ``Such indicators 
     may include customer satisfaction of employers and 
     participants with services received from the workforce 
     investment activities authorized under this subtitle.''.
       (3) Levels of performance.--Section 136(b)(3)(A) (29 U.S.C. 
     2871(b)(3)(A)) is amended--
       (A) in clause (i), by striking ``and the customer 
     satisfaction indicator described in paragraph (2)(B)'';
       (B) in clause (ii), by striking ``and the customer 
     satisfaction indicator of performance, for the first 3'' and 
     inserting ``for the 2'';
       (C) in clause (iii)--
       (i) in the heading, by striking ``for first 3 years''; and
       (ii) by striking ``and the customer satisfaction indicator 
     of performance, for the first 3'' and inserting ``for the 
     2'';
       (D) in clause (iv)--
       (i) by striking subclause (I);
       (ii) by redesignating subclauses (II) and (III) as 
     subclauses (I) and (II), respectively; and
       (iii) in subclause (I) (as so redesignated)--

       (I) by striking ``taking into account'' and inserting 
     ``which shall be adjusted based on'';
       (II) by inserting ``such as unemployment rates and job 
     losses or gains in particular industries'' after ``economic 
     conditions''; and
       (III) by inserting ``such as indicators of poor work 
     history, lack of work experience, low levels of literacy or 
     English proficiency, disability status, and welfare 
     dependency'' after ``program'';

       (E) by striking clause (v); and
       (F) by redesignating clause (vi) as clause (v).
       (4) Additional indicators.--Section 136(b)(3)(B) is amended 
     by striking ``paragraph (2)(C)'' and inserting ``paragraph 
     (2)(B)''.
       (b) Local Performance Measures.--Section 136(c) (29 U.S.C 
     2871(c)) is amended--
       (1) in paragraph (1)(A)(i), by striking ``, and the 
     customer satisfaction indicator of performance described in 
     subsection (b)(2)(B),'';
       (2) in paragraph (1)(A)(ii), by striking ``subsection 
     (b)(2)(C)'' and inserting ``subsection (b)(2)(B)''; and
       (3) by amending paragraph (3) to read as follows:
       ``(3) Determinations.--In determining such local levels of 
     performance, the local board, the chief elected official, and 
     the Governor shall ensure such levels are adjusted based on 
     the specific economic characteristics (such as unemployment 
     rates and job losses or gains in particular industries), 
     demographic characteristics, or other characteristics of the 
     population to be served in the local area, such as poor work 
     history, lack of work experience, low levels of literacy or 
     English proficiency, disability status, and welfare 
     dependency.''.
       (c) Report.--Section 136(d) (29 U.S.C. 2871(d)) is 
     amended--
       (1) in paragraph (1), by striking ``and the customer 
     satisfaction indicator'' in both places that it appears;
       (2) in paragraph (2)(E), by striking ``(excluding 
     participants who received only self-service and informational 
     activities)''; and
       (3) by adding at the end the following:
       ``(4) Data validation.--In preparing the reports described 
     in this subsection, the States shall establish procedures, 
     consistent with guidelines issued by the Secretary, to ensure 
     the information contained in the report is valid and 
     reliable.''.
       (d) Sanctions for State.--Section 136(g) (29 U.S.C. 
     2871(g)) is amended--
       (1) in paragraph (1)(A), by striking ``or (B)''; and
       (2) in paragraph (2), by striking ``section 503'' and 
     inserting ``section 136(i)''.
       (e) Sanctions for Local Areas.--Section 136(h) (29 U.S.C. 
     2871(h)) is amended--
       (1) in paragraph (1), by striking ``or (B)''; and
       (2) by amending paragraph (2)(B) to read as follows:
       ``(B) 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 than 30 days after the receipt of the appeal.''.
       (f) Incentive Grants.--Section 136(i) (29 U.S.C. 2871(i)) 
     is amended to read as follows:
       ``(i) Incentive Grants for States and Local Areas.--
       ``(1) Incentive grants for states.--
       ``(A) In general.--From funds appropriated under section 
     174, the Secretary may award grants to States for exemplary 
     performance in carrying programs under this chapters 4 and 5 
     of this title. Such awards may be based on States meeting or 
     exceeding the performance measures established under this 
     section, on the performance of the State in serving special 
     populations, including the levels of service provided and the 
     performance outcomes, and such other factors relating to the 
     performance of the State under this title as the Secretary 
     determines is appropriate.
       ``(B) Use of funds.--The funds awarded to a State under 
     this paragraph may be used to carry out any activities 
     authorized under chapters 4 and 5 of this title, including 
     demonstrations and innovative programs for special 
     populations.
       ``(2) Incentive grants for local areas.--
       ``(A) In general.--From funds reserved under sections 
     128(a) and 133(a), the Governor may award incentive grants to 
     local areas for exemplary performance with respect to the 
     measures established under this section and with the 
     performance of the local area in serving special populations, 
     including the levels of service and the performance outcomes.
       ``(B) Use of funds.--The funds awarded to a local area may 
     be used to carry out activities authorized for local areas 
     under chapters 4 and 5 of this title, and such demonstration 
     or other innovative programs to serve special populations as 
     may be approved by the Governor.''.
       (g) Repeal of Definitions.--Sections 502 and 503 (and the 
     items related to such sections in the table of contents) are 
     repealed.

     SEC. 114. AUTHORIZATION OF APPROPRIATIONS.

       (a) Youth Activities.-- Section 137(a) (29 U.S.C. 2872(a)) 
     is amended by striking ``such sums as may be necessary for 
     each of fiscal years 1999 through 2003'' and inserting 
     ``$1,250,000,000 for fiscal year 2004 and such sums as may be 
     necessary for each of fiscal years 2005 through 2009''.
       (b) Adult Employment and Training Activities.--Section 
     137(b) (29 U.S.C. 2872(b)) is amended by striking ``section 
     132(a)(1), such sums as may be necessary for each of fiscal 
     years 1999 through 2003'' and inserting ``132(a), 
     $3,079,800,000 for fiscal year 2004 and such sums as may be 
     necessary for each of fiscal years 2005 through 2009''.
       (c) Dislocated Worker Employment and Training Activities.--
     Section 137 is further amended by striking subsection (c).

     SEC. 115. JOB CORPS.

       (a) Community Participation.--Section 153 (29 U.S.C. 2893) 
     is amended--
       (1) by amending subsection (a) to read as follows:
       ``(a) Business and Community Participation.--The director 
     of each Job Corps center shall ensure the establishment and 
     development of the business and community relationships and 
     networks described in subsection (b) in order to enhance the 
     effectiveness of such center.'';
       (2) in subsection (b)--
       (A) in the heading, by striking ``Responsibilities'' and 
     inserting ``Networks''; and
       (B) by striking ``The responsibilities of the Liaison'' and 
     inserting ``The activities carried out by each Job Corps 
     center under this section''; and
       (3) in subsection (c), by striking ``The Liaison for'' and 
     inserting ``The director of''.
       (b) Industry Councils.--Section 154(b) (29 U.S.C. 2894(b)) 
     is amended--
       (1) in paragraph (1)(A), by striking ``local and distant''; 
     and
       (2) by adding after paragraph (2) the following:
       ``(3) Employers outside of local areas.--The industry 
     council may include, or otherwise provide for consultation 
     with, employers from outside the local area who are likely to 
     hire a significant number of enrollees from the Job Corps 
     center.''.
       (c) Indicators of Performance and Additional Information.--
     Section 159(c) (29 U.S.C. 2893(c)) is amended--
       (1) by amending paragraph (1) to read as follows:
       ``(1) Core indicators.--The Secretary shall annually 
     establish expected levels of performance for Job Corps 
     centers and the Job Corps program relating to each of the 
     core indicators for youth identified in section 
     136(b)(2)(A)(ii).''; and
       (2) in paragraph (2), by striking ``measures'' each place 
     it appears and inserting ``indicators''.

[[Page 14893]]



     SEC. 116. NATIVE AMERICAN PROGRAMS.

       (a) Advisory Council.--Section 166(h)(4)(C) (29 U.S.C. 
     2911(h)(4)(C)) is amended to read as follows:
       ``(C) Duties.--The Council shall advise the Secretary on 
     the operation and administration of the programs assisted 
     under this section.''.
       (b) Assistance to American Samoans in Hawaii.--Section 166 
     (29 U.S.C. 2911) is further amended by striking subsection 
     (j).
       (c) Migrant and Seasonal Farmworker Programs.--Section 
     167(d) is amended by inserting ``(including permanent 
     housing)'' after ``housing''.

     SEC. 117. YOUTH CHALLENGE GRANTS.

       Section 169 (29 U.S.C. 2914) is amended to read as follows:

     ``SEC. 169. YOUTH CHALLENGE GRANTS.

       ``(a) In General.--Of the amounts reserved by the Secretary 
     under section 127(a)(1)(A) for a fiscal year--
       ``(1) the Secretary shall use not less than 80 percent to 
     award competitive grants under subsection (b); and
       ``(2) the Secretary may use not more than 20 percent to 
     award discretionary grants under subsection (c).
       ``(b) Competitive Grants to States and Local Areas.--
       ``(1) Establishment.--From the funds described in 
     subsection (a)(1), the Secretary shall award competitive 
     grants to eligible entities to carry out activities 
     authorized under this section to assist eligible youth in 
     acquiring the skills, credentials and employment experience 
     necessary to succeed in the labor market.
       ``(2) Eligible entities.--Grants under this subsection may 
     be awarded to States, local boards, recipients of grants 
     under section 166 (relating to Native American programs), and 
     public or private entities (including consortia of such 
     entities) applying in conjunction with local boards.
       ``(3) Grant period.--The Secretary may make a grant under 
     this section for a period of 1 year and may renew the grants 
     for each of the 4 succeeding years.
       ``(4) Authority to require match.--The Secretary may 
     require that grantees under this subsection provide a non-
     Federal share of the cost of activities carried out under a 
     grant awarded under this subsection.
       ``(5) Participant eligibility.--Youth ages 14 through 19 as 
     of the time the eligibility determination is made may be 
     eligible to participate in activities provided under this 
     subsection.
       ``(6) Use of funds.--Funds under this subsection may be 
     used for activities that are designed to assist youth in 
     acquiring the skills, credentials and employment experience 
     that are necessary to succeed in the labor market, including 
     the activities identified in section 129. The activities may 
     include activities such as--
       ``(A) training and internships for out-of-school youth in 
     sectors of economy experiencing or projected to experience 
     high growth;
       ``(B) after-school dropout prevention activities for in-
     school youth;
       ``(C) activities designed to assist special youth 
     populations, such as court-involved youth and youth with 
     disabilities; and
       ``(D) activities combining remediation of academic skills, 
     work readiness training, and work experience, and including 
     linkages to postsecondary education, apprenticeships, and 
     career-ladder employment.
       ``(7) Applications.--To be eligible to receive a grant 
     under this subsection, an eligible entity shall submit an 
     application to the Secretary at such time, in such manner, 
     and containing such information as the Secretary may require, 
     including--
       ``(A) a description of the activities the eligible entity 
     will provide to eligible youth under this subsection;
       ``(B) a description of the programs of demonstrated 
     effectiveness on which the provision of the activities under 
     subparagraph (A) are based, and a description of how such 
     activities will expand the base of knowledge relating to the 
     provision of activities for youth;
       ``(C) a description of the private and public, and local 
     and State resources that will be leveraged to provide the 
     activities described under subparagraph (A) in addition the 
     funds provided under this subsection; and
       ``(D) the levels of performance the eligible entity expects 
     to achieve with respect to the indicators of performance for 
     youth specified in section 136(b)(2)(A)(ii).
       ``(8) Factors for award.--In awarding grants under this 
     subsection the Secretary may consider the quality of the 
     proposed project, the goals to be achieved, the likelihood of 
     successful implementation, the extent to which the project is 
     based on proven strategies or the extent to which the project 
     will expand the knowledge base on activities for youth, and 
     the additional State, local or private resources that will be 
     provided.
       ``(9) Evaluation.--The Secretary may reserve up to 5 
     percent of the funds described in subsection(a)(1) to provide 
     technical assistance to, and conduct evaluations of the 
     projects funded under this subsection (using appropriate 
     techniques as described in section 172(c)).
       ``(c) Discretionary Grants for Youth Activities.--
       ``(1) In general.--From the funds described in 
     subsection(a)(2), the Secretary may award grants to eligible 
     entities to provide activities that will assist youth in 
     preparing for, and entering and retaining, employment.
       ``(2) Eligible entities.--Grants under this subsection may 
     be awarded to public or private entities that the Secretary 
     determines would effectively carry out activities relating to 
     youth under this subsection.
       ``(3) Participant eligibility.--Youth ages 14 through 19 at 
     the time the eligibility determination is made may be 
     eligible to participate in activities under this subsection.
       ``(4) Use of funds.--Funds provided under this subsection 
     may be used for activities that will assist youth in 
     preparing for, and entering and retaining, employment, 
     including the activities described in section 129 for out-of-
     school youth, activities designed to assist in-school youth 
     to stay in school and gain work experience, and such other 
     activities that the Secretary determines are appropriate.
       ``(5) Applications.--To be eligible to receive a grant 
     under this subsection, an eligible entity shall submit an 
     application to the Secretary at such time, in such manner, 
     and containing such information as the Secretary may require.
       ``(6) Additional requirements.--The Secretary may require 
     the provision of a non-Federal share for projects funded 
     under this subsection and may require participation of 
     grantees in evaluations of such projects, including 
     evaluations using the techniques as described in section 
     172(c).''.

     SEC. 118. TECHNICAL ASSISTANCE.

       Section 170 (29 U.S.C. 2915) is amended--
       (1) by striking subsection (b);
       (2) by striking ``(a) General Technical Assistance.--'';
       (3) by redesignating paragraphs (1), (2), and (3) as 
     subsections (a), (b), and (c) respectively, and moving such 
     subsections 2 ems to the left;
       (4) in subsection (a) (as redesignated by paragraph (3))--
       (A) by inserting ``the training of staff providing rapid 
     response services, the training of other staff of recipients 
     of funds under this title, peer review activities under this 
     title, assistance regarding accounting and program operation 
     practices (when such assistance would not be duplicative to 
     assistance provided by the State),'' after ``localities,''; 
     and
       (B) by striking ``from carrying out activities'' and all 
     that follows up to the period and inserting ``to implement 
     the amendments made by the Workforce Reinvestment and Adult 
     Education Act of 2003''; and
       (5) by inserting, after subsection (c) (as redesignated by 
     paragraph (3)), the following:
       ``(d) Best Practices Coordination.--The Secretary shall 
     establish a system whereby States may share information 
     regarding best practices with regards to the operation of 
     workforce investment activities under this Act.''.

     SEC. 119. DEMONSTRATION, PILOT, MULTISERVICE, RESEARCH AND 
                   MULTI-
                   STATE PROJECTS.

       (a) Demonstration and Pilot Projects.--Section 171(b) (29 
     U.S.C. 2916(b)) is amended--
       (1) in paragraph (1)--
       (A) by striking ``Under a'' and inserting ``Consistent with 
     the priorities specified in the'';
       (B) by amending subparagraphs (A) through (D) to read as 
     follows:
       ``(A) projects that assist national employers in connecting 
     with the workforce investment system established under this 
     title in order to facilitate the recruitment and employment 
     of needed workers and to provide information to such system 
     on skills and occupations in demand;
       ``(B) projects that promote the development of systems that 
     will improve the effectiveness and efficiency of programs 
     carried out under this title;
       ``(C) projects that focus on opportunities for employment 
     in industries and sectors of industries that are experiencing 
     or are likely to experience high rates of growth;
       ``(D) projects carried out by States and local areas to 
     test innovative approaches to delivering employment-related 
     services;'';
       (C) by striking subparagraph (E);
       (D) by redesignating subparagraphs (F) and (G) as 
     subparagraphs (E) and (F), respectively;
       (E) by inserting after subparagraph (F) (as so 
     redesignated) the following:
       ``(G) projects that provide retention grants to qualified 
     job training programs upon placement or retention of a low-
     income individual trained by that program in employment with 
     a single employer for a period of 1 year, provided that such 
     employment is providing to the low-income individual an 
     income not less than twice the poverty line for that 
     individual.''; and
       (F) by striking subparagraph (H); and
       (2) in paragraph (2)--
       (A) by striking subparagraph (B); and
       (B) by redesignating subparagraph (C) as subparagraph (B).
       (b) Multiservice Projects.--Section 171(c)(2)(B) (29 U.S.C. 
     2916(c)(2)(B)) is amended to read as follows:
       ``(B) Net impact studies and reports.--The Secretary shall 
     conduct studies to determine the net impacts of programs, 
     services, and activities carried out under this title. The 
     Secretary shall prepare and disseminate to the public reports 
     containing the results of such studies.''.

[[Page 14894]]

       (c) Waiver Authority to Carry Out Demonstrations and 
     Evaluations.--Section 171 (29 U.S.C. 2916(d)) is further 
     amended by striking subsection (d).

     SEC. 120. EVALUATIONS.

       (a) In General.--Section 173 (29 U.S.C. 2916) is amended--
       (1) by amending the designation and heading to read as 
     follows:

     ``SEC. 173. NATIONAL DISLOCATED WORKER GRANTS.'';

     and
       (2) in subsection (a)--
       (A) by striking ``national emergency grants'' in the matter 
     preceding paragraph (1) and inserting ``national dislocated 
     worker grants''; and
       (B) in paragraph (1), by striking ``subsection (c)'' and 
     inserting ``subsection (b)''.
       (b) Administration.--Section 173 (29 U.S.C. 2918) is 
     further amended--
       (1) by striking subsection (b) and redesignating 
     subsections (c) and (d) as subsections (b) and (c), 
     respectively; and
       (2) by striking subsection (e) and redesignating 
     subsections (f) and (g) as subsection (d) and (e), 
     respectively.
       (c) Eligible Entities.--Section 173(b)(1)(B) (29 U.S.C. 
     2918(b)(1)(B)) (as redesignated by subsection (b) of this 
     section) is amended by striking ``, and other entities'' and 
     all that follows and inserting a period.
       (d) Conforming Amendment.--The table of contents in section 
     1(b) is amended by amending the item related to section 173 
     to read as follows:

``Sec. 173. National dislocated worker grants.''.

     SEC. 121. AUTHORIZATION OF APPROPRIATIONS FOR NATIONAL 
                   ACTIVITIES.

       (a) In General.--Section 174(a)(1) (29 U.S.C. 2919(a)(1)) 
     is amended by striking ``1999 through 2003'' and inserting 
     ``2004 through 2009''.
       (b) Reservations.--Section 174(b) is amended to read as 
     follows:
       ``(b) Technical Assistance; Demonstration and Pilot 
     Projects; Evaluations; Incentive Grants.--There are 
     authorized to be appropriated to carry out sections 170 
     through 172 and section 136 such sums as may be necessary for 
     each of fiscal years 2004 through 2009.''.

     SEC. 122. REQUIREMENTS AND RESTRICTIONS.

       (a) In General.--Section 181(c)(2)(A) (29 U.S.C. 
     2931(c)(2)(A)) is amended in the matter preceding clause (i) 
     by striking ``shall'' and inserting ``may''.
       (b) Limitations.--Section 181(e) is amended by striking the 
     first sentence.

     SEC. 123. NONDISCRIMINATION.

       Section 188(a)(2) (29 U.S.C. 2931(a)(2)) is amended--
       (1) by striking ``employment.--No'' and inserting 
     ``employment.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     no''; and
       (2) by adding at the end the following subparagraph:
       ``(B) Exemption for religious organizations.--Subparagraph 
     (A) shall not apply to a recipient of financial assistance 
     under this title that is a religious corporation, 
     association, educational institution, or society, with 
     respect to the employment of individuals of a particular 
     religion to perform work connected with the carrying on by 
     such corporation, association, educational institution, or 
     society of its activities. Such recipients shall comply with 
     the other requirements contained in subparagraph (A).''.

     SEC. 124. ADMINISTRATIVE PROVISIONS.

       (a) Program Year.--Section 189(g)(1) (29 U.S.C. 2939(g)(1)) 
     is amended to read as follows:
       ``(1) In general.--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) Availability.--Section 189(g)(2) (29 U.S.C. 2939(g)(2)) 
     is amended by striking ``each State'' and inserting ``each 
     recipient''.
       (c) General Waivers.--Section 189(i)(4) (29 U.S.C. 
     2939(i)(4)) is amended--
       (1) in subparagraph (A), in the matter preceding clause 
     (i), by inserting ``, or in accordance with subparagraph 
     (D),'' after ``subparagraph (B)''; and
       (2) by adding the following subparagraph:
       ``(D) Expedited process for extending approved waivers to 
     additional states.--In lieu of the requirements of 
     subparagraphs (B) and (C), the Secretary may establish an 
     expedited procedure for the purpose of extending to 
     additional States the waiver of statutory or regulatory 
     requirements that have been approved for a State pursuant to 
     a request under subparagraph (B). Such procedure shall ensure 
     that the extension of such waivers to additional States are 
     accompanied by appropriate conditions relating the 
     implementation of such waivers.''.

     SEC. 125. GENERAL PROGRAM REQUIREMENTS.

       Section 195 (29 U.S.C. 2945) is amended by adding at the 
     end the following new paragraph:
       ``(14) Funds provided under this title shall not be used to 
     establish or operate stand-alone fee-for-service enterprises 
     that compete with private sector employment agencies within 
     the meaning of section 701(c) of the Civil Rights Act of 1964 
     (42 U.S.C. 2000e(c)). For purposes of this paragraph, such an 
     enterprise does not include one-stop centers.''.

                       TITLE II--ADULT EDUCATION

        PART A--ADULT BASIC SKILLS AND FAMILY LITERACY EDUCATION

     SEC. 201. TABLE OF CONTENTS.

       The table of contents in section 1(b) is amended by 
     amending the items relating to title II to read as follows:

      ``TITLE II--ADULT BASIC SKILLS AND FAMILY LITERACY EDUCATION

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

                    ``Chapter 1--Federal Provisions

``Sec. 211. Reservation of funds; grants to eligible agencies; 
              allotments.
``Sec. 212. Performance accountability system.
``Sec. 213. Incentive grants for states.

                     ``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 leadership activities.''.

     SEC. 202. AMENDMENT.

       Title II is amended to read as follows:

      ``TITLE II--ADULT BASIC SKILLS AND FAMILY LITERACY EDUCATION

     ``SEC. 201. SHORT TITLE.

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

     ``SEC. 202. PURPOSE.

       ``It is the purpose of this title to provide instructional 
     opportunities for adults seeking to improve their basic 
     reading, writing, speaking, and math skills, and support 
     States and local communities in providing, on a voluntary 
     basis, adult basic skills and family literacy programs, in 
     order to--
       ``(1) increase the basic reading, writing, speaking, and 
     math skills necessary for adults to obtain employment and 
     self-sufficiency and to successfully advance in the 
     workforce;
       ``(2) assist adults in the completion of a secondary school 
     education (or its equivalent) and the transition to a 
     postsecondary educational institution;
       ``(3) increase the basic reading, writing, speaking, and 
     math skills of parents to enable them to support the 
     educational development of their children and make informed 
     choices regarding their children's education; and
       ``(4) assist immigrants who are not proficient in English 
     in improving their reading, writing, speaking, and math 
     skills and acquiring an understanding of the American free 
     enterprise system, individual freedom, and the 
     responsibilities of citizenship.

     ``SEC. 203. DEFINITIONS.

       ``In this title:
       ``(1) Adult basic skills and family literacy education 
     programs.--The term `adult basic skills and family literacy 
     education programs' means a sequence of academic instruction 
     and educational services below the postsecondary level that 
     increase an individual's ability to read, write, and speak in 
     English and perform mathematical computations leading to a 
     level of proficiency equivalent to secondary school 
     completion that is provided for individuals--
       ``(A) who are at least 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 reading, writing, 
     speaking, and math skills to enable the individuals to 
     function effectively in society;
       ``(ii) do not have a secondary school diploma or the 
     General Equivalency Diploma (GED) (including recognized 
     alternative standards for individuals with disabilities), and 
     have not achieved an equivalent level of education; or
       ``(iii) are unable to read, write, or speak the English 
     language.
       ``(2) Eligible agency.--The term `eligible agency'--
       ``(A) means the sole entity or agency in a State or an 
     outlying area responsible for administering or supervising 
     policy for adult basic skills and family literacy education 
     programs in the State or outlying area, respectively, 
     consistent with the law of the State or outlying area, 
     respectively; and
       ``(B) may be the State educational agency, the State agency 
     responsible for administering workforce investment 
     activities, or the State agency responsible for administering 
     community or technical colleges.
       ``(3) Eligible provider.--The term `eligible provider' 
     means--
       ``(A) a local educational agency;
       ``(B) a community-based or faith-based organization of 
     demonstrated effectiveness;

[[Page 14895]]

       ``(C) a volunteer literacy organization of demonstrated 
     effectiveness;
       ``(D) an institution of higher education;
       ``(E) a public or private educational agency;
       ``(F) a library;
       ``(G) a public housing authority;
       ``(H) an institution that is not described in any of 
     subparagraphs (A) through (G) and has the ability to provide 
     adult basic skills and family literacy education programs to 
     adults and families; or
       ``(I) a consortium of the agencies, organizations, 
     institutions, libraries, or authorities described in any of 
     subparagraphs (A) through (H).
       ``(4) English language acquisition program.--The term 
     `English language acquisition program' means a program of 
     instruction designed to help individuals with limited English 
     proficiency achieve competence in reading, writing, and 
     speaking the English language.
       ``(5) Essential components of reading instruction.--The 
     term `essential components of reading instruction' has the 
     meaning given to that term in section 1208 of the Elementary 
     and Secondary Education Act of 1965 (20 U.S.C. 6368).
       ``(6) Family literacy education programs.--The term `family 
     literacy education programs' means educational programs 
     that--
       ``(A) assist parents and students, on a voluntary basis, in 
     achieving the purposes of this title as described in section 
     202; and
       ``(B) are of sufficient intensity in terms of hours and of 
     sufficient duration to make sustainable changes in a family, 
     are based upon scientific research-based principles, and for 
     the purpose of substantially increasing the ability of 
     parents and children to read, write, and speak English 
     integrate--
       ``(i) interactive literacy activities between parents and 
     their children;
       ``(ii) training for parents regarding how to be the primary 
     teacher for their children and full partners in the education 
     of their children;
       ``(iii) parent literacy training that leads to economic 
     self-sufficiency; and
       ``(iv) an age-appropriate education to prepare children for 
     success in school and life experiences.
       ``(7) Governor.--The term `Governor' means the chief 
     executive officer of a State or outlying area.
       ``(8) 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 one individual with a 
     disability.
       ``(9) Individual with limited english proficiency.--The 
     term `individual with limited English proficiency' means an 
     adult or out-of-school youth who has limited ability in 
     reading, writing, speaking, 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.
       ``(10) Institution of higher education.--The term 
     `institution of higher education' has the meaning given to 
     that term in section 101 of the Higher Education Act of 1965 
     (20 U.S.C. 1001).
       ``(11) Literacy.--The term `literacy' means the ability to 
     read, write, and speak the English language with competence, 
     knowledge, and comprehension.
       ``(12) Local educational agency.--The term `local 
     educational agency' has the meaning given to that term in 
     section 9101 of the Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 7801).
       ``(13) Outlying area.--The term `outlying area' has the 
     meaning given to that term in section 101 of this Act.
       ``(14) 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.
       ``(15) Reading.--The term `reading' has the meaning given 
     to that term in section 1208 of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6368).
       ``(16) Scientifically based reading research.--The term 
     `scientifically based reading research' has the meaning given 
     to that term in section 1208 of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6368).
       ``(17) Secretary.--The term `Secretary' means the Secretary 
     of Education.
       ``(18) State.--The term `State' means each of the several 
     States of the United States, the District of Columbia, and 
     the Commonwealth of Puerto Rico.
       ``(19) State educational agency.--The term `State 
     educational agency' has the meaning given to that term in 
     section 9101 of the Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 7801).
       ``(20) Workplace literacy program.--The term `workplace 
     literacy program' means an educational program that is 
     offered in collaboration between eligible providers and 
     employers or employee organizations for the purpose of 
     improving the productivity of the workforce through the 
     improvement of reading, writing, speaking, and math skills.

     ``SEC. 204. HOME SCHOOLS.

       ``Nothing in this title shall be construed to affect home 
     schools, whether or not a home school is treated as a home 
     school or a private school under State law, or to compel a 
     parent engaged in home schooling to participate in an English 
     language acquisition program, a family literacy education 
     program, or an adult basic skills and family literacy 
     education program.

     ``SEC. 205. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     title $584,300,000 for fiscal year 2004 and such sums as may 
     be necessary for fiscal years 2005 through 2009.

                    ``CHAPTER 1--FEDERAL PROVISIONS

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

       ``(a) Reservation of Funds.--From the sums appropriated 
     under section 205 for a fiscal year, the Secretary--
       ``(1) shall reserve 1.75 percent to carry out the National 
     Institute for Literacy Establishment Act;
       ``(2) shall reserve up to 1.72 percent for incentive grants 
     under section 213; and
       ``(3) shall reserve up to 1.55 percent to carry out section 
     242.
       ``(b) Grants to Eligible Agencies.--
       ``(1) In general.--From the sums 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 agency for the fiscal year, subject to 
     subsections (f) and (g).
       ``(2) Purpose of grants.--The Secretary may award a grant 
     under paragraph (1) only if the eligible agency involved 
     agrees to expend the grant in accordance with the provisions 
     of this title.
       ``(c) Allotments.--
       ``(1) Initial allotments.--From the sums 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--
       ``(A) $100,000, in the case of an eligible agency serving 
     an outlying area; and
       ``(B) $250,000, in the case of any other eligible agency.
       ``(2) Additional allotments.--From the sums 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 sums 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;
       ``(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 the 
     General Equivalency Diploma (GED) (including recognized 
     alternative standards for individuals with disabilities); 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 title in accordance with the provisions of this title as 
     determined by the Secretary.
       ``(2) 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 be eligible to receive a grant under this title until 
     an agreement for the extension of United States education 
     assistance under the Compact of Free Association for each of 
     the Freely Associated States becomes effective.
       ``(3) 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 Provisions.--
       ``(1) In general.--Notwithstanding subsection (c), and 
     subject to paragraphs (2) and (3), for fiscal year 2004 and 
     each succeeding fiscal year, no eligible agency shall receive

[[Page 14896]]

     an allotment under this title that is less than 90 percent of 
     the allotment the eligible agency received for the preceding 
     fiscal year under this title.
       ``(2) Exception.--An eligible agency that receives for the 
     preceding fiscal year only an initial allotment under 
     subsection 211(c)(1) (and no additional allotment under 
     211(c)(2)) shall receive an allotment equal to 100 percent of 
     the initial allotment.
       ``(3) Ratable reduction.--If for any fiscal year the amount 
     available for allotment under this title 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 title 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 
     title, 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 title for such year.

     ``SEC. 212. PERFORMANCE ACCOUNTABILITY SYSTEM.

       ``(a) Purpose.--The purpose of this section is to establish 
     a comprehensive performance accountability system, composed 
     of the activities described in this section, to assess the 
     effectiveness of eligible agencies in achieving continuous 
     improvement of adult basic skills and family literacy 
     education programs funded under this title, in order to 
     optimize the return on investment of Federal funds in adult 
     basic skills and family literacy education programs.
       ``(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) employment performance indicators 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) Measurable improvements in basic skill levels in 
     reading, writing, and speaking the English language and basic 
     math, leading to proficiency in each skill.
       ``(ii) Receipt of a secondary school diploma or the General 
     Equivalency Diploma (GED) (including recognized alternative 
     standards for individuals with disabilities).
       ``(iii) Placement in postsecondary education or other 
     training programs.
       ``(B) Employment performance indicators.--Consistent with 
     applicable Federal and State privacy laws, an eligible agency 
     shall identify in the State plan the following individual 
     participant employment performance indicators--
       ``(i) entry into employment;
       ``(ii) retention in employment; and
       ``(iii) increase in earnings.
       ``(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 basic skills and family literacy education programs 
     authorized under this title. 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 and significantly improving the agency's 
     performance outcomes in an objective, quantifiable, and 
     measurable form.

       ``(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 basic 
     skills and family literacy education programs authorized 
     under this title, the Secretary and each eligible agency 
     shall reach agreement on levels of student proficiency 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's adjusted levels of performance, taking into account 
     factors including the characteristics of participants when 
     the participants entered the program; and
       ``(II) the extent to which such levels promote continuous 
     and significant improvement in performance on the student 
     proficiency measures used by such eligible agency and ensure 
     optimal return on the investment of Federal funds.

       ``(v) Agreement on eligible agency adjusted levels of 
     performance for second 3 years.--Prior to the fourth program 
     year covered by the State plan, the Secretary and each 
     eligible agency shall reach agreement on levels of student 
     proficiency for each of the core indicators of performance 
     for the fourth, fifth, and sixth 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)(I), the eligible agency may request 
     that the eligible agency adjusted levels of performance 
     agreed to under clause (iii) or (v) be revised.
       ``(B) Levels of employment performance.--The eligible 
     agency shall identify, in the State plan, eligible agency 
     levels of performance for each of the employment performance 
     indicators described in paragraph (2)(B). Such levels shall 
     be considered to be eligible agency adjusted levels of 
     performance for purposes of this title.
       ``(c) Report.--
       ``(1) In general.--Each eligible agency that receives a 
     grant under section 211(b) shall annually prepare and submit 
     to the Secretary, the Governor, the State legislature, 
     eligible providers, and the general public within the State, 
     a report on the progress of the eligible agency in achieving 
     eligible agency performance measures, including the 
     following:
       ``(A) Information on the levels of performance achieved by 
     the eligible agency with respect to the core indicators of 
     performance and employment performance indicators.
       ``(B) The number and type of each eligible provider that 
     receives funding under such grant.
       ``(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 the 
     Congress with copies of such reports.

     ``SEC. 213. INCENTIVE GRANTS FOR STATES.

       ``(a) In General.--From funds appropriated under section 
     211(a)(2), the Secretary may award grants to States for 
     exemplary performance in carrying out programs under this 
     title. Such awards shall be based on States meeting or 
     exceeding the core indicators of performance established 
     under section 212(b)(2)(A) and may be based on the 
     performance of the State in serving populations, such as 
     those described in section 224(b)(10), including the levels 
     of service provided and the performance outcomes, and such 
     other factors relating to the performance of the State under 
     this title as the Secretary determines appropriate.
       ``(b) Use of Funds.--The funds awarded to a State under 
     this paragraph may be used to carry out any activities 
     authorized under this title, including demonstrations and 
     innovative programs for hard-to-serve populations.

                     ``CHAPTER 2--STATE PROVISIONS

     ``SEC. 221. STATE ADMINISTRATION.

       ``Each eligible agency shall be responsible for the 
     following activities under this title:
       ``(1) The development, submission, implementation, and 
     monitoring 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 title.
       ``(3) Coordination and avoidance of duplication 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 title for a fiscal year--
       ``(1) shall use an amount 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 such amount 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 $75,000, 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

[[Page 14897]]

     211(b), each eligible agency shall provide, for the costs to 
     be incurred by the eligible agency in carrying out the adult 
     basic skills and family literacy education programs for which 
     the grant is awarded, a non-Federal contribution in an amount 
     at least 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 basic skills and family literacy education programs 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 basic 
     skills and family literacy education programs 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 basic 
     skills and family literacy education programs in a manner 
     that is consistent with the purpose of this title.

     ``SEC. 223. STATE LEADERSHIP ACTIVITIES.

       ``(a) In General.--Each eligible agency may use funds made 
     available under section 222(a)(2) for any of the following 
     adult basic skills and family literacy education programs:
       ``(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 the essential 
     components of reading instruction 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 basic skills and family literacy education 
     programs for development and dissemination of scientific 
     research-based instructional practices in reading, writing, 
     speaking, math, and English language acquisition programs.
       ``(3) The provision of assistance to eligible providers in 
     developing, implementing, and reporting measurable progress 
     in achieving the objectives of this title.
       ``(4) The provision of technology assistance, including 
     staff training, to eligible providers of adult basic skills 
     and family literacy education programs, including distance 
     learning activities, to enable the eligible providers to 
     improve the quality of such activities.
       ``(5) The development and implementation of technology 
     applications or distance learning, including professional 
     development to support the use of instructional technology.
       ``(6) Coordination with other public programs, including 
     welfare-to-work, workforce development, and job training 
     programs.
       ``(7) 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 basic skills and family literacy education 
     programs, for adults enrolled in such activities.
       ``(8) The development and implementation of a system to 
     assist in the transition from adult basic education to 
     postsecondary education.
       ``(9) Activities to promote workplace literacy programs.
       ``(10) Activities to promote and complement local outreach 
     initiatives described in section 242(7).
       ``(11) Other activities of statewide significance, 
     including assisting eligible agencies in achieving progress 
     in improving the skill levels of adults who participate in 
     programs under this title.
       ``(b) Coordination.--In carrying out this section, eligible 
     agencies shall coordinate 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 title 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 imposed by the State or outlying area.

     ``SEC. 224. STATE PLAN.

       ``(a) 6-Year Plans.--
       ``(1) In general.--Each eligible agency desiring a grant 
     under this title for any fiscal year shall submit to, or have 
     on file with, the Secretary a 6-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.--The eligible agency shall include in 
     the State plan or any revisions to the State plan--
       ``(1) an objective assessment of the needs of individuals 
     in the State or outlying area for adult basic skills and 
     family literacy education programs, including individuals 
     most in need or hardest to serve;
       ``(2) a description of the adult basic skills and family 
     literacy education programs that will be carried out with 
     funds received under this title;
       ``(3) a description of how the eligible agency will 
     evaluate and measure annually the effectiveness and 
     improvement of the adult basic skills and family literacy 
     education programs based on the performance measures 
     described in section 212 including--
       ``(A) how the eligible agency will evaluate and measure 
     annually such effectiveness on a grant-by-grant basis; and
       ``(B) how the eligible agency--
       ``(i) will hold eligible providers accountable regarding 
     the progress of such providers in improving the academic 
     achievement of participants in adult education programs under 
     this title and regarding the core indicators of performance 
     described in section 212(b)(2)(A); and
       ``(ii) will use technical assistance, sanctions, and 
     rewards (including allocation of grant funds based on 
     performance and termination of grant funds based on 
     nonperformance);
       ``(4) a description of the performance measures described 
     in section 212 and how such performance measures have 
     significantly improved adult basic skills and family literacy 
     education programs in the State or outlying area;
       ``(5) an assurance that the eligible agency will, in 
     addition to meeting all of the other requirements of this 
     title, award not less than one grant under this title to an 
     eligible provider that--
       ``(A) 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 
     basic skills and family literacy education programs; and
       ``(B) attempts to coordinate with support services that are 
     not provided under this title prior to using funds for adult 
     basic skills and family literacy education programs provided 
     under this title for support services;
       ``(6) an assurance that the funds received under this title 
     will not be expended for any purpose other than for 
     activities under this title;
       ``(7) a description of how the eligible agency will fund 
     local activities in accordance with the measurable goals 
     described in section 231(d);
       ``(8) an assurance that the eligible agency will expend the 
     funds under this title 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, which process--
       ``(A) shall include consultation with the State workforce 
     investment board, the State board responsible for 
     administering community or technical colleges, the Governor, 
     the State educational agency, the State board or agency 
     responsible for administering block grants for temporary 
     assistance to needy families under title IV of the Social 
     Security Act, the State council on disabilities, the State 
     vocational rehabilitation agency, other State agencies that 
     promote the improvement of adult basic skills and family 
     literacy education programs, and direct providers of such 
     programs; and
       ``(B) may include consultation with the State agency on 
     higher education, institutions responsible for professional 
     development of adult basic skills and family literacy 
     education programs instructors, representatives of business 
     and industry, refugee assistance programs, and faith-based 
     organizations;
       ``(10) a description of the eligible agency's strategies 
     for serving populations that include, at a minimum--
       ``(A) low-income individuals;
       ``(B) individuals with disabilities;
       ``(C) the unemployed;
       ``(D) the underemployed; and
       ``(E) individuals with multiple barriers to educational 
     enhancement, including individuals with limited English 
     proficiency;
       ``(11) a description of how the adult basic skills and 
     family literacy education programs that will be carried out 
     with any funds received under this title 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;
       ``(12) a description of the steps the eligible agency will 
     take to ensure direct and equitable access, as required in 
     section 231(c)(1), including--
       ``(A) how the State will build the capacity of community-
     based and faith-based organizations to provide adult basic 
     skills and family literacy education programs; and
       ``(B) how the State will increase the participation of 
     business and industry in adult basic skills and family 
     literacy education programs; and
       ``(13) a description of how the eligible agency will 
     consult with any State agency responsible for postsecondary 
     education to develop adult education that prepares students 
     to enter postsecondary education without the need for 
     remediation upon completion of secondary school equivalency 
     programs.
       ``(c) Plan Revisions.--When changes in conditions or other 
     factors require substantial revisions to an approved State 
     plan, the

[[Page 14898]]

     eligible agency shall submit the revisions of 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, the chief State school officer, or the 
     State officer responsible for administering community or 
     technical colleges, or outlying area for review and comment; 
     and
       ``(2) ensure that any comments regarding the State plan by 
     the Governor, the chief State school officer, or the State 
     officer responsible for administering community or technical 
     colleges, and any revision to the State plan, are submitted 
     to the Secretary.
       ``(e) Plan Approval.--A State plan submitted to the 
     Secretary shall be approved by the Secretary only if the plan 
     is consistent with the specific provisions of this title.

     ``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 and 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 skills education;
       ``(2) special education programs as determined by the 
     eligible agency;
       ``(3) reading, writing, speaking, and math programs; and
       ``(4) secondary school credit or diploma programs or their 
     recognized equivalent.
       ``(c) Priority.--Each eligible agency that is using 
     assistance provided under this section to carry out a program 
     for criminal offenders within a correctional institution 
     shall give priority to serving individuals who are likely to 
     leave the correctional institution within 5 years of 
     participation in the program.
       ``(d) Definitions.--For purposes of this section:
       ``(1) 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.
       ``(2) Criminal offender.--The term `criminal offender' 
     means any individual who is charged with, or convicted of, 
     any criminal offense.

                     ``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 that 
     meet the conditions and requirements of this title to enable 
     the eligible providers to develop, implement, and improve 
     adult basic skills and family literacy education programs 
     within the State.
       ``(b) Local Activities.--The eligible agency shall require 
     eligible providers receiving a grant or contract under 
     subsection (a) to establish or operate one or more programs 
     of instruction that provide services or instruction in one or 
     more of the following categories:
       ``(1) Adult basic skills and family literacy education 
     programs (including proficiency in reading, writing, 
     speaking, and math).
       ``(2) Workplace literacy programs.
       ``(3) English language acquisition programs.
       ``(4) Family literacy education programs.
       ``(c) Direct and Equitable Access; Same Process.--Each 
     eligible agency receiving funds under this title 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) Measurable Goals.--The eligible agency shall require 
     eligible providers receiving a grant or contract under 
     subsection (a) to demonstrate--
       ``(1) the eligible provider's measurable goals for 
     participant outcomes to be achieved annually on the core 
     indicators of performance and employment performance 
     indicators described in section 212(b)(2);
       ``(2) the past effectiveness of the eligible provider in 
     improving the basic academic skills of adults and, for 
     eligible providers receiving grants in the prior year, the 
     success of the eligible provider receiving funding under this 
     title in meeting or exceeding its performance goals in the 
     prior year;
       ``(3) the commitment of the eligible provider to serve 
     individuals in the community who are the most in need of 
     basic academic skills instruction services, including 
     individuals who are low-income or have minimal reading, 
     writing, speaking, and math skills, or limited English 
     proficiency;
       ``(4) the program--
       ``(A) is of sufficient intensity and duration for 
     participants to achieve substantial learning gains; and
       ``(B) uses instructional practices that include the 
     essential components of reading instruction;
       ``(5) educational practices are based on scientifically 
     based research;
       ``(6) the activities of the eligible provider effectively 
     employ advances in technology, as appropriate, including the 
     use of computers;
       ``(7) the activities provide instruction in real-life 
     contexts, when appropriate and scientifically based, to 
     ensure that an individual has the skills needed to compete in 
     the workplace and exercise the rights and responsibilities of 
     citizenship;
       ``(8) the activities are staffed by well-trained 
     instructors, counselors, and administrators;
       ``(9) the activities are coordinated with other available 
     resources in the community, such as through strong links with 
     elementary schools and secondary schools, postsecondary 
     educational institutions, one-stop centers, job training 
     programs, community-based and faith-based organizations, and 
     social service agencies;
       ``(10) 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) the activities include a high-quality information 
     management system that has the capacity to report measurable 
     participant outcomes and to monitor program performance 
     against the performance measures established by the eligible 
     agency;
       ``(12) the local communities have a demonstrated need for 
     additional English language acquisition programs;
       ``(13) the capacity of the eligible provider to produce 
     valid information on performance results, including 
     enrollments and measurable participant outcomes;
       ``(14) adult basic skills and family literacy education 
     programs offer rigorous reading, writing, speaking, and math 
     content that are based on scientific research; and
       ``(15) applications of technology, and services to be 
     provided by the eligible providers, are of sufficient 
     intensity and duration to increase the amount and quality of 
     learning and lead to measurable learning gains within 
     specified time periods.
       ``(e) Special Rule.--Eligible providers may use grant funds 
     under this title to serve children participating in family 
     literacy programs assisted under this part, provided that 
     other sources of funds available to provide similar services 
     for such children are used first.

     ``SEC. 232. LOCAL APPLICATION.

       ``Each eligible provider desiring a grant or contract under 
     this title 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 title 
     will be spent consistent with the requirements of this title;
       ``(2) a description of any cooperative arrangements the 
     eligible provider has with other agencies, institutions, or 
     organizations for the delivery of adult basic skills and 
     family literacy education programs; and
       ``(3) each of the demonstrations required by section 
     231(d).

     ``SEC. 233. LOCAL ADMINISTRATIVE COST LIMITS.

       ``(a) In General.--Subject to subsection (b), of the amount 
     that is made available under this title to an eligible 
     provider--
       ``(1) at least 95 percent shall be expended for carrying 
     out adult basic skills and family literacy education 
     programs; and
       ``(2) the remaining amount shall be used for planning, 
     administration, personnel and professional development, 
     development of measurable goals in reading, writing, 
     speaking, and math, 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 may 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 basic skills and family literacy education programs 
     under this title shall supplement and not supplant other 
     State or local public funds expended for adult basic skills 
     and family literacy education programs.
       ``(b) Maintenance of Effort.--
       ``(1) In general.--
       ``(A) Determination.--An eligible agency may receive funds 
     under this title for any fiscal year if the Secretary finds 
     that the fiscal effort per student or the aggregate 
     expenditures of such eligible agency for activities under 
     this title, in the second preceding fiscal year, were not 
     less than 90 percent of the fiscal effort per student or the 
     aggregate expenditures of such eligible agency for adult 
     basic skills and family literacy education programs, in the 
     third preceding fiscal year.

[[Page 14899]]

       ``(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 title for 
     such program year to the agency for adult basic skills and 
     family literacy education programs 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 basic skills and family literacy 
     education programs under this title for a fiscal year is less 
     than the amount made available for adult basic skills and 
     family literacy education programs under this title 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 not more than 1 fiscal year, 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 LEADERSHIP ACTIVITIES.

       ``The Secretary shall establish and carry out a program of 
     national leadership activities that may include the 
     following:
       ``(1) Technical assistance, on request, including 
     assistance--
       ``(A) on requests to volunteer community- and faith-based 
     organizations, including but not limited to, improving their 
     fiscal management, research-based instruction, and reporting 
     requirements, and the development of measurable objectives to 
     carry out the requirements of this title;
       ``(B) in developing valid, measurable, and reliable 
     performance data, and using performance information for the 
     improvement of adult basic skills and family literacy 
     education programs;
       ``(C) on adult education professional development; and
       ``(D) in using distance learning and improving the 
     application of technology in the classroom.
       ``(2) Providing for the conduct of research on national 
     literacy basic skill acquisition levels among adults, 
     including the number of adults functioning at different 
     levels of reading proficiency.
       ``(3) Improving the coordination, efficiency, and 
     effectiveness of adult education and workforce development 
     services at the national, State, and local levels.
       ``(4) Determining how participation in adult basic skills 
     and family literacy education programs prepares individuals 
     for entry into and success in postsecondary education and 
     employment, and in the case of prison-based services, the 
     effect on recidivism.
       ``(5) Evaluating how different types of providers, 
     including community and faith-based organizations or private 
     for-profit agencies measurably improve the skills of 
     participants in adult basic skills and family literacy 
     education programs.
       ``(6) Identifying model integrated basic and workplace 
     skills education programs, coordinated literacy and 
     employment services, and effective strategies for serving 
     adults with disabilities.
       ``(7) Supporting the development of an entity that would 
     produce and distribute technology-based programs and 
     materials for adult basic skills and family literacy 
     education programs using an intercommunication system, as 
     that term is defined in section 397 of the Communications Act 
     of 1934 (47 U.S.C. 397), and expand the effective outreach 
     and use of such programs and materials to adult education 
     eligible providers.
       ``(8) Initiating other activities designed to improve the 
     measurable quality and effectiveness of adult basic skills 
     and family literacy education programs nationwide.''.

                PART B--NATIONAL INSTITUTE FOR LITERACY

     SEC. 211. SHORT TITLE; PURPOSE.

       (a) Short Title.--This part may be cited as the ``National 
     Institute for Literacy Establishment Act''.
       (b) Purpose.--The purpose of this part is to establish a 
     National Institute for Literacy to provide national 
     leadership in promoting reading research, reading 
     instruction, and professional development in reading based on 
     scientifically based research by--
       (1) disseminating widely information on scientifically 
     based reading research to improve academic achievement for 
     children, youth, and adults;
       (2) identifying and disseminating information about 
     schools, local educational agencies, and State educational 
     agencies that have effectively developed and implemented 
     classroom reading programs that meet the requirements of 
     subpart 1 of part B of title I of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 6361 et seq.), 
     including those State educational agencies, local educational 
     agencies, and schools that are identified as effective 
     through the External Evaluation of Reading First under 
     section 1205 of the Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 6365);
       (3) serving as a national resource for information on 
     reading instruction programs that contain the essential 
     components of reading instruction as supported by 
     scientifically based reading research, and that can lead to 
     improved reading outcomes for children, youth, and adults;
       (4) developing print and electronic materials that describe 
     and model the application of scientifically based reading 
     research;
       (5) providing national and regional reading leadership for 
     State and local personnel for the application and 
     implementation of scientifically based reading research;
       (6) coordinating efforts among Federal agencies, especially 
     the Department of Labor, the Department of Health and Human 
     Services, and the National Institute of Child Health and 
     Human Development, that provide reading programs, conduct 
     research, and provide services to recipients of Federal 
     financial assistance under titles I and III of the Elementary 
     and Secondary Education Act of 1965, the Head Start Act, the 
     Individuals with Disabilities Education Act, and the Adult 
     Basic Skills and Family Literacy Education Act, and each 
     Bureau funded school (as defined in title XI of the Education 
     Amendments of 1978 (25 U.S.C. 2001 et seq.)); and
       (7) informing the Congress, Federal departments and 
     agencies, schools of education, and the public of successful 
     local, State, and Federal program activities in reading 
     instruction that are determined to be effective based on the 
     findings of scientifically based reading research.

     SEC. 212. ESTABLISHMENT.

       (a) In General.--There is established the National 
     Institute for Literacy. The Institute shall be administered, 
     in accordance with this part, under the supervision and 
     direction of a Director. There shall be an agreement between 
     an Interagency Group (comprised of the Secretary of 
     Education, the Secretary of Labor, and the Secretary of 
     Health and Human Services) and the Institute on how the 
     purposes of the Institute may be achieved effectively. Such 
     agreement--
       (1) shall be regularly reviewed, and modified as needed to 
     remain current with any changes in the purposes of the 
     Institute; and
       (2) shall be updated no later than 1 year after the 
     enactment of this part.
       (b) Director.--
       (1) Appointment.--The Interagency Group shall appoint a 
     Director of the Institute, who has an understanding of, 
     supports, and is familiar with scientifically based reading 
     research, instruction, and professional development 
     applicable to children, youth, and adults. If a vacancy in 
     the position of the Director of the Institute occurs, the 
     Interagency Group shall appoint an Interim Director until 
     such time as a new Director can be appointed.
       (2) Pay.--The Director of the Institute shall receive the 
     rate of basic pay for level IV of the Executive Schedule.
       (3) Term.--The Director of the Institute shall be appointed 
     for an initial term of 3 years and may serve not more than 1 
     additional term of 3 years.

     SEC. 213. ADMINISTRATION.

       (a) In General.--The Director of the Institute shall be 
     responsible for administering the Institute. The Director of 
     the Institute shall--
       (1) provide leadership for the Institute, consistent with 
     the purposes described in section 211(b);
       (2) supervise all employees in the Institute;
       (3) assign responsibility to carry out the duties of the 
     Institute among officers ad employees, and offices of the 
     Institute;
       (4) prepare requests for appropriations for the Institute 
     and submit those requests to the Interagency Group;
       (5) oversee the expenditure of all funds allocated for the 
     Institute to carry out the purposes under section 211(b); and
       (6) ensure that the Institute's standards for research 
     quality are consistent with those promulgated by the 
     Institute for Education Sciences.
       (b) Offices.--The Institute shall have separate offices 
     from the Department of Education, the Department of Labor, 
     and the Department of Health and Human Services, and shall 
     have maximum flexibility in its operations to carry out the 
     purposes of the Institute.
       (c) Administrative Support.--The Secretary of Education 
     shall provide administrative support for the Institute, 
     including the administration of grants, contracts and 
     cooperative agreements, personnel, legal counsel, and 
     payroll.

[[Page 14900]]



     SEC. 214. DUTIES.

       (a) In General.--In order to provide leadership for the 
     improvement and expansion of the system for delivery of 
     scientifically based reading instructional practices, the 
     Director of the Institute shall--
       (1) establish a national electronic database of effective 
     reading programs for children, youth, and adults that include 
     the essential components of reading instruction, and 
     disseminate such information to parents, teachers, State and 
     Federal elected officials, and the public;
       (2) develop print and electronic materials for professional 
     development that provide applications of scientifically based 
     reading research, and instructional practices in reading for 
     children, youth, and adults;
       (3) provide technical assistance to the Congress, school 
     Boards, Federal agencies, State departments of education, 
     adult education programs, local school districts, local 
     public and private schools, and schools of education, on 
     scientifically based reading instructional practices 
     including diagnostic and assessment instruments and 
     instructional materials;
       (4) collaborate and support Federal research programs in 
     reading instruction, including, where appropriate, those 
     areas of study addressed by the National Institute of Child 
     Health and Human Development, the Institute for Education 
     Sciences, the National Science Foundation, the Department of 
     Labor, and the National Research Council;
       (5) coordinate with the Department of Education, the 
     Department of Labor, the Department of Health and Human 
     Services, and the National Institute of Child Health and 
     Human Development on all programs that include improving 
     reading instructional practices for children, youth, and 
     adults, and teacher training in reading instructional 
     practices;
       (6) use and support the collection of the best possible 
     information in carrying out this section, and where 
     appropriate, including reviews of research on instruction 
     using the criteria for quality identified by the Institute 
     for Education Sciences;
       (7) conduct reviews of research, including randomized field 
     trials, on reading programs, and conduct reviews of Federal 
     reading policies and reading program implementation using a 
     board of visitors as described in subchapter 300 of the 
     National Science Foundation Administrative Manual; and
       (8) develop an Internet site that provides useful 
     information to educators and the public on reading literacy 
     that is consistent with the purposes described in section 
     211(b).
       (b) 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 other legal 
     entities to carry out the activities of the Institute.
       (c) Relation to Other Laws.--The duties and powers of the 
     Institute under this part are in addition to the duties and 
     powers of the Institute under subparts 1, 2, and 3 of part B 
     of the Elementary and Secondary Education Act of 1965 (20 
     U.S.C. 1201 et seq.) (commonly referred to as Reading First, 
     Early Reading First, and the William F. Goodling Even Start 
     Family Literacy Programs, respectively).

     SEC. 215. LEADERSHIP IN SCIENTIFICALLY BASED READING 
                   INSTRUCTION.

       (a) In General.--The Director of the Institute may award 
     fellowships, with such stipends and allowances as necessary, 
     to outstanding individuals who are pursuing careers in 
     scientifically based research in reading instruction or pre-
     service or in-service training in reading instruction, 
     including teaching children and adults to read.
       (b) 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 scientifically based 
     reading instruction for children, youth, and adults, 
     including the training of volunteers in such reading skills 
     instruction.
       (c) Interns and Volunteers.--The Director of the Institute 
     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 deems necessary.

     SEC. 216. NATIONAL INSTITUTE FOR LITERACY ADVISORY BOARD.

       (a) Establishment.--
       (1) In general.--There shall be a National Institute for 
     Literacy Advisory Board, which shall consist of 10 
     individuals appointed by the President with the advice and 
     consent of the Senate.
       (2) Composition.--The Board shall be comprised of 
     individuals who are not otherwise officers or employees of 
     the Federal Government and who are knowledgeable about 
     scientifically based reading instruction, and the findings of 
     scientifically based reading research. The members of the 
     Board may include--
       (A) representatives from teacher training institutions 
     where scientifically based reading instruction is a major 
     component of pre-service training;
       (B) teachers who have been successful in teaching children 
     to read proficiently;
       (C) members of the business community who have developed 
     successful employee reading instruction programs;
       (D) volunteer tutors in reading who are using 
     scientifically based reading instruction;
       (E) reading researchers who have conducted scientifically 
     based research; and
       (F) other qualified individuals knowledgeable about 
     scientifically based reading instruction, including adult 
     education.
       (b) Duties.--The Board shall--
       (1) provide advice to the Director of the Institute to 
     ensure that the purposes of the Institute under section 211 
     are carried out effectively; and
       (2) approve the annual report to the Congress;
       (c) Federal Advisory Committee Act.--Except as otherwise 
     provided in this part, the Board established by this section 
     shall be subject to the provisions of the Federal Advisory 
     Committee Act (5 U.S.C. App.).
       (d) Appointments.--
       (1) 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.
       (2) 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.
       (e) 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 members present.
       (f) 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.
       (g) Meetings.--The Board shall meet at the call of the 
     Chairperson, or a majority of the members of the Board, but 
     not less than quarterly.

     SEC. 217. GIFTS, BEQUESTS, AND DEVISES.

       (a) In General.--The Institute may accept, administer, and 
     use gifts or donations of services, money, or property, 
     whether real or personal, tangible or intangible.
       (b) Rules.--The Director of the Institute 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.

     SEC. 218. 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.

     SEC. 219. APPLICABILITY OF CERTAIN CIVIL SERVICE LAWS.

       The Director of the Institute and the 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.

     SEC. 220. EXPERTS AND CONSULTANTS.

       The Institute may procure temporary and intermittent 
     services under section 3109(b) of title 5, United States 
     Code.

     SEC. 221. REPORT.

       (a) In General.--The Institute shall submit a biennial 
     report to the Committee on Education and the Workforce of the 
     House of Representatives and the Committee on Health, 
     Education, Labor, and Pensions of the Senate. Each report 
     submitted under this section shall include--
       (1) a comprehensive and detailed description of the 
     Institute's operations, activities, financial condition, and 
     accomplishments in carrying out the purposes of the Institute 
     as specified in section 211, for the period covered by the 
     report; and
       (2) a summary description of how the Institute will advance 
     the purposes of the Institute for the next biennium.
       (b) First Report.--The Institute shall submit a report 
     under this section not later than 1 year after the date of 
     enactment of this part.

     SEC. 222. DEFINITIONS.

       For purposes of this part--
       (1) the term ``Board'' means the National Institute for 
     Literacy Advisory Board;
       (2) the term ``Institute'' means the National Institute for 
     Literacy;
       (3) the term ``Interagency Group'' means the Secretary of 
     Education, the Secretary of

[[Page 14901]]

     Labor, and the Secretary of Health and Human Services;
       (4) the term ``literacy'' means the ability to read, write, 
     and speak the English language with competence, knowledge, 
     and comprehension; and
       (5) the terms ``reading'', ``scientifically based reading 
     research'', and ``essential components of reading 
     instruction'' have the meanings given those terms in section 
     1208 of part B of title I of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6368).

     SEC. 223. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to administer and 
     carry out this part $6,700,000 for fiscal year 2004 and such 
     sums as may be necessary for each of the 5 succeeding fiscal 
     years.

     SEC. 224. RESERVATION.

       From amounts appropriated to the Institute, the Director of 
     the Institute may use not more than 5 percent of such amounts 
     for the administration of information dissemination under 
     section 1207 of the Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 6367).

     SEC. 225. AUTHORITY TO PUBLISH.

       The Institute, including the Board, may prepare, publish, 
     and present (including through oral presentations) such 
     research-based information and research reports as needed to 
     carry out the purposes and mission of the Institute.

                       PART C--GENERAL PROVISIONS

     SEC. 241. TRANSITION.

       The Secretary shall take such actions as the Secretary 
     determines to be appropriate to provide for the orderly 
     implementation of this title.

             TITLE III--AMENDMENTS TO THE WAGNER-PEYSER ACT

     SEC. 301. AMENDMENTS TO THE WAGNER-PEYSER ACT.

       The Wagner-Peyser Act (29 U.S.C. 49 et. seq.) is amended--
       (1) by striking sections 1 through 13;
       (2) in section 14 by inserting ``of Labor'' after 
     ``Secretary''; and
       (3) by amending section 15 to read as follows:

     ``SEC. 15. WORKFORCE AND LABOR MARKET INFORMATION SYSTEM.

       ``(a) System Content.--
       ``(1) In general.--The Secretary of Labor, in accordance 
     with the provisions of this section, shall oversee the 
     development, maintenance, and continuous improvement of a 
     nationwide workforce and labor market information system 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 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 workforce and labor market 
     information 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 workforce and labor market 
     information 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 
     workforce and labor market information 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) National Electronic Tools To Provide Services.--The 
     Secretary is authorized to assist in the development of 
     national electronic tools that may be used to facilitate the 
     delivery of core services described in section 134 and to 
     provide workforce information to individuals through the one-
     stop delivery systems descried in section 121 and through 
     other appropriate delivery systems.
       ``(d) Coordination With the States.--
       ``(1) In general.--The Secretary, working through the 
     Bureau of Labor Statistics and the Employment and Training 
     Administration, shall regularly consult with representatives 
     of State agencies carrying out workforce information 
     activities regarding strategies for improving the workforce 
     and labor market information system.
       ``(2) Formal consultations.--At least twice each year, the 
     Secretary, working through the Bureau of Labor Statistics, 
     shall conduct formal consultations regarding programs carried 
     out by the Bureau of Labor Statistics with representatives of 
     each of the 10 Federal regions of the Department of

[[Page 14902]]

     Labor, elected from the State directors affiliated with 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 workforce and labor 
     market information system described in subsection (a) that 
     comprise a statewide workforce and labor market information 
     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 workforce and labor market information 
     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);
       ``(D) maintain and continuously improve the statewide 
     workforce and labor market information 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 workforce and labor market information 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 2004 
     through 2009.
       ``(h) Definition.--In this section, the term `local area' 
     means the smallest geographical area for which data can be 
     produced with statistical reliability.''.

         TITLE IV--AMENDMENTS TO THE REHABILITATION ACT OF 1973

     SEC. 401. CHAIRPERSON.

       Section 705(b)(5) of the Rehabilitation Act of 1973 (29 
     U.S.C. 796d(b)(5)) is amended to read as follows:
       ``(5) Chairperson.--The Council shall select a chairperson 
     from among the voting membership of the Council.''.

     SEC. 402. REHABILITATION SERVICES ADMINISTRATION.

       Section 3(a) of the Rehabilitation Act of 1973 (29 U.S.C. 
     702(a)) is amended--
       (1) by striking ``Office of the Secretary'' and inserting 
     ``Department of Education'';
       (2) by striking ``President by and with the advice and 
     consent of the Senate'' and inserting ``Secretary, except 
     that the current Commissioner appointed under the authority 
     existing on the day prior to the date of enactment of this 
     Act may continue to serve in the former capacity''; and
       (3) by striking ``, and the Commissioner shall be the 
     principal officer,''.

     SEC. 403. DIRECTOR.

       (a) In General.--The Rehabilitation Act of 1973 (29 U.S.C. 
     701 et seq.) is amended by striking ``Commissioner'' each 
     place it appears, except in section 21, and inserting 
     ``Director''.
       (b) Exception.--Section 21 of the Rehabilitation Act of 
     1973 (29 U.S.C. 718) is amended--
       (1) in subsection (b)(1)--
       (A) by striking ``Commissioner'' the first place it appears 
     and inserting ``Director of the Rehabilitation Services 
     Administration''; and
       (B) by striking ``(referred to in this subsection as the 
     `Director')''; and
       (2) by striking ``Commissioner and the Director'' each 
     place it appears and inserting ``both such Directors''.

     SEC. 404. STATE GOALS.

       Section 101(a) of the Rehabilitation Act of 1973 (29 U.S.C. 
     721(a)) is amended--
       (1) in paragraph (11)(D)(i) by inserting ``, which may be 
     provided using alternative means of meeting participation 
     (such as video conferences and conference calls)'' before the 
     semicolon; and
       (2) in paragraph (15)--
       (A) in subparagraph (A), by redesignating clauses (ii) and 
     (iii) as clauses (iii) and (iv), respectively, and inserting 
     after clause (i) the following:
       ``(ii) include an assessment of the transition services 
     provided under this Act, and coordinated with transition 
     services under the Individuals with Disabilities Education 
     Act, as to those services meeting the needs of individuals 
     with disabilities.''; and
       (B) by amending subparagraph (D)(i) to read as follows:
       ``(i) the methods to be used to expand and improve the 
     services to individuals with disabilities including--

       ``(I) how a broad range of assistive technology services 
     and assistive technology devices will be provided to such 
     individuals at each stage of the rehabilitative process and 
     how such services and devices will be provided to such 
     individuals on a statewide basis; and
       ``(II) how transition services will be better coordinated 
     with those services under the Individuals with Disabilities 
     Education Act in order to improve transition services for 
     individuals with disabilities served under this Act;''.

     SEC. 405. AUTHORIZATIONS OF APPROPRIATIONS.

       The Rehabilitation Act of 1973 is further amended--
       (1) in section 100(b)(1) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (2) in section 100(d)(1)(B) by striking ``fiscal year 
     2003'' and inserting ``fiscal year 2009'';
       (3) in section 110(c) by amending paragraph (2) to read as 
     follows:
       ``(2) The sum referred to in paragraph (1) shall be, as 
     determined by the Secretary, 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 2003 through 2009.'';
       (4) in section 112(h) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (5) in section 201(a) by striking ``fiscal years 1999 
     through 2003'' each place it appears and inserting ``fiscal 
     years 2004 through 2009'';
       (6) in section 302(i) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (7) in section 303(e) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (8) in section 304(b) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (9) in section 305(b) by striking ``fiscal years 1999 
     through 2003'' and insert ``fiscal years 2004 through 2009'';
       (10) in section 405 by striking ``fiscal years 1999 through 
     2003'' and inserting ``fiscal years 2004 through 2009'';
       (11) in section 502(j) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (12) in section 509(l) by striking ``fiscal years 1999 
     through 2003'' and inserting ``fiscal years 2004 through 
     2009'';
       (13) in section 612 by striking ``fiscal years 1999 through 
     2003'' and inserting ``fiscal years 2004 through 2009'';
       (14) in section 628 by striking ``fiscal years 1999 through 
     2003'' and inserting ``fiscal years 2004 through 2009'';
       (15) in section 714 by striking ``fiscal years 1999 through 
     2003'' and inserting ``fiscal years 2004 through 2009'';
       (16) in section 727 by striking ``fiscal years 1999 through 
     2003'' and inserting ``fiscal years 2004 through 2009''; and
       (17) in section 753 by striking ``fiscal years 1999 through 
     2003'' and inserting ``fiscal years 2004 through 2009''.

     SEC. 406. 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 ``1999 
     through 2003'' and inserting ``2004 through 2009''.
       (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 amended by striking ``1999 through 2003'' and 
     inserting ``2004 through 2009''.

                 TITLE V--TRANSITION AND EFFECTIVE DATE

     SEC. 501. TRANSITION PROVISIONS.

       The Secretary of Labor shall take such actions as the 
     Secretary determines to be appropriate to provide for the 
     orderly implementation of this division.

     SEC. 502. EFFECTIVE DATE.

       Except as otherwise provided in this division, this 
     division and the amendments made by this division, shall take 
     effect on the date of enactment of this division.

[[Page 14903]]



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