[Federal Register Volume 63, Number 120 (Tuesday, June 23, 1998)]
[Proposed Rules]
[Pages 34218-34224]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16590]



[[Page 34217]]

_______________________________________________________________________

Part II





Department of Education





_______________________________________________________________________



34 CFR Part 379



Projects With Industry; Proposed Rule

  Federal Register / Vol. 63, No. 120 / Tuesday, June 23, 1998 / 
Proposed Rules  

[[Page 34218]]



DEPARTMENT OF EDUCATION

34 CFR Part 379

RIN 1820-AB45


Projects With Industry

AGENCY: Office of Special Education and Rehabilitative Services, 
Department of Education.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: The Secretary proposes to amend the regulations governing the 
performance indicators for the Projects With Industry (PWI) program (34 
CFR Part 379). The PWI program is authorized by section 621 of the 
Rehabilitation Act of 1973, as amended (the Act). The purpose of the 
PWI program is to create and expand job and career opportunities for 
individuals with disabilities in the competitive labor market by 
engaging the talent and leadership of private industry as partners in 
the rehabilitation process, to identify competitive job and career 
opportunities and the skills needed to perform those jobs, to create 
practical job and career readiness and training programs, and to 
provide job placements and career advancement. The Secretary is 
proposing to change the performance indicators for this program in 
order to improve project performance, enhance project accountability, 
better reflect statutory intent, and reduce grantee burden.

DATES: Comments must be received by the Department on or before August 
24, 1998.

ADDRESSES: All comments concerning these proposed regulations should be 
addressed to Fredric K. Schroeder, Commissioner, Rehabilitation 
Services Administration, U.S. Department of Education, 600 Independence 
Avenue, S.W., Room 3028, Mary E. Switzer Building, Washington, D.C. 
20202-2531. Comments may also be sent through the Internet to: 
C[email protected]. You must include the term ``PWI'' in the subject line 
of the electronic comment.
    To ensure that public comments have maximum effect in developing 
the final regulations, the Department urges commenters to identify 
clearly the specific section or sections of the proposed regulations 
that each comment addresses and to arrange comments in the same order 
as the proposed regulations.
    Comments that concern information collection requirements must be 
sent to the Office of Management and Budget at the address listed in 
the Paperwork Reduction Act section of this preamble. A copy of those 
comments may also be sent to the Department representative named in 
this section.

FOR FURTHER INFORMATION CONTACT: Thomas E. Finch, U.S. Department of 
Education, 600 Independence Avenue, S.W., Room 3038, Mary E. Switzer 
Building, Washington, D.C. 20202-2575. Telephone: (202) 205-8292. 
Individuals who use a telecommunications device for the deaf (TDD) may 
call the Federal Information Relay Service (FIRS) at 1-800-877-8339 
between 8 a.m. and 8 p.m., Eastern time, Monday through Friday.
    Individuals with disabilities may obtain this document in an 
alternate format (e.g. Braille, large print, audiotape, or computer 
diskette) on request to the contact person listed in the preceding 
paragraph.


SUPPLEMENTARY INFORMATION:

Overview of Proposed Changes

    The Secretary proposes to amend the regulations governing the 
application content requirements and performance indicators for the PWI 
program in order to clarify statutory intent, enhance project 
accountability, and reduce grantee burden.
    In a notice of proposed rulemaking (NPRM) published in the Federal 
Register on January 22, 1996 (61 FR 1672), the Secretary invited 
comments on changes needed to improve the compliance indicators. The 
comments received in response to this solicitation, as well as comments 
provided by participants in focus group meetings held by the 
Rehabilitation Services Administration (RSA), were used to develop 
these proposed changes. In addition, the Secretary used a June 1994 
report on the PWI program entitled ``Assessment of Performance 
Indicators for the Projects With Industry Program,'' prepared for the 
Department by Research Triangle Institute (RTI), which identifies 
needed changes in the PWI performance indicators and scoring system. To 
assist in revising the compliance indicators and determining the 
proposed minimum performance levels, the Secretary also analyzed 
grantee performance on the current PWI compliance indicators.
    Based on information from public comments, the 1994 report prepared 
by RTI, and experience in the implementation of the program, the 
Secretary is proposing one addition to the application content 
requirements and a number of changes in the compliance indicators. The 
Secretary believes that the additional application content requirement 
regarding the proposed cost per placement is needed in light of the 
proposed changes to the compliance indicators and to ensure that cost-
effective projects are selected for funding. The Secretary proposes to 
reduce the number of indicators from nine to five, with an additional 
indicator to be established at a later date. These compliance 
indicators establish minimum performance levels in areas that the 
Secretary believes are the most critical and most closely related to 
the program's purpose and evaluation standards. To be eligible for 
continued funding under the proposed system, projects must meet or 
exceed the minimum performance level for each compliance indicator. 
However, projects have two opportunities to meet these criteria before 
funding is terminated. If, based upon the end-of-year data submission, 
a project fails any compliance indicator, the project may request that 
funding be continued for the first six months of the subsequent project 
year and agree to submit additional data. At the end of the six-month 
period the project must submit the data collected for those six months 
to demonstrate that it has passed all the compliance indicators. If the 
project passes all the indicators, funding will continue for the 
remainder of the project year.
    In this NPRM, the Secretary proposes minimum performance levels for 
five indicators. The proposed compliance indicators measure a project's 
(a) placement rate; (b) average change in weekly earnings; (c) 
percentage of individuals placed who have severe disabilities; (d) 
percentage of individuals placed who were unemployed at least six 
months at project entry; and (e) variation between projected and actual 
average cost per placement. In addition, the Secretary proposes to 
collect data from projects on change in earnings and job retention. The 
Secretary will use these data to determine the need, and appropriate 
performance levels, for new indicators on change in earnings and job 
retention.

Section-by-Section Summary of the Proposed Changes

    The following is a summary of the proposed changes contained in 
this NPRM.
     In Sec. 379.21(a)(4), the Secretary proposes to add an 
application content requirement that would require a description of the 
factors that justify a project's projected cost per placement. These 
factors may include the objectives of the project, the types of 
services that will be provided, the population that is being targeted, 
and the proposed geographicservice area. This is the only proposed 
addition to the current application content requirements.

[[Page 34219]]

     In Sec. 379.50, the Secretary proposes to remove the 
reference to minimum composite score and replace it with a reference to 
minimum performance levels on all compliance indicators. Under the 
proposed system, grantees must attain a minimum performance level on 
each of the indicators rather than achieve an overall composite score. 
Grantees must pass every indicator in order to receive continuation 
funding.
     In Secs. 379.51 and 379.52, the Secretary proposes to 
delete all references to performance ranges in accordance with the 
proposed change to a system in which grantees must pass all compliance 
indicators. The proposed change deletes the reference to composite 
scores and requires grantees to pass each indicator by demonstrating 
performance at or above the established minimum levels.
     In Sec. 379.53, the Secretary proposes to replace the 
current nine performance indicators with five compliance indicators. 
The major areas of change are outlined in the following sections 
entitled ``Compliance Indicators to be Eliminated'' and ``Proposed 
Compliance Indicators and Performance Levels.''
     In Sec. 379.54, the Secretary proposes to make conforming 
changes to reflect the change from composite scoring to a pass/fail 
system. As under the current regulations, projects must submit data 
from the most recent complete project year to demonstrate compliance, 
but (if project performance during the most recent complete year does 
not meet minimum performance levels) may opt to submit data from the 
first six months of the current project year. In either case, projects 
must submit data to demonstrate compliance with minimum performance 
levels on all of the indicators.

Compliance Indicators To Be Eliminated

    The Secretary proposes to replace the current nine indicators with 
five compliance indicators. In addition, the Secretary proposes to 
collect data that may lead to a modified indicator on change in 
earnings and data that may form the basis of a future indicator on job 
retention. Four compliance indicators would be eliminated, including 
cost per placement, projected placement rate, percent of persons served 
whose disabilities are severe, and percent of persons served who have 
been unemployed at least six months prior to project entry. The 
Secretary believes the proposed indicators better reflect the goals of 
the PWI program, place a greater emphasis on project outcomes, and 
reduce grantee information collection and reporting burden.
    The Secretary proposes to eliminate the cost per placement 
indicator and modify the projected cost per placement indicator. The 
Secretary maintains the importance of serving and placing individuals 
at the lowest possible cost to the Federal Government, but believes it 
is not feasible to establish a cost per placement standard that is 
reasonable for all projects supported under the PWI program. The 
Secretary recognizes that some projects may not be able to achieve a 
low cost per placement, particularly projects that serve a high 
percentage of individuals with severe disabilities, provide extensive 
services, or serve rural areas. In addition, the Secretary is concerned 
that a uniform cost per placement standard may discourage projects from 
serving individuals who require extensive support services, job 
training, and other resources. Therefore, the Secretary believes it is 
more appropriate for grantees to determine an appropriate cost per 
placement and justify the proposed cost, based on the proposed project 
design and objectives, service population, and services to be provided. 
The proposed indicator would require that a project's actual cost per 
placement not exceed the projected cost per placement, as specified in 
the approved grant application, by more than 10 percent.
    The Secretary also proposes to eliminate the indicator on projected 
placement rate. The Secretary believes it is more appropriate to focus 
on a project's actual, rather than projected, success in placing 
individuals in competitive employment.
    Finally, the Secretary proposes to eliminate the two indicators 
that measure the extent to which projects serve individuals with severe 
disabilities and individuals who have been unemployed at least six 
months prior to project entry. While the Secretary believes that it is 
important to preserve the program's focus on individuals with severe 
disabilities and individuals who are unemployed, the Secretary believes 
it is more appropriate to judge projects based on the extent to which 
they are successful in assisting these individuals to achieve 
competitive employment. The Secretary therefore proposes to retain the 
two compliance indicators that measure the percentage of these 
individuals who are placed into competitive employment.

Proposed Compliance Indicators and Performance Levels

    The proposed compliance indicators would measure grantee 
performance in five areas. The Secretary believes that the proposed 
indicators represent the most critical quantifiable aspects of project 
performance. In establishing minimum performance levels on each 
indicator, the Secretary reviewed project performance data, public 
comment in response to the NPRM published in the Federal Register on 
January 22, 1996, focus group discussions, and the RTI report.
    Placement rate. The Secretary proposes to retain the current 
placement rate indicator and raise the minimum performance level. The 
primary goal of the PWI program is to place individuals into 
competitive employment. Therefore, the Secretary views placement rate 
as a critical indicator of project success. Under the proposed 
indicator, projects would be required to place a minimum of 55 percent 
of individuals served into competitive employment.
    While higher than the current minimum placement rate of 40 percent, 
the Secretary believes the proposed performance level is both 
appropriate and realistic. Between 1990 and 1995, PWI projects reported 
an average placement rate of 61.2 percent. In comparison, in 1996 
approximately 60.7 percent of individuals served by The State 
Vocational Rehabilitation Services Program achieved an employment 
outcome. The Secretary believes the partnerships with private industry 
and collaboration with State vocational rehabilitation agencies will 
enable every PWI project to achieve, at a minimum, the proposed 
placement rate of 55 percent. In addition, given the proposal to give 
more flexibility to projects on cost per placement (discussed in the 
following sections), the Secretary believes it is appropriate to raise 
performance expectations, particularly on this critical indicator.
    Average change in earnings. The Secretary proposes to modify the 
current indicator that measures average change in earnings by raising 
the minimum performance level. The current minimum performance level 
requires an average increase of $75 per week. The proposed regulations 
would change the required minimum performance level to $150 per week 
for projects that do not use a school-to-work or supported employment 
service delivery model. That is, the earnings of individuals who are 
placed into competitive employment by the project must increase by an 
average of at least $150 a week over earnings at the time of project 
entry. Concurrently, the Secretary proposes to collect data to 
determine the need for additional changes to this indicator.

[[Page 34220]]

    The Secretary believes that the proposed increase in the minimum 
performance level is appropriate given both inflation and increases in 
the minimum wage since the original performance level for this 
indicator was set in 1989. In addition, the Secretary believes this 
proposed performance level is realistic based on project performance 
data that demonstrate an overall average change in earnings of $183 and 
$195 per week in fiscal years 1993 and 1994, respectively.
    The Secretary proposes to establish a lower performance level on 
this indicator for PWI projects that primarily serve secondary school 
students transitioning to work or that use a supported employment 
model. Based on a review of these types of projects, the Secretary has 
concluded that, by virtue of the individuals they serve and place, 
these projects might have difficulty meeting the change in earnings 
standard. The Secretary does not want to exclude these types of 
projects from the PWI program and, therefore, proposes a lower minimum 
performance level of $100 per week for these projects. Specifically, 
the Secretary proposes this lower standard for projects in which 75 
percent or more of the individuals placed into competitive employment 
are students who are enrolled in secondary schools and who are working 
fewer than 30 hours per week and for projects in which at least 75 
percent of individuals are placed into supported employment, as defined 
in 34 CFR 361(b)(45) and (46). All other projects will be subject to 
the higher standard.
    In addition to these changes, the Secretary is proposing to collect 
data to assess the need to modify the change in earnings indicator to 
measure change in earnings for two groups: (1) individuals who entered 
a project without earnings and (2) individuals who entered a project 
with earnings. The Secretary believes such a two-tiered indicator may 
be a more accurate means of measuring a project's impact on individual 
earnings. This proposed data collection is discussed in more detail in 
the section entitled ``Proposed Data Collection on Change in Earnings 
and Job Retention.''
    Percent of individuals placed who are individuals with severe 
disabilities and percent of persons placed who have been unemployed for 
six months prior to project entry. The Secretary proposes to retain 
these two indicators at the current minimum performance level, which 
requires that 50 percent of those placed into competitive employment 
are individuals with severe disabilities and 50 percent are individuals 
who have been unemployed continuously for six months prior to project 
entry. The Secretary believes that it is appropriate to preserve the 
program's emphasis on placing into competitive employment individuals 
with severe disabilities and individuals who are unemployed for at 
least six months prior to program entry.
    Actual versus projected cost per placement. The Secretary proposes 
to revise the current indicator on projected cost per placement. The 
proposed indicator would require that a project's actual cost per 
placement not exceed the projected cost per placement, as specified in 
the approved grant application, by more than 10 percent. That is, the 
actual average cost per placement does not exceed 110 percent of the 
projected cost per placement.
    The Secretary proposes to allow each project to determine what is a 
reasonable cost per placement, based on factors such as project 
objectives, population and geographic area to be served, and services 
to be provided. As part of its grant application, a project would be 
required to provide a description of those factors that justify its 
projected cost per placement, including, but not limited to, the 
project's objectives, types of services, target population, and service 
area. A project chosen for funding would not be permitted to exceed by 
more than 10 percent, the projected cost per placement in its approved 
grant application. The Secretary believes that this revised approach to 
cost per placement allows flexibility in project design while 
encouraging each project to consider cost effectiveness in the 
development of its grant application.

Proposed Data Collection on Change in Earnings and Job Retention

    In addition to the five compliance indicators, the Secretary is 
concurrently proposing to collect data to determine the need to modify 
the change in earnings indicator and to add an additional indicator on 
job retention.
    Change in earnings. While the current change in earnings indicator 
may demonstrate the average economic benefit of a project, the 
Secretary believes it does not measure the true extent to which the 
project improved the earnings of individual participants. The change in 
earnings as a result of project participation is likely to be 
significantly different for individuals who were unemployed at the time 
of project entry and who came to the project for job training and 
placement services than it is for individuals who held a wage-earning 
job at the time of project entry and who required career advancement 
services. The Secretary is considering the establishment of a two-
tiered indicator to measure more adequately the effect of project 
services on the earnings of these two populations. However, the 
Secretary does not have sufficient data on which to base such a 
decision.
    Concurrent with the proposed application content and compliance 
indicator changes, the Secretary proposes to collect data to determine 
the need for a modification to the change in earnings indicator to 
measure project performance for two groups: individuals who entered the 
project without earnings and individuals who entered with earnings. The 
Secretary proposes to require projects to report the following data for 
the next three years:
    (1) For individuals with no earnings at the time of project entry, 
average hourly wage and average hours worked per week at placement.
    (2) For individuals with earnings at the time of project entry, the 
average hourly wage and average hours worked per week, both at the time 
of project entry and at placement.
    The Secretary plans to use these data to decide whether a two-
tiered indicator would be a more accurate means of gauging the earnings 
impact of the job training and career advancement services provided 
through the PWI program, and what performance levels would be 
appropriate for such an indicator.
    Job retention. The Secretary is concurrently proposing to collect 
data to determine the need to modify the change in earnings indicator 
and whether to add an additional indicator on job retention. The 
Secretary believes job retention is a critical indicator of project 
success because it demonstrates the quality of placements achieved by 
projects. A high job retention rate may indicate consumer satisfaction 
with the placement, appropriate job matching, and effective follow-up 
services.
    In order to sample projects' job retention rates, the Secretary 
proposes that projects report the number of individuals who become 
unemployed within three months after placement, within six months after 
placement, and within nine months after placement.
    In accordance with Sec. 379.5(b)(7), placement occurs after the 
individual has held the job for 90 days. The intent of the 90-day 
period is to ensure that an individual is at least initially stabilized 
on a job. The proposed data collection would require projects to track 
each individual for up to nine months after placement or up to one year 
after the individual's initial job entry. At the end of the year, the 
project must report three separate figures:

[[Page 34221]]

     The number of individuals who were unable to maintain 
employment during the first three-month period after placement (the 
fourth through sixth months of employment).
     The number of individuals who were unable to maintain 
employment during the second three-month period after placement (the 
seventh through ninth month of employment).
     The number of individuals who were unable to maintain 
employment during the third three-month period after placement (the 
tenth through twelfth month of employment).
    For the purpose of this data collection, an individual can change 
jobs and still be considered to be employed as long as there is no gap 
in employment.
    In order to include all placements, projects may have to include 
individuals who were unable to maintain employment during the reporting 
year but who obtained placements in the previous reporting year. For 
example, if the reporting year is from October 1997 to September 1998, 
an individual who was placed in August 1997 but left the job in 
December 1997 would be reported as someone who was unable to maintain 
employment during the second three-month period after placement.
    The Secretary does not believe this will be a significant burden to 
projects, since under section 621(a)(2)(E) projects are required to 
provide, as necessary, support and career advancement services to 
individuals after they are placed. In addition, as part of the annual 
evaluation plan, projects must provide information on the number of 
project participants who were terminated from project placements and 
the duration of those placements. The Secretary thus believes projects 
already track individuals after they are placed.
    The job retention indicator would be established after the 
Secretary has collected and evaluated data for at least three years. 
Once collection and analysis of the data are completed, the Secretary 
would determine whether to establish a new indicator to measure job 
retention.

Goals 2000: Educate America Act

    The Goals 2000: Educate America Act (Goals 2000) focuses the 
Nation's education reform efforts on eight National Education Goals and 
provides a framework for meeting them. Goals 2000 promotes new 
partnerships to strengthen schools and expands the Department's 
capacities for helping communities to exchange ideas and obtain 
information needed to achieve the goals.
    These proposed regulations would address the National Education 
Goals that every adult American will be literate and will possess the 
knowledge and skills necessary to compete in a global economy and 
exercise the rights and responsibilities of citizenship. The proposed 
regulations would further the objectives of this Goal by ensuring that 
only those projects that are successful in making persons with 
disabilities part of the global economy and in allowing them to 
exercise their rights as citizens to participate in the national labor 
market continue to receive Federal funding.

Executive Order 12866

1. Potential Costs and Benefits

    These proposed regulations have been reviewed in accordance with 
Executive Order 12866. Under the terms of the order the Secretary has 
assessed the potential costs and benefits of this regulatory action.
    The potential costs associated with the proposed regulations are 
those resulting from statutory requirements and those determined by the 
Secretary to be necessary for administering this program effectively 
and efficiently. Burdens specifically associated with information 
collection requirements are identified and explained elsewhere in this 
preamble under the heading Paperwork Reduction Act of 1995.
    In assessing the potential costs and benefits--both quantitative 
and qualitative--of these proposed regulations, the Secretary has 
determined that the benefits of the proposed regulations justify the 
costs.
    The Secretary has also determined that this regulatory action does 
not unduly interfere with State, local, and tribal governments in the 
exercise of their governmental functions.
    To assist the Department in complying with the specific 
requirements of Executive Order 12866, the Secretary invites comment on 
whether there may be further opportunities to reduce any potential 
costs or increase potential benefits resulting from these proposed 
regulations without impeding the effective and efficient administration 
of the program.

Summary of Potential Costs and Benefits

    The potential costs and benefits of these proposed regulations are 
discussed elsewhere in this preamble under the following headings: 
Overview of proposed changes, and Potential costs and benefits.
    The Secretary believes the changes proposed in this NPRM would 
improve the PWI program regulations and would yield substantial 
benefits in terms of improved accountability and performance and 
reduced burden. As stated in the supplementary information section of 
this preamble, the Secretary believes the proposed regulations reduce 
grantee burden by reducing the number and complexity of the compliance 
indicators and improve accountability by focusing on the most critical 
areas of project performance. The Secretary has determined that the 
potential benefits of these proposed changes justify the potential 
costs to grantees.

2. Clarity of the Regulations

    Executive Order 12866 requires each agency to write regulations 
that are easy to understand.
    The Secretary invites comments on how to make these proposed 
regulations easier to understand, including answers to questions such 
as the following: (1) Are the requirements in the proposed regulations 
clearly stated? (2) Do the proposed regulations contain technical terms 
or other wording that interferes with their clarity? (3) Does the 
format of the proposed regulations (grouping and order of sections, use 
of headings, paragraphing, etc.) aid or reduce their clarity? Would the 
proposed regulations be easier to understand if they were divided into 
more (but shorter) sections? (A ``section'' is preceded by the symbol 
``Sec. '' and a numbered heading; for example, Sec. 379.51 What are 
program compliance indicators?). (4) Is the description of the proposed 
regulations in the ``Supplementary Information'' section of this 
preamble helpful in understanding the proposed regulations? How could 
this description be more helpful in making the proposed regulations 
easier to understand? (5) What else could the Department do to make the 
proposed regulations easier to understand?
    A copy of any comments that concern how the Department could make 
these proposed regulations easier to understand should be sent to 
Stanley M. Cohen, Regulations Quality Officer, U.S. Department of 
Education, 600 Independence Avenue, S.W. (Room 5121, FB-10B), 
Washington, D.C. 20202-2241.

Regulatory Flexibility Act Certification

    The Secretary certifies that these proposed regulations would not 
have a significant economic impact on a substantial number of small 
entities.
    The small entities that would be affected by these proposed 
regulations are government, nonprofit, and for-profit organizations 
that receive Federal

[[Page 34222]]

funds under this program. However, the regulations would not have a 
significant economic impact on these entities because the regulations 
would not impose excessive regulatory burdens or require unnecessary 
Federal supervision. These regulations would impose minimal 
requirements to ensure the proper expenditure of program funds.

Paperwork Reduction Act of 1995

    Sections 379.21 and 379.54 contain information collection 
requirements. As required by the Paperwork Reduction Act of 1995 (44 
U.S.C. 3507(d)), the Department of Education has submitted a copy of 
these sections to the Office of Management and Budget (OMB) for its 
review.

Collection of Information: Projects With Industry

    These proposed regulations would affect entities eligible to apply 
for and receive grants under the PWI program, including for-profit and 
nonprofit agencies or organizations with the capacity to create and 
expand job and career opportunities for individuals with disabilities, 
designated State units, labor unions, employers, community 
rehabilitation program providers, trade associations, and Indian tribes 
and tribal organizations. These information collection requirements 
would affect applicants for new awards and organizations and entities 
already receiving assistance under the PWI program.
    The Department needs to collect this information in order to 
fulfill statutory requirements regarding the compliance indicators (in 
section 621(f) of the Act). All information is to be collected and 
reported once a year, with the exception of that which is required of 
all applicants for new awards in Sec. 379.21(a). This section requires 
responses from every organization or entity that applies for a new 
award under the PWI program. Annual reporting and recordkeeping burden 
for these collections of information is estimated to average 30 hours 
for each response for 105 respondents, including the time for reviewing 
instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information. Thus, the total annual reporting and 
recordkeeping burden for these collections is estimated to be 3,150 
hours.
    Organizations and individuals desiring to submit comments on the 
information collection requirements should direct them to the Office of 
Information and Regulatory Affairs, OMB, Room 10235, New Executive 
Office Building, Washington, D.C. 20503; Attention: Desk Officer for 
the U.S. Department of Education.
    The Department considers comments by the public on these proposed 
collections of information in--
     Evaluating whether the proposed collections of information 
are necessary for the proper performance of the functions of the 
Department, including whether the information will have practical 
utility;
     Evaluating the accuracy of the Department's estimate of 
the burden of the proposed collections of information, including the 
validity of the methodology and assumptions used;
     Enhancing the quality, usefulness, and clarity of the 
information to be collected; and
     Minimizing the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology; e.g., permitting 
electronic submission of responses.
    OMB is required to make a decision concerning the collections of 
information contained in these proposed regulations between 30 and 60 
days after publication of this document in the Federal Register. 
Therefore, a comment to OMB is best assured of having its full effect 
if OMB receives it within 30 days of publication. This does not affect 
the deadline for the public to comment to the Department on the 
proposed regulations.

Intergovernmental Review

    This program is subject to the requirements of Executive Order 
12372 and the regulations in 34 CFR Part 79. The objective of the 
Executive order is to foster an intergovernmental partnership and a 
strengthened federalism by relying on processes developed by State and 
local governments for coordination and review of proposed Federal 
financial assistance.
    In accordance with the order, this document is intended to provide 
early notification of the Department's specific plans and actions for 
this program.

Invitation to Comment

    Interested persons are invited to submit comments and 
recommendations regarding these proposed regulations. All comments 
submitted in response to these proposed regulations will be available 
for public inspection, during and after the comment period, in Room 
3330, Mary E. Switzer Building, 330 C Street, S.W., Washington, D.C., 
between the hours of 8:30 a.m. and 4:00 p.m., Eastern time, Monday 
through Friday of each week except Federal holidays.
    On request, the Department supplies an appropriate aid, such as a 
reader or print magnifier, to an individual with a disability who needs 
assistance to review the comments or other documents in the public 
rulemaking docket for these proposed regulations. An individual with a 
disability who wants to schedule an appointment for this type of aid 
may call (202) 205-8113 or (202) 260-9895. An individual who uses a TDD 
may call the Federal Information Relay Service at 1-800-877-8339, 
between 8 a.m. and 8 p.m., Eastern time, Monday through Friday.
    To assist the Department in complying with the specific 
requirements of Executive Order 12866 and its overall requirement of 
reducing regulatory burden, the Secretary invites comments on whether 
there may be further opportunities to reduce any regulatory burdens 
found in these proposed regulations.

Assessment of Educational Impact

    The Secretary particularly requests comments on whether the 
proposed regulations in this document would require transmission of 
information that is being gathered by or is available from any other 
agency or authority of the United States.

Electronic Access to This Document

    Anyone may view this document, as well as all other Department of 
Education documents published in the Federal Register, in text or 
portable document format (pdf) on the World Wide Web at either of the 
following sites:

http://ocfo.ed.gov/fedreg.htm
http://www.ed.gov/news.html

To use the PDF you must have the Adobe Acrobat Reader Program with 
Search, which is available free at either of the previous sites. If you 
have questions about using the pdf, call the U.S. Government Printing 
Office toll free at 1-888-293-6498.
    Anyone may also view these documents in text copy only on an 
electronic bulletin board of the Department. Telephone: (202) 219-1511 
or, toll free, 1-800-222-4922. The documents are located under Option 
G--Files/Announcements, Bulletins and Press Releases.

    Note: The official version of this document is the document 
published in the Federal Register.

[[Page 34223]]

List of Subjects in 34 CFR Part 379

    Education, Grant programs--education, Grant programs--social 
programs, Reporting and recordkeeping requirements, Vocational 
rehabilitation.

    Dated: February 5, 1998.
Judith E. Heumann,
Assistant Secretary for Special Education and Rehabilitative Services.
(Catalog of Federal Domestic Assistance Number 84.234 Projects With 
Industry)

    The Secretary proposes to amend Part 379 of Title 34 of the Code of 
Federal Regulations as follows:

PART 379--PROJECTS WITH INDUSTRY

    1. The authority citation for part 379 continues to read as 
follows:

    Authority: Sections 12(c) and 621 of the Act; 29 U.S.C. 711(c) 
and 795(g), unless otherwise noted.

    2. Section 379.21 is revised to read as follows:


Sec. 379.21  What is the content of an application for an award?

    (a) The grant application must include a description of--
    (1) The proposed job training to prepare project participants for 
specific jobs in the competitive labor market for which there is a need 
in the geographic area to be served by the project, as identified by an 
existing current labor market analysis or other needs assessment or one 
conducted by the applicant in collaboration with private industry;
    (2) The involvement of private industry in the design of the 
proposed project and the manner in which the project will collaborate 
with private industry in planning, implementing, and evaluating job 
training, job placement, and career advancement activities;
    (3) The responsibilities of the BAC and how it will interact with 
the project in carrying out grant activities;
    (4) The justification of the project's proposed cost per placement, 
including factors such as the project's objectives, types of services, 
target population, and service area;
    (5) The geographic area to be served by the project, including an 
explanation of how the area is currently unserved or underserved by the 
PWI program;
    (6) A plan for evaluating annually the operation of the proposed 
project, which, at a minimum, provides for collecting and submitting to 
the Secretary the following information and any additional data needed 
to determine compliance with the program compliance indicators 
established in subpart F:
    (i) The numbers and types of individuals with disabilities served.
    (ii) The types of services provided.
    (iii) The sources of funding.
    (iv) The percentage of resources committed to each type of service 
provided.
    (v) The extent to which the employment status and earning power of 
individuals with disabilities changed following services.
    (vi) The extent of capacity building activities, including 
collaboration with business and industry and other organizations, 
institutions, and agencies, including the State vocational 
rehabilitation unit.
    (vii) A comparison, if appropriate, of activities in prior years 
with activities in the most recent year.
    (viii) The number of project participants who were terminated from 
project placements and the duration of those placements;
    (7) A description of the manner in which the project will address 
the needs of individuals with disabilities from minority backgrounds, 
as required by 34 CFR 369.21; and
    (8) A description of how career advancement services will be 
provided to project participants.
    (b) The grant application also must include assurances from the 
applicant that--
    (1) The project will carry out all activities required by 
Sec. 379.10;
    (2) Individuals with disabilities who are placed by the project 
will receive compensation at or above the minimum wage, but not less 
than the customary or usual wage paid by the employer for the same or 
similar work performed by individuals who are not disabled;
    (3) Individuals with disabilities who are placed by the project 
will be given terms and benefits of employment equal to those that are 
given to similarly situated co-workers and will not be segregated from 
their co-workers; and
    (4) The project will maintain any records required by the Secretary 
and make those records available for monitoring and audit purposes.

(Authority: Sections 621(a)(4), 621(a)(5), 621(b), and 621(e)(1)(B) 
of the Act; 29 U.S.C. 795g(a)(4), 795g(a)(5), 795g(b), and 
795g(e)(1)(B))

    3. Subpart F of Part 379 is revised to read as follows:

Subpart F--What Compliance Indicator Requirements Must a Grantee Meet 
to Receive Continuation Funding?

379.50  What are the requirements for continuation funding?
379.51  What are the program compliance indicators?
379.52  How is grantee performance measured using the compliance 
indicators?
379.53  What are the minimum performance levels for each compliance 
indicator?
379.54  What are the reporting requirements for the compliance 
indicators?

Subpart F--What Compliance Indicator Requirements Must a Grantee 
Meet to Receive Continuation Funding?


Sec. 379.50  What are the requirements for continuation funding?

    Beginning with fiscal year 1998, in order to receive a continuation 
award for the third or any subsequent year of a PWI grant, a grantee 
must adhere to the provisions of its approved application and must meet 
the minimum performance levels on the program compliance indicators 
contained in Sec. 379.53.

(Authority: Section 621(f)(1)of the Act; 29 U.S.C. 795g(f)(1))


Sec. 379.51  What are the program compliance indicators?

    The program compliance indicators implement program evaluation 
standards, which are contained in an appendix to this part, by 
establishing minimum performance levels in essential project areas to 
measure the effectiveness of individual grantees.

(Authority: Sections 621(d)(1) and 621(f)(1) of the Act; 29 U.S.C. 
795g(d)(1) and 795g(f)(1))


Sec. 379.52  How is grantee performance measured using the compliance 
indicators?

    (a) Each compliance indicator establishes a minimum performance 
level.
    (b) If a grantee does not achieve the minimum performance level for 
a compliance indicator, the grantee does not pass the compliance 
indicator.
    (c) A grantee must pass all the compliance indicators to meet the 
evaluation standards and qualify for continuation funding.

(Authority: Section 621(f)(1) of the Act; 29 U.S.C. 795g(f)(1))


Sec. 379.53  What are the minimum performance levels for each 
compliance indicator?

    (a) Placement rate. A minimum of 55 percent of individuals served 
by the project are placed into competitive employment.
    (b) Change in earnings. (1) For projects in which at least 75 
percent of individuals placed are placed into supported employment, as 
defined in 34 CFR 361.5(b)(45) and (46), the earnings of individuals 
placed by the project increase by an average of at least $100.00 a week 
over earnings at the time of project entry.

[[Page 34224]]

    (2) For projects in which at least 75 percent of individuals placed 
into competitive employment are students enrolled in secondary schools 
working fewer than 30 hours per week, the earnings of individuals 
placed by the project increase by an average of at least $100.00 a week 
over earnings at the time of project entry.
    (3) For all projects not covered under Sec. 379.53(b)(1) or (2), 
the earnings of individuals who are placed into competitive employment 
by the project increase by an average of at least $150.00 a week over 
earnings at the time of project entry.
    (c) Percent placed who have severe disabilities. At least 50 
percent of individuals who are placed into competitive employment are 
individuals with severe disabilities.
    (d) Percent placed who were previously unemployed. At least 50 
percent of individuals who are placed into competitive employment are 
individuals who were continuously unemployed for at least six months at 
the time of project entry.
    (e) Cost per placement. The actual average cost per placement does 
not exceed 110 percent of the projected average cost per placement in 
the grantee's application.

(Authority: Section 621(f)(1) of the Act; 29 U.S.C. 795g(f)(1))


Sec. 379.54  What are the reporting requirements for the compliance 
indicators?

    (a) In order to receive continuation funding for the third or any 
subsequent year of a PWI grant, each grantee must submit data for the 
most recent complete project year no later than 60 days after the end 
of that project year, unless the Secretary authorizes a later 
submission date, in order for the Secretary to determine if the grantee 
has met the program compliance indicators established in this Subpart 
F.
    (b) If the data for the most recent complete project year provided 
under paragraph (a) of this section shows that a grantee has failed to 
achieve the minimum performance required in Sec. 379.53 to meet the 
program compliance indicators, the grantee may, at its option, submit 
data from the first 6 months of the current project year no later than 
60 days after the end of that 6-month period, unless the Secretary 
authorizes a later submission date, to demonstrate that its project 
performance has improved sufficiently to meet the minimum performance 
levels for all compliance indicators.

(Authority: Section 621(f)(2) of the Act; 29 U.S.C. 795g(f)(2))

    Note: A grantee receives its second year of funding (or the 
first continuation award) under this program before data from the 
first complete project year is available. Data from the first 
project year, however, must be submitted and is used (unless the 
grantee exercises the option in paragraph (b) of this section) to 
determine eligibility for the third year of funding (or the second 
continuation award).

[FR Doc. 98-16590 Filed 6-22-98; 8:45 am]
BILLING CODE 4000-01-P