[Federal Register Volume 67, Number 233 (Wednesday, December 4, 2002)]
[Notices]
[Pages 72222-72234]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-30660]


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DEPARTMENT OF LABOR

Office of the Secretary


Submission for OMB Emergency Review; Comment Request

November 27, 2002.
    The Department of Labor (DOL) has submitted the following (see 
below) information collection request (ICR), utilizing emergency review 
procedures, to the Office of Management and Budget (OMB) for review and 
clearance in accordance with the Paperwork Reduction Act of 1995 (Pub. 
L. 104-13, 44 U.S.C. Chapter 35). OMB approval has been requested by 
December 23, 2002. Attached is a copy of the proposed application 
procedures for the National Emergency Grants for Trade Health Insurance 
Assistance. A copy of this ICR, with applicable supporting 
documentation and application procedures, may be obtained by calling 
the Department of Labor. To obtain documentation, contact Darrin King 
on 202-693-4129 or e-mail: [email protected].
    Comments and questions about the ICR listed below should be 
forwarded by December 20, 2002 to the Office of Information and 
Regulatory Affairs, Attn: OMB Desk Officer for the Employment and 
Training Administration, Room 10235, Washington, DC 20503. The Office 
of Management and Budget is particularly interested in comments which:
    [sbull] Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
    [sbull] Evaluate the accuracy of the agency's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
    [sbull] Enhance the quality, utility, and clarify of the 
information to be collected; andminimize the burden of the collection 
of information on those who are to respond, including through the use 
of appropriate automated, electronic, mechanical, or other

[[Page 72223]]

technological collection techniques or other forms of information 
technology, e.g., permitting electronic submissions of responses.
    Agency: Employment and Training Administration (ETA).
    Title: Workforce Investment Act: National Emergency Grants for 
Trade Health Insurance Assistance-Application and Reporting Procedures.
    OMB Number: 1205-0NEW.
    Affected Public: State, Local, or Tribal Government.

----------------------------------------------------------------------------------------------------------------
                                  Number of                          Annual        Average time    Total annual
          Reference             respondents *      Frequency       responses *     per response   burden hours *
----------------------------------------------------------------------------------------------------------------
Narrative Summary............              50  On occasion.....              50  1.0 hour.......            50.0
ETA 9103.....................              50  On occasion.....              50  90 minutes.....            75.0
ETA 9105.....................              50  On occasion.....              50  30 minutes.....            25.0
ETA 9106.....................              50  On occasion.....              50  1.0 hour.......            50.0
Reports: ETA 9104............              50  Quarterly.......             200  30 minutes.....           100.0
Grant Modifications..........              40  On occasion.....              40  30 minutes.....            20.0
                              -----------------
      Total..................  ..............  ................             440  ...............            320
----------------------------------------------------------------------------------------------------------------
* Actual number will vary, because the information collection is required to obtain a benefit.

    Total Burden Cost (capital/startup): $0.
    Total Burden Cost (operating/maintaining): $0.
    Description: The Department of Labor/Employment and Training 
Administration announces proposed application and reporting procedures 
for states to enable them to access funds in order to implement Trade 
Health Insurance Assistance National Emergency Grant (NEG) programs. 
Trade Health Insurance Assistance NEG funds provide specialized 
assistance, including health insurance coverage, to trade-impacted 
workers and other individuals eligible under the Trade Adjustment 
Assistance Reform Act of 2002.

Ira L. Mills,
Departmental Clearance Officer.

Attachment--Workforce Investment Act: Application Procedures for Trade 
Health Insurance Assistance National Emergency Grants

Overview

    This application package provides information and procedures by 
which states can apply for newly authorized National Emergency Grant 
(NEG) funds to provide health insurance assistance and related support 
services to certain eligible individuals. It consists of the following 
eight parts and two appendices:
    [sbull] Part I provides background regarding the purpose and use of 
National Emergency Grant (NEG) funds to provide health insurance 
assistance for eligible individuals under the Trade Adjustment 
Assistance Reform Act of 2002 (Pub. L. 107-210);
    [sbull] Part II describes key policies regarding eligible 
individuals for assistance, allowable uses of grant funds, eligible 
entities for grant awards, and coordination;
    [sbull] Part III identifies the policies governing administrative 
and project design requirements on Health Insurance Assistance NEGs;
    [sbull] Part IV provides an overview of the application submission 
requirements for Health Insurance Assistance NEG projects;
    [sbull] Part V identifies the elements in the application review 
process including the criteria that will be used to determine the 
appropriateness of the request for funds;
    [sbull] Part VI describes alternative approaches to grant funding 
and the requirements associated with partial funding requests and 
actions;
    [sbull] Part VII describes the follow-up planning, oversight and 
reporting requirements for awarded grants;
    [sbull] Part VIII describes the grant modification process.
    Appendix A contains copies of the required grant application forms. 
States are not required to submit these forms until OMB approval has 
been obtained. The forms are in an electronic format for ease of 
completion and timeliness of submission by the applicant. The 
Department seeks to establish a process that provides both timely 
submission of applications for funding, in relation to worker 
eligibility for assistance, and timely processing of such applications. 
The electronic formats have been developed to facilitate accomplishment 
of this objective.
    Appendix B contains a directory of Regional Office contacts.
    A companion piece to this document, Training and Employment 
Guidance Letter (TEGL) 10-02, was issued on October 10, 2002. It 
provides information and procedures by which states may apply for newly 
authorized NEG system-building funds to develop and implement the 
infrastructure needed to make the health insurance assistance 
authorized in the Trade Act of 2002 available.
    Applications for NEG funds to provide the assistance described in 
this notice may be submitted at any time. The maximum allowable project 
performance period is defined by the months remaining in the Program 
Year in which the grant award is made plus the subsequent two Program 
Years. The ProgramYear for these projects is the twelve month period 
July 1-June 30. USDOL/ETA expects that the project performance period 
in any NEG application will reflect a time efficient approach to 
returning eligible individuals to appropriate employment consistent 
with the performance goals that apply to NEG projects.
    The application procedures, application review process, and project 
oversight and reporting requirements described in this notice are 
issued under the WIA regulations at 20 CFR 671.125.
    Applications may be filed electronically using the website http://testetareports.doleta.gov. To submit an application electronically, 
applicants will need to use a PIN  that has been assigned to 
them by USDOL. A PIN  can be obtained by contacting the 
appropriate Regional Office. Alternatively, applications may be mailed 
or hand-delivered to: Office of Grants and Contracts Management, 
Division of Federal Assistance, Employment and Training Administration, 
U.S. Department of Labor, Room S-4203, 200 Constitution Avenue, NW., 
Washington, DC 20210; Attention: E. Fred Tello, Grant Officer. 
Applications may also be FAXed to the attention of Mr. Tello at (202) 
693-2879. Applicants submitting by mail should be aware that mail 
delivery in the Washington, D.C. area may be delayed due to 
decontamination procedures. For non-electronic applications, a copy of 
the application should be concurrently submitted (via e-mail, mail, or 
FAX) to

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the appropriate Regional Administrator of USDOL/ETA.
    For further information you may contact Shirley M. Smith, 
Administrator, Office of National Response at (202) 693-3501. (This is 
not a toll-free number.) A user's guide on preparing and submitting an 
application electronically, and technical assistance on application 
requirements are available from Regional Offices of ETA and from the 
Office of National Response, Employment and Training Administration, 
U.S. Department of Labor, Room N-5426, 200 Constitution Avenue, NW., 
Washington DC 20210.

Part I: Background

    The Trade Adjustment Assistance Reform Act of 2002 (Pub. L. 107-
210), (the Act) was signed by the President on August 6, 2002. Title I 
of the Act amends the Trade Act of 1974 to consolidate the prior TAA 
and NAFTA-TAA programs into one comprehensive program of assistance. 
The Act expands the eligibility for TAA to additional groups of workers 
and enhances the assistance available under the program. Title II of 
the Act amends the Internal Revenue Code of 1986 and the Workforce 
Investment Act of 1998 (WIA) to establish new mechanisms by which 
certain TAA participants, as well as eligible Pension Benefit Guaranty 
Corporation (PBGC) pension recipients, can receive assistance in 
covering the cost of health insurance.
    The primary mechanism for such assistance is a federal tax credit 
to be administered by the Internal Revenue Service. The tax credit is 
equal to 65% of the amount paid by an eligible individual for coverage 
of the individual and certain family members under qualified health 
insurance. The tax credit is applicable to qualified health insurance 
coverage costs paid by eligible individuals beginning December 2002, 
and the credit is to be made available on an advance payment basis by 
August 1, 2003. The provisions related to this tax credit are contained 
in Sections 201 and 202 of the Act.
    The Act also establishes an additional mechanism, which is intended 
to be used as a bridge to when eligible individuals can receive the tax 
credit on an advance basis, by authorizing the use of NEG funds under 
the WIA to assist in paying the cost of qualified health insurance 
coverage for eligible individuals. These provisions are contained in 
section 203 of the Act, which establishes a new section 173(g) of WIA.
    Section 203 of the Act identifies the specific groups of 
individuals who are eligible to receive the health insurance coverage 
assistance and the types of health insurance coverage programs that can 
qualify for this assistance. They are described in more detail in Part 
II of this document.
    The approach to Health Insurance Assistance NEG grant awards will 
be based on quick turnaround initial funding actions where the 
following can be demonstrated:
    [sbull] The individuals to receive assistance with grant funds are 
currently eligible to receive such assistance;
    [sbull] The costs of heath insurance coverage assistance, 
processing payments to providers, and other allowable services are 
reasonable.
    USDOL/ETA is committed to making a decision to approve or 
disapprove all submitted applications within 15 working days from 
receipt of a complete application. However, because of the variation 
between initial planning assumptions and subsequent implementation that 
has historically characterized NEGs, most applications for Trade Act 
Health Insurance coverage assistance will be partially funded at the 
outset. Approximately 90 days following grant award, a site review will 
be conducted to assess implementation status. This review will help 
verify the full amount of NEG funding needed.

Part II: Policies Governing the Award and Use of NEG Funds

A. Eligible Individuals for Assistance

    In general, individuals eligible for health insurance coverage 
assistance under the Trade Adjustment Assistance Reform Act are:

--``An eligible TAA recipient'' which is defined as an individual who 
is receiving a trade readjustment allowance (TRA) under the TAA 
program, or would be eligible for TRA except that he/she has not yet 
exhausted Unemployment Insurance benefits;
--``An eligible alternative TAA recipient'' which is defined as an 
individual who is receiving benefits under a demonstration program of 
alternative trade adjustment assistance for older workers under section 
246 of the Trade Act of 1974 (as amended by the Act), although it 
should be noted that the demonstration program does not commence until 
August 6, 2003; or
--``An eligible PBGC pension recipient'' which is defined as an 
individual who is 55 years of age or older and is receiving a pension 
benefit paid in whole or part by the Pension Benefit Guaranty 
Corporation (PBGC).

    Coverage may also be provided for the spouse and dependents of an 
eligible individual where such persons are not otherwise covered by 
health insurance. Dependents are limited under the law to those persons 
who are allowable dependent deductions on the eligible individual's tax 
return.

B. Allowable Uses and Limitations on the Use of NEG Funds

    In general, NEG funds provided under section 173(g) may be used to 
provide assistance and support services to eligible individuals, 
including qualifying health insurance coverage, transportation, 
childcare, dependent care and income assistance. For both health 
insurance coverage and income support assistance, the assistance cannot 
supplant other federal, state, or local assistance for which the 
individual is eligible.
    In order to promote consistency with, and a transition to, the 
advance payment tax credit and to conserve NEG resources in a manner 
that will allow broad participation by the states and eligible 
individuals, these NEG funds may be used to pay no more than 65% of the 
amount paid by an eligible individual for qualified health insurance 
coverage of the eligible individual and qualifying family members. This 
is the same level of assistance provided under the tax credit 
mechanisms and is intended to fulfill the objective of this NEG of 
providing a bridge to the advance payment tax credit mechanism.
    In addition, the Department would generally expect the assistance 
provided under the NEG would be for prospective coverage, that is for 
payments for coverage for months after the individual has been 
determined eligible for assistance under the NEG. In extraordinary 
cases, as demonstrated by the applicant, the Department would consider 
the use of NEG funds to pay reimbursement for qualified health 
insurance coverage premium payments that were made for coverage on or 
after September 1, 2002. However, to qualify for such reimbursement, 
the individual would have to be determined to have met the eligibility 
requirements at the time such prior premiums were paid.

C. Qualified Health Insurance Coverage

    In general, NEG funds can be used to pay for the following types of 
health insurance coverage assistance:
    (1) Coverage under a COBRA continuation provision.
    (2) Coverage under a state-based continuation provision.
    (3) Coverage through a qualified state high risk pool.
    (4) Coverage under a program offered to state employees.

[[Page 72225]]

    (5) Coverage under a state-based health insurance program 
comparable to a program for state employees.
    (6) Coverage through an arrangement between a state and

--A group health plan
--An issuer of healthcare coverage
--An administrator, or
--An employer

    (7) Coverage offered through a state arrangement with a private 
sector healthcare coverage purchasing pool.
    (8) Coverage under a state-operated health plan that does not 
receive any Federal financial participation.
    (9) Coverage under a group health plan that is available through 
the employment of the eligible individual's spouse.
    (10) Coverage under individual health insurance in which the 
eligible individual was enrolled during the entire 30 day period 
preceding the date of separation by which the individual became 
eligible for TAA assistance.
    The health insurance coverage mechanisms described under items (2) 
through (8) will only qualify for assistance under an NEG if the state 
elects to establish and/or use those mechanisms and the coverage meets 
certain requirements. Those requirements are contained in the new 
section 173(f)(2)(B)(i) of WIA, and require that under such coverage a 
``qualifying individual'' is (1) guaranteed enrollment; (2) no pre-
existing conditions are imposed; (3) the premium charged is 
nondiscriminatory (i.e., a qualifying individual is not charged a 
greater amount than a similarly situated individual who is not a 
qualifying individual); and (4) the benefits are the same or 
substantially similar to similarly situated individuals who are not 
qualifying individuals. The term ``qualifying individual'' is defined 
in the new section 173(f)(2)(B)(ii) of WIA, and means an individual who 
is eligible for assistance under the NEG and who, as of the date the 
individual seeks to enroll in one of these elected coverage mechanisms, 
had an aggregate period of creditable health insurance coverage (as 
defined in section 9801(c) of the IRC) of three months or longer. The 
individual also must not have other specified coverage or be 
imprisoned.
    States must decide whether to elect to include all, some, or none 
of the coverage mechanisms described in items (2) through (8). States 
are encouraged to give consideration to these optional coverage 
mechanisms and evaluate their appropriateness in light of the 
particular circumstances in the state. The elected coverage mechanisms 
must be identified in the NEG application. The coverage mechanisms 
described in items (1), (9), and (10) qualify for assistance under the 
NEG without election by the state.

D. Eligible Entities for Grant Awards

    In order to ensure coordination with the state system-building 
grants described in TEGL 10-02, eligible applicants for Health 
Insurance Assistance projects under this notice are limited to states.
    The award of these grants will be expedited where the application 
for the NEG funds is submitted by the grant recipient under the current 
NEG Master Agreement between the Department and the State. This is not 
intended to limit the State regarding the participation in, or 
administration of, activities carried out under the NEG by other 
entities, including appropriate State agencies. For example, through 
subgrants or the interagency transfer of NEG funds, the Governor may 
decide to have other agencies provide aspects of the health insurance 
coverage assistance. However, the use of the currently designated grant 
recipient as the applicant ensures that the procedures necessary to 
facilitate the award of funds are in place.

E. Coordination

    The Department strongly encourages efforts by the State to 
coordinate the provision of assistance under this NEG with the 
activities of appropriate State agencies, such as the State insurance 
commission, the State health licensing and regulatory board or entity, 
and other departments or entities involved in the provision of health 
insurance coverage.

Part III: Administrative and Project Design Requirements

1. General

    Grantee organizations, administrative entities and service 
providers are subject to the WIA law, regulations, grant application 
instructions, the terms and conditions of the grant and any subsequent 
modifications, and to all other applicable Federal laws (including 
provisions in Federal appropriations law). Since eligible applicants 
are limited to states, Health Insurance Assistance NEG grantees will be 
subject to all administrative system requirements that apply to the use 
of WIA formula funds for dislocated workers, except as otherwise 
provided in these instructions.

2. Cost Limitations

    Administrative cost limitations apply to all NEG grant awards. Cost 
limitations shall apply to actual expenditures.
    Although administrative cost limits on NEG projects are subject to 
negotiation with the Grant Officer, in general, a ten percent (10%) 
limit will apply. Any request for a higher limit will have to be 
clearly and fully justified in terms of unusual project operating 
circumstances. Applicants should recognize that any such request will 
have to be negotiated with the Grant Officer and will delay the timing 
of the funding action.
    Any costs associated with administering a system of health 
insurance coverage payments must be separately identified in the 
application budget and justified in the narrative.

3. Indirect Costs

    If an indirect cost rate is applied in calculating administrative 
costs, the applicant must include information from the most recent 
approval document that identifies the approved indirect cost rate and 
base, the cognizant approval agency, and the date of the approval. 
Generally, indirect costs will only be approved at the grantee level.

4. Allowable Activities and Services

    For Health Insurance Assistance projects, funds may be used for the 
services described in WIA section 173(g).

5. Project Design and Service Operations

    Provision of services, in addition to health insurance coverage 
assistance, should be consistent with similar services provided under 
WIA including established policies and procedures of the state and 
local area(s) in which the project is to operate.

Part IV: Application Submission Requirements

    In order to be considered for funding, a Health Insurance 
Assistance NEG application will need to include the following 
information:
    a. Completed and signed SF 424-Application for Federal Assistance. 
This form is the required application for federal funds. Where the 
electronic submission option is used, the authorized signatory of the 
applicant will be issued a unique Personal Identification Number (PIN). 
The entry of this PIN on the SF 424 will constitute authorized 
signature.
    b. Project Synopsis (ETA 9106). This form summarizes key aspects of 
the proposed project such as project type, planned number of 
participants, and contact information. It also includes identification 
of the types of health insurance coverage options that will be 
available to project participants.

[[Page 72226]]

    c. Employer Data (ETA 9105). This form provides information on the 
TAA petition and certification through which individuals are eligible 
for assistance.
    d. Planning Form (ETA 9103). This form provides cumulative 
quarterly estimates on project scope (e.g., number of participants, 
exits), design (e.g., mix of services), and budget (e.g., costs by type 
of activity, administrative costs).
    e. Narrative Statement. A narrative explanation must be provided in 
cases where one or more of the following are reflected in the project 
plan:

--Indirect costs are included in the budget, which requires identifying 
the following: cognizant approval agency, approved cost rate and base, 
and date of approval.
--``Other'' costs are included in the budget, which requires 
identifying the specific cost items and amounts.
--Administrative costs related to processing payments for qualified 
healthcare coverage and/or income support are included in the budget, 
which requires explaining how the administrative cost estimate was 
derived (i.e., based on number of check payments and check processing 
costs).

    In addition, the application must include a narrative description 
of coordination activities and arrangements among appropriate state 
agencies. The applicant is free to include narrative explanations of 
other special factors, but the narrative should not exceed five pages.
    A copy of forms that can be used to submit one or more the above 
requirements is provided in Attachment A.

Part V: Application Review Process

    To be considered for funding, a Health Insurance Assistance NEG 
Project application must demonstrate that the proposed project meets 
the purpose of and is consistent with the Act and Regulations and 
provides all of the information required by these guidelines. 
Applications that are not completely in accordance with the 
requirements or do not contain all required submission forms will not 
be considered as submitted and will not be evaluated for funding until 
all required information and documentation is provided. Complete 
applications will be evaluated for responsiveness to the criteria 
identified in this part.
    1. Eligibility: To ensure that NEG funds are only awarded where 
there is a verifiable group that is both eligible and in need of 
assistance.
    a. TAA certifications and/or other appropriate documentation to 
demonstrate eligibility is either provided in the application or can be 
accessed from other sources in DOL/ETA.
    2. Reasonableness of Proposed Services and Costs: To ensure that 
NEG projects are designed and operated in accordance with the federal 
requirements and the state and local policies that apply to trade 
adjustment assistance programs in the proposed project area.
    a. The indirect costs are justified by identifying: (1) The 
approved indirect cost rate and base; (2) the cognizant approval 
agency; (3) the date of the approval.
    b. ``Other'' expenditures that are included in the budget are 
identified and justified in the narrative.
    c. Total administrative costs, exclusive of health insurance 
premium processing costs, are within the cost limitation, OR are 
explained and justified.
    d. The basis for administrative costs to process health insurance 
premium payments is justified.

Part VI: Funding Approaches

    Applications for NEG funds can be funded in whole or in part. Full 
or partial funding can be at the applicant's request or at the 
Secretary's discretion. In order to ensure the effective use of NEG 
resources, in general these requests, when approved, will be funded 
partially. Where the grant award reflects a partial funding action, the 
grantee will be required to submit, at a later date, supplemental 
information to request the balance of funds. This information will be 
specified in the grant award letter but will include, at a minimum, 
current information on actual participant levels, performance outcomes, 
and expenditures.

Part VII: Post-Grant Award Requirements

A. Followup Planning Requirements

    Recipients of a NEG will be required to develop a more complete 
project operational plan as followup to the grant award. This plan 
should be completed within 90 days of grant award and be available for 
review at the office of the grant recipient. The information in this 
plan will be used to verify the need for the full amount of requested 
funds and the feasibility of the planned levels of performance based on 
actual project implementation experience. The content of the plan will 
vary by type of project but, in general, will need to address factors 
such as participant enrollments, needs of participants for specific 
services, implementation schedules, project operator agreements and 
budgets, and project management structure.

B. Project Oversight

    In addition to the 90 day review of the Project Operational Plan, 
each project will be reviewed at the project midpoint. The purpose of 
this review will be to verify core compliance factors such as 
participant eligibility and adequate financial management, and to 
assess the effectiveness of participant service policies and processes 
in achieving project performance goals.

C. Project Performance Reporting

    Each grant recipient will be required to submit to the Grant 
Officer a Quarterly Report (ETA 9104) on actual performance to-date. 
The report will include the same factors as the Planning Form in the 
grant document. A copy of this form is included in Appendix A.

Part VII: Grant Modifications

    Grant modifications will be required in the following 
circumstances:

--When end-of-project performance is expected to vary by more than 10% 
from the approved plan regarding: Total participants, participants to 
be enrolled in training, or expenditures for retraining;
--To increase the number of participants receiving health insurance 
premium assistance and/or the amount of expenditures for health 
insurance premium assistance;
--To increase the approved amounts of administrative costs;
--To change the performance period for the project;
--When actual end-of-project expenditures will be less than the amount 
of awarded funds.

    Grant modifications must be submitted to the Grant Officer. They 
may be submitted in writing or electronically.
    Grant modifications will not be accepted within 90 days prior to 
the scheduled expiration date of the project.
    Where there is a need to increase the amount of approved funding 
and/or to expand the target group to include additional layoffs, these 
will have to submitted as a new request for funds.

Appendix A--e-Application and Reporting Forms

A. Application for Federal Assistance Form (SF 424)

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[FR Doc. 02-30660 Filed 12-3-02; 8:45 am]
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