[Federal Register Volume 79, Number 143 (Friday, July 25, 2014)]
[Rules and Regulations]
[Pages 43257-43260]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-17604]


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DEPARTMENT OF EDUCATION

34 CFR Chapter III

[Docket ID ED-2014-OSERS-0023]


Final Priority; National Institute on Disability and 
Rehabilitation Research--Disability and Rehabilitation Research 
Projects and Centers Program

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

ACTION: Final priority.

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[CFDA Number: 84.133A-10.]

SUMMARY: The Assistant Secretary for Special Education and 
Rehabilitative Services announces a priority under the Disability and 
Rehabilitation Research Projects and Centers Program administered by 
the National Institute on Disability and Rehabilitation Research 
(NIDRR). Specifically, we announce a priority for a Disability and 
Rehabilitation Research Project (DRRP) on Improving Methods of 
Evaluating Return on Investment (ROI) for the State Vocational 
Rehabilitation Services Program (VR Program). The Assistant Secretary 
may use this priority for competitions in fiscal year (FY) 2014 and 
later years. We take this action to focus research attention on an area 
of national need. We intend for the priority to contribute to improved 
employment outcomes for individuals with disabilities.

DATES: Effective Date: This priority is effective August 25, 2014.

FOR FURTHER INFORMATION CONTACT: Marlene Spencer, U.S. Department of 
Education, 400 Maryland Avenue SW., Room 5133, Potomac Center Plaza 
(PCP), Washington, DC 20202-2700. Telephone: (202) 245-7532 or by 
email: [email protected].
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.

SUPPLEMENTARY INFORMATION: 
    Purpose of Program: The purpose of the Disability and 
Rehabilitation Research Projects and Centers Program is to plan and 
conduct research, demonstration projects, training, and related 
activities, including international activities, to develop methods, 
procedures, and rehabilitation technology that maximize the full 
inclusion and integration into society, employment, independent living, 
family support, and economic and social self-sufficiency of individuals 
with disabilities, especially individuals with the most significant 
disabilities, and to improve the effectiveness of services authorized 
under the Rehabilitation Act of 1973, as amended (Rehabilitation Act).

Disability and Rehabilitation Research Projects

    The purpose of NIDRR's DRRPs, which are funded through the 
Disability and Rehabilitation Research Projects and Centers Program, is 
to improve the effectiveness of services authorized under the 
Rehabilitation Act by developing methods, procedures, and 
rehabilitation technologies that advance a wide range of independent 
living and

[[Page 43258]]

employment outcomes for individuals with disabilities, especially 
individuals with the most significant disabilities. DRRPs carry out one 
or more of the following types of activities, as specified and defined 
in 34 CFR 350.13 through 350.19: Research, training, demonstration, 
development, utilization, dissemination, and technical assistance.
    An applicant for assistance under this program must demonstrate in 
its application how it will address, in whole or in part, the needs of 
individuals with disabilities from minority backgrounds (34 CFR 
350.40(a)). The approaches an applicant may take to meet this 
requirement are found in 34 CFR 350.40(b). Additional information on 
the DRRP program can be found at: http://www2.ed.gov/programs/drrp/index.html.

    Program Authority:  29 U.S.C. 762(g) and 764(a).

    Applicable Program Regulations: 34 CFR part 350.
    We published a notice of proposed priority for this program in the 
Federal Register on May 23, 2014 (79 FR 29701). That notice contained 
background information and our reasons for proposing the particular 
priority.
    There are differences between the proposed priority and this final 
priority as discussed in the Analysis of Comments and Changes section 
of this notice.
    Public Comment: In response to our invitation in the notice of 
proposed priority, 16 parties submitted comments on the proposed 
priority.
    Generally, we do not address technical and other minor changes.
    Analysis of Comments and Changes: An analysis of the comments and 
of any changes in the priority since publication of the notice of 
proposed priority follows.
    Comment: One commenter suggested that the ROI model(s) to be 
developed and implemented under this priority should use individual-
level data, since vocational rehabilitation (VR) services are 
individualized and delivered to meet the specific needs of individual 
VR consumers. In response to the requirement in paragraph (a) that ROI 
``model(s) must include variables such as costs associated with 
individuals who enter the agency but leave without receiving 
services,'' this commenter also stated that such a model may not 
adequately take into account the experiences of individuals who leave 
the VR system, and then return to achieve successful employment 
outcomes.
    Discussion: With this priority we are seeking advancements in ROI 
models for the VR Program. Advanced models for determining ROI use 
individual-level data over extended periods of time. As noted by the 
commenter, the collection of individual-level data is particularly 
important when developing models related to VR services, which are 
individualized and delivered to meet the specific needs of individual 
VR consumers. Consistent with the proposed priority, paragraph (a) of 
the final priority specifies that ROI models must include some data 
which are typically collected at the individual level. These data 
include relevant characteristics of, and services received by, VR 
consumers, including the extent to which VR consumers may exit and 
return for subsequent services and achieve successful outcomes.
    Changes: None.
    Comment: Three commenters stated that ROI models should never be 
applied to individual VR client cases to determine the costs and 
benefits of the services received by specific VR clients.
    Discussion: We agree with the commenter. While data for ROI models 
are collected at the level of the individual VR consumer, the models to 
be developed and tested under this priority are aggregate models of 
employment outcomes achieved at the VR Program level. The purpose of 
the ROI models is to identify service delivery factors that facilitate 
employment for VR consumers with different characteristics and 
disability types--not to assess the costs and benefits of VR services 
for individual VR consumers.
    Changes: None.
    Comment: Four commenters expressed concerns that the ROI model(s) 
to be developed under this priority could be used or applied in ways 
that harm individuals with disabilities and the VR agencies that serve 
them. These concerns include the fear that (1) the results of ROI 
model(s) could be used to penalize State VR agencies that serve 
consumers in specific disability subpopulations that have greater and 
more expensive service needs, (2) the ROI model(s) could be used to 
establish cost maximums that must not be exceeded by VR agencies, and 
(3) widespread use of the ROI model(s) could lead agencies to serve 
only those with minimal or inexpensive service needs.
    Discussion: We understand and appreciate these concerns. As noted 
by many of the commenters, the Rehabilitation Act requires a VR agency 
to first serve those individuals with the most significant disabilities 
if it cannot serve all eligible individuals and to provide services 
based on the individualized needs of eligible individuals. Using ROI 
findings in the ways the commenter has described would be contrary to 
statutory intent. All VR agencies have the responsibility to ensure 
that VR services are provided fairly and equitably, regardless of the 
disabling condition of individual consumers or the costs associated 
with serving them. Within the context of the requirements of the 
Rehabilitation Act, our intent is to support the development of more 
sophisticated ROI models that can systematically identify VR service 
delivery factors that facilitate positive employment outcomes, while 
taking into account the wide variation in VR consumer characteristics, 
service delivery experiences, and outcomes.
    Changes: None.
    Comment: One commenter stated that many of the benefits of VR 
services cannot be measured or accounted for by ROI models, including 
the value to communities of increased workforce and community 
participation of individuals with disabilities and more positive 
perceptions of people with disabilities by employers and community 
members who do not have disabilities.
    Discussion: We agree that many of the benefits of VR services are 
not easily quantified. Nothing in the priority precludes applicants 
from proposing to develop and test ROI models that include community-
level outcome variables as described by the commenter. The peer review 
process will determine the merits of each proposal.
    Although we recognize that an ROI model may not adequately reflect 
all potential outcome variables, we establish this priority to increase 
the field's ability to build ROI models with important variables for 
which quantifiable data are available, including receipt of VR 
services, costs associated with specific VR services, and the long-term 
employment outcomes achieved by VR consumers. By improving the methods 
for such ROI analysis, we aim to assess and demonstrate the impact of 
the VR Program on employment outcomes of individuals with disabilities 
and to identify promising practices that can be scaled up in VR 
Programs across the United States.
    Changes: None.
    Comment: Two commenters stated that the ROI models to be developed 
and tested under this priority should take into account the variation 
in VR Program characteristics that exist throughout the United States. 
One of

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these commenters requested that NIDRR modify the priority to require 
that the standards for ROI models that are developed and disseminated 
under paragraph (c) take this variation in VR Programs into account.
    Discussion: We recognize that there is variation in the 
characteristics of State VR agencies, including in their VR Program 
administration. To address this variation, in paragraph (b) of the 
priority, we require that the ROI model(s) developed under paragraph 
(a) be tested in at least eight State VR agencies with varying program 
characteristics.
    Changes: In addition, we have revised paragraph (c) to require that 
the standards developed for conducting ROI studies under this priority 
adequately account for the varying characteristics of VR Programs.
    Comment: One commenter recommended that NIDRR modify paragraph (f) 
of the priority to require the advisory board to include current or 
former VR consumers to help ensure that ROI results are used in ways 
that are meaningful for the individuals served by the VR Program.
    Discussion: NIDRR agrees with the commenter that current or former 
VR consumers should be included in the advisory board for this grant.
    Changes: NIDRR has revised paragraph (f) to require the inclusion 
of current or former VR consumers on the advisory board.
    Comment: One commenter stated that ROI models should be developed 
separately for programs serving blind and visually impaired 
individuals, relative to programs serving the broader population of 
individuals with disabilities.
    Discussion: NIDRR does not think that separate models are necessary 
for agencies that serve only blind and visually impaired individuals. 
The model(s) to be developed under this priority will use and control 
for a large number of variables including disability type, severity of 
disability, and the VR services provided. In addition, we have revised 
paragraph (c) of the priority to require that the standards developed 
for conducting ROI studies adequately account for the varying 
characteristics of VR Programs. By developing models that are based on 
data from the full population of VR consumers with disabilities, we aim 
for the model(s) to identify promising practices that are associated 
with high-quality employment outcomes and that can be applied and 
scaled up widely in VR Programs across the United States.
    Changes: None.
    Comment: One commenter requested that NIDRR modify the priority to 
require the ROI models to take the following factors into account: (1) 
Whether consumers are placed in integrated employment settings versus 
sheltered settings, (2) length of employment following a VR case 
closure, and (3) the likelihood of employment and earnings for VR 
clients in the model(s).
    Discussion: NIDRR agrees with the commenter that the ROI model(s) 
to be developed under this priority must account for the variation in 
the types of employment outcomes, including employment settings, as 
well as the wide variation in VR consumer characteristics that may 
affect the likelihood of a consumer obtaining employment without VR 
services and a consumer's long-term outcomes, such as the length of 
employment and wages earned. To address the commenter's proposed 
factors, we have modified in paragraph (a) the list of variables to be 
included in the ROI models being developed under this priority.
    Changes: The list of variables in paragraph (a) to be included in 
the ROI models being developed under this priority has been expanded to 
add type of employment outcome, including employment setting. In 
addition, in paragraph (a), length of employment and wages earned have 
been added as examples of long-term outcome variables and the 
likelihood of a consumer obtaining employment without VR services has 
been added as an example of a characteristic of disability 
subpopulations.

Final Priority

Improving Methods of Evaluating Return on Investment (ROI) for the 
State Vocational Rehabilitation (VR) Services Program

    The Assistant Secretary for Special Education and Rehabilitative 
Services establishes a priority for a DRRP on Improving Methods of 
Evaluating Return on Investment (ROI) for the State Vocational 
Rehabilitation Services Program (VR Program).
    Under this priority, the DRRP must contribute to improving the ROI 
methodologies available to assess the impact of the VR Program on 
employment outcomes of individuals with disabilities. This includes:
    (a) Developing or expanding valid, innovative, and replicable ROI 
model(s) for assessing the VR Program and the services it provides. 
These model(s) must include: Variables such as costs associated with 
individuals who enter the agency but leave without receiving services, 
costs related to specific services so VR agencies can better consider 
ROI when determining services that lead to better outcomes, estimates 
of State and Federal expenditures incurred as part of the VR Program 
administration and service delivery system, characteristics of 
disability subpopulations (e.g., disability type, severity of 
disability, and likelihood of obtaining employment without VR 
services), type of employment outcome, including the employment setting 
(e.g., competitive integrated employment), long-term outcomes extending 
years after exit from the VR Program (e.g., length of employment and 
wages earned), and information on general economic conditions. These 
models must use rigorous methods, including the use of a comparison 
group to determine the effect of the VR Program.
    (b) Testing the model(s) in at least eight State VR agencies with 
varying characteristics (e.g., urban/rural, with/without waitlists) to 
determine its replicability, including determining what data are 
necessary to make the model(s) successful and evaluating the data 
quality and data availability in selected sites. The final number of 
sites must be approved by NIDRR. In carrying out this requirement, we 
want the successful applicant to clarify a process for ensuring access 
to Social Security data and earnings data as required to assess long-
term impact of the VR Program.
    (c) Developing and disseminating recommended standards for 
conducting ROI studies of the VR Program. These standards must 
adequately account for the varying characteristics of VR Programs.
    (d) Producing and disseminating training materials to support the 
VR Program in using the model(s).
    (e) Making the underlying data available so others can learn from 
and replicate the findings, without compromising personally 
identifiable information. Data availability will conform to all 
security requirements of identified sources.
    (f) Working with an advisory board made up of current or former VR 
consumers, as well as ROI, VR, and research methodology experts to 
ensure the findings are relevant, replicable, and sound.

Types of Priorities

    When inviting applications for a competition using one or more 
priorities, we designate the type of each priority as absolute, 
competitive preference, or invitational through a notice in the Federal 
Register. The effect of each type of priority follows:

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    Absolute priority: Under an absolute priority, we consider only 
applications that meet the priority (34 CFR 75.105(c)(3)).
    Competitive preference priority: Under a competitive preference 
priority, we give competitive preference to an application by (1) 
awarding additional points, depending on the extent to which the 
application meets the priority (34 CFR 75.105(c)(2)(i)); or (2) 
selecting an application that meets the priority over an application of 
comparable merit that does not meet the priority (34 CFR 
75.105(c)(2)(ii)).
    Invitational priority: Under an invitational priority, we are 
particularly interested in applications that meet the priority. 
However, we do not give an application that meets the priority a 
preference over other applications (34 CFR 75.105(c)(1)).
    This notice does not preclude us from proposing additional 
priorities, requirements, definitions, or selection criteria, subject 
to meeting applicable rulemaking requirements.

    Note:  This notice does not solicit applications. In any year in 
which we choose to use this priority, we invite applications through 
a notice in the Federal Register.

Executive Orders 12866 and 13563

Regulatory Impact Analysis

    Under Executive Order 12866, the Secretary must determine whether 
this regulatory action is ``significant'' and, therefore, subject to 
the requirements of the Executive order and subject to review by the 
Office of Management and Budget (OMB). Section 3(f) of Executive Order 
12866 defines a ``significant regulatory action'' as an action likely 
to result in a rule that may--
    (1) Have an annual effect on the economy of $100 million or more, 
or adversely affect a sector of the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, local, or 
tribal governments or communities in a material way (also referred to 
as an ``economically significant'' rule);
    (2) Create serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impacts of entitlement grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles stated in the 
Executive order.
    This final regulatory action is not a significant regulatory action 
subject to review by OMB under section 3(f) of Executive Order 12866.
    We have also reviewed this final regulatory action under Executive 
Order 13563, which supplements and explicitly reaffirms the principles, 
structures, and definitions governing regulatory review established in 
Executive Order 12866. To the extent permitted by law, Executive Order 
13563 requires that an agency--
    (1) Propose or adopt regulations only upon a reasoned determination 
that their benefits justify their costs (recognizing that some benefits 
and costs are difficult to quantify);
    (2) Tailor its regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives and taking into 
account--among other things and to the extent practicable--the costs of 
cumulative regulations;
    (3) In choosing among alternative regulatory approaches, select 
those approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity);
    (4) To the extent feasible, specify performance objectives, rather 
than the behavior or manner of compliance a regulated entity must 
adopt; and
    (5) Identify and assess available alternatives to direct 
regulation, including economic incentives--such as user fees or 
marketable permits--to encourage the desired behavior, or provide 
information that enables the public to make choices.
    Executive Order 13563 also requires an agency ``to use the best 
available techniques to quantify anticipated present and future 
benefits and costs as accurately as possible.'' The Office of 
Information and Regulatory Affairs of OMB has emphasized that these 
techniques may include ``identifying changing future compliance costs 
that might result from technological innovation or anticipated 
behavioral changes.''
    We are issuing this final priority only on a reasoned determination 
that its benefits justify its costs. In choosing among alternative 
regulatory approaches, we selected those approaches that maximize net 
benefits. Based on the analysis that follows, the Department believes 
that this regulatory action is consistent with the principles in 
Executive Order 13563.
    We also have determined that this regulatory action does not unduly 
interfere with State, local, and tribal governments in the exercise of 
their governmental functions.
    In accordance with both Executive orders, the Department has 
assessed the potential costs and benefits, both quantitative and 
qualitative, of this regulatory action. The potential costs are those 
resulting from statutory requirements and those we have determined as 
necessary for administering the Department's programs and activities.
    The benefits of the Disability and Rehabilitation Research Projects 
and Centers Program have been well established over the years, as 
projects similar to the one envisioned by the final priority have been 
completed successfully. The new DRRP will generate and promote the use 
of new information that is intended to improve outcomes for individuals 
with disabilities.
    Accessible Format: Individuals with disabilities can obtain this 
document in an accessible format (e.g., braille, large print, 
audiotape, or compact disc) on request to the program contact person 
listed under FOR FURTHER INFORMATION CONTACT.
    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. Free 
Internet access to the official edition of the Federal Register and the 
Code of Federal Regulations is available via the Federal Digital System 
at: www.gpo.gov/fdsys. At this site you can view this document, as well 
as all other documents of this Department published in the Federal 
Register, in text or Adobe Portable Document Format (PDF). To use PDF 
you must have Adobe Acrobat Reader, which is available free at the 
site.
    You may also access documents of the Department published in the 
Federal Register by using the article search feature at: 
www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.

    Dated: July 22, 2014.
Melody Musgrove,
Director, Office of Special Education Programs.
[FR Doc. 2014-17604 Filed 7-24-14; 8:45 am]
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