Veterans' Employment and Training Service: Labor Actions Needed  
to Improve Accountability and Help States Implement Reforms to	 
Veterans' Employment Services (30-DEC-05, GAO-06-176).		 
                                                                 
Roughly 700,000 veterans have been unemployed in recent months, a
figure that could swell considerably with the anticipated	 
increase in the number of people leaving active duty. Congress	 
passed the Jobs for Veterans Act in 2002 to improve employment	 
and training services for veterans and to encourage employers to 
hire them. As mandated by law, GAO reviewed progress to date in  
its implementation, including the development of new staff roles 
and responsibilities, performance accountability system,	 
incentive awards, and priority of service to veterans. GAO	 
examined (1) implementation status of the key provisions and any 
associated challenges, (2) what is known about services and	 
outcomes since the law's enactment, and (3) changes in program	 
accountability. 						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-176 					        
    ACCNO:   A44037						        
  TITLE:     Veterans' Employment and Training Service: Labor Actions 
Needed to Improve Accountability and Help States Implement	 
Reforms to Veterans' Employment Services			 
     DATE:   12/30/2005 
  SUBJECT:   Accountability					 
	     Employment assistance programs			 
	     Occupational retraining				 
	     Performance measures				 
	     Program evaluation 				 
	     Program management 				 
	     State-administered programs			 
	     Surveys						 
	     Veterans						 
	     Veterans employment programs			 
	     Program implementation				 
	     DOL Disabled Veterans Outreach Program		 
	     DOL Local Veterans' Employment			 
	     Representative Program				 
                                                                 

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GAO-06-176

Report to Congressional Committees

United States Government Accountability Office

GAO

December 2005

VETERANS' EMPLOYMENT AND TRAINING SERVICE

Labor Actions Needed to Improve Accountability and Help States Implement
Reforms to Veterans' Employment Services

Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for
Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act
Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs
for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans
Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate
Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for
Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act
Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs
for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans
Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate
Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for
Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act
Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs
for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans
Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate
Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for
Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act
Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs
for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans
Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate
Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for
Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act
Mandate Jobs for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs
for Veterans Act Mandate Jobs for Veterans Act Mandate Jobs for Veterans
Act Mandate Jobs for Veterans Act Mandate

GAO-06-176

Contents

Letter 1

Results in Brief 3
Background 5
Most JVA Provisions Have Been Carried Out, but Not without Some Challenges
8
State Administrators Reported Improvement in Veterans' Services and
Employment Outcomes 27
Absence of Local Level Data and Lack of Coordinated Oversight Weaken
Program Accountability 30
Conclusions 36
Recommendations for Executive Action 37
Agency Comments and Our Evaluation 37
Appendix I Objectives, Scope, and Methodology 39
Appendix II Comparison of DVOP and LVER Grant Funding, Fiscal Years 2003
and 2005 42
Appendix III State Incentive Award Allocation and Expenditures, Fiscal
Year 2004 44
Appendix IV State-Negotiated Goals for Veterans Entering Employment
through the DVOP and LVER Programs, Program Years 2004 and 2005 46
Appendix V States' Use of Full-Time and Part-Time Veterans' Staff 48
Appendix VI Comments from the Department of Labor 52
Appendix VII GAO Contact and Staff Acknowledgments 55
Related GAO Products 56

Tables

Table 1: Comparison of Selected Provisions under Title 38 and JVA 6
Table 2: Summary of Labor's Completed and Planned Actions to Implement
Selected JVA Provisions, as of December 2005 9
Table 3: Veterans' Participation in ETA Programs for Adult Job Seekers,
Program Year 2003 15
Table 4: Development of DVOP and LVER Performance Measures and Reporting
Requirements 17
Table 5: Utilization of DVOP Staff 48
Table 6: Utilization of LVER Staff 50

Figures

Figure 1: State Workforce Administrators with Positive Comments on the
Quality of Labor's Guidance and Assistance on New Roles for Veterans'
Staff 11
Figure 2: Allocation of Projected Total Expenditures of the President's
National Hire Veterans Committee through Fiscal Year 2005 19
Figure 3: Extent to Which the Committee's Promotional Activities Have
Benefited Veterans in Obtaining Employment 20
Figure 4: State Actions to Implement JVA in more than 75 Percent of Local
Offices or One-Stop Centers, as of October 2005 22
Figure 5: Use of Part-Time Veterans' Staff in Local Offices 23
Figure 6: Effect of Incentive Award Program on Staff Integration, Morale,
and Performance 25
Figure 7: Improvements in Services to Veterans since JVA Was Enacted 28
Figure 8: Factors That Assisted Veterans in Obtaining Employment 29
Figure 9: Factors That Delayed or Prevented Veterans from Obtaining
Employment 30
Figure 10: Extent That VETS' New Monitoring Role Strengthened Performance
Accountability at the Local Level 32
Figure 11: Extent to Which VETS' Monitoring Tools Strengthened Performance
Accountability 33
Figure 12: Methods Used to Coordinate Monitoring Activities between VETS
and ETA 35

Abbreviations

BLS Bureau of Labor Statistics

CPS Current Population Survey

DVOP Disabled Veterans' Outreach Program

ETA Employment and Training Administration

JVA Jobs for Veterans Act

LAUS Local Area Unemployment Statistics

LVER Local Veterans' Employment Representative

NVTI National Veterans' Training Institute

OFCCP Office of Contract Compliance Programs

VETS Veterans' Employment and Training Service

WIA Workforce Investment Act

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protection in the United States. It may be reproduced and distributed in
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separately.

United States Government Accountability Office

Washington, DC 20548

December 30, 2005

The Honorable Larry E. Craig Chairman The Honorable Daniel Akaka Ranking
Minority Member Committee on Veterans' Affairs United States Senate

The Honorable Steve Buyer Chairman The Honorable Lane Evans Ranking
Minority Member Committee on Veterans' Affairs House of Representatives

In recent years, roughly 700,000 veterans have been unemployed in any
given month, and that figure could swell considerably with the anticipated
increase in the number of service members currently leaving active duty
and returning to civilian life-approximately 200,000 a year, according to
the Department of Labor (Labor). Since we last reported on veterans'
employment and training services,1 Congress passed the Jobs for Veterans
Act (JVA) to improve employment and training services for veterans and to
encourage employers to hire them. The act made several changes to the two
Labor programs that focus exclusively on veterans and that are
administered by the Veterans' Employment and Training Service (VETS): the
Disabled Veterans' Outreach Program (DVOP) and the Local Veterans'
Employment Representative program (LVER). It clarified the respective
roles of DVOP and LVER staff and required the establishment of a
performance accountability system, and an incentive award program. JVA
provided states administering the programs more flexibility by funding
both programs through one allocation, allowing states to choose the mix of
staff and whether they would be hired on a full-time or part-time basis.
Additionally, it called for the integration of DVOP and LVER staff into
the one-stop delivery system established in 1998 under the Workforce
Investment Act (WIA) to streamline services provided by federal employment
and training programs. JVA expanded Labor's focus on veterans by requiring
that all of the agency's training programs give veterans priority in
receiving their services, within their target population. It also required
Labor to establish a national minimum standard--or threshold--for
veterans' employment. Finally, to encourage businesses to hire veterans,
the act established a committee to develop a national campaign promoting
veterans and updated existing requirements that employers who receive
federal contracts advertise job openings at the appropriate employment
service delivery system and report on their veteran hiring practices.

1 GAO, Veterans' Employment and Training Service: Flexibility and
Accountability Needed to Improve Service to Veterans, GAO-01-928
(Washington, D.C.: Sept. 12, 2001).

In light of the many changes introduced by the Jobs for Veterans Act, and
as mandated by the act, we conducted a study on the implementation of its
provisions. In reviewing federal and state progress in carrying out the
act's provisions, we examined (1) the implementation status of the key
provisions and any associated challenges, (2) what is known about services
and outcomes since the law's enactment, and (3) how accountability has
changed for the Disabled Veterans' Outreach and Local Veterans' Employment
Representative programs.

To obtain information to address our objectives, we administered two
surveys, one to the state directors of veterans' employment and training
and the other to state workforce administrators in all 50 states and the
District of Columbia. We received responses from all 51 state directors of
veterans' employment and training and 50 state workforce administrators2.
We validated the survey instruments through pretest but did not verify the
information respondents provided. To further understand local area
approaches to JVA implementation, we visited 10 local one-stop centers in
five states: California, Florida, Louisiana, Ohio, and Washington. We
selected these states on the basis of several criteria, including
geographic dispersion, range of sizes as determined by funding allocation,
whether the state had implemented JVA's incentive award program, and
recommendations by Labor, veterans' service organizations, and the
National Association of State Workforce Agencies. On the basis of these
organizations' recommendations, we then chose two local one-stop centers
that were either further along in implementation or were facing some
challenges. Our site visits at the state level included interviews with
officials from the Veterans' Employment and Training Service and state
workforce agency; at the local level, we interviewed one-stop management
and staff, including veterans' staff. In addition, we also visited the
National Veterans' Training Institute in Denver, Colorado, where we
interviewed training officials, state-level Veterans' Employment and
Training officials, and veterans' staff from 24 states who were attending
training classes. We also met with representatives of various veterans'
service organizations and the National Association of State Workforce
Agencies. Finally, we spoke with federal officials at other Labor agencies
responsible for implementing JVA, including the Employment and Training
Administration (ETA), Office of Federal Contract Compliance Programs,
Women's Bureau, Office of Disability Employment Policy, and Bureau of
International Labor Affairs. For a greater discussion of our scope and
methodology, see appendix I. Our work was conducted between January and
November 2005 in accordance with generally accepted government auditing
standards.

2The state workforce administrator from the District of Columbia did not
respond.

                                Results in Brief

Labor took action to implement most JVA provisions within the first 2
years of the new legislation. For example, Labor issued guidance on new
roles and responsibilities for DVOP and LVER staff as well as implemented
a new funding formula for allocating grant funds to states. However,
federal actions are still outstanding for certain provisions designed to
give priority to veterans in Labor training programs, update federal
contractor regulations, and improve state accountability for veteran
employment. For example, Labor agencies have not provided complete
guidance to grantees required to provide priority of service to veterans
in the various Labor training programs, or on reporting requirements. In
addition, the department anticipates it will be 2007 before sufficient
trend data will be available to replace individual state goals for
veterans' employment with a national standard common to all states. Also,
Labor has not updated regulations on federal contractors' hiring and
reporting practices because of a lack of consensus and coordination on how
to implement and enforce this provision. States reported good progress in
implementing provisions through October 2005, but challenges remain in
certain states and local areas. For example, most states reported that
veterans' staff have transitioned to their new roles and responsibilities
in over 75 percent of local workforce offices, but that integration with
other staff in some local offices remains a challenge. Similarly, about
one-third of states reported that they did not establish incentive
programs recognizing high-quality veterans' services because this JVA
requirement conflicts with state laws, policies, or collective bargaining
agreements. While most state workforce administrators reported on our
survey that good progress has been made in implementing priority of
service for veterans in Labor training programs, officials in some areas
we visited were unaware of or confused by Labor's guidance on this JVA
requirement.

Most state workforce administrators reported that the new legislation has
improved the quality of services to veterans, including disabled veterans,
and has also improved employment outcomes. They credited the greater
availability of case management services through DVOP staff, citing this
factor most often in helping veterans obtain employment. In contrast,
state administrators reported that the lack of federal contractor
compliance with the requirement to list job openings at the local one-stop
centers has limited veteran employment opportunities. Non-JVA factors also
played a significant role in employment outcomes. In particular,
administrators cited the willingness of employers to hire veterans and the
strength of the local job market as significant factors.

While about half of state VETS directors reported that their monitoring
role under JVA had strengthened local accountability for the DVOP and LVER
programs, just over a third reported that it had either lessened or not
improved. Monitoring tools most often reported to strengthen
accountability were analysis of local level performance data and site
visits to local offices. However, VETS directors in 21 states reported
that local-level data were unavailable, potentially limiting federal
oversight of local office performance in these states to site visits
conducted every 5 years. Although not specifically required by JVA, the
lack of coordinated oversight by agencies within Labor that share
responsibility for implementing certain JVA provisions weakens performance
accountability. For example, only five state VETS directors reported
taking a coordinated approach with ETA to monitor local office
performance, share results, and take corrective action. Also, in terms of
federal oversight, VETS lacks a strategy to use monitoring results to
improve program performance. For example, state performance goals for the
rate at which veterans enter employment range from 38 percent to 65
percent, but VETS has not proactively identified why goals are lower in
some states than in other states and targeted these states for assistance.

To improve the way JVA is implemented, we are making a number of
recommendations to Labor regarding integration of veterans' staff into the
one-stops, priority of service across all programs, best practices on
awarding performance incentives, coordinated monitoring efforts, and also
implementation and enforcement of federal contractor requirements.

In its written comments, Labor generally concurred with our findings and
recommendations.

                                   Background

JVA3 amended Title 38 of the U.S. Code, the legislation that governs the
DVOP and LVER programs, and by doing so, introduced an array of reforms to
the way employment, training, and placement services are provided to
veterans. (See table 1.) JVA addressed concerns raised by some that Title
38 was overly prescriptive and did not provide states the flexibility to
determine the best way to serve veteran job seekers. For example, JVA
amended Title 38 by removing provisions detailing the specific duties of
DVOP and LVER staff and how they were to be assigned.4 Under JVA, the
states have the authority to employ, subject to Labor's approval, a
sufficient number of full or part-time DVOP staff to provide intensive
services to eligible veterans, giving priority to disabled veterans and
others as Labor determines. Similarly, JVA gives the states authority to
employ a sufficient number of LVERs to carry out employment, training, and
placement services, including conducting outreach to employers and
facilitating services furnished to veterans under the applicable state
employment service delivery systems. Beginning July 2003, states and
localities were required to implement JVA provisions.

3 Pub. L. No. 107-288 (2002).

4 Prior to JVA, Title 38 provided that there was to be one DVOP for each
7,400 veterans in a state and prescribed 11 functions the DVOP staff to
carry out in providing services to eligible veterans. Similarly, prior to
JVA, Title 38 provided that in any fiscal year funding should be available
for 1,600 full-time LVER staff and prescribed how those LVER staff were to
be allocated to the states and assigned to local employment service
offices. In addition, Title 38 prescribed 13 functions to be performed by
the LVER staff.

Table 1: Comparison of Selected Provisions under Title 38 and JVA

Title 38 before JVA amendments      JVA                                    
State funding                       
      o  Funding is available by grant    o  Funding is available by grant or 
      or contract through two separate    contract through one allocation     
      allocations, each with its own      under a new funding formula that    
      funding formula that prescribes     allows states to determine number   
      total number and location of        of DVOP and LVER staff.             
      DVOP and LVER staff for each        o  Requires state plan as a         
      state.                              condition of funding, which must    
      o  States submit grant              include a description of how        
      applications to request funding.    veterans' staff will be integrated  
                                          into the service delivery system,   
                                          their duties, and the veterans'     
                                          population to be served.            
Staff roles and responsibilities    
      o  Prescribes 11 specific duties    o  Clearly distinguishes DVOP and   
      for DVOP staff and 13 for LVER      LVER staff roles and gives states   
      staff.                              flexibility in deciding their       
      o  Only LVER staff may be           duties.                             
      assigned on a part-time basis.      o  Allows both types of staff to be 
                                          assigned on a part-time basis.      
Priority of service                 
      o  Eligible veterans and spouses    o  Eligible veterans and spouses of 
      of certain veterans receive         certain veterans receive priority   
      priority of service in those        of service in all Labor-funded      
      federally funded employment and     employment and training programs.   
      training programs that           
      specifically require it.         
Performance accountability          
      o  Performance measures             o  Comprehensive performance        
      emphasize processes over            accountability system consistent    
      outcomes.                           with WIA performance measures.      
      o  National standard not            o  National performance standard    
      required.                           for the rate at which veterans      
      o  Each local employment office     enter employment, a rate that all   
      evaluated annually.                 states are expected to meet.        
                                          o  Annual performance reviews of    
                                          veterans' services without          
                                          specifying how many local offices   
                                          will be evaluated.                  
Incentive awards                    
      o  No incentive award program.      o  Incentive award program to       
                                          encourage the improvement and       
                                          modernization of veterans' services 
                                          and recognize exemplary staff.      
Committees                          
      o  No such committee.               o  President's National Hire        
                                          Veterans Committee to market        
                                          veterans as a viable workforce      
                                          resource.                           
Federal contractors                 
      o  Requires regulations for         o  Raises federal contract          
      employers with federal contracts    threshold amount to $100,000 or     
      of $25,000 or more to list all      more, requires contractors to list  
      their job openings as               their job openings and give         
      appropriate, give veterans          veterans priority in referral to    
      priority in referral to those       those jobs, and modifies categories 
      jobs, and report on their hiring    of veterans to be reported.         
      practices.                       

Source: GAO analysis of Title 38 and JVA legislation.

Within Labor, two agencies---VETS and ETA-share responsibility for helping
the nation's veterans find employment. Among the programs that VETS
administers are the DVOP and LVER programs, which were funded at about
$162 million in fiscal year 2005.5 Prior to JVA, funding for these two
programs was allocated as two separate grants to states. Under JVA,
however, the DVOP and LVER grants are allocated as one funding stream to
states, and states use this funding to support nearly 2,400 veterans'
specialist and representative positions nationwide. To promote the
professional competence of these veterans' service providers, VETS
received about $2 million in fiscal year 2005 for the National Veterans'
Training Institute to develop and deliver training. In addition, JVA
authorized funding for the newly created President's National Hire
Veterans Committee at a level of $3 million annually, from fiscal year
2003 through 2005, to carry out its marketing and promotional activities,
and stipulated that the committee would terminate in February 2006, 2
months after issuing a final annual report on its activities.

VETS carries out its responsibilities through a nationwide network that
includes representation in each of Labor's six regions and staff in each
state. The Office of the Assistant Secretary for VETS administers the
agency's activities through regional administrators and state directors.
The state directors are the link between VETS and the states' employment
service system that is overseen by ETA. The DVOP and LVER staff, whose
positions are funded by VETS, are part of states' public employment
services.

Employment services fall under the purview of ETA, which administers the
Wagner-Peyser-funded Employment Services program, providing a national
system of public employment services to any individual seeking
employment-including a veteran-who is authorized to work in the United
States. Thus, those veterans considered job ready and not in need of
intensive services from a DVOP could instead be served by employment
service staff and receive such services as assessment, counseling, job
readiness evaluation, and placement. Veterans would also be eligible to
receive WIA-funded services. Like VETS, ETA carries out its employment
service program through staff in Labor's six regions and workforce
agencies in each state. In fiscal year 2005, ETA requested about $700
million for the Wagner-Peyser program.

5 The other grant programs and services administered by VETS are the
Homeless Veterans Reintegration Program, Veterans Workforce Investment
Program, Transition Assistance Program, and National Veterans' Training
Institute.

The DVOP and LVER programs, along with the Employment Services program,
are all mandatory partners in the one-stop center system created in 1998
by WIA and overseen by Labor, in which services provided by numerous
employment and training programs are made available through a single
network. JVA requires that veterans be given priority of service in any
job training program administered by Labor. This requirement affects 23
Labor-funded workforce programs, including WIA and Wagner-Peyser
Employment Services. Labor's guidance requires states to modify their
strategic plans for workforce investment for the next 2 years, addressing
how veterans will be given priority and how veterans' services will be
provided through the state's one-stop service delivery system.

Most JVA Provisions Have Been Carried Out, but Not without Some Challenges

Labor's implementation of JVA has been on track, with most provisions in
place within the first 2 years of the new legislation. For example, Labor
timely implemented new roles and responsibilities for veterans' staff as
well as the new funding formula for allocating grant funds to states.
However, Labor's implementation is still pending for provisions designed
to give veterans priority for participating in all Labor's training
programs, govern federal contractor hiring practices, and improve states'
accountability for increasing veterans' employment. States also report
good progress in implementing provisions, but challenges remain in some
local areas in terms of integrating veterans' staff with other staff in
local workforce centers and establishing incentive programs as provided in
JVA for recognizing quality services to veterans.

Labor Is Generally on Track in Implementing Most JVA Provisions

Labor has taken actions to implement most JVA provisions to reform
veterans' services since the law was enacted in November 2002. For
example, Labor has issued guidance clarifying the new roles and
responsibilities for veterans' staff, and has established criteria in
regulation, to implement the new funding formula for allocating grant
funds to states. (See table 2.) Additional Labor actions may be needed to
ensure progress in implementing other JVA provisions. These include
issuance of regulations requiring recent federal contractors to list job
openings and report on their veterans hiring practices, and development of
a national standard for veteran employment, needed to complete its new
performance accountability system for states.

Table 2: Summary of Labor's Completed and Planned Actions to Implement
Selected JVA Provisions, as of December 2005

Provision              Labor's completed actions   Labor's planned actions 
Prior to JVA                                       
Veterans' staff roles     o  VETS issued first of     o  Updates will      
and responsibilities      several guidance letters    occur as necessary.  
                             in September 2002.       
                             National Veterans'       
                             Training Institute       
                             subsequently began       
                             conducting training on   
                             JVA provisions for       
                             veterans' staff in 2003. 
JVA Enacted November                               
7, 2002                                            
First full program                                 
year following JVAa                                
Performance               o  VETS issued a            o  Labor anticipates 
accountability            guidance letter on new      that it will be 2007 
                             performance measures in     before it can        
                             July 2003.                  establish a national 
                                                         standard that states 
                                                         must meet for        
                                                         veterans entering    
                                                         employment.          
Priority of service       o  ETA issued its first     o  Two of three      
                             guidance letter for 15      other Labor agencies 
                             programs in September       plan to issue        
                             2003.                       guidance for their   
                                                         programs.            
National Hire Veterans    o  Secretary of Labor       o  None              
Committee                 began appointing members 
                             in 2003.                 
First full fiscal year                             
following JVAb                                     
State grant funding       o  VETS allocated grants    o  None              
                             to states phased in over 
                             a 2-year period          
                             beginning fiscal year    
                             2004.                    
Incentive awards          o  VETS allocated           o  None              
                             incentive award funds to 
                             states beginning in      
                             fiscal year 2004.        
Second full fiscal                                 
year following JVA                                 
Federal contractors       o  VETS and Office of       o  VETS and OFCCP    
                             Federal Contract            anticipate issuing   
                             Compliance Program          regulations in early 
                             (OFCCP) drafted             2006.                
                             regulations on           
                             contractor affirmative   
                             action, job listings,    
                             and reporting            
                             requirements.            

Source: GAO analysis of JVA provisions and Labor information.

aProgram year 2003 was the first full program year under JVA and ran from
July 1, 2003, to June 30, 2004.

bFiscal year 2004 was the first full fiscal year under JVA and ran from
October 1, 2003, to September 30, 2004.

  Staff Roles and Responsibilities

VETS took several steps to prepare veterans' staff for their new roles and
responsibilities under the law. VETS issued guidance and held training
classes, but officials cite challenges in providing all staff with
training on their new roles and responsibilities because of resource
limitations on the number of classes. VETS took action in September 2002,
before JVA was enacted, to issue guidance for DVOP and LVER staff, and
directed the National Veterans' Training Institute (NVTI) to design
training seminars to facilitate state and local implementation in the next
program year.6 The initial VETS guidance, updated in later years,
explained how the DVOP staff roles and responsibilities were to transition
to exclusively focus on intensive services and outreach to veterans, while
LVER staff were to exclusively focus on outreach to employers and
community organizations, training other staff on veterans' issues, and
quarterly reporting on compliance with the law. Subsequent guidance issued
in July 2005 discussed, among other topics, the flexibility states have
under JVA to decide number of DVOP and LVER staff hired on a full-time or
part-time basis. The later guidance also instructed each workforce area to
report quarterly on veterans' services. Almost three-quarters of the 50
state workforce officials reported on our survey that the quality of
Labor's formal written guidance and technical assistance was good or
excellent in terms of facilitating implementation of new staff duties.
(See fig. 1.) Conversely, no more than a dozen states characterized the
guidance and assistance as fair or poor.

6 VETS issued guidance based in part on House bill H.R. 4015, which
contained provisions that VETS believed would be enacted in the new
legislation.

Figure 1: State Workforce Administrators with Positive Comments on the
Quality of Labor's Guidance and Assistance on New Roles for Veterans'
Staff

Shortly after JVA was enacted, Labor's training institute held a series of
implementation seminars that were attended by representatives from all
states. The institute continues to conduct and fund training for DVOP and
LVER staff. At the end of its first training year in October 2004, the
institute reported having trained 282 DVOP staff in case management.
Similarly, at the end of its second training year in 2005, the institute
reported that 240 LVER staff were trained in employer outreach. NVTI
estimated that an additional 144 DVOP and 240 LVER staff would be trained
in these two courses each year in the future, but had concerns that these
numbers would cover only about 16 percent of all veterans' staff each
year, while annual staff turnover was averaging about 18 percent. Training
institute officials estimated that 48 additional sessions would be
required to meet the needs of all staff in these two course offerings in
addition to the 80 training sessions planned for veterans' staff over the
institute's 5-year contract period.

VETS officials confirmed a need for expanded training opportunities but
said that their authority to reallocate resources to NVTI is limited.7
Overall, state and local workforce officials were pleased with the quality
of NVTI training. For example, a DVOP in a one-stop center in California
found that NVTI classes provided a valuable opportunity to network and
exchange ideas with other participants from around the country. In a
survey comment, a state administrator also said that the NVTI Web site has
been useful in helping the state keep up with all aspects of JVA
implementation and that the state makes extensive use of NVTI's electronic
discussion board to communicate with other states.

  Funding Formula

VETS began using JVA's method for allocating DVOP and LVER grant funds to
states in the fiscal year beginning in October 2003. Under JVA, the
previously separate DVOP and LVER grants were merged into one grant for
veterans' staff, and states are now required to submit an application for
funding containing a plan describing how the state will furnish the
required employment, training and placement services, the veteran
population to be served, and any additional information Labor may require.
Labor was to award funds proportionately to the states with approved
applications, based on a ratio of the total number of veterans residing in
the state that are seeking employment to the total number of veterans
seeking employment in all states using criteria that Labor may establish
in regulation. JVA required Labor to phase in this new method of providing
funding to the states and provided that it may establish minimum funding
levels and hold harmless criteria for the states.

VETS issued a final rule establishing criteria for making funds available
for veterans' employment services. It reserved up to 4 percent of the
grant money available for unexpected needs and transition assistance
programs8 and allocated grants to states using the new formula prescribed
by law.9 During the first 2 years of the required 3-year phase-in period,
states were provided with (1) a hold harmless rate of no less than 80
percent of its previous year's allocation during fiscal year 2005 and 90
percent thereafter, and (2) a minimum funding level of 0.28 percent of the
prior year's total funding level for all states. For example, the minimum
funding level for fiscal year 2004 was $439,000 ($156,811,000 x .0028).
Under the new formula, 4 states received about the same amount of funding,
while 31 states received a decrease of 5 percent or more and 16 states
received at least a 5 percent increase between fiscal years 2003 and 2005.
(See app. II for state funding allocations.)

7National Veterans' Training Institute is funded as a separate line item
in the VETS budget, limiting VETS' authority to reprogram funds among its
accounts to $500,000, according to a VETS official.

8The Transition Assistance Program was established to ease the transition
of separating service members and their spouses from military service to
the civilian workforce. During 3-day workshops conducted at selected
military installations nationwide, participants learn about job searches,
career decision making, current occupational and labor market conditions,
resume writing, and interviewing techniques. In fiscal year 2005, VETS
allocated $2.5 million to 40 states for the provision of 3,048 workshops.

  Incentive Awards Program

VETS issued guidance in May 2003 for an incentive award program to be
implemented by states in the first fiscal year after JVA. This guidance
laid out eligibility and selection criteria and examples of nonmonetary
awards, giving states flexibility to tailor their awards programs. JVA
required that states establish an incentive program to recognize eligible
employees for excellence or demonstrable improvement in the provision of
employment, training, and placement services. Under JVA, Labor is to
establish criteria, in consultation with the states, to be used by the
states in setting up the required incentive program. The law provides
further that the form of incentive award may be either a cash or a
nonfinancial award, as Labor may specify. The act provided that beginning
in program years during or after fiscal year 2004, 1 percent of the annual
grant funds is to be used for making cash awards under the state's
incentive award program.

In accordance with JVA, VETS mandated that 1 percent of each state's grant
amount be used for incentive payments to staff. In total, VETS allocated
about $1.5 million for the incentive program in fiscal years 2004 and
2005. Of this amount, states used about $600,000 (40 percent) during the
first year of implementation, and VETS officials stated that the remaining
unexpended funds were returned to the Treasury. In addition, VETS does not
anticipate returning any incentive funds to the Treasury in 2005. Instead,
VETS informed Congress that any unspent funds will be reallocated to the
DVOP and LVER programs, according to officials. (See app. III for state
incentive program allocation and expenditures in fiscal year 2004.)

9The ratio of the total number of job-seeking veterans residing in the
state to the total number of job-seeking veterans in all states is best
determined using data collected through the Local Area Unemployment
Statistics (LAUS) and the Current Population Survey (CPS), both of which
are administered by the Bureau of Labor Statistics (BLS). The LAUS data
are considered to be the most reliable source of the number of unemployed
persons in the civilian labor force, while the CPS data are considered to
be the most reliable source of the number of veterans in the civilian
labor force. BLS officials said that these two data sources provide the
most meaningful and reliable data on veterans seeking employment at the
state level, and that using a 3-year average to calculate the funding
formula will stabilize the effect of annual fluctuations in the data and,
consequently, in the amounts allocated annually to states.

  Priority of Service

Labor has only partially implemented the JVA requirement to give priority
service to veterans in its many employment training programs. JVA added a
new section to Title 38 on priority to veterans and spouses of certain
veterans in receiving employment and training services through
Labor-funded programs. In that section, Labor is given authority to
establish priorities among covered persons to take into account the needs
of disabled veterans and special disabled veterans. This provision applies
to 23 employment and training programs operated by five Labor
agencies-VETS, ETA, Women's Bureau, Office of Disability Employment
Policy, and the Bureau of International Labor Affairs. Veterans
automatically receive priority of service in the five programs operated by
VETS because these programs serve veterans exclusively. However, for
programs that serve additional populations and are operated by other Labor
agencies, priority of service for veterans is applied differently once
veterans meet the programs' eligibility requirements. For example, under
ETA's Wagner-Peyser-funded Employment Services program, priority is to be
given first to veterans and then to all others. By contrast, under ETA's
Senior Community Service Employment program, priority is given to
low-income individuals who are first veterans and their qualified spouses
aged 60 years or older; second, other individuals who are at least 60
years old; third, veterans and their qualified spouses who are 55 to 59
years old; and fourth, other individuals who are 55 to 59 years old.

These Labor agencies are in different stages of providing guidance and
reporting requirements for veterans' service priority to the grantees of
their respective programs. ETA, for example, was somewhat delayed in
issuing an initial guidance letter for its 15 programs, notifying grantees
of the law's general requirements in September 2003, several months after
the first program year following JVA began. Both the Women's Bureau and
the Office of Disability Employment Policy have included language on
priority of service in their 2003 grant solicitations, but officials told
us that they have not issued further guidance or established reporting
requirements. In addition, officials at the Bureau of International Labor
Affairs said that their agency funds overseas projects for which veterans
are not eligible, such as a project in Indonesia that focuses on the
prevention of child labor.

Labor did not issue its required annual report to Congress for the first
program year of JVA, and its report to Congress for program year 2004
contained incomplete information regarding veterans' priority among its
training programs. JVA required Labor's annual report to include three
issues (1) whether veterans are receiving priority of service; (2) whether
they are being fully served; and (3) whether the representation of
veterans in programs is in proportion to their representation in the labor
market. Labor did not collect and report data on the first two
requirements for any of its programs, and information on the third
requirement was incomplete. Of its 23 programs subject to the law's
requirement, Labor reported veterans' participation rates for only 11 ETA
programs. (See table 3.) ETA officials said that they were unable to
collect data from participants in all their programs because grantee data
collection systems were not in place.

The data that Labor reported for 11 of its programs showed that veterans
are essentially represented in proportion to their labor force
participation rate of 9.5 percent in five ETA programs that were aimed at
adult job seekers, while six programs fell short of the 9.5 percent target
participation rate. The report indicated that programs with lower veteran
participation rates tended to be those least applicable to veterans, such
as programs for migrant farm workers or youth.

Table 3: Veterans' Participation in ETA Programs for Adult Job Seekers,
Program Year 2003

                                   Number of veterans Veterans' participation 
ETA adult programs                          served          rate (percent) 
Wagner-Peyser Employment                 1,421,977                     9.4 
Services                                           
Trade Act                                    4,970                    13.6 
WIA Adults                                  31,588                     7.1 
WIA Dislocated Workers                      34,943                     9.6 
Senior Community Services                   10,853                    10.1 
Employment, age 55 and up                          
America's Job Bank                         150,327                    15.8 
National Emergency Grants                    3,013                    10.5 
H-1B Skills Grantsa                          1,454                     6.2 
Native American                                398                     2.2 
Migrant and Seasonal                           308                     1.0 
Farmworker, adults                                 
Job Corps                                      114                     0.2 
Total                                    1,659,945                     9.7 

Source: VETS 2004 annual report to Congress.

aData collected and reported by 84.3 percent of H-1B grantees who were
operational in 2004.

  Performance Accountability

VETS established some new performance measures for the DVOP and LVER grant
programs, issuing guidance for state implementation beginning July 2003,
but officials state that it will be at least 2007 before VETS can
establish a national standard for employment outcomes that it will require
all states to meet. Under JVA, Labor was required, by May 2003, to
establish and implement a comprehensive performance accountability system
to measure the performance of employment service delivery systems,
including disabled veterans' outreach program specialists and local
veterans' employment representatives. The standards and measures in that
system are supposed to be consistent with state performance measures under
WIA and be appropriately weighted to provide special consideration for
placement of veterans requiring intensive services and veterans who enroll
in readjustment counseling. Additionally, Labor is required by JVA to
issue regulations establishing a uniform national threshold
entered-employment rate for veterans. As required by JVA, VETS based the
new performance measures on those for WIA. In doing so, it dropped two
process measures--number of veterans receiving counseling or some
reportable service. It also added several others focused primarily on
outcomes-employment rates following either staff-assisted or intensive
services, and employment retention rate. (See table 4.) VETS officials
told us they made additional modifications to the performance
accountability system when, in July 2005, they adopted the Office of
Management and Budget's (OMB) new common performance measures. Under this
change, VETS established a new performance measure for individuals who got
a job by comparing their earnings 6 months before they enroll in a program
with earnings 6 months after they exit the program.

Table 4: Development of DVOP and LVER Performance Measures and Reporting
Requirements

Performance measure or reporting Before program Program years Program year 
requirement                        year 2002    2002 to 2004      2005     
Entered employment rate                X              X            X       
Number of veterans placed in           X                      
training                                                      
Number of veterans receiving           X                      
counseling                                                    
Number of veterans receiving           X                      
some reportable service                                       
Federal contractor jobs filled         X                      
by Vietnam and special disabled                               
veterans                                                      
Employment rate following                             X            X       
receipt of staff-assisted                                     
services                                                      
Employment rate following                             X            X       
receipt of intensive servicesa                                
Employment retention rate at 6                        X            X       
months                                                        
Number of veterans placed in                          X            X       
federal training                                              
Number of veterans placed in                          X       
federal jobs                                                  
Number of veterans that entered                       X            X       
into federal contractor jobs                                  
Earnings increase at 6 months                                      X       

Source: Veterans' Employment and Training Service, Department of Labor.

aIntensive services were formerly referred to as case management.

VETS officials said that they have changed the method they use to
calculate the entered employment measure and collect source data.
Initially, VETS measured job placements that tracked whether a veteran was
referred to, hired, and retained in a specific job. With WIA's enactment
in 1998, VETS began tracking the entered-employment rate or percentage of
all registered veterans who were placed in or obtained employment.
However, states had different policies regarding how and when veterans
were registered, resulting in inconsistent performance data.10 During this
time, VETS also moved from a manual follow-up system to identify how many
veterans obtained jobs to an automated system using unemployment insurance
wage records.11 The resulting changes in state reporting systems have
delayed the setting of a national standard for veterans' employment. VETS
anticipates that it will need at least 3 years under the OMB measures to
collect the comparable trend data needed to establish the national
performance standard holding all states accountable to the same minimum
goal for veterans entering employment. In the interim, VETS issued
guidance in May 2004 on how it would negotiate individual performance
goals with states. These goals ranged from 38 to 65 percent in program
years 2004 and 2005. (See app. IV.)

10Under the common measures, Labor plans to require one-stops to track all
participants who walk through the door of a one-stop center and receive
any one-stop service, regardless of which program provides the service.

11GAO, Unemployment Insurance: Better Data Needed to Assess Reemployment
Services to Claimants, GAO-05-413 (Washington, D.C.: June 24, 2005).

  National Hire Veterans Committee

Approximately 15 months passed as the Secretary of Labor appointed members
to the President's National Hire Veterans Committee, and these members
worked with a contractor to begin the national campaign to make employers
and businesses more aware of veterans through the public workforce system.

JVA provided for the establishment of the National Hire Veterans
Committee, whose purpose is to furnish information to employers with
respect to the training and skills of veterans and disabled veterans, and
the advantages to employers of hiring veterans with such training and
skills and to facilitate employment of veterans and disabled veterans
through participation in America's Career Kit national labor exchange and
other means. The Secretary of Labor is required to appoint the 15 members
of the committee and the chairman. Labor is required to submit a report to
Congress on the activities of the committee annually for 2003, 2004, and
2005. The report is to contain data concerning the placement and retention
of veterans in jobs attributable to the activities of the committee.

Labor initiated action during the third and fourth quarters of calendar
year 2003 by appointing the 15 committee members from the various public
and private organizations required by law. Starting in February 2004, the
committee held the first of its required quarterly meetings in Washington,
D.C., and held nearly all of its six subsequent meetings in various parts
of the country in order to increase media coverage. The meetings allow
committee members to monitor activities, develop strategies, and hold
public forums on veterans' employment issues.

The committee also hired a contractor in 2004 to carry out a national
campaign to promote the hiring of veterans and to inform veteran job
seekers of the public workforce resources available to them. The campaign
included a Web site,12 activated in October 2004, which offered an
electronic clearinghouse to facilitate a match between employers and
veteran job-seekers and help veterans conduct their job searches. The
campaign has run magazine advertisements in Business Week and HR Magazine
(the magazine for the Society of Human Resource Management) and posted
banner ads on electronic job boards that targeted private sector
employers, advising them to recruit veterans through one-stop centers.
Finally, the committee persuaded 44 state governors to proclaim a "Hire
Vets First" month to demonstrate state support.

12The Web site can be found at http://www.hirevetsfirst.gov.

Although JVA authorized $3 million a year for the committee's activities,
according to a committee official, these funds were not appropriated and
funds were drawn from VETS' administrative budget instead. The committee
has projected that its cumulative total expenditures will be about $2.2
million through fiscal year 2005. Contract services, which account for
approximately 60 percent of expenditures, are predominately for
implementing the national campaign and associated marketing and media
activities. (See fig. 2.)

Figure 2: Allocation of Projected Total Expenditures of the President's
National Hire Veterans Committee through Fiscal Year 2005

A majority of the state workforce administrators reported on our survey
that the committee's promotional activities have been beneficial to some
degree in helping veterans get jobs. (See fig. 3.)

Figure 3: Extent to Which the Committee's Promotional Activities Have
Benefited Veterans in Obtaining Employment

  Federal Contractors

Labor has not yet issued updated regulations for federal contractors with
regard to affirmative action in hiring veterans, although Labor officials
said they plan to issue regulations in 2006. As with the prior Title 38
provision, under JVA, federal contractors are to (1) implement affirmative
action in employing qualified veterans, (2) list their employment openings
with the appropriate employment service delivery system, and (3) submit an
annual report on their hiring and employment of qualified veterans.
However, JVA amended the Title 38 provision by raising the dollar amount
of covered contracts from $25,000 to $100,000 and by modifying the
categories of veterans to which this provision applies by creating a new
definition of "covered veteran." In addition, the law added another
reporting requirement to the annual report, providing that contractors
must report the total number of all current employees in each job category
and at each hiring location. JVA provides that these amendments apply to
contractors with federal contracts of $100,000 or more entered into on or
after December 1, 2003.

As under the prior Title 38 provision, JVA requires Labor to issue
regulations implementing these requirements. Labor has not yet issued
updated regulations, but VETS officials said that Labor plans to issue
regulations that would, among other things, clarify the new categories of
covered veterans. In the meantime, Labor has issued guidance stating that
contractors receiving contracts before December 1, 2003, are subject to
existing regulations and reporting categories of veterans. For contracts
awarded on or after December 1, 2003, of $100,000 or more, the guidance
states that contractors are not required to file the annual report until
VETS has completed its regulatory clearance process and new regulations
are published implementing the changes made by JVA.

Two Labor agencies are responsible for issuing regulations covering these
requirements-VETS and the Office of Federal Contract Compliance Programs
(OFCCP)-but action has been delayed because of a lack of consensus and
coordination within Labor on how to implement and enforce them, according
to officials. On the basis of their experience, VETS officials were
concerned about the feasibility and usefulness of the contractor
requirements. They said that there is no central repository of contractors
to identify which ones are subject to the requirements, that the reporting
requirements are burdensome for employers, and they are not relevant in
evaluating the program's effectiveness. Further, VETS officials said that
they lack enforcement authority over contractors that do not comply.
Instead, OFCCP has this authority.

VETS has nevertheless drafted regulations requiring contractors to report
on their veteran hiring practices, and OFCCP has drafted regulations
concerning affirmative action and job listings. Pending OMB approval, they
will be issued in early 2006, according to Labor officials. Advocates from
veterans service organizations believe that regulations are necessary to
ensure federal contractor compliance, and state workforce administrators
from 18 states agree-reporting that half or fewer local workforce offices
had been able to increase the number of federal contractor jobs they could
list and fill since JVA was enacted.

States Report Good Progress Implementing JVA, but Challenges Remain in Certain
States and Local Areas

State workforce agency administrators report good progress in implementing
JVA provisions, but challenges remain in certain states and local areas.
During the first year of JVA implementation, state workforce agencies were
required to transition veterans' staff to their new roles and
responsibilities, establish the incentive program to enhance staff
performance, and implement priority of service to veterans in Labor
training programs. The majority of state workforce administrators reported
that three-fourths or more of local offices had transitioned veterans'
staff to their new roles through greater focus on intensive services and
employer outreach. (See fig. 4.) State administrators also reported the
most progress in providing electronic services to veterans and least
progress in establishing incentive programs for improving service to
veterans.

Figure 4: State Actions to Implement JVA in more than 75 Percent of Local
Offices or One-Stop Centers, as of October 2005

  Staff Roles and Responsibilities

The majority of state workforce administrators reported that veterans'
staff had transitioned to a greater focus on intensive services and
employer outreach in most local offices. However, a minority reported
using JVA's flexibility to establish part-time13 veterans' staff
positions. Also, integration of veterans' staff into the one-stop centers
was still problematic in some offices. Our survey data showed that 22
states had part-time DVOP staff, 33 used part-time LVER staff, and 17 had
part-time positions for both types of staff. (See app. V for information
on states' use of full- and part-time veterans' staff.) VETS officials
from several states we visited told us that having the flexibility to use
part-time DVOP and LVER staff allowed the state to provide veterans'
services in more locations and reach more veterans in the community,
including those in remote rural areas. However, some other state and local
workforce officials told us that part-time staffing could, in some cases,
hamper service to veterans, particularly if more than 50 percent of such
time were devoted to performing office duties such as staffing the
reception desk and answering the phone.

13 Labor's guidance defines part-time DVOP and LVER positions as half-time
positions.

The use of part-time veterans' staff was limited. For example, just over
half of the states reported not using any part-time DVOP staff in their
local offices, and over a quarter did not use any part-time LVERs. (See
fig. 5.) One reason may be lack of guidance in this area. About
one-quarter (12 states) of state workforce administrators responding to
our survey characterized Labor's guidance and technical assistance for
making effective use of part-time veterans' staff as fair or poor.

Figure 5: Use of Part-Time Veterans' Staff in Local Offices

Finally, Labor officials said that integrating veterans' staff into the
one-stop offices has been a persistent challenge and can hinder services
to veterans. According to the DVOP and LVER staff we interviewed, the
degree of their integration has varied widely in local areas and has
depended on the level of support from the one-stop managers of veterans'
programs. For example, one DVOP staff member we interviewed told us that
the veterans' program is highly integrated with the WIA program in her
local one-stop, with both DVOP and WIA staff sharing case management
responsibilities for veterans. In addition, she participates in regular
meetings with the other one-stop partners. She attributed this cohesion to
her manager's commitment to work cooperatively with all the partners. In
contrast, a DVOP staff member from another state told us that his manager
sometimes resented veterans' staff because they do not serve nonveteran
clients or help with other one-stop activities.

Another reason cited by veterans' staff for poor levels of integration was
that other one-stop staff members were not educated or trained to serve
veterans. In addition, Labor's guidance and technical assistance to
integrate veterans' staff within the one-stop was ranked only fair or poor
by more than one-quarter of state workforce administrators responding to
our survey. Some states have taken action to mitigate the challenges. Ohio
workforce officials, for example, requested the National Veterans'
Training Institute to come to their state and conduct orientation training
for all one-stop partners, identifying the training as a best practice, in
part to address integration challenges. Individual one-stop centers in
such states as Ohio and California have also taken steps to enhance
integration. They have cross-trained other partner staff on serving
veterans and veterans' staff may potentially conduct orientation and job
search workshops for mixed groups of job-seekers that included veterans.

  Incentive Awards Program

Nationwide, 32 of the 50 state workforce administrators we surveyed
reported implementing an incentive awards program for veterans' services.
Incentives were perceived by some as effective in improving veterans'
services in the state. For example, administrators in 16 states with award
programs in place reported that their program had a positive effect on
improving or modernizing veterans' services. The remaining 7
administrators either said that their incentive programs had no effect and
8 believed it was still too early to say. Although most states had
included other one-stop partners in their incentive award programs, at
least 10 respondents reported that the incentive program either had no
effect on improving staffs' performance, morale, or integration with
veteran's staff or that it was too early to tell. (See fig. 6.)

Figure 6: Effect of Incentive Award Program on Staff Integration, Morale,
and Performance

In the five states we visited, VETS and workforce officials told us the
incentive program was a good concept. However, not all had implemented the
program. In fact, 17 states have reported not implementing the incentive
program.14 For example, California has cited state laws prohibiting
monetary or other gifts to employees for performing their duties. In
Alaska, Iowa, New Hampshire, and Massachusetts, the 2005 state plans
indicated that performance incentive awards were incompatible with the
states' collective bargaining agreements. Idaho, on the other hand, cited
potential morale problems among nonveteran staff with limited
opportunities to serve veterans and was exploring other options for
creating incentives. VETS officials said that they withhold the incentive
program money from states that do not implement the program.

14 These states were Alaska, California, Connecticut, Georgia, Hawaii,
Idaho, Iowa, Louisiana, Maine, Massachusetts, Minnesota, Mississippi, New
Hampshire, North Carolina, Oklahoma, Pennsylvania, and Rhode Island. While
the survey respondent from Montana did not report information for this
question, the state's fiscal year 2005 plan notes that Montana will not
implement an incentive program. Collectively, these states accounted for
about $526,000 (34 percent) of incentive award funding in fiscal year
2005.

States that implemented the incentive program have made awards in
different ways. In one state, a one time cash award of $1,000 was divided
among all one-stop staff, amounting to as little as $16 each. By contrast,
some DVOP staff told us that in another state, individuals received as
much as $4,000 each. Incentives for staff in one state we visited were
based on nominations by supervisors using performance data, while
supervisors in another state were relying on staff to nominate themselves.
VETS officials told us that some states had been more successful than
others in designing their awards program and acknowledged it would be
beneficial to disseminate their ideas and practices.

  Priority of Service

Workforce administrators in 36 states reported that one-stop centers were
giving priority of service to veterans entering Labor's training programs.
However, administrators from 11 other states reported that less than half
of local offices were providing priority to veterans. Whether this has
affected veterans' ability to participate in these programs is not known.
Only four state workforce administrators reported that waiting lists for
Labor training programs impeded employment to a great or very great
extent. In contrast, the other 46 state administrators reported waiting
lists were a factor to a lesser extent, so that veterans would not
necessarily have to be prioritized over other job seekers.

If training resources were to fall short of demand, however, Labor's
guidance would be insufficient for determining who would receive service
priority, according to some local one-stop officials we met with.
Moreover, a 2004 Urban Institute study conducted for Labor reported that
employment services staff need more training on how to implement priority
of service across programs.15 ETA issued specific program guidance to
states on its Web site in 2004, but some workforce officials were not
aware that ETA had posted additional guidance, and other officials still
found ETA's guidance confusing and incomplete. ETA officials told us that
they do not plan to issue any further guidance until WIA is reauthorized,
at which time they plan to respond to all state feedback by issuing a
consolidated document for all their training programs. However, it is not
known when WIA will be reauthorized or when the consolidated guidance will
be issued. ETA officials said that until then, they would work to educate
service delivery staff by means of national conferences and promotional
activities at the one-stop centers about how to give priority to veterans.

15 The Urban Institute, Strategies for Implementing Priority of Service to
Veterans in Department of Labor Programs (Washington, D.C.: 2004).

 State Administrators Reported Improvement in Veterans' Services and Employment
                                    Outcomes

According to VETS data we examined, 46 states have met their negotiated
goals for veterans' employment outcomes under the DVOP program and 42
states have met similar goals under the LVER program. While it is too
early to determine whether or how JVA's reforms are responsible, most
state workforce administrators we surveyed believed that the reforms have
improved the quality of services to veterans, including disabled veterans,
and have improved their employment outcomes. They credited the greater
availability of case management services under JVA for much of the
improvement in employment. State administrators reported, on the other
hand, that federal contractor failure to list job openings at the local
one-stop centers was most likely to delay or prevent some employment.
Aside from the new law, administrators considered some non-JVA factors as
significant for veterans' employment success, including the willingness of
employers to hire veterans and the strength of the local job market.

In their responses to our survey, many state workforce administrators
associated JVA reforms with improvements. Overall, 33 of the 50 state
workforce administrators reported that veterans' employment services have
improved in their respective states since enactment of the law. They most
often reported that DVOPs were spending more time on case management since
JVA, although somewhat fewer states reported that services to disabled
veterans had similarly improved. (See fig. 7.)

Figure 7: Improvements in Services to Veterans since JVA Was Enacted

Regarding actual employment results, 33 state workforce administrators
also reported improvement. These respondents attributed the improvement
both to the law's reforms and to other factors. The reform cited most
often as helping veterans obtain employment was the increased availability
of case management or other intensive services through the DVOP program
(39 states). (See fig. 8.) The reform least cited was the requirement to
give priority to veterans in referrals to federal contractor jobs. Only 22
state administrators said it had improved outcomes. Beyond the reforms
themselves, administrators said veterans' employment was influenced by
employer willingness or desire to hire veterans and by the strength of the
local job market. They reported that employment was also influenced by the
transferability of veterans' existing skills to other jobs.

Figure 8: Factors That Assisted Veterans in Obtaining Employment

State workforce administrators also reported what they viewed as obstacles
to employing veterans. Specifically, lack of federal contractor listing of
job openings, as required under law, was most likely to delay or prevent
employment. (See fig. 9.) Other obstacles, such as veterans not receiving
priority of referral for federal contractor jobs and waiting lists for
training programs, were cited less than half as often. Non-JVA factors
also presented obstacles to employment, the most frequent one being a poor
local job market. This factor was cited nearly more than twice as often as
other factors, such as non-transferability of veterans' skills to
available jobs or employer reluctance to hire veterans with National Guard
or Reserve commitments.

Figure 9: Factors That Delayed or Prevented Veterans from Obtaining
Employment

  Absence of Local Level Data and Lack of Coordinated Oversight Weaken Program
                                 Accountability

While VETS directors in 26 states reported that their monitoring role had
strengthened local performance accountability, the remainder reported no
effect or a negative effect. In our survey, 21 state VETS directors
reported that key veterans employment data are not collected at the local
level or available through other means. Performance accountability is also
weakened by the lack of coordinated oversight among Labor agencies
responsible for implementing JVA reforms and by the absence of a strategy
for using monitoring results to improve program performance and help
states that lag behind.

Unavailability of Performance Data at Many Local Offices Weakens Accountability

Under JVA, states took on greater responsibility for assessing their own
performance, and while VETS modified its monitoring practices in response,
the unavailability of local level performance data in many states has
limited federal oversight and weakened local level accountability. Prior
to JVA, the law required VETS directors to annually review every local
employment service office or one-stop center where DVOP or LVER staff were
located. Since JVA's enactment, however, VETS directors review states' own
assessments of performance and are required to visit each local office
once every 5 years. VETS completed its first round of monitoring in 2004
using four primary review tools:

           o  State JVA plans for compliance with program requirements;
           o  Annual state self-assessments to ensure the approved state plan
           is being effectively implemented, determine the state's progress
           toward meeting its performance goals, identify technical
           assistance and training needs, and identify best practices;
           o  State quarterly performance and management reports on veterans'
           services and employment outcomes; and
           o  Annual site visits to 20 percent of local offices within each
           state to validate information in self-assessments.

State VETS directors responding to our survey most often reported that
their monitoring role under JVA has had a positive effect on local
accountability. (See fig. 10.) Specifically, 27 state directors reported
their monitoring role had a positive effect on local accountability.
However, 19 directors reported their monitoring role either had no effect
or a negative effect on local accountability.

Figure 10: Extent That VETS' New Monitoring Role Strengthened Performance
Accountability at the Local Level

Some monitoring approaches were regarded as more effective than others.
The most beneficial were analysis and use of data captured in states'
performance reports, along with on-site reviews of local offices. (See
fig. 11.) For example, more than half of 51 state VETS directors said that
analyzing the performance reports had improved accountability. Cited by
only 15 directors, state self-assessments were considered the least
beneficial tool. Respondents from the remaining states reported that their
monitoring activities had little to no effect--or had a negative
effect--on performance accountability.

Figure 11: Extent to Which VETS' Monitoring Tools Strengthened Performance
Accountability

Despite the reported benefits of analyzing performance data reports and
visiting local offices, however, data were not always available to help
monitor local offices, limiting federal oversight and weakening local
level accountability. For example, VETS directors in 21 states noted that
VETS 200 performance data were not available at the local level. In these
states, federal oversight of local office performance may be limited to
the on-site monitoring visits required once every 5 years.

Lack of Coordinated Oversight among Labor Agencies also Weakens Accountability

Labor's several agencies responsible for carrying out JVA reforms have not
coordinated their monitoring activities to ensure consistent and timely
oversight, or used information collected through their monitoring to help
states in greatest need of assistance. For example, the five Labor
agencies16 operating the 23 training programs required to provide service
priority to veterans did not work together to determine what type of
oversight would be needed to ensure that grantees comply with the law. Nor
have they established common reporting requirements.17

16The five Labor agencies are Employment and Training Administration,
Veterans' Employment and Training Service, Women's Bureau, Office of
Disability Employment Policy, and Bureau of International Labor Affairs.

Similarly, the two Labor agencies responsible for implementing federal
contractor requirements have not coordinated their monitoring efforts,
despite VETS' limited enforcement authority. VETS collects reports from
federal contractors on their veteran hiring and employment practices, but
VETS officials told us that only the Office of Federal Contract Compliance
Programs (OFCCP) has enforcement authority. Thus, if a contractor fails to
submit an annual report, VETS cannot take action against the contractor
and must rely on OFCCP to address the issue during its compliance review.
VETS directors in two states we visited said that coordination between the
two agencies was lacking and they had seen little evidence of monitoring
and enforcement by the compliance office.

Similarly, the lack of coordination between VETS and ETA has weakened
oversight of the DVOP and LVER programs. While VETS is responsible for
monitoring both programs, ETA oversees other workforce programs that serve
veterans and nonveterans, such as WIA and Wagner-Peyser Employment
Services. However, the two agencies do not generally coordinate their
monitoring activities or share the results. State VETS directors
responding to our survey said that some coordination occurs between VETS
and ETA when they review state plans for compliance with JVA and WIA, but
it is less likely to occur during other types of monitoring activities.
Although about half of state VETS directors reported that they coordinated
with ETA on reviewing state plans, only five said that they met with them
to share the results and take joint action. (See fig. 12.)

17Some states have taken action to coordinate monitoring activities among
programs. Louisiana state workforce officials, for example, established a
two-person monitoring division that reviews all aspects of veterans'
services, including whether they are receiving priority, regardless of
which program serves them. Following the site visit, the monitoring unit
provides immediate training and technical assistance based on its
findings.

Figure 12: Methods Used to Coordinate Monitoring Activities between VETS
and ETA

Finally, VETS lacks a strategy for using the information it gathers in
monitoring programs to improve performance across states and local areas,
according to officials. While Labor has authority under JVA to provide
technical assistance to states that are deficient in performance or need
help, VETS has yet to begin addressing the significant variation in
performance levels among states, as reflected by their widely divergent
goals negotiated with VETS. For example, in program years 2004 and 2005,
states' negotiated goals for the rate at which veterans entered
employment, ranging from 38 to 65 percent, depending on past performance,
while Labor's national employment goal for veterans was 58 percent.18
Although more than half of the state goals were short of Labor's target,
nationally, VETS has not been proactive in determining why certain states
are falling behind and in targeting them for assistance. Decisions on how
to support states remain with the individual state VETS directors who must
work without the overview and insight of national information.

18Labor's national goal applies to all programs that serve veterans and is
distinct from the JVA requirement to set a national minimum standard for
veterans served by the DVOP and LVER programs.

                                  Conclusions

The employment reforms under JVA represent a significant shift for
veterans' employment and training services, not only because they changed
how services are provided through DVOP and LVER staff, but also because
they provided more latitude to states in implementing the law, allowing
them to tailor service delivery to best meet the needs of their veteran
job seekers. Our work suggests Labor and states are making steady progress
in implementing most JVA provisions. However, the transition of DVOP and
LVER roles and responsibilities, along with establishing and monitoring a
new performance accountability system, may take years to achieve and
fine-tune. For those states with an incentive award program, the wide
variation in methodology for awarding incentives suggests that states
could benefit from strategies on how best to implement their programs.
Similarly, strategies are needed to address the long-standing challenge
states have faced in integrating veterans into their service delivery
system. Without clear guidance, veterans' service providers may work in
isolation from other providers, hindering staff from leveraging the full
array of resources available to assist veteran job seekers. In addition,
if waiting lists for Labor training programs become more prevalent, clear
guidance and reporting of how well programs are providing priority of
service to veterans will become especially important. VETS questions the
effectiveness of federal contractor reporting requirements and Labor has
not yet issued updated regulations; yet states cite lack of contractor job
listings as the most likely factor to limit employment opportunities for
veterans. In the absence of Labor actions to improve the ability of states
and local areas to identify contractors who are subject to the requirement
and enforce compliance, additional employment opportunities for veterans
may be missed.

The flexibility states and localities have to implement JVA allows them to
try innovative ways to best meet the needs of veterans in their area. By
the same token, greater flexibility underscores the need for greater
accountability to ensure that programs are on the right track in serving
clients. Such accountability can be facilitated by robust monitoring and
information systems at the state and local levels that can highlight areas
in which states and localities are lagging behind. Accountability can be
hindered, however, by failure to tailor the type and intensity of
monitoring to the relative strength or weakness of local offices and
states, as well as differences in the availability of local level
information. Similarly, in the absence of a coordinated approach to
guiding and monitoring veterans' services among Labor agencies, programs
may not be consistently implementing JVA's reforms or be held accountable
for doing so.

                      Recommendations for Executive Action

To better ensure that Labor workforce programs are serving veterans as
required by JVA, we recommend that Labor agencies collaborate to:

           o  Provide states and local areas with clear guidance and
           assistance for providing priority of service for all veterans and
           integrating veterans' staff into the one-stops or other workforce
           centers.
           o  Disseminate best-practice information to states on
           methodologies to award meaningful performance incentives.
           o  Monitor the extent to which all Labor workforce programs are
           providing priority of service to veterans.
           o  Strategically use monitoring results to target guidance and
           technical assistance to states and local areas most in need of
           improved performance.

To achieve results from JVA's provisions regarding veteran hiring
practices of federal contractors, Labor should issue regulations as soon
as possible and explore effective methods of enforcement.

                       Agency Comments and Our Evaluation

We provided a draft of this report to the Department of Labor for its
review and comment. Labor's comments are reproduced in appendix VI. In its
comments, Labor concurred with our findings and recommendations and noted
that its two agencies with primary responsibility for employment
assistance to veterans, VETS and ETA will be working together to better
coordinate their efforts to assist veterans. Specifically, Labor concurred
that additional actions are needed to better integrate veterans' staff
into one-stop centers, share best practices for awarding performance
incentives, monitor priority of service for veterans, and use monitoring
results to improve program performance. In addition, Labor said it would
expedite issuing federal contractor regulations and explore effective
methods of regulation enforcement. Further, while Labor generally
concurred with our recommendation to provide clear guidance and assistance
for providing priority of service for veterans, Labor stated that it
believes priority of service has been implemented more fully than the
report indicates, citing publication of guidance for 15 programs on its
Web site and the launch of an initiative designed to raise awareness among
veterans and one-stop center professionals. Our report discusses the
extent of Labor's actions in issuing guidance, but our assessment, as well
as opinions from some state and local officials, is that Labor guidance on
priority of service for its 23 workforce training programs has been uneven
and sometimes insufficient.

We will send copies of this report to the Secretary of Labor, relevant
congressional committees, and other interested parties. Copies will be
made available to others upon request. In addition, the report will be
available at no charge on GAO's Web site at http://www.gao.gov.

Please contact me at (202) 512-7215 if you or your staff have any
questions about this report. Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of this report. GAO staff who made major contributors to this report are
listed in appendix VII.

Sigurd R. Nilsen Director, Education, Workforce, and Income Security
Issues

Appendix I: Objectives, Scope, and Methodology  Appendix I: Objectives,
Scope, and Methodology

The objectives of this report were to determine (1) the implementation
status of the key provisions and any associated challenges, (2) what is
known about services and outcomes since the law's enactment, and (3) how
accountability has changed for the Disabled Veterans' Outreach and Local
Veterans' Employment Representative programs.

To address each of these objectives, we

           o  conducted two Web-based surveys, the first one surveying all 50
           states and the District of Columbia workforce administrators and
           the second surveying the Department of Labor's Directors of
           Veterans' Employment and Training Services (VETS) in the 50 states
           and the District of Columbia;
           o  conducted site visits to state workforce agencies and local
           employment offices and one-stop centers, as well as state
           Directors of VETS offices in five states; and
           o  interviewed representatives of national organizations with
           expertise in the issues of veterans' employment, including staff
           of the President's National Hire Veterans Committee.

More detailed information on each of these aspects is presented below. We
conducted our work in accordance with generally accepted auditing
standards between January and November 2005.

  Survey Development and Implementation

Our survey of state workforce administrators as well as our survey of
Directors of VETS addressed all three objectives and included questions
about implementation of the Jobs for Veterans Act, its impact on services
and outcomes, performance accountability, and monitoring.

The surveys were developed based on knowledge obtained during our
preliminary research. This included a review of pertinent literature and
interviews with members and representatives of organizations that conduct
research on and perform policy analysis of veterans' employment issues and
programs. We also conducted a site visit to the state workforce agency and
the VETS office in the state of Washington to obtain an understanding of
veterans' employment programs and how the state uses them to increase
employment among veterans. The surveys were pretested with cognizant state
veterans' employment officials and state Directors of VETS in Washington,
Colorado, and North Carolina to determine whether respondents would
understand the questions the way they were intended. Revisions were made
to the surveys based on comments received during the pretests.

We sent notifications of the Web-based survey in July 2005 and followed up
with additional e-mail messages and telephone calls as necessary during
August and September. In October, we closed data collection for both
surveys. At that time, all Directors of VETS had responded to their survey
and 50 of the 51 state workforce administrators had done so. (The District
of Columbia did not complete the survey.) We did not independently verify
information obtained through the survey.

Because we surveyed state workforce administrators and VETS directors in
all 50 states and the District of Columbia, no sampling error is
associated with our work. However, nonsampling error could figure into any
data collection effort and involves a range of issues that could affect
data quality and introduce unwanted variability into the results. We took
several steps to minimize nonsampling errors. For example, GAO survey
methodologists and staff with subject matter expertise collaboratively
designed both Web-based survey instruments. Each of the surveys was
pretested in three states to ensure that the Web-based surveys were
relevant, clear, complete, and easy to comprehend. To the extent possible,
we compared the responses we received on the surveys with our site visit
observations.

Data from the two Web-based surveys were converted into separate databases
and analysis was performed. Finally, a second, independent analyst checked
all computer analyses.

  Site Visits to State Workforce Agencies and Directors of VETS

To obtain a detailed understanding of the impact of the Jobs for Veterans
Act on states and the activities of the Directors of VETS, we conducted
visits to five states. We visited the state of Washington in the
preliminary phase of our work and four other states-California, Florida,
Louisiana, and Ohio-in a later phase. We selected these states on the
basis of several criteria including geographic dispersion, range of sizes
as determined by funding allocation, whether the state had implemented
JVA's incentive award program, and recommendations by Labor, veterans'
service organizations, and the National Association of State Workforce
Agencies. On the basis of these organizations' recommendations, we then
chose two local one-stop centers that were either far along in
implementation or were facing some challenges. Our site visits at the
state level included interviews with officials from the state workforce
agency and VETS; at the local level, we interviewed one-stop management
and staff, including veterans' staff.

During each of these interviews, we used a standard interview protocol
that enabled us to obtain more detailed-yet comparable-information than
states were able to provide in the survey. In our interviews with the
state workforce agency, we discussed the status of implementation of the
Jobs for Veterans Act, the incentive awards program, monitoring of local
employment offices and one-stops for priority of service and the use of
part-time DVOP and LVER staff. At the local offices, we discussed the
implementation of the act, its impact on veterans' employment, specific
benefits the act achieved, and obstacles to the complete implementation of
the act's provisions. Finally, we interviewed Directors of VETS and their
staff, discussing the changes in monitoring one-stops and local employment
offices, the accountability of local offices and one-stops, and
coordination between VETS and ETA. Our site visit work was conducted
between April and August 2005.

  Other Work

As part of our work, we reviewed pertinent literature and interviewed
representatives of the following organizations:

           o  National Veterans' Training Institute in Denver, Colorado;
           o  Veterans' staff from 24 states attending the training
           institute;
           o  President's National Hire Veterans Committee;
           o  National Association of State Workforce Agencies;
           o  The following Labor agencies: VETS, ETA, Office of Federal
           Contract Compliance Programs, Women's Bureau, Office of Disability
           Employment Policy, and Bureau of International Labor Affairs; and
           o  The following veterans' service organizations: Disabled
           American Veterans, Paralyzed Veterans of America, Veterans of
           Foreign Wars of the United States, and Vietnam Veterans of
           America.

Appendix II: Comparison of DVOP and LVER Grant Funding, Fiscal Years 2003
and 2005  Appendix II: Comparison of DVOP and LVER Grant Funding, Fiscal
Years 2003 and 2005

                         2003 actual budget   2005 actual budget   Percentage 
State                  allocation (base)    allocation (base)       change 
States receiving 5 percent or more increase in funding from 2003 to 2005
Arizona                       $1,767,000           $2,929,000           66 
Delaware                         382,000              444,000           16 
Florida                        7,439,000            8,507,000           14 
Georgia                        3,219,000            4,336,000           35 
Kansas                         1,394,000            1,523,000            9 
Kentucky                       1,587,000            2,281,000           44 
Louisiana                      1,564,000            2,319,000           48 
Mississippi                    1,222,000            1,476,000           21 
Nevada                         1,239,000            1,299,000            5 
New Jersey                     3,275,000            3,927,000           20 
North Carolina                 3,984,000            4,722,000           19 
South Carolina                 1,854,000            2,467,000           33 
Tennessee                      2,313,000            3,206,000           39 
Texas                          9,393,000           11,602,000           24 
Utah                             881,000            1,042,000           18 
Virginia                       3,368,000            3,861,000           15 
States receiving about the same amount of funding in 2003 and 2005
California                    18,114,000           17,749,000           -2 
Colorado                       2,520,000            2,625,000            4 
Indiana                        3,074,000            3,130,000            2 
Washington                     4,052,000            4,154,000            3 
States receiving 5 percent or more decrease in funding from 2003 to 2005
Alabama                        2,438,000            2,316,000           -5 
Alaska                           687,000              520,000          -24 
Arkansas                       1,695,000            1,430,000          -16 
Connecticut                    2,963,000            1,904,000          -36 
District of                      475,000              444,000           -7 
Columbia                                                      
Hawaii                           755,000              598,000          -21 
Idaho                            936,000              779,000          -17 
Illinois                       7,957,000            6,536,000          -18 
Iowa                           2,333,000            1,497,000          -36 
Maine                          1,040,000              763,000          -27 
Maryland                       3,125,000            2,887,000           -8 
Massachusetts                  3,345,000            3,092,000           -8 
Michigan                       6,634,000            5,439,000          -18 
Minnesota                      3,414,000            2,698,000          -21 
Missouri                       3,641,000            3,342,000           -8 
Montana                          815,000              536,000          -34 
Nebraska                         964,000              887,000           -8 
New Hampshire                    815,000              729,000          -11 
New Mexico                     1,107,000              990,000          -11 
New York                      10,561,000            8,355,000          -21 
North Dakota                     606,000              444,000          -27 
Ohio                           8,436,000            6,308,000          -25 
Oklahoma                       2,325,000            1,862,000          -20 
Oregon                         2,503,000            2,363,000           -6 
Pennsylvania                   7,662,000            6,472,000          -16 
Rhode Island                     642,000              534,000          -17 
South Dakota                     527,000              444,000          -16 
Vermont                          623,000              444,000          -29 
West Virginia                  1,018,000              931,000           -9 
Wisconsin                      3,221,000            3,063,000           -5 
Wyoming                          494,000              444,000          -10 
Total                       $156,398,000         $152,650,000 

Source: Labor's VETS.

Appendix III: State Incentive Award Allocation and Expenditures, Fiscal
Year 2004  Appendix III: State Incentive Award Allocation and
Expenditures, Fiscal Year 2004

State                Allocation Expended Unexpended 
Alabama                 $23,780  $18,590     $5,190 
Alaska                    5,500        0      5,500 
Arizona                  29,000   29,000          0 
Arkansas                 13,970        0     13,970 
California              179,240        0    179,240 
Colorado                 24,230        0     24,230 
Connecticut              23,700   14,200      9,500 
Delaware                  4,465        0      4,465 
District of Columbia      4,400        0      4,400 
Florida                  83,010   81,284      1,726 
Georgia                  36,050   36,050          0 
Hawaii                    6,200        0      6,200 
Idaho                     8,070        0      8,070 
Illinois                 65,150   59,498      5,652 
Indiana                  35,109   35,109          0 
Iowa                     18,660        0     18,660 
Kansas                   15,410        0     15,410 
Kentucky                 22,560   14,571      7,989 
Louisiana                24,760        0     24,760 
Maine                     8,320    8,316          4 
Maryland                 29,727   10,000     19,727 
Massachusetts            28,770        0     28,770 
Michigan                 53,070        0     53,070 
Minnesota                27,310        0     27,310 
Mississippi              15,250   15,925       -675 
Missouri                 31,580        0     31,580 
Montana                   6,520        0      6,520 
Nebraska                  8,840        0      8,840 
Nevada                   12,590        0     12,590 
New Hampshire             7,140        0      7,140 
New Jersey               38,200   27,053     11,147 
New Mexico                9,832    9,832          0 
New York                 84,490    3,704     80,786 
North Carolina           47,610        0     47,610 
North Dakota              4,850    4,493        357 
Ohio                     67,490        0     67,490 
Oklahoma                $18,600       $0    $18,600 
Oregon                   22,550        0     22,550 
Pennsylvania             66,100        0     66,100 
Rhode Island              5,320        0      5,320 
South Carolina           24,430   24,180        250 
South Dakota              4,390        0      4,390 
Tennessee                31,670   32,740     -1,070 
Texas                   110,580   95,468     15,112 
Vermont                   5,030    2,700      2,330 
Virginia                 38,150   33,392      4,758 
Washington               41,330   35,244      6,086 
West Virginia             9,850    7,386      2,464 
Wisconsin                30,600   21,287      9,313 
Wyoming                   4,390        0      4,390 
Total                $1,528,203 $630,097   $898,106 

Source: Labor's VETS.

Appendix IV: State-Negotiated Goals for Veterans Entering Employment
through the DVOP and LVER Programs, Program Years 2004 and 2005  Appendix
IV: State-Negotiated Goals for Veterans Entering Employment through the
DVOP and LVER Programs, Program Years 2004 and 2005

                                                        LVER performance goal 
State                DVOP performance goal (percent)             (percent) 
Alabama                                           56                    60 
Alaska                                            51                    56 
Arizona                                           60                    58 
Arkansas                                          53                    53 
California                                        50                    51 
Colorado                                          58                    59 
Connecticut                                       53                    55 
Delaware                                          56                    55 
District of Columbia                              53                    58 
Florida                                           61                    61 
Georgia                                           65                    65 
Hawaii                                            45                    42 
Idaho                                             46                    59 
Illinois                                          45                    46 
Indiana                                           46                    54 
Iowa                                              57                    57 
Kansas                                            58                    60 
Kentucky                                          58                    60 
Louisiana                                         55                    59 
Maine                                             58                    58 
Maryland                                          56                    60 
Massachusetts                                     53                    60 
Michigan                                          46                    48 
Minnesota                                         50                    52 
Mississippi                                       58                    59 
Missouri                                          48                    49 
Montana                                           60                    60 
Nebraska                                          64                    62 
Nevada                                            55                    56 
New Hampshire                                     64                    65 
New Jersey                                        54                    57 
New Mexico                                        55                    60 
New York                                          55                    57 
North Carolina                                    56                    56 
North Dakota                                      59                    63 
Ohio                                              50                    56 
Oklahoma                                          60                    60 
Oregon                                            47                    54 
Pennsylvania                                      54                    59 
Rhode Island                                      55                    56 
South Carolina                                    59                    59 
South Dakota                                      58                    64 
Tennessee                                         38                    38 
Texas                                             58                    57 
Utah                                              51                    57 
Vermont                                           55                    56 
Virginia                                          55                    56 
Washington                                        51                    54 
West Virginia                                     52                    51 
Wisconsin                                         56                    58 
Wyoming                                           48                    57 

Source: Labor's VETS.

Appendix V: States' Use of Full-Time and Part-Time Veterans' Staff 
Appendix V: States' Use of Full-Time and Part-Time Veterans' Staff

Table 5: Utilization of DVOP Staff

                                                         Number of DVOP staff 
                                                         that serve more than 
                        Full-time DVOP Part-time DVOP     one local workforce 
State                         staff          staff       area in the state 
Alabama                          16              1                       0 
Alaska                            1              6                       0 
Arizona                          35              0                       0 
Arkansas                          9              0                       9 
California                      123             10                       0 
Colorado                         20              4                       4 
Connecticut                       8              0                       0 
Delaware                          5              0                       0 
District of Columbia              2              0                       0 
Florida                          66             10                       3 
Georgia                          50              0                       0 
Hawaii                            4              1                       0 
Idaho                             4              2                       0 
Illinois                         38              0                      10 
Indiana                          26              0                       0 
Iowa                             15              0                      15 
Kansas                           12             11                       0 
Kentucky                         10              3                       0 
Louisiana                        14              0                       0 
Maine                             6              0                       6 
Maryland                         25              a                       0 
Massachusetts                    20              0                       4 
Michigan                         31              0                      15 
Minnesota                        21              4                       0 
Mississippi                      19             12                      11 
Missouri                         19             13                       0 
Montana                           7              3                       5 
Nebraska                          5              a                       0 
Nevada                            5              4                       0 
New Hampshire                     5              0                       2 
New Jersey                       33              1                       0 
New Mexico                        9              0                       0 
New York                         55              a                       0 
North Carolina                   22              0                       0 
North Dakota                      2              0                       2 
Ohio                             58              0                      38 
Oklahoma                         18              0                       0 
Oregon                           18              2                       0 
Pennsylvania                     37              7                       a 
Rhode Island                      2              1                       0 
South Carolina                   15              8                       2 
South Dakota                      4              9                       2 
Tennessee                        32              a                       2 
Texas                            86             12                       0 
Utah                              9              a                       0 
Vermont                           2              0                       2 
Virginia                         35              0                       3 
Washington                       36              0                       3 
West Virginia                     6              0                       a 
Wisconsin                        23              0                      10 
Wyoming                           1              8                       5 
Total                         1,124            132                     153 

Source: Survey of Directors of Veterans' Employment and Training Services.

a Indicates that the respondent did not know the answer to the question.

Table 6: Utilization of LVER Staff

                                                         Number of LVER staff 
                                                         that serve more than 
                        Full-time LVER Part-time LVER     one local workforce 
State                         staff          staff       area in the state 
Alabama                          16              2                       0 
Alaska                            2              4                       0 
Arizona                          14              9                       1 
Arkansas                         10              6                      14 
California                       72             19                       0 
Colorado                         14              4                       a 
Connecticut                       8              a                       0 
Delaware                          3              0                       2 
District of Columbia              2              0                       0 
Florida                          56              9                       4 
Georgia                          25             30                       0 
Hawaii                            6              0                       0 
Idaho                             8              5                       0 
Illinois                         31              0                      20 
Indiana                          32              1                       0 
Iowa                              3              0                       3 
Kansas                           10              2                       0 
Kentucky                         15             12                       0 
Louisiana                        16              3                       1 
Maine                             a              8                       0 
Maryland                         17              a                       0 
Massachusetts                    19              a                       3 
Michigan                         29              0                      11 
Minnesota                        14              0                      14 
Mississippi                       0              0                      18 
Missouri                         26             13                       0 
Montana                           1              0                       0 
Nebraska                          3             15                       0 
Nevada                            6              1                       1 
New Hampshire                     6              0                       1 
New Jersey                       13              8                       1 
New Mexico                       10              8                       9 
New York                         50              a                       0 
North Carolina                   43             35                       0 
North Dakota                      5              3                       5 
Ohio                             11              0                       6 
Oklahoma                         16             18                       0 
Oregon                           14              9                       0 
Pennsylvania                     33             22                       a 
Rhode Island                      3              0                       1 
South Carolina                   17             15                       0 
South Dakota                      1              1                       2 
Tennessee                        30              7                       3 
Texas                            91             18                       0 
Utah                              6              7                       7 
Vermont                           2              3                       3 
Virginia                         27              8                       0 
Washington                       24              0                       3 
West Virginia                     6              4                       a 
Wisconsin                        18              a                       3 
Wyoming                           1              1                       2 
Total                           885            310                     138 

Source: Survey of Directors of Veterans' Employment and Training Services.

a Indicates that the respondent did not know the answer to the question.

Appendix VI: Comments from the Department of Labor  Appendix VI: Comments
from the Department of Labor

Appendix VII: A  Appendix VII: GAO Contact and Staff Acknowledgments

GAO Contact

Sigurd R. Nilsen (202) 512-7215 or [email protected]

Staff Acknowledgments

In addition to the individual mentioned above, Lacinda Ayers, Assistant
Director; R. Jerry Aiken; Susan Bernstein; Jessica Botsford; Meeta Engle;
Stuart Kaufman; Robert Miller; Emily Pickrell; Jay Smale; and Dianne
Whitman-Miner made key contributions to this report.

Related GAO Products  Related GAO Products

Unemployment Insurance: Better Data Needed to Assess Reemployment Services
to Claimants. GAO-05-413. Washington, D.C.: June 24, 2005.

Veterans' Employment and Training Service: Preliminary Observations on
Changes to Veterans' Employment Programs. GAO-05-662T. Washington, D.C.:
May 12, 2005.

Workforce Investment Act: States and Local Areas Have Developed Strategies
to Assess Performance, but Labor Could Do More to Help. GAO-04-657.
Washington, D.C.: June 1, 2004.

Veterans' Employment and Training Service: Flexibility and Accountability
Needed to Improve Service to Veterans. GAO-01-928. Washington, D.C.:
September 12, 2001.

Veterans' Employment and Training Service: Proposed Performance
Measurement System Improved, but Further Changes Needed. GAO-01-580.
Washington, D.C.: May 15, 2001.

Veterans' Employment and Training Service: Strategic and Performance Plans
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1998.

Veterans' Employment and Training: Services Provided by Labor Department
Programs. GAO/HEHS-98-7. Washington, D.C.: October 17, 1997.

(130444)

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Highlights of GAO-06-176, a report to congressional committees

December 2005

VETERANS'EMPLOYMENT AND TRAINING SERVICE

Labor Actions Needed to Improve Accountability and Help States Implement
Reforms to Veterans' Employment Services

Roughly 700,000 veterans have been unemployed in recent months, a figure
that could swell considerably with the anticipated increase in the number
of people leaving active duty. Congress passed the Jobs for Veterans Act
in 2002 to improve employment and training services for veterans and to
encourage employers to hire them. As mandated by law, GAO reviewed
progress to date in its implementation, including the development of new
staff roles and responsibilities, performance accountability system,
incentive awards, and priority of service to veterans. GAO examined (1)
implementation status of the key provisions and any associated challenges,
(2) what is known about services and outcomes since the law's enactment,
and (3) changes in program accountability.

What GAO Recommends

GAO is recommending that the Department of Labor provide clear guidance
that would integrate veterans' staff into the one-stops, ensure priority
of service for veterans among all programs, and foster state use of
incentives. GAO is also recommending that Labor's program offices
coordinate their oversight regarding JVA provisions, and that Labor use
monitoring results to develop program improvements. Finally, GAO
recommends that Labor establish effective methods for enforcing federal
contractor requirements. Labor agreed with these recommendations.

Labor implemented most provisions of the Jobs for Veterans Act (JVA)
within the first 2 years of its enactment. However, some are not fully
implemented, such as measures to increase service priority for veterans in
the full spectrum of Labor's training programs, and others designed to
improve accountability from states and federal contractors. States also
report substantial progress implementing the law, but challenges remain in
some areas. About one-third of the states, for example, did not establish
incentive award programs for their workforce personnel because their laws,
policies, or agreements conflict with this JVA provision.

Most state workforce administrators surveyed reported that the new
legislation has improved both the quality of services to veterans and
their employment outcomes. They credited the greater availability of case
management services under JVA for much of the improvement in employment.
They cited lack of federal contractor compliance with the law's provisions
as most likely to have limited veterans' employment opportunities. Aside
from the law's influence, they cited the willingness of employers to hire
veterans and the strength of the local job market as significant factors
affecting veterans' employment.

About half of state directors of Veterans' Employment and Training
reported their new monitoring role had strengthened local program
accountability. However, just over a third reported that accountability
had either lessened or not improved. Some partly attributed this to
absence of local performance data and fewer annual visits to one-stop
centers. GAO found, as well, that a lack of coordination among Labor's
agencies responsible for certain JVA provisions has weakened
accountability. Also, while Labor has developed a system to monitor
program performance, it lacks a strategy for using the information it
gathers to make improvements and to help states.

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