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December 4, 2006

REGION 5 ETA WORKFORCE DEVELOPMENT LETTER 001-07

TO:      State Workforce System Administrators

FROM:    Byron Zuidema
             Byron Zuidema
             Regional Administrator

SUBJECT:  Designation of Areas of Substantial Unemployment for the Workforce Investment Act during Program Year 2007

1.  Purpose. To advise the States of the designation of Areas of Substantial Unemployment (ASUs) for the Workforce Investment Act during Program Year (PY) 2007 in order to allot funds under the Act for the period beginning July 1, 2007.

2.  References. Training and Employment Guidance Letter No. 10-06, November 30, 2006; Workforce Investment Act of 1998, [Pub.L. 105-220].

3.  Links.  This Letter is in the Region 5 website archive at: http://www.doleta.gov/regions/reg05/pages/LibraryIssuances.cfm.

4.  Background. Sections 127(b)(2)(B) and 132(b)(1)(B)(v)(III) of the Workforce Investment Act define an ASU and require that ASU determinations be made once each Fiscal Year.  These ASU designations will be used by the Department of Labor for the allotment of Title I, Chapters 4 and 5 funds to States for PY 2007. 

5.  Substance. Following are guidelines to States for the FY 2007 designation of ASUs:

 

  1. Definition.  An ASU is a contiguous area with a current population of at least 10,000 and an average unemployment rate of at least 6.5 percent for the 12-month reference period.

  2. Technical Adjustment for PY 2007.  An error in the processing of the 2000 Decennial Census that affects unemployment and labor force data for census tracts that include group quarters (for example, college dormitories), adversely affected the quality of the data. As a result, the Bureau of Labor Statistics (BLS) would not certify state ASU calculations that used these data starting in PY 2006. A temporary solution was used for PY 2006 ASU designations.

    To address this issue for PY 2007 and later years, ETA has obtained special 2000 Census data runs that provide employment and unemployment data using only household responses. These data will replace the 1990 Census data that were used for census sharing for PY 2006 and previous ASU determinations. The 1990 Census data are not to be used for census sharing for PY 2007 or future ASU determinations. The new 2000 Census data and instructions for calculating ASUs were transmitted by the Bureau of Labor Statistics to the States in October.

  3. Reference Period.  The 12-month reference period for the designation shall be July 2005 through June 2006.

6.  Process.

 

  1. If a State has an unemployment rate of 6.5 percent or higher for the reference period, the entire State will be designated an ASU, for purposes of the State allotments.  In this case, no data or forms need to be transmitted.

  2. If the State does not qualify in total as an ASU, the State should examine all jurisdictions within the State, and designate contiguous combinations of counties, cities, towns, townships, other minor civil divisions and/or census tracts as ASUs. ASUs designated under this section should be described using the largest appropriate defining units. If Local Area Unemployment Statistics data for the total area designated as an ASU are already routinely collected by the BLS as a unit, the State should report it, but no data need to be submitted.

  3. For those designated ASUs for which data are not routinely collected by BLS, the State should prepare an ASU designation form and send it according to BLS instructions.  The form should include data for the 12-month period ending June 2006.  A copy of each form should be sent to the National Offices of BLS and ETA.  (See Section 7)

  4. The State should describe the geographic components of each ASU in sufficient detail for a knowledgeable reviewer to verify that they are contiguous, do not overlap and have a total population of at least 10,000 persons.  States should either include maps with the submission or keep the maps available in case questions arise.

  5. BLS is now issuing specific procedures and ASU designation forms to States, for preparation of the ASU data.


7.  Action. State Workforce System Administrators are requested to share this Letter with appropriate staff and State WIA officials; and ensure that all designation forms are in the ETA and BLS National Offices by December 8, 2006.

The copy for ETA should be sent to:

U.S. Department of Labor/ETA
200 Constitution Avenue, NW
Room N-5637
Washington, D.C. 20210.
Attention: Wayne S. Gordon

The copy for BLS should be sent to:

Bureau of Labor Statistics
Division of Local Area Unemployment Statistics
Mail Code 140, Room 4675
2 Massachusetts Avenue, NE
Washington, D.C.  20212-0001
Attention: Lisa Williamson

8.  Contact.  Comments or questions concerning the 2007 Areas of Substantial Unemployment may be directed to Maria K. Flynn on 202.693.3700. Comments or questions about the format of this Letter may be directed to Robert Rainault on 312.596.5416.

9.  Expiration Date. December 8, 2006

10.  Attachment. None


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