Mr. Timothy C. Joyce
Commissioner
Department of Workforce Development
10 North Senate Avenue, Room 302
Indianapolis, Indiana 46204
Dear Mr. Joyce:
I am pleased to offer Indiana JTPA waiver approvals in response to Governor
O'Bannon's April 29, 1997 request. This could not have been done without the vision,
strategy and planning that was produced by the local, State, and Federal (national and regional
staff) partnership, of which it has been our pleasure to be a part. I thank you for your and
your staff's hard work and patience.
The State's request was considered under the special appropriations act provision
granting the Secretary of Labor authority to waive certain requirements of Titles I-III of JTPA,
and Sections 8-10 of the Wagner-Peyser Act. This authority was granted to the Secretary in
the Department of Labor's (DOL) Appropriation Act for 1997 (Pub. L. 104-208, section
101(e)).
This is a one-year authority and applies only to JTPA funds available for expenditure
during the period July 1, 1997 through June 30, 1998, and, therefore, could affect the JTPA
Grant Agreements for Program Year (PY) 1997, 1996 and 1995 funds, depending on fund
availability during the waiver period. Enclosed you will find an overview and our disposition
with regard to each of your requests, as well as copies of our formal response to the Governor.
Enclosed also is a grant modification (3 copies) that will require signature by the Governor or
the State's JTPA signatory official. Please check off the applicable JTPA grant agreements
(PY 97, 96, 95) that the statutory waiver modification will affect. We ask that the documents
be signed by the appropriate official and returned to the Grant Officer at the address indicated
below:
Mr. James C. De Luca
U.S. Department of Labor - ETA
Office of Grants and Contract
Management - DAA
200 Constitution Avenue, N.W,
Room - South 4203
Washington, D.C. 20210
Upon execution by the appropriate USDOL grant officer, we will return an executed
copy for the State's official files. This modification is effective July 1, 1997.
We applaud Indiana's efforts to focus on a workforce vision and the development of a
strategy to meet that vision. Waivers, of course, are only a small part of this strategy. We
will continue to work with Indiana to reach these goals. We expect that these reforms will
continue to reflect the Department of Labor's guiding principles: individual opportunity and
customer choice; leaner government; greater accountability; State and local flexibility; and
strong private sector roles.
This is a living document. As we continue our partnership be sure to let us know if additional
waivers or other action would be beneficial.
Sincerely,
Melvin J. Howard
Acting Regional Administrator
Enclosures
OVERVIEW
The JTPA Grant Agreement between the Governor and the Department will be
modified upon the Governor (or his designee) signing the attached Modification. The granted
waivers are authorized for the period of Program Year 1997. In exchange for these waivers
Indiana is expected to meet the agreed upon performance improvements. Below is a
discussion, including the disposition, of all of the State's waiver requests.
Requests to waive program design components were honored except in the case where
the request conflicted with the Secretary's statutory waiver authority, the Department's guiding
principles for waivers and the One-Stop Career Centers and School-to-Work Systems
principles. Administrative waivers were granted in such a manner as to maintain fiscal
responsibility and accountability.
These waivers are based upon the Governor's request, meetings and discussions among
staff, and the Department's familiarity with the program in Indiana. They do not necessarily
constitute an endorsement of the examples in Indiana's waiver request. In several instances,
the Department would recommend against the interventions proposed. For example, most
research would caution against general use of stand-alone work experience, job search or on-the job training interventions, particularly for youth without a high school diploma or its
equivalent. The Department continues to strongly encourage educational components for
youth participants.
WAIVERS
A. As requested, the Secretary will apply the definition of "family income" in 20 CFR
626.5 such that ". . . such income shall also exclude Social Security Disability Income for an
individual with a disability,. . . ." This administrative regulatory waiver is being granted
under the provisions of 20 CFR 627.201 for a period of four years from the effective date of
this Grant Modification.
B. The Governor agrees to continue to require an objective assessment and individualized
service strategy (ISS) at entry and on an on-going basis for all participants under titles I, II and
III that is tailored to the background and needs of the participant and ensures that services
identified in the individual service strategy will be secured for the individual. The Secretary
waives 20 CFR 628.515(a) and 628.520(a) and will interpret JTPA §§ 204(a)(1) and
264(b)(1), and remaining sections of 20 CFR 628.515 and 628.520 as providing non-binding
guidance for developing the State policy.
Until such time as the alternate policy is in place for title II adults and youth, the requirements
in the preceding sentence will continue to apply to any decision to provide the stand-alone
activities permitted in paragraphs C. and F. below (i.e., work experience, job search
assistance, job search skills training, job club for both youth and adults, and pre-employment
and work maturity skills training for youth) which relies on the objective assessment and ISS.
C. As requested, the Secretary waives the prohibition on stand-alone work experience, job
search assistance, job search skills training, and job club, for both youth and adults, in
instances when an individual service strategy substantiates its use as appropriate, by waiving
JTPA § 204(c)(2)(B)(ii) and 20 CFR 628.535(b)(2) and (c)(1)(ii) and applying JTPA §
264(d)(3)(A) and (B) as if they read ". . . shall be accompanied by . . . additional services . .
. unless the individual service strategy demonstrates such additional services are not
warranted." Additionally, the title III prohibition on work experience at 20 CFR 627.245(e)
and the combination requirements at 20 CFR 627.245(d) and 628.804(e) and (f) are waived
where such stratagies are supported by an individual assessment. (JTPA § 204(c)(2)(A) was
not waived as it was unnecessary to do so since (B)(i) already provides an exception.) We
wish to point out to the State that there is research suggesting that work experience provided in
a stand-alone mode is not as effective as when combined with other needed services and that,
as suggested in the request, this authority will be used sparingly.
D. As requested, the Secretary will apply the provisions of needs-based payments at JTPA
§ 204(b)(2)(I) and (c)(3) and 20 CFR 627.305(b)(1) to title III participants. However, in
order to preserve the principle that training is most effective if individuals are enrolled in
training early in the adjustment process and pursuant to the eligibility requirement exclusion
contained in the Appropriations Act of 1997, JTPA § 314(e)(1) is not waived nor is 20 CFR
631.20(b)(1), and shall apply to dislocated workers in order to receive needs-based payments
as well as needs-related payments. Therefore, in order to be eligible for needs-related
payments or needs-based payments, a dislocated worker must be enrolled in training by the
end of the 13th week of the worker's initial unemployment compensation benefit period
(following qualifying layoff), or if later, the end of the 8th week after an employee is informed
that a short-term layoff will in fact exceed six months. This also means that JTPA § 314(e)(2)
is not waived and neither are 20 CFR 631.20(c) and (d).
The Secretary will, however, consider an alternative to the definition of "enrolled in training
or education" at 20 CFR 631.20(b)(2) to be utilized in extraordinary circumstances if Indiana
wishes to propose such a policy. Any alternative policy should preserve the principle that
training is most effective if individuals are enrolled in training early in the adjustment process.
E. For titles II and III, current authority permits participants to continue to receive
services following placement so long as participants have not been terminated. Instead of
terminating at placement, termination occurs at the completion of planned services. ETA
encourages such a policy and is willing to work with Indiana to develop reporting procedures
to take credit for job placements occurring prior to termination.
Nevertheless, as requested, the Secretary will apply JTPA §§ 204(b)(2)(J) and 204(c)(4) and
20 CFR 627.310(e) to title III to enable title III participants to receive post-termination
services, except for financial assistance, for up to one year consistent with title II.
Additionally, as requested, the Secretary will apply JTPA §§ 204(b)(2)(J) and (c)(4),
264(c)(2), 264(d)(5), 314(c)(15), and 20 CFR 627.310(e) to authorize training as a post-termination service contingent upon the Governor:
However, the provision within 20 CFR 627.310(e) which prohibits the use of financial
assistance as a post-termination service is not waived. Therefore, needs-based and needs-related payments are not post-termination options under this waiver for both title II and III.
F. As requested, the Secretary waives the requirements at JTPA § 264(d)(3)(A) and 20
CFR 628.804(d) and (f) that prohibit pre-employment and work maturity skills training as a
stand-alone activity in cases where the objective assessment and individual service strategy
indicate it is the appropriate intervention. We note that the State has neither asked for nor
received a waiver of the definition of the Youth Employability Enhancement performance
standard, which requires as one of five options that two out of three youth employment
competencies (pre-employment/work maturity, basic skills, and occupational skills) be
obtained. (A waiver of 20 CFR 628.520(e) is unnecessary since this requirement applies only
if the assessment indicates that a service is needed. This provision is also applied as non-binding guidance pursuant to waiver B.)
G. The Secretary waives the youth OJT wage requirement at JTPA § 264(d)(3)(C)(i)(I)
and the related regulations at 20 CFR 628.804(j)(1)(i) and the participation requirement at
JTPA § 264(d)(3)(C)(iii) and the related regulation at 20 CFR 628.804(j)(2), when indicated
as appropriate in the assessment and individual service strategy for youth on-the-job training.
The State shall assure that the OJT positions for youth have substantial training content and
that the training time is correctly determined. In addition, the State should issue policies to
assure that youth OJT opportunities reflect positions with career potential and avoid the
introduction of abuses in the development of youth OJT slots in low wage, low skill positions
which precipitated the enactment of the provisions for which this waiver is requested.
H. The State's request to waive the definition of "older individual" at JTPA § 204(d)(7),
which establishes the age requirement used in determining eligibility for services to older
individuals at JTPA § 204(d)(5)(A) has not been granted. This is an eligibility requirement
which is excepted from the Secretary's waiver authority under the 1997 DOL Appropriations
Act (Pub. L. 104-208) and may not be waived.
I. As requested, the Secretary waives JTPA § 108(b)(1), (4) and (c); the 15%
administration cost limitation under JTPA §§ 253(a)(3) and 315(a), (b), and (c); 20 CFR
627.445(a), (b)(3), and (d) and 631.14(a), (b), (c), (d), (f), and (g), eliminating all cost
limitations for titles II and III [except for national reserve account (NRA) grants]; and will
apply JTPA § 108(b)(2) and (3) and 20 CFR 627.440(c) and (d) and 631.13(a)(1) to reduce the
number of cost categories to two: Administration and Program Costs. The costs of
Administration shall be those defined at 20 CFR 627.440(d)(5) for title II and 631.13(f) for
title III. Program Costs will consist of all other costs including those defined at 20 CFR
627.440(d)(1), (2), (3), and (4) for title II and at 631.13(c), (d), and (e) for title III. The
costs of Rapid Response activities identified at JTPA § 314(b) and 20 CFR 631.13(b) shall
continue to be separately reported. Reporting instructions for the two cost category reporting
method have been developed and are attached for use by the State.
J. As requested, the Secretary shall apply the requirements in TEIN 26-96 transmitting the
"Guide to JTPA Performance Standards for Program Years 1996 and 1997," such that title III
performance standards calculations exclude participants terminating after receiving objective
assessment only, consistent with title II.
K. In consideration of the waivers contained in this grant modification, the State agrees to
a performance improvement of at least five percent at the State and local levels measured at the
conclusion of Program Year 1997 using actual performance in PY 1996 as the baseline for
improvement. Performance improvements will apply to all the Secretary's performance
measures, or to their approved equivalents, for Titles II-A, II-C, and III. States will take into
account the SDAs' performance improvement targets in determining the receipt of Title II
incentive grant awards for PY 1997. In considering whether the State and the SDAs have
attained the agreed upon performance improvement for PY 1997, the Department will apply
the Secretary's Adjustment Models, exclusive of Governor's Adjustments, to the performance
improvement goals. Program Year 1996 and Program Year 1997 performance will be
calculated in the same way for both years.
The Standardized Participant Information Report (SPIR) instructions in Training and
Employment Information Notice 5-93, Change 1 (dated June 23, 1994), as modified by
Training and Employment Information Notice 5-93, Change 2 (dated January 24, 1997),
remain in effect where not specifically waived or modified in this Agreement. Also in effect
unless specifically waived are the Performance Standards Status Summary Report requirements
put forth in Training and Employment Guidance Letter 2-95 (dated August 10, 1995). This
requires Governors to report each SDA's final standard and actual performance for each of the
Secretary's Title II core standards, with required technical assistance plans and reorganization
plans attached.
These waivers are open for modification and the Department will also entertain
additional requests for waivers during this program year. These waivers apply to the title II
and the title III formula programs. However, ETA will consider requests to apply specific
waivers to individual title III Secretary's National Reserve Account (NRA) grants which are
active during Program Year 1997. In addition, ETA will consider requests to incorporate
specific waivers into new individual NRA grants, as appropriate.