Order Code RL32778
CRS Report for Congress
Received through the CRS Web
The Workforce Investment Act of 1998 (WIA):
Reauthorization of Job Training Programs
Updated May 17, 2005
Ann Lordeman
Specialist in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

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The Workforce Investment Act of 1998 (WIA):
Reauthorization of Job Training Programs
Summary
Title I of the Workforce Investment Act of 1998 (WIA), P.L. 105-220, the
nation’s chief job training legislation, authorizes several job training programs,
including Youth, Adult, and Dislocated Worker Activities; and Job Corps. The
authorization for WIA programs expired on September 30, 2003, although annual
appropriations have continued funding for WIA through FY2005.
On March 2, 2005, the House passed H.R. 27, the Job Training Improvement
Act of 2005. This bill, which would amend the Workforce Investment Act of 1998
(P.L. 105-220), was reported by the Committee on Education and the Workforce on
February 25, 2005 (H.Rept. 109-9). On May 12, 2005, Senator Michael Enzi,
Chairman of the Senate Committee on Health, Education, Labor, and Pensions,
introduced S. 1021, the Workforce Investment Act Amendments of 2005. S. 1021
is based on S. 9, which was introduced on January 24, 2005, to, among other things,
reauthorize WIA.
Both H.R. 27 and S. 1021 in addition to reauthorizing the Title I WIA training
programs, would also modify the Adult Education and Family Literacy Act (AEFLA)
and reauthorize the Rehabilitation Act of 1973. All three programs would be
authorized through FY2011. The focus of this report is on Title I of WIA. Some of
the Title I issues addressed by H.R. 27 and S. 1021 include:
! Funding for the costs of the one-stop centers’ infrastructure (defined
as nonpersonnel costs).
! The percentage of youth program funds that would be spent on
activities for out-of-school youth.
! The sequencing of core, intensive, and training services to
individuals.
! The criteria and procedures for determining eligibility for training
providers.
! The indicators of program performance.
! The flexibility of state and local workforce boards in directing
funding to areas of need by creating a consolidated adult program
under H.R. 27, and by increasing the percentage of funds that could
be transferred between the adult and dislocated worker programs
under S. 1021.
! The hiring practices of religious organizations that operate job
training programs.
! Creation of a new Youth Challenge Grant Program to assist youth in
acquiring the skills, credentials, and employment experience
necessary to succeed in the labor market.
! Creation of new demonstration projects, including Personal
Reemployment Accounts under H.R. 27 and Community-Based Job
Training under both H.R. 27 and S. 1021.
This report will be updated should major legislative developments occur.

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Summary of Amendments to Title I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
One-Stop Delivery System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Structure of State and Locally Administered Programs . . . . . . . . . . . . . . . . . 3
State and National Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Youth Challenge Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
State and Local Formula Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Youth Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Allocations for Adult Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Youth Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Adult Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Demonstration and Pilot Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Community-Based Job Training . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Personal Reemployment Accounts (PRAs) . . . . . . . . . . . . . . . . . . . . . 10
Training for Realtime Writers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Business Partnership Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Skill Certification Pilot Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Integrated Workforce Training Programs for Adults with Limited
English Proficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Performance Accountability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Nondiscrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Authorization of Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Youth, Adult, and Dislocated Worker Activities . . . . . . . . . . . . . . . . . 13
Demonstration and Pilot Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

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The Workforce Investment Act of 1998
(WIA): Reauthorization of Job Training
Programs
Most Recent Developments
On May 12, 2005, Senator Michael Enzi, Chairman of the Senate Committee
on Health, Education, Labor, and Pensions, introduced S. 1021, the Workforce
Investment Act Amendments of 2005 with Senator Edward Kennedy, the ranking
member of the committee as the co-sponsor. S. 1021 is based on S. 9, which was
introduced on January 24, 2005, to, among other things, reauthorize WIA. On
March 2, 2005, the House passed H.R. 27, the Job Training Improvement Act of
2005. This bill, which would amend the Workforce Investment Act of 1998 (P.L.
105-220), was reported by the Committee on Education and the Workforce on
February 25, 2005 (H.Rept. 109-9).
Introduction
The Workforce Investment Act of 1998 (WIA) (P.L. 105-220),1 was enacted in
August 1998. Among other things, WIA repealed the Job Training Partnership Act
(JTPA), and replaced it with new training provisions under Title I, Workforce
Investment Systems.2 All states were required to implement Title I by July 1, 2000.
The authorization for WIA programs expired on September 30, 2003; however,
Congress has continued to fund the programs through the appropriations process.
On February 17, 2005, the House Education and the Workforce Committee
approved H.R. 27, the Job Training Improvement Act of 2005, by a party-line vote
of 26-20. On March 2, 2005, the House passed the bill by a vote of 224-200, largely
along party lines. H.R. 27 is similar to the Workforce Reinvestment and Adult
Education Act of 2003 (H.R. 1261), which was passed by the House during the 108th
Congress.
On January 24, 2005, Senator Michael Enzi, Chairman of the Senate Committee
on Health, Education, Labor, and Pensions, introduced S. 9, the Lifetime of
Education Opportunities Act of 2005. This bill includes the Workforce Investment
Act Amendments of 2005. Except for technical changes, this bill is identical to S.
1627, which was incorporated into the Senate version of H.R. 1261 and passed by the
1 29 U.S.C. §§ 2811 et seq.
2 For more information, see CRS Report 97-536, Job Training Under the Workforce
Investment Act (WIA): An Overview, by Ann Lordeman.

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CRS-2
Senate in the 108th Congress.3 On May 12, 2005, Senator Michael Enzi, Chairman
of the Senate Committee on Health, Education, Labor, and Pensions, introduced S.
1021, the Workforce Investment Act Amendments of 2005 with Senator Edward
Kennedy, the ranking member of the committee as the co-sponsor. S. 1021 is based
on S. 9.
One of the most contentious issues in H.R. 27 is a provision that would allow
religious organizations that operate job training programs to take religion into
consideration in hiring. This provision is not included under the nondiscrimination
provisions of current law and is not included in S. 1021. Another major difference
between H.R. 27 and S. 1021 is that H.R. 27 would create a consolidated adult
program by combining funding for adult activities, dislocated worker activities, the
employment service, and reemployment grants. The funding for these programs is
currently allocated under separate formulas. S. 1021 would not create a consolidated
adult program; funding streams would remain separate in the Senate bill. S. 1021
would, however, permit local boards with the approval of the Governor to transfer
up to 45% of their allocations between the adult and dislocated worker programs.
Both H.R. 27 and S. 1021, among other things, would also amend and
reauthorize adult education and literacy programs, Title II of WIA, and the
Rehabilitation Act of 1973, Title IV of WIA.4 This report focuses on Workforce
Investment Systems, Title I of WIA.
Summary of Amendments to Title I
One-Stop Delivery System
Under current law, services for adults are provided primarily through a
coordinated service-delivery system overseen by local workforce investment boards
(WIBs). This “one-stop” system is intended to provide a “seamless” combination of
services to improve employment opportunities for individuals. The law mandates
that certain “partners,” which are entities that administer programs such as adult
education and vocational rehabilitation, provide “applicable” services through the
one-stop system. In addition to these mandatory partners, WIA specifies certain
programs, such as Temporary Assistance for Needy Families (TANF), as optional
partners. Both H.R. 27 and S. 1021 would make TANF a required partner unless the
state’s Governor notified the Departments of Labor and Health and Human Services
that TANF was not to be a required partner.
3 For more information on reauthorization of WIA job training programs in the 108th
Congress, see CRS Report RS21484, Workforce Investment Act of 1998 (WIA):
Reauthorization of Title I Job Training Programs in the 108th Congress, by Ann Lordeman.
4 For information on reauthorization of federal adult education and literacy programs, see
CRS Report RL32867, Adult Education and Literacy: Overview and Reauthorization
Proposals of the 109th Congress, by Paul M. Irwin. For information on the Rehabilitation
Act of 1973, see CRS Report RS22068, Rehabilitation Act of 1973: 109th Congress
Legislation and FY2006 Budget Request, by Sidath V. Panangala and Carol O’Shaughnessy.

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Under current law, each required partner must enter into a memorandum of
understanding (MOU) with the local WIB regarding, among other things, how the
operating costs of the system will be funded. H.R. 27 would require that each
Governor determine a portion of one-stop partner programs’ federal funds for
administration to be contributed toward paying the costs of the one-stop centers’
infrastructure (defined as nonpersonnel costs). Only funds available for the costs of
administration for each mandatory or participating optional partner program could
be used, except that federal direct spending programs, such as TANF, would
contribute an amount equal to their proportionate use in the state. Each state WIB
would develop the formula to be used by the Governor in allocating the funds to the
one-stop centers it would certify for this purpose.
S. 1021 would require the Governor to make this determination only if the local
board, chief elected official, and the one-stop partners in a local area failed to reach
agreement in the MOU on methods to sufficiently fund the infrastructure costs.
Under S. 1021, there would be a cap on the portion of federal funds that could be
required to be contributed. The cap would apply to all federal funds allotted to a
program, but the funds could be contributed only from the administrative funds. This
cap would be 3% of federal funds for WIA programs and the employment service
authorized under the Wagner-Peyser Act, and 1.5% for other required partners. For
vocational rehabilitation, the cap would increase from 0.75% to 1.5% over five years.
Under both bills, the method for determining the appropriate portion of funds
to be provided by Native American programs to pay for the costs of infrastructure of
a one-stop center would be determined as part of the MOU.
Structure of State and Locally Administered Programs
Under current law, the state WIB, which functions as an advisory body to the
Governor, includes in its membership the Governor; members of the state legislature;
chief elected local officials; representatives of the lead state agencies responsible for
the programs carried out by one-stop partners, business, and labor organizations; and
individuals and representatives of organizations having experience with youth. Both
H.R. 27 and S. 1021 would add the state agency officials responsible for economic
development to the required membership, clarify that the director of the state
vocational rehabilitation unit be a member of the state WIB, and would remove
representatives of youth organizations as members.
Both bills would amend the functions of the WIB by adding the requirement that
they develop and review statewide policies affecting the provision of coordinated or
integrated services through the one-stop system. H.R. 27 would also amend the
functions of the WIBs by adding the requirement that they assist the Governor in
certifying one-stop centers and awarding infrastructure funds.
One function of the state WIB is to assist the Governor in the designation of
local workforce investment areas. Under current law, a request for designation is
automatically approved if it is from any unit of general local government with a
population of 500,000 or more, an area served by a rural-concentrated employment
program, or from a local area in Rhode Island. H.R. 27 eliminates the automatic
designation for local areas in Rhode Island, but continues automatic designation for

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jurisdictions with populations of 500,000 or more and rural-concentrated
employment programs, although the Governor may deny a request for designation if
the unit of government did not perform successfully5 during the preceding two years.
S. 1021 would continue to allow for automatic designation of any unit of general
local government with a population of 500,000, an area served by a rural-
concentrated employment program, or a local area in Rhode Island, but only if the
area performed successfully and sustained fiscal integrity6in the two-year period
following the enactment of S. 1021. In addition, S. 1021 would make any area that
was a local workforce investment area in the two years preceding the enactment of
S. 1021 an automatically designated area if the area had performed successfully and
sustained fiscal integrity.
Within each local area, a local WIB is certified by the Governor under current
law. These local boards have broad responsibility for developing a local workforce
investment system. Membership includes representatives of businesses, local
educational entities, labor organizations, community-based organizations, economic
development agencies, and one-stop partners. Both H.R. 27 and S. 1021 would
eliminate the requirement that representatives of the one-stop partners be included
on the local WIBs; one-stop partners are required members of the state WIBs. Under
current law, each local board is required to establish a youth council as a subgroup
of the WIB to develop the youth portion of the local plan, to recommend eligible
providers of youth activities, and to coordinate youth activities in the local area. Both
bills would make youth councils optional. H.R. 27 would add “faith-based
organization” to the list of entities that must be represented on the local board.
S. 1021 would not make this change, but it would include a “faith-based
organization” in the definition of a community-based organization. Representatives
of community-based organizations are required members of the local boards.
State and National Programs
Overview. Under current law, there are three state-administered programs:
youth, adult, and dislocated worker, each of which has its own state grant. Both bills
would retain the youth program, but refocus it as described below. H.R. 27 would
create a consolidated adult program by combining the state grants for the WIA adult
and dislocated worker programs with the state reemployment grants and state
employment service grants, both of which are authorized under the Wagner-Peyser
Act (29 U.S.C. §§ 49 et seq.) S. 1021 would maintain separate programs.
There are several national programs under current law, such as Job Corps, and
programs for Native Americans, migrant and seasonal farmworkers, and veterans.
5 H.R. 27 does not define “perform successfully.” S. 1021 defines the standard to mean that
the local area performed at 80% or more of its adjusted level of performance for core
indicators of performance, e.g., entry into employment. (See discussion of performance
accountability below.)
6 S. 1021 defines “fiscal integrity” to mean that the Secretary of Labor has not made a
formal determination that funds were “misexpended” in the local area due to willful
disregard of the requirements of the law, gross negligence, or failure to comply with
accepted standards of administration.

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Both bills would retain these programs and would create a new Youth Challenge
Grant Program.7
Youth Challenge Grants. This program would be designed to assist youth
in acquiring necessary skills, credentials, and employment. Under both H.R. 27 and
S. 1021, of the funds reserved by the Secretary of Labor for this program, not less
than 80% would be used for competitive grants to states and local areas, and not
more than 20% would be used for grants to public or private entities.8 Under H.R.
27, the Secretary could require the grantees to provide an unspecified non-federal
share of the cost of the activities. Under S. 1021, the Secretary must require grantees
to provide non-federal matching funds of not less than 10% of the cost of the
activities. The youth served by the grants would be ages 14 through 19 under H.R.
27, and ages 14 through 21 under S. 1021 for the 80% portion of the funds and 16
through 21 for the 20% portion.
State and Local Formula Allocations
Youth Allocations. Under current law, of the funds appropriated for youth
activities, not more than 0.25% is reserved for outlying areas9 and not more than
1.5% is reserved for youth activities for Native Americans. The remainder of funds
are allocated to states by a formula based one-third on the relative10 number of
unemployed individuals residing in areas of substantial unemployment (an
unemployment rate of at least 6.5%), one-third on the basis of the relative “excess”
number of unemployed individuals (an unemployment rate more than 4.5%), and
one-third on the basis of the relative number of low-income youth. In addition, states
receive a minimum of the higher of the amount which is 90% of their relative share
of the prior year’s funding (i.e., minimum funding) or 0.25% of the total allocation
(i.e., floor), and a maximum of the amount which is 130% of their relative share of
the prior year’s funding (i.e., maximum funding).
Under H.R. 27, of the funds appropriated for youth activities, the Secretary of
Labor would reserve 25% for Youth Challenge Grants — not to exceed $250 million.
Of the remainder, not more than 0.25% would be reserved for grants to outlying areas
and not more than 1.5% for youth activities for Native Americans. Under S. 1021,
7 Youth Challenge Grants would replace Youth Opportunity Grants (YOGs) — competitive
grants made to local WIBs and other entities to increase the long-term employment of youth
living in empowerment zones, enterprise communities, and high-poverty areas. YOGs have
not been funded since FY2003.
8 Under H.R. 27, 20% of the funds could be awarded to public or private entities that the
Secretary determines would be effective. Under S. 1021, 20% of the funds would be
awarded to consortium that would include a State or local board, and a consortium of
businesses, and could include local educational agencies, institutions of higher education,
business intermediaries, community-based organizations, or apprenticeship programs.
9 The outlying areas comprise the United States Virgin Islands, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, the Republic of the Marshall Islands, the
federated States of Micronesia, and the Republic of Palau.
10 The word “relative” as used in this report means the number of individuals in a state
compared to the total number in all states.

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the Secretary would reserve any funds appropriated in excess of $1.0 billion for
Youth Challenge Grants up to a maximum of $250 million. Of the remainder not
reserved for Youth Challenge Grants, not more than 0.25% would be reserved for
grants to outlying areas and not more than 1.5% for youth activities for Native
Americans. Under S. 1021, of the amount reserved for Youth Challenge Grants, the
Secretary would reserve the greater of $10 million or 4% for youth activities for
farmworkers. If no funds were appropriated in excess of $1.0 billion then $10.0
million would be reserved for youth activities for farmworkers from the total funds
appropriated for youth activities. H.R. 27 does not contain these provisions.
Under both bills, funds would be allocated to states using the current law
formula,11 except that any funds in excess of the amount available to states for
FY2005, estimated at $969 million, would be allocated by a three-part formula based
equally on each state’s relative number of individuals in the civilian labor force
compared to the total number of individuals in the civilian labor force in all states
ages 16 through 19 under H.R. 27 and ages 16 through 21 under S.1021; each state’s
relative number of unemployed individuals compared to the total number of
unemployed individuals in all states; and each state’s relative number of
economically disadvantaged youth age 16 though 21, compared to the total number
of disadvantaged youth in all states. Under both bills, it appears that minimum, floor,
and maximum provisions apply to both the excess funds and to the total
appropriation.
Under current law, of the funds allocated to states, Governors can reserve not
more than 15% for statewide activities. The remainder of the funds are allocated to
local areas. Under H.R. 27, of the funds allocated to the states, Governors could
reserve up to 10% for statewide activities. Under S. 1021, up to 15% could be
reserved, the same as current law. Under current law, of the remainder not reserved
for statewide activities, not less than 70% is allocated based on a statutory formula
that uses the same factors and weights used to allocate funds to states, and up to 30%
is allocated on a formula developed by the state board. Under both H.R. 27 and S.
1021, 80% would be allocated to local areas using the same factors and weights that
would be used to allocate funds to states, and 20% would be allocated to local areas
on a formula developed in consultation with state and local WIBs.
Allocations for Adult Activities. Separate formulas are currently used to
allocate funds to states for adult activities, dislocated worker activities, the
employment service, and reemployment grants.12 Under H.R. 27, these four funding
streams would be combined into one formula grant for a revised adult program. Of
the funds appropriated for adult activities, the Secretary of Labor would reserve 10%
to provide for national dislocated worker grants (currently called national emergency
11 Under current law, one-third of funds are allocated on the basis of the relative number of
unemployed individuals residing in areas of substantial employment; one-third on the basis
of the relative excess number of unemployed individuals; and one-third on the basis of the
relative number of disadvantaged youth ages 16 through 21.
12 For a detailed description of how funds are allotted to states for adults, dislocated
workers, and employment services, see [http://www.doleta.gov/budget/WIAFormDesc.pdf].

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grants), demonstration projects, and technical assistance.13 Of the remainder, not
more than 0.25% would be reserved for grants to outlying areas. The remainder
would be allocated by a two-part formula. The first part would allocate 26% of the
remainder based primarily on a state’s prior-year share of the Wagner-Peyser state
allotments. The second part would allocate 74% of the remainder as follows: 60%
(of the remaining 74% of total funds) would be allotted to states on the basis of the
relative number of unemployed individuals, 25% on the basis of the relative excess
number of unemployed individuals, and 15% on the basis of the relative number of
low-income adults. In addition, under the second part of the formula, states would
receive a minimum of the higher of the amount which would be 90% of their relative
share of the prior year’s funding (i.e., minimum funding) or 0.20% of the total
allocation (i.e., floor), and a maximum of the amount which would be 130% of their
relative share of the prior year’s funding (i.e., maximum funding). Each state’s total
allotment would be the sum of its allotment under the two parts, except that no state
would receive less than it received in FY2005 for the total of the four funding
streams and, unless DOL determined otherwise, no state would receive 3% more than
it had in FY2005 for the four funding streams. The funds needed to ensure that no
state received less than it had in FY2005 would come both from states that would
have received an increase greater than 3%, but were reduced to a 3% increase, and
from the Secretary’s Reserve (i.e., 10% of the total appropriation).
S. 1021 would not create a consolidated adult program; funding streams would
remain separate. The funding formula for the adult program would be a modified
version of the current formula, with 40% of the funds to be allocated on the basis of
the relative number of unemployed individuals residing in areas of substantial
unemployment, rather than one-third under current law, 25% on the basis of the
relative number of individuals in the civilian labor force — which is not currently a
factor — and 35% on the basis of the relative number of low-income adults rather
than one-third. The dislocated worker formula would be the same as current law.
Under current law, of the funds allocated to states for adult activities, the
Governor can reserve not more than 15% for statewide activities. S. 1021 would
retain current law. Under H.R. 27, the Governor could reserve up to 50% for
statewide activities. Of this amount, not less than half would be distributed to local
areas by formula to support the provision of core services (e.g., outreach and job
search assistance) through one-stop delivery systems. States could employ state
personnel to provide the services in local areas in consultation with local boards.
Under current law, of the funds allocated to local areas for adult activities, not
less than 70% are allocated based on a statutory formula, and up to 30% are allocated
on a formula developed by the state board. S. 1021 would retain current law with
respect to the shares of funds allocated under a statutory formula versus a formula
13 Of the 10%, not less than 75% would be used for national dislocated worker grants, of
which up to $125,000,000 could be used to carry out a demonstration project on community-
based job training, not more than 20% could be used for demonstration projects, and not
more than 5% could be used to provide technical assistance.

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developed by a state board, but the statutory formula would be modified.14 Under
H.R. 27, of the funds allocated to local areas for the consolidated adult program, 85%
would be allocated based on a statutory formula,15 and 15% would be allocated to
local areas based on a formula developed in consultation with state and local WIBs.
Youth Activities
Under current law, “eligible youth” are individuals not less than age 14 and not
more than age 21, low-income, and have a barrier to completing an educational
program or securing or holding employment. At least 30% of the funds currently
allocated to local areas have to be spent on activities for out-of-school youth. Under
H.R. 27, eligible youth would be not less than age 16 and not more than age 24. At
least 70% of the funds would have to be spent on school dropouts, recipients of a
secondary school diploma or the General Educational Development (GED)
certificate, court-involved youth attending an alternative school, and youth in foster
care or who have been in foster care. Within this group, which would not have to be
low-income, priority for youth activities would be given to school dropouts. No
more than 30% of the funds could be spent on in-school youth who would be low-
income. In addition, activities for in-school youth could be carried out only during
non-school hours.
Under S. 1021, in-school youth would be not less than age 14 and not more than
age 21, low-income, and have a barrier to completing an educational program or
securing or holding employment. Out-of-school youth would be not younger than
age 16 or older than age 21 and would have to meet one of several criteria such as a
school dropout or a youth subject to the juvenile justice system. At least 40% of the
funds would be spent on out-of-school youth. Unlike H.R. 27, S. 1021 does not
create a priority for serving school dropouts.
Adult Activities
Under current law, three levels of services (core, intensive, and training) are
provided to individuals sequentially. To be eligible to receive intensive services,
such as comprehensive assessments and development of individual employment
plans, an individual must first receive at least one core service, such as job search,
and have been unable to either obtain employment or retain employment that allows
for self-sufficiency. To be eligible to receive training services, such as occupational
skills training and on-the-job training, an individual must have received at least one
intensive service, and must have been unable to obtain or retain employment.
14 Forty percent of funds would be allocated on the basis of the relative number of
unemployed individuals residing in areas of substantial unemployment, 25% on the basis
of the relative number of individuals in the civilian labor force, and 35% on the basis of the
relative number of low-income adults. These are the same factors and weights as are used
to distribute the 74% of funds to states.
15 Sixty percent of funds would be allocated on the basis of the relative number of
unemployed individuals in each local area, 25% on the basis of the relative excess number
of unemployed individuals, and 15% on the basis of the relative number of disadvantaged
adults in each local area.

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Both bills would modify this sequencing of services to provide that individuals
could receive intensive or training services if they were unlikely or unable to obtain
or retain employment through core or intensive services, respectively. Under H.R.
27, unemployed individuals would be eligible to receive intensive or training services
if the one-stop operator determined they would be “unlikely or unable to obtain
suitable employment,” or in the case of an employed person, “retain suitable
employment.” The Governor would define “suitable employment.” Under S. 1021
unemployed individuals would be eligible to receive intensive or training services if
the one-stop operator determined they would be “unlikely or unable to obtain
employment that leads to self sufficiency or wages comparable to or higher than
previous employment,” or in the case of an employed person, leads to “self-
sufficiency.” Under S. 1021, a self-sufficiency standard defined by states for state
activities and local workforce investment boards for local activities would specify the
income needs of families, by family size, the number and ages of children in the
family, and sub-state geographical considerations.
Under current law and S. 1021, if a local area determined that funds for adult
activities are limited, a priority for intensive and training services must be given to
recipients of public assistance and low-income individuals participating in the adult
program.16 H.R. 27 would add a priority for intensive and training services for
unemployed individuals in its consolidated adult program.
Both bills would permit local WIBs to use 10% of their allotment for adult
activities for incumbent worker training programs to assist workers in obtaining the
skills necessary to retain employment and avert layoffs.17 An employer match would
be required.
Training, as in current law, would be provided primarily though individual
training accounts, which would be called career scholarship accounts in S. 1021. The
one-stop operator is responsible for arranging payment to eligible training providers.
Current law stipulates specific procedures states must follow for determining
provider eligibility, including specific cost and performance information that
providers must collect. Under both bills, current statutory requirements would be
eliminated and Governors would be responsible for establishing criteria and
procedures regarding the eligibility of providers. Local WIBs and one-stop delivery
systems would continue to retain a list of eligible providers, and participants would
continue to choose providers from this list in consultation with a case manager.
Demonstration and Pilot Projects
Under current law, the Secretary of Labor is authorized to carry out
demonstration and pilot projects that would develop and implement approaches and
demonstrate the effectiveness of specialized methods in addressing employment and
training needs. Both H.R. 27 and S. 1021 would amend the list of projects that could
be funded to include projects that focus on opportunities for employment in
16 There is no similar priority for the dislocated worker program.
17 Under current law, statewide activities may include training for incumbent workers, but
there is no similar provision for local areas.

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industries and sectors of industries that are experiencing (or are likely to experience)
high rates of growth, and projects that provide retention grants to job training
programs upon placement or retention of a low-income individual in jobs providing
a certain level of income. In addition, H.R. 27 and S. 1021 would authorize specific
demonstration projects that are summarized below.
Community-Based Job Training. Both H.R. 27 and S. 1021 would
authorize a competitive grant demonstration project to eligible entities to carry out
activities such as the development of rigorous training and education programs.
Under H.R. 27 an eligible entity would be a community college or consortia of
community colleges that would work with the local workforce investment system and
business in a qualified industry (e.g., an industry or economic sector projected to
experience significant growth). Under S. 1021, an eligible entity would be a
community college or a consortium composed of a community college and an
institution of higher education, that would work with a local board, business in a
qualified industry, and an economic development entity.
For FY2005, the President requested $250 million for a competitive grant
demonstration project to enhance the capacity of community colleges to provide
training, particularly for occupations in demand by high growth industries. The
FY2005 consolidated appropriations act (P.L. 108-447) provided a total of $250
million for these grants: $125 million is provided under WIA demonstration
authority, and an additional $125 million is required to be spent from the National
Reserve of the Dislocated Worker Assistance Program. For FY2006, the President
has again requested $250 million for this demonstration project. H.R. 27 would
authorize $125 million under WIA demonstration authority and would provide that
$125 million could be spent from the Secretary’s Reserve under the new consolidated
adult program. S. 1021 does not authorize a specific amount of funding.
Personal Reemployment Accounts (PRAs). H.R. 27 would authorize
a PRA demonstration project. The PRA provisions in H.R. 27 are identical to the
provisions contained in H.R. 444, passed in the House in the 108th Congress.
The principal features of the PRA demonstration are as follows:
! States and other eligible entities would provide accounts of up to
$3,000 per eligible individual. The initial account balances must be
the same for all participants within a state.
! Eligible individuals primarily would be Unemployment Insurance
(UI) claimants identified through worker profiling as likely to
exhaust their benefits and in need of job search assistance to obtain
new employment.18 Eligible entities could, at their option, extend
18 P.L. 103-152, which amended the Social Security Act, required states to develop systems
of profiling new UI claimants in order to identify those likely to exhaust their benefits.
After states screen out initial claimants on recall status (including in some cases persons laid
off from seasonal industries) and those who exclusively use union hiring halls, the states use
statistical models or characteristic screens to identify potential UI exhaustees. Measures
(continued...)

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accounts to individuals who had exhausted their benefit entitlement
and (a) are in training for which completion requires additional
support, or (b) were laid off from an industry or occupation with
declining employment or which no longer provides jobs in a local
area.
! Individuals could use the account funds, at their own discretion, to
purchase a variety of employment-related services (e.g., intensive
services, training, and support services and assistance with buying
or leasing a car) on a fee-for-service basis from the one-stop delivery
system or other service providers. Recipients could only receive
training, intensive, and support services on a fee-for-service basis
during the one-year period from the date of establishment of their
accounts. Core services provided by one-stop centers would remain
free to account recipients (e.g., access to job listings and assistance
with writing resumes).
! Individuals with PRAs who obtain full-time jobs within a 13-week
qualification period (dating from initial receipt of UI benefits for
those still eligible for benefits and from the account’s establishment
for those who had exhausted their benefits) would receive any funds
remaining in their accounts as bonuses. The bonuses would be
dispensed in two installments: 60% upon reemployment and 40%
six months thereafter.
These features are similar to an $8 million PRA demonstration for which the
Labor Department (DOL) announced awards to seven states on October 29, 2004.19
For FY2005, the President requested $50 million under the authority of WIA Section
171 for a PRA demonstration. Funding for the demonstration was not included in the
FY2005 consolidated appropriations act (P.L. 108-447). No request for funding was
made for FY2006.
Training for Realtime Writers. H.R. 27 would authorize competitive grants
to court reporting or realtime writing training programs that met certain conditions
to promote training and placement of individuals as realtime writers in order to meet
the requirements for closed captioning of video programming set forth in Section 723
of the Communications Act of 1994.
Business Partnership Grants. H.R. 27 would authorize competitive grants
to businesses or business partnerships to expand local sector-focused training and
workforce development in high-growth, high-wage industry sectors.
18 (...continued)
taken into account include previous occupation, industry, wages, and job tenure; educational
attainment and other claimant characteristics; local economic indicators; and the
individual’s UI weekly benefit amount. States are not permitted to include such equal
opportunity characteristics as age, race, gender, and disability status.
19 The seven states are Florida, Idaho, Minnesota, Mississippi, Montana, Texas and West
Virginia. For more information, see [http://www.dol.gov/opa/media/press/opa/
OPA20042248.htm].

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Skill Certification Pilot Projects. S. 1021 would require the Secretary of
Labor to establish and carry out not more than 10 pilot projects to establish a system
of industry-validated national certification of skills. For FY2006, $30.0 million
would be authorized for these pilot projects.
Integrated Workforce Training Programs for Adults with Limited
English Proficiency. S. 1021 would require the Secretary of Labor to establish
and implement a national demonstration project designed to both analyze and provide
data on workforce training programs that integrate English language acquisition and
occupational training. The Secretary would be required to make not less than 10
grants on a competitive basis. For FY2006, $10.0 million would be authorized for
this demonstration project.
Performance Accountability
Under current law, there are four core indicators of performance for programs
serving youth ages 19 through 21, adults, and dislocated workers: entry into
unsubsidized employment, retention in employment six months after job entry,
earnings received six months after job entry, and attainment of a recognized
credential. There are also two measures of customer satisfaction, one for individuals
and one for employers. H.R. 27 would eliminate the measure of attainment of a
credential. H.R. 27 would also eliminate the current measures of customer
satisfaction, but would permit states to include customer satisfaction of employers
and participants as additional indicators of performance in the state plan. S. 1021
would modify the earnings measure to be an “increase in earnings”; it would not
eliminate measures of customer satisfaction. Both bills would eliminate the
application of these indicators to youth ages 19 through 21.
Under current law, there are three indicators of performance for programs
serving youth ages 14 through 18: attainment of basic skills, attainment of secondary
school diplomas and their equivalents, and placement and retention in such things as
postsecondary education, advanced training, military service, and employment. Both
H.R. 27 and S. 1021 would modify current core indicators of performance to apply
to youth of all ages. The three indicators, that are similar but not identical, would be
entry into employment, education or advanced training, or military service;
attainment of secondary school diplomas or their recognized equivalents, and
postsecondary certificates; and literacy or numeracy gains. Under S. 1021, a state
could add in the state plan additional indicators of performance including indicators
identified in collaboration with state business and industry associations, with
employee representatives, and with local boards, to measure the performance of the
workforce investment system in serving the workforce needs of business and industry
in the state.
Nondiscrimination
Under current law, discrimination regarding participation, benefits and
employment because of race, color, religion, sex, national origin, age, disability or
political affiliation is prohibited. H.R. 27 would continue these prohibitions, but it

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would add an exemption for religious organizations with respect to their employment
of individuals of a particular religion. S. 1021 would not change current law.
Authorization of Appropriations
Youth, Adult, and Dislocated Worker Activities. Under H.R. 27, youth
activities would be authorized at $1,250,000,000 for FY2006, and for such sums as
necessary for each of the fiscal years 2007 through 2011. Adult activities under the
new consolidated adult program would be authorized at $3,140,000,000 for FY2006,
and for such sums as necessary for each of the fiscal years FY2007 through FY2011.
Under S. 1021, youth, adult, and dislocated worker programs would be authorized
for such sums as necessary for each of the fiscal years FY2006 through FY2011.
Demonstration and Pilot Projects. H.R. 27 would authorize $211.0
million for FY2006 and such sums as may be necessary for each of the fiscal years
FY2007 through FY2011. Of this amount, the Secretary would reserve up to
$125,000,000 for the Community-Based Job Training Demonstration Project. S.
1021 would authorize such sums as may be necessary for each of the fiscal years
FY2006 through FY2011

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