Workforce Innovation and Opportunity Act, Miscellaneous Program Changes

DEPARTMENT OF EDUCATION

34 CFR Parts 367, 369, 370, 371, 373, 376, 377, 379, 381, 385, 386, 387, 388, 389, 390, and 396

[Docket No. 2015-ED-OSERS-0002]

RIN 1820-AB71

Workforce Innovation and Opportunity Act, Miscellaneous Program Changes

AGENCY:

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

ACTION:

Final Regulations.

SUMMARY:

The Secretary amends the regulations governing a number of programs administered by the Rehabilitation Services Administration (RSA) to implement changes to the Rehabilitation Act of 1973 (Act) made by the Workforce Innovation and Opportunity Act, signed on July 22, 2014.

The Secretary also implements changes to the Act made by the Workforce Investment Act of 1998, signed on August 7, 1998, that have not previously been implemented in regulations, and otherwise updates, clarifies, and improves RSA's current regulations.

DATES:

This final rule is effective September 19, 2016, except the removal of part 388, amendatory instruction 13, is effective on October 1, 2016.

FOR FURTHER INFORMATION CONTACT:

Ed Anthony, U.S. Department of Education, 400 Maryland Avenue SW., Room 5086 PCP, Washington, DC 20202-2800.

Telephone:

(202) 245-7488, or by email:

Edward.Anthony@ed.gov

.

If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

Background

The Secretary amends the regulations governing a number of programs administered by the Rehabilitation Services Administration (RSA) to implement changes to the Rehabilitation Act of 1973 (Act) made by the Workforce Innovation and Opportunity Act (WIOA), signed on July 22, 2014 (Pub. L. 113-128). These programs and their corresponding regulations are:

• The Independent Living Services for Older Individuals Who Are Blind (OIB) program, 34 CFR part 367;

• The Client Assistance Program (CAP), 34 CFR part 370;

• The American Indian Vocational Rehabilitation Services (AIVRS) program, 34 CFR part 371 (formerly known as “Vocational Rehabilitation Service Projects for American Indians with Disabilities”);

• The Rehabilitation National Activities program, 34 CFR part 373 (formerly known as “Special Demonstration Projects”);

• The Protection and Advocacy of Individual Rights (PAIR) program, 34 CFR part 381;

• The Rehabilitation Training program, 34 CFR part 385;

• The Rehabilitation Long-Term Training program, 34 CFR part 386;

• The Innovative Rehabilitation Training program, 34 CFR part 387 (formerly known as the “Experimental and Innovative Training”);

• The Training of Interpreters for Individuals Who are Deaf or Hard of Hearing and Individuals who are Deaf-Blind program, 34 CFR part 396 (formerly known as the “Training of Interpreters for Individuals Who are Deaf and Individuals who are Deaf-Blind program”).

WIOA also repealed the statutory authority for four programs, and the Secretary, therefore, removes their corresponding regulations. These programs and regulations are:

• Vocational Rehabilitation Service Projects for Migratory Agricultural Workers and Seasonal Farmworkers with Disabilities (Migrant Workers) program, portions of 34 CFR part 369;

• Projects for Initiating Special Recreation Programs for Individuals with Disabilities (Recreational programs), portions of 34 CFR part 369;

• Projects with Industry, 34 CFR part 379 and portions of part 369; and

• The State Vocational Rehabilitation Unit In-Service Training program, 34 CFR part 388.

In addition, the Secretary implements changes to the Act made by the Workforce Investment Act of 1998 (WIA), signed into law August 7, 1998 (Pub. L. 105-220). These changes were not previously implemented in the OIB, CAP, AIVRS, and PAIR program regulations, and the Secretary now makes these changes in the applicable regulations.

Separate and apart from amendments to the Act made by WIOA and WIA, the Secretary updates and clarifies the regulations governing the various rehabilitation training programs—34 CFR parts 373, 385, 386, 387, and 396—and 34 CFR part 390, which governs the Rehabilitation Short-Term Training program. These regulations have not been updated in some time, and updating them now is intended to improve how these programs function.

Finally, as part of this update, the Secretary removes regulations that are superseded or obsolete and consolidates regulations, where appropriate. In addition to removing portions of 34 CFR part 369 pertaining to specific programs whose statutory authority was repealed under WIOA (

i.e.,

Migrant Workers program, the Recreational Programs, and the Projects With Industry program), the Secretary is removing the remaining portions of the Part 369 regulations. The Secretary is also removing parts 376, 377, and 389.

Public Comment

On April 16, 2015, the Secretary published a notice of proposed rulemaking (NPRM) for these programs in the

Federal Register

(80 FR 20988). In response to our invitation in the NPRM, more than 100 parties submitted comments on the proposed regulations. Because the amendments described in these final regulations are so many and varied, we first discuss those programs whose regulations we amend and do not remove. We discuss these programs in the order in which their parts appear in the Code of Federal Regulations (CFR). For each part, we provide a summary of the changes we proposed, a summary of the differences between the proposed regulations and these final regulations, and a detailed discussion of the public comment we received on the proposed regulations. We then discuss those programs whose regulations we remove. Generally, we do not address technical and other minor changes.

Independent Living Services for Older Individuals who are Blind (OIB), 34 CFR Part 367

Summary of Changes

In the preamble of the NPRM, we discussed on pages 20989 through 20991 the major changes proposed to part 367 implementing the amendments to the OIB program made by WIOA. These included a requirement that not less than 1.8 percent and not more than 2 percent of the funds for this program be reserved to provide training and technical assistance to designated State agencies (DSA) or other providers of independent living services for older individuals who are blind.

In addition, we proposed to incorporate into part 367 the text of relevant provisions of parts 364 and 365 regarding general independent living and State independent living services that were previously incorporated only by reference.

There are five differences between the NPRM and these final regulations. As a result of our further review, we add the

entities eligible to apply for awards under the training and technical assistance funding in § 367.21; we revise § 367.24 to give the Secretary the discretion to conduct the application process and make the subsequent award in accordance with 34 CFR part 75, but not require it; we clarify in §§ 367.65 and 367.66 requirements for the use of program income; we address in a new § 367.67 the financial participation by consumers served by the OIB program; and we revise § 367.69 by requiring that designated State agencies and other service providers enter into written agreements when sharing personal information with entities and organizations for the purpose of evaluations, audits, research, and other program purposes. We also make other, minor technical changes.

Public Comment

In response to our invitation in the NPRM, eight parties submitted comments on the proposed regulations amending the OIB program. One commenter agreed with all of the proposed regulations as written. Another expressed specific support for incorporating into part 367 the independent living (IL) services from section 7(17) of the Act, including the requisite supports and services that facilitate the transition of individuals from nursing homes and other institutions to home- and community-based residences and services to assist older individuals who are blind and who are at risk of entering institutions to remain in their communities. We address those commenters that requested clarifications or proposed additions to the regulations. Because we made a number of structural and numbering revisions to part 367, we provide an analysis of public comment by subpart and, within each subpart, by subject or section. We do not address areas about which we did not receive public comments,

i.e.

Subpart D—How Does the Secretary Award Discretionary Grants? and Subpart E—How Does the Secretary Award Formula Grants?

Subpart A—General

Comment:

An organization representing State agencies for the blind and that supports the concept of “employment first” recommended that part 367 refer all consumers presumed eligible for the OIB program based upon age to the State VR services program to be assessed for employment potential prior to being served under the OIB program. The commenter stated that this would relieve the “underfunded” OIB program of the costs of eligibility and assessment and allow for these costs to be met by the VR program.

Discussion:

We appreciate the commenter's support for “employment first,” which regards employment as the preferred option for individuals of working age. However, we understand that many older individuals with vision loss may not believe that employment is an option for them. The purpose of the OIB program is to provide IL services to individuals age 55 or older whose significant visual impairment makes competitive employment extremely difficult but for whom IL goals are feasible. Individuals served by the OIB program who subsequently express an interest in employment during or after receiving OIB services may be referred at any time to the VR program; however, there is no statutory authority to require that all potential OIB consumers be referred to the VR program before receiving OIB services.

We acknowledge the commenter's concerns about relieving the OIB program of the costs of eligibility and assessments; however, to require that all individuals presumed eligible for the OIB program be referred first to the VR program for assessment of employment potential is not appropriate, as it shifts those costs to the VR program for individuals for whom competitive employment may not be likely.

What activities may the Secretary fund? (§ 367.3(b))

Comments:

Some commenters asked for clarification about whether it is mandatory to provide all independent living (IL) services that may be funded under this part. Commenters were concerned about their capacity to provide all IL services, particularly those defined in proposed § 367.5(b)(10). The commenters noted that some of the services are duplicative of those provided by Centers for Independent Living (CILs), while others may not usually apply to the OIB program (

e.g.

shelter, supported living, physical rehabilitation, therapeutic treatment, and prostheses).

Additionally, commenters stated that vision rehabilitation specialists would require extensive training to gain the qualifications needed to provide all services and that providing the full array of services would affect the quality of vision services provided to clients by an already overstretched staff.

Discussion:

We acknowledge the concerns expressed by some commenters about whether providing all IL services identified in § 367.3(b)—particularly the catchall in § 367.3(b)(8), “Other IL services as defined in § 367.5”—is required. While § 367.3(a) specifies that the DSA may use funds under part 367 for activities described in § 367.1 and § 367.5(b), it does not require the DSA to provide the full array of services and activities that the Secretary may fund. In fact, many of these IL services and activities may also be provided under title VII, chapter 1 of the Act, and older individuals who are blind may be referred to these programs, which include CILs, for services that may not be specific to the vision-related services traditionally provided by the OIB program. However, the broad scope of IL services that an OIB program may provide allows the program to determine what array of services and activities it will provide and to individualize services according to need.

Changes:

None.

Transfer of Title VII, Chapter 1 IL Programs

Comment:

One commenter requested further clarification about how the Department intends to work with the Department of Health and Human Services (HHS) throughout the IL program transition process to assure that older individuals who are blind continue to receive the necessary services that provide the greatest opportunity for complete and full independence.

Discussion:

The Department has worked collaboratively with HHS to ensure the efficient and effective transfer of the Title VII, Chapter 1 programs from the Department of Education to HHS. The OIB program, which continues to be administered by the Department, was transferred within RSA to staff in the Technical Assistance Unit who have the knowledge and expertise necessary to administer the OIB program.

Change:

None.

Subpart B—Training and Technical Assistance

Comment:

One commenter strongly recommended that a portion of the technical assistance and training funds be required to be used to train service providers on techniques and best practices for serving older individuals who are deaf-blind, including those who are blind or visually impaired and hard of hearing. This specialized training would increase understanding of the needs of deaf-blind individuals, assist service providers who routinely work with individuals who are blind to recognize those who also have hearing loss, and provide techniques designed to maximize independence.

Discussion:

We appreciate the commenter's recommendation.

Individuals who are deaf-blind, including those who are blind or visually impaired and hard of hearing, encompass a growing population within those who may be served under the OIB program. As such, we anticipate that training and technical assistance for DSAs and other service providers will address the needs of this dual sensory loss group, as well as of other individuals who are blind or visually impaired and have multiple disabilities.

Change:

None.

Eligible Entities for Grants, Contracts, or Cooperative Agreements (§ 367.21(a))

Comment:

None.

Discussion:

In proposed § 367.21(a), we did not describe the entities eligible to compete for funds reserved under § 367.20 to carry out training and technical assistance through grants, contracts, or cooperative agreements. This was an oversight.

Change:

We added eligible entities to final § 367.21(a): State and public or non-profit agencies and organizations and institutions of higher education.

How does the Secretary evaluate an application? (§ 367.24)

Comments:

None.

Discussion:

When WIOA added a training and technical assistance authority to the OIB program it gave the Secretary the ability to make awards by grant, cooperative agreement or contract. Since the Department generally makes these awards by grants using the procedures in part 75, which uses the peer review process identified in the statute, we added a subsection in the NPRM that provided that the Secretary would use the procedures in part 75, even when awarding a contract. However, upon further reflection, we have determined that there may be circumstances when the Department has an amount of funds that is too small to compete but could be used to support a contract consistent with the training and technical assistance authority, in the form of a task order or modification under an existing Department contract for example, in which case, the Department would not want to use the grant processes in part 75. Therefore, we have determined that it is more appropriate to change the language in this subsection to give the Secretary the authority to use part 75 if awarding a contract, where the Secretary determines it is appropriate but not require its use.

Changes:

We have revised final § 367.24(b) to give the Secretary the discretion to conduct the application process and make the subsequent award in accordance with 34 CFR part 75, but not require it.

Subpart C—What are the application requirements under this part?

Removal of State Plan for Independent Living OIB Requirements

Comments:

Two commenters, an organization representing agencies for the blind and an individual, acknowledged that WIOA eliminated the requirement for including a reference to the OIB program in the State Plan for Independent Living (SPIL) and expressed concern that this would disenfranchise and remove the “voice” of older individuals with vision loss. These commenters recommended that an OIB section be added to the Vocational Rehabilitation (VR) portion of the Unified or Combined State Plans submitted by States, with the requirement that plans require coordination with VR, CILs, aging, and other entities that would further the independence of older persons with visual impairments.

Discussion:

We appreciate the commenters' concerns surrounding the potential elimination of the “voice” of older individuals who are blind or visually impaired that resulted from the transfer of the IL programs to HHS. However, the previous SPIL requirements for IL coordination with the OIB program and for including any new methods or approaches for providing OIB services were minimal.

In addition, nothing prohibits older individuals who are blind or visually impaired from participating in the development of the SPIL. In fact, for the periodic review and revision of the SPIL, section 704(a)(3)(C)(ii)(II) of the Act requires collaboration and working relationships with, among others, entities carrying out programs that provide independent living services and that serve older individuals. Furthermore, some State OIB programs have developed advisory committees to provide input into determining the needs of the older blind population and developing the services required to meet those needs.

While we appreciate the recommendation to add an OIB section to the VR services portion of the Unified or Combined State Plan, section 101(a) of the Act dictates its required components, which do not include the OIB program. We encourage OIB consumers to make their views known to the DSA and other service providers, and we encourage State OIB programs to develop strategies to coordinate and link OIB programs with other disability and aging-related activities and programs within each State to maximize collaboration and availability of services.

Change:

None.

Subpart F—What conditions must be met after an award?

Use of Program Income (§ 367.65(a)(2) and (b)(2))

Comment:

None.

Discussion:

After further review, we have revised § 367.65 to clarify that payments received by the State agency, subrecipients, or contractors for IL services provided under the OIB program to individual consumers will be treated as program income. We have also revised final § 367.65(b)(2) to require OIB grantees to use program income only to supplement the OIB grant. Grantees will not be permitted to deduct program income from the grant.

Upon closer examination of the grant formula set forth in the statute, we have concluded that the use of the deduction method would, in effect, result in a reduction of an OIB program grantee's allotment. Absent specific statutory authority, these reductions would be inconsistent with the statute and general appropriations law principles. In reviewing the grantees' financial reports, we have found that very few, if any, OIB programs elect to use the deduction method. Instead, most, if not all, grantees elect to use the addition method, which is still permissible and, in fact, will be the only permissible use of program income under the OIB final regulations. We do not believe this change will negatively affect any grantee.

Changes:

We have added § 367.65(a)(2), stating that payments received by the State agency, subrecipients, or contractors from insurers, consumers, or others for IL services provided under the OIB program to defray part or all of the costs of services provided to individual consumers will be treated as program income. We have revised final § 367.65(b)(2) to permit grantees to use program income only to supplement their OIB grant and have removed all references to the deduction method.

The Requirements That Apply to the Obligation of Federal Funds and Program Income (§ 367.66)

Comment:

None.

There has been a long-standing, government-wide requirement under the common rule implementing former OMB Circular A-102 and the former OMB guidance in Circular A-110, as codified by the Department of Education at former 34 CFR 80.21(f)(2) and

74.22(g), respectively, that non-Federal grantees must expend program income prior to drawing down Federal grant funds. The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), codified at 2 CFR part 200, were adopted by the Department at 2 CFR 3474 on December 19, 2014 (79 FR 76091), and apply to all new and continuing awards made after December 26, 2014.

The new 2 CFR 200.305(a) specifies the payment procedures that States must use to draw down Federal funds; however, these procedures appear, on the surface, to apply only to funds included in a Treasury-State Agreement (TSA), and not all Federal program funds made available to States are subject to TSAs. For this reason, 2 CFR 200.305(a) has created an ambiguity about how States should draw Federal funds under non-TSA programs.

Moreover, TSAs do not cover program income earned by State grantees, and 2 CFR 200.305(a) does not address whether States should expend available program income funds before requesting additional Federal cash, which had been the long-standing government-wide requirement in OMB Circular A-102 and codified for Department grantees at 34 CFR 80.21(f)(2). This silence creates concern because, for all other non-Federal entities, 2 CFR 200.305(b)(5) requires them to expend available program income funds before requesting payments of Federal funds.

While the silence in 2 CFR 200.305(a) creates an unintended ambiguity, we do not believe that it should be construed to change the prior rule and remove the requirement that States must expend program income funds before requesting additional Federal cash. No such policy change was discussed in the preambles to either the final guidance in 2 CFR part 200, which was published on December 26, 2013 (78 FR 78589), or in the Interim Final Guidance published on December 19, 2014 (79 FR 75867).

Further, § 361.63(c)(2) permits the transfer of VR Social Security reimbursement program income to carry out programs under title VII, Chapter 2 of the Act (Independent Living Services for Older Individuals Who Are Blind). For this reason, we believe it is essential that we resolve this unintended ambiguity for the OIB program.

We proposed in the NPRM to incorporate the requirement to expend program income before requesting payment of funds by referencing 2 CFR 200.305(a). Given the ambiguity in that section, however, the proposed rule did not clearly state the requirement. We resolve the ambiguity by revising § 367.66(c) to explicitly require States to expend available program income funds before requesting additional cash payments, as was the long-standing requirement under former 34 CFR 80.21(f)(2).

We believe this change is essential to protect the Federal interest by using program income to increase the funds devoted to this program, to which VR Social Security reimbursement program income may also be transferred, keeping to a minimum the interest costs to the Federal government of making grant funds available to the States. This change should not negatively affect States because it merely maintains the status quo that existed under 34 CFR 80.21(f)(2).

Changes:

We have revised final § 367.66(c) to make clear that all designated agencies must disburse program income prior to drawing down Federal funds or, as stated in 2 CFR 200.305(b)(5), “requesting additional cash payments.” Finally, we have made other technical and conforming edits.

Financial Participation

Comment:

One commenter pointed out that the proposed regulations did not address how a grantee should consider a consumer's ability to pay.

Discussion:

We agree that the proposed regulations did not address the subject of financial participation by consumers of the OIB program. Since there is neither a Federal requirement for, nor prohibition of, consumers of the OIB program to participate in the cost of IL services, we believe it is beneficial to address the commenter's suggestion by including regulatory language to provide guidance to States that might want to consider this as an option.

Change:

We added new § 367.67—

May an individual's ability to pay be considered in determining his or her participation in the costs of OIB services?

A State is neither required to charge, nor is it prohibited from charging, consumers for the cost of IL services provided under the OIB program. Also, a State is neither required to, nor prohibited from, considering the ability of individual consumers to pay for the cost of OIB services in determining how much a particular consumer must contribute to the costs of a particular service. However, specific requirements apply if the State does choose to charge consumers or allow providers of services to charge consumers for services provided under the OIB program. Specific requirements also apply if the State considers, or allows providers of services to consider, the ability of individual consumers to pay for the cost of OIB services. These requirements are outlined in the new § 367.67. Because this is a new section added to the regulations, the sections after it are renumbered accordingly.

CAP (§ 367.68)

Comment:

One commenter, noting the inclusion of the notice of the availability of CAP in this subpart, remarked that the OIB regulations should, but do not, address appeals procedures.

Discussion:

The Act does not include an appeals procedure for the OIB program; therefore, there is no statutory authority to include any regulations beyond those relating to the availability of CAP to the OIB program.

Change:

None.

What are the special requirements pertaining to the protection, use, and release of personal information? (§ 367.69)

Comments:

None.

Discussion:

We anticipate that other Federal and State agencies, and researchers will have an increased interest in using the data required to be collected by programs established under the Act, including the OIB program. Therefore, after further departmental review, we have strengthened the protection of the confidentiality of personal information collected by the OIB program by requiring in final § 367.69 that designated State agencies and service providers enter into written agreements with any entity seeking access to this information for the purpose of audits, evaluations, research, or for other program purposes. This change is consistent with revisions to final 34 CFR 361.38 governing the protection of confidentiality of personal information collected by the VR program.

Changes:

We have revised final § 367.69(a), (d), and (e)(1) by requiring that designated State agencies and service providers enter into written agreements with other organizations and entities receiving personal OIB program information during the conduct of audits, evaluations, research, and for other program purposes.

Client Assistance Program (CAP), 34 CFR Part 370

Summary of Changes

In the preamble of the NPRM, we discussed on pages 20991 through 20994 the major changes proposed to part 370 that would implement the amendments to the CAP made by WIOA and WIA. To implement those changes made by WIA, the Secretary proposed amending the regulations governing the redesignation of a designated CAP

agency to require the governor to redesignate the designated CAP agency if it is internal to the designated State agency (DSA) for the Vocational Rehabilitation program and that DSA undergoes a significant reorganization that meets certain statutory criteria.

The Secretary also proposed making three substantive changes to incorporate statutory changes made to section 112 by WIOA. First, we proposed adding the protection and advocacy system serving the American Indian Consortium as an entity eligible to receive a CAP grant. Second, we proposed requiring the Secretary to reserve funds from the CAP appropriation, once it reaches a specified level, to award a grant for the provision of training and technical assistance to designated CAP agencies. Finally, we proposed clarifying that authorized activities under the CAP include assisting client and client-applicants who are receiving services under sections 113 and 511 of the Act.

In addition to substantive changes required by statutory amendments, the Secretary proposed making other changes to update part 370 so that it, among other things, conforms with RSA practice (

i.e.,

with regard to submission of application and assurances), reflects current CAP grantee practice (

i.e.,

with regard to contracts with centers for independent living), and conforms to the new Uniform Guidance at 2 CFR part 200.

There are no differences between the NPRM and these final regulations, except that, as a result of our further review, we clarify in final § 370.47 requirements related to the use of program income and make other minor technical changes.

Public Comment:

In response to our invitation in the NPRM, 41 parties submitted comments on the proposed regulations amending the CAP (part 370). In general, these comments supported the proposed regulations. We provide an analysis of public comments by subject and section only for those regulations about which we received opposing comments or requests for clarification. In addition, we provide an explanation of the clarification in § 370.47 regarding requirements related to the use of program income.

Clients and Client-Applicants (§ 370.1)

Comments:

A few commenters supported the revision to § 370.1 clarifying that CAP services are available to assist individuals seeking or receiving services under sections 113 and 511 of the Act. Yet, a few other commenters believe the same proposed regulations were confusing in that the terms “clients” and “client-applicants” would not include those individuals who are potentially eligible to receive pre-employment transition services. These commenters recommended that we incorporate the definitions of “student with a disability” and “youth with a disability” within this part to clarify that these individuals are clients and client-applicants. These commenters also recommended that we amend this section to prohibit the provision of CAP services to youth with disabilities seeking subminimum wage employment in sheltered settings.

Discussion:

We appreciate the commenters' support for this regulation. We disagree that there is a need to clarify in the regulation that students and youth with a disability, including those students with disabilities seeking or receiving pre-employment transition services, are clients and client-applicants for the purposes of this part. As defined in § 370.6, “client or client-applicant” means an individual receiving or seeking services under the Act, respectively. Moreover, section 112(a) makes clear that CAPs may serve clients and client-applicants who are receiving services under section 113—

e.g.,

students with disabilities. In fact, students and youth with disabilities may be eligible to receive a wide range of services under the Act, such as transition services, training, transportation, supported employment, and independent living. Therefore, students and youth with disabilities who are receiving services under the Act are clients and client-applicants for purposes of part 370 and are, therefore, eligible to receive CAP services.

We also appreciate the commenter's concerns about the payment of subminimum wages to youth with disabilities. However, we disagree that we should prohibit the provision of CAP services to youth with disabilities seeking subminimum wage employment. Section 112(a) of the Act, as amended by WIOA, specifically establishes CAPs to assist clients and client-applicants with all benefits and services available under the Act, including those required by section 511. Given this mandate, there is no authority under the Act for the Secretary to prohibit the provision of CAP services to youth with disabilities seeking subminimum wage employment, regardless of the setting. We believe that the final regulation is consistent with the statute.

Change:

None.

Requirements for Redesignation (§ 370.10)

Comments:

One commenter supported the proposed changes in this section. However, another commenter suggested that redesignation should ultimately be based on criteria, such as the efficiency and effectiveness of the grantee as assessed by RSA through its monitoring activities, in addition to the determination of “good cause” by the governor.

Discussion:

We appreciate the comment supporting this regulation, as well as the recommendation from the commenter regarding criteria on which to base the redesignation of a CAP grantee. However, other than a determination of good cause by the governor, the Act does not provide the Secretary with authority to specify criteria that would require the redesignation of a designated CAP agency. We believe that the final regulation is consistent with the statute.

Change:

None.

Access to Records and Monitoring

Comments:

Several commenters were concerned that the proposed regulations did not provide CAPs with the authority to access records and conduct monitoring to help carry out the mandate to assist individuals seeking or receiving services under sections 113 and 511 of the Act. These commenters recommended that CAPs be given the same authority to access records as do other component programs, including the PAIR program, of the protection and advocacy system established under the Developmental Disabilities Assistance and Bill of Rights Act of 2000, believing this general authority would enable CAP grantees to access records and documentation developed under both sections 113 and 511 of the Act.

Discussion:

We disagree with the commenters' recommendation. Although many CAPs are housed within a State's protection and advocacy system, section 112 of the Act neither establishes the CAP as a mandatory component of the protection and advocacy system nor requires that the CAP have the same general authorities as those established in part C of the Developmental Disabilities Assistance and Bill of Rights Act of 2000.

Rather, section 112(a) of the Act establishes CAPs to: (1) Advise and inform clients and client-applicants of all services and benefits available to them under the Act; (2) upon the request of these clients and client-applicants, assist and advocate for these individuals in their relationships with projects, programs, and services provided under the Act; and (3) inform individuals with disabilities of the services and benefits available to them under the Act and under Title I of the Americans with Disabilities Act.

In assisting and advocating for clients and client-applicants upon their request, section 112(a) of the Act authorizes the CAP to pursue legal, administrative, or other appropriate remedies to ensure the protection of their rights under the Act and to facilitate access to, and services funded under, the Act through individual and systemic advocacy, as defined at § 370.6(b). This advocacy, whether individual or systemic, must be at the request of the client or client-applicant and must be solely for the purpose of protecting the rights of clients and client-applicants under the Act or to facilitate their access to services under the Act. In this situation alone, the CAPs could access relevant records so long as they follow the requirements of the holder of those records, which typically would require the informed written consent of the client or client-applicant. There is no authority under section 112 for the CAP to engage in advocacy for the sole purpose of gaining general access to records or conducting monitoring.

For these reasons, section 112 of the Act does not provide a basis on which to amend these regulations, as recommended by commenters, to include the same general authorities as those established in part C of the Developmental Disabilities Assistance and Bill of Rights Act of 2000 for mandatory components of the protection and advocacy system, which the CAP is not.

Change:

None.

Program Income (§ 370.47)

Comments:

None.

Discussion:

In further reviewing the interplay between § 370.47 and 2 CFR 200.305, the Department has determined additional clarification is necessary in final § 370.47, particularly with regard to the use of available program income.

There has been a long-standing government-wide requirement under the common rule implementing former OMB Circular A-102 and the former OMB guidance in Circular A-110, as codified by the Department at former 34 CFR 80.21(f)(2) and 74.22(g), respectively, that non-Federal grantees must expend program income prior to drawing down Federal grant funds. The Uniform Guidance, codified at 2 CFR part 200, was adopted by the Department at 2 CFR part 3474 on December 19, 2014 (79 FR 76091) and applies to all new and continuing awards made after December 26, 2014.

The new 2 CFR 200.305 specifies the payment procedures that non-Federal entities must use to draw down Federal funds; however, 2 CFR 200.305(a), which applies to State agencies, does not address whether designated agencies that are State agencies should expend available program income funds before drawing down Federal funds, as had been the long-standing government-wide requirement under OMB Circulars A-102 and A-110.

This silence creates concern because 2 CFR 200.305(b)(5), which appears to apply to non-Federal entities other than States, requires that those entities expend available program income funds before requesting payments of Federal funds. While the silence in 2 CFR 200.305(a) creates an unintended ambiguity, we do not believe that this ambiguity should be construed to change the prior rule and remove the requirement that State agencies must expend program income funds before requesting additional Federal cash. No such policy change was discussed in the preambles to either the OMB final guidance in 2 CFR part 200, which was published on December 26, 2013 (78 FR 78589), or in the Interim Final Guidance published on December 19, 2014 (79 FR 75867).

Therefore, we believe it is essential that we resolve this unintended ambiguity here. To that end, we have amended § 370.47 in these final regulations to make clear that all designated CAP agencies, regardless of their organizational structure, must expend program income before drawing down Federal funds. In so doing, we have revised final § 370.47(b)(2)(ii) to explicitly require CAP grantees to expend available program income funds before requesting additional cash payments, as was the long-standing requirement under former 34 CFR 74.22(g) and 80.21(f)(2).

We believe the change is essential to protect the Federal interest by using program income to increase the funds devoted to the CAP program and keeping to a minimum the interest costs to the Federal government of making grant funds available to the designated agencies. This change should not negatively affect designated CAP agencies that are State agencies because it merely maintains the status quo that existed under 34 CFR 80.21(f)(2).

We also have revised final § 370.47(b)(2) by requiring CAP grantees to use program income only to supplement the CAP grant. Upon closer examination of the grant formula set forth in the statute, we have concluded that the use of the deduction method would, in effect, result in a reduction of a CAP's grant allotment. Absent specific statutory authority, such reductions would be inconsistent with the statute and general appropriations law principles. In reviewing the grantees' financial reports, we have found that very few, if any, designated CAP agencies elect to use the deduction method. Instead, most, if not all, grantees elect to use the addition method, which is still permissible and, in fact, will be the only permissible use of program income under these CAP final regulations. We do not believe this change will negatively affect any grantee.

Changes:

We have revised final § 370.47(b)(2) to permit grantees to use program income only to supplement their CAP grant and to remove all references to the deduction method. We have also added a new § 370.47(b)(2)(ii) to make clear that all designated CAP agencies must disburse program income prior to drawing down Federal funds or, as stated in 2 CFR 200.305(b)(5), “requesting additional cash payments.” Finally, we have made other technical and conforming edits.

American Indian Vocational Rehabilitation Services Program (AIVRS), 34 CFR Part 371

Tribal Consultation

Consistent with Executive Order 13175, “Consultation and Coordination With Indian Tribal Governments,” in addition to seeking input from Indian tribal governments through the public comment process, the Department conducted tribal consultations to obtain input on the proposed changes in the AIVRS program. We hosted a webinar on June 9, 2015, and invited written comments from tribal officials, tribal governments, tribal organizations, and affected tribal members. We provided an overview of the AIVRS NPRM and the proposed changes to the regulations governing the program as a result of WIOA and WIA, and we asked for tribal input regarding those proposed changes.

When announcing the tribal consultation, the Department acknowledged that it was somewhat unusual to ask for tribal input after an NPRM was published, but WIOA's requirement to publish an NPRM within six months for all the programs contained in the Rehabilitation Act, including regulations with the Department of Labor implementing the requirements for a joint state plan for the State Vocational Rehabilitation program, precluded the Department from engaging in a tribal consultation process before it needed to publish the NPRM. The consultation process also had to proceed quickly so that the Department could receive the comments before the public comment period for the NPRM ended in order for those

comments to be considered. Despite these constraints, the Indian community responded thoughtfully during the consultation process and provided 42 comments, many of them unique. Those comments were considered and are addressed along with the other public comments here.

Summary of Changes

In the preamble of the NPRM, we discussed on pages 20994 through 20998 the major changes proposed to part 371 implementing the amendments to the AIVRS program made by WIOA. These included (1) the expansion of the definition of “Indian” to include natives and descendants of natives under the Alaska Native Claims Settlement Act, (2) the amendment of the definition of “Indian tribe” to include a “tribal organization,” and (3) amendments to subpart B to require the reservation of not less than 1.8 percent and not more than 2 percent of the funds for the AIVRS program for the provision of training and technical assistance to the governing bodies of Indian tribes and consortia of those governing bodies eligible for a grant under this program.

The amendments to part 371 also implement changes made by WIA in 1998 that have not previously been incorporated, such as the expansion of services to American Indians with disabilities living “near” a reservation, as well as “on” a reservation, and the change of the project period from up to three to up to five years. Additionally, we incorporate relevant sections of part 369, which the Department proposed in the NPRM to repeal, and relevant sections of part 361, particularly definitions found in each of those parts.

There are a few differences between the NPRM and these final regulations. Section 371.2(a)(2) now explicitly requires approval of the tribal government before a tribal organization may apply for an AIVRS grant and provide services to tribal members. We made a minor change in § 371.2(a)(3) to make the language consistent with § 371.2(a)(1). We modified the definition of “supported employment” in § 371.6 to reflect changes we made to the definition in 34 CFR 361.5(c)(53) so that the term is used identically in both the State VR program and the AIVRS program. We revised § 371.14 to give the Secretary the discretion to conduct the application process and make the subsequent award in accordance with 34 CFR part 75, but not require it. As a means of implementing the statutory requirement that the Secretary give priority consideration to applications for the continuation of programs that have been funded under section 121, we added paragraph (b) to § 371.32 to authorize the Secretary to provide a competitive preference to applicants who previously received an AIVRS grant. Finally, after further departmental review, we revised § 371.44 by requiring that Tribal Vocational Rehabilitation units enter into written agreements with organizations and entities when sharing personal information for the purposes of evaluations, audits, research and other program purposes.

Public Comment:

In response to our invitation in the NPRM, 65 parties submitted comments on the proposed regulations amending the AIVRS program (part 371). We received comments in support of most of the proposed regulations, and we received comments questioning or opposing some. We thank the commenters for their support. We discuss only those comments that questioned or opposed particular regulations, and we organize our discussion by subject.

Funding for the AIVRS Program

Comments:

Under Section 100(c)(1)-(2) of the Act, the AIVRS program is funded annually through a set-aside of not less than 1 percent and not more than 1.5 percent of the funds appropriated for the State Vocational Rehabilitation (VR) program. A number of commenters requested that the Department increase the funds available for AIVRS projects by setting aside the maximum allowable level of 1.5 percent. Most of these commenters argued that an increase in the set-aside was needed to offset the effect of the new training and technical assistance requirement on the funding available to operate AIVRS projects and asked the Department to take this into consideration in determining the annual set-aside.

Discussion:

The level of funding set aside for the AIVRS program under Section 100(c)(1)-(2) of the Act is outside of the scope of the proposed rules. However, the Department is aware that the new reservation of funds for training and technical assistance, coupled with the sequester of mandatory funds under the Budget Control Act of 2011 (Pub. L. 112-25), has in recent years reduced the funds available to operate AIVRS projects and provide services to American Indians with disabilities. The Department will take these and other factors into account when determining the annual level of the AIVRS set-aside.

Changes:

None.

Comments:

One commenter objected generally to the amount provided for the AIVRS program, stating that the government funds minority groups inequitably and gives too much to American Indians “just for being Indian.”

Discussion:

The commenter's statement is outside the scope of this rulemaking. The Department is implementing a program funded by Congress based on a recognized need for vocational rehabilitation services for American Indians with disabilities.

Changes:

None.

60-Month Project Period—§ 371.4

Comments:

Some commenters proposed that, instead of limiting funding for AIVRS projects to five years, AIVRS projects ought to be funded permanently. These commenters stated that to compete for funds every five years, not knowing if the project will be re-funded, makes it difficult to ensure continuity of services and operate an efficient and effective program. Many of these commenters recommended that AIVRS projects, once funded, continue to be funded based on decisions from monitoring and technical assistance rather than competing for new awards every five years, much like the Centers for Independent Living program under Title VII of the Act, and some also recommended that each project receive an annual cost-of-living increase.

Discussion:

Section 121(b)(3) provides that grants can be effective for up to 60 months. Because the AIVRS program is a discretionary grant program, there is no statutory authority for the Commissioner to provide permanent funding. Section 121 does not provide authority similar to that for the Centers for Independent Living program under Part C of Title VII of the Act, which permits continued funding without competition. The Department can only continue to provide funds to a grant beyond 60 months if, given exceptional circumstances, the Secretary publishes a rule that waives the requirements of 34 CFR 75.250 and 75.261(c)(2), which limit project periods to 60 months and restrict project period extensions that involve the obligation of additional Federal funds.

As for annual cost-of-living increases, there are no provisions in the statute that permit the Commissioner to provide automatic cost-of-living increases to all grantees. A grantee may request a cost-of-living increase when filing its annual performance report and budget, and the request must provide a justification for the increase. The Commissioner will review and approve or disapprove requests for a cost-of-living increase case-by-case.

Changes:

None.

Consolidation of AIVRS With Other Employment and Training Programs

Comments:

Two commenters requested that tribes that consolidate their employment and training programs under Public Law 102-477 (25 U.S.C. 3401,

et seq.

) be able to add the AIVRS program to the programs they are able to consolidate under that statute.

Discussion:

This request is outside the scope of this rulemaking. In any event, the Department would be unable to grant it because the AIVRS program is not eligible for consolidation under Public Law 102-477 (25 U.S.C. 3401,

et seq.

The Indian Employment, Training and Related Services Demonstration Act of 1992 (Pub. L. 102-477) is a statute under which the Secretary of the Interior, in cooperation with the appropriate Secretary of Labor, Health and Human Services, or Education, upon the receipt of a plan submitted by an Indian tribal government, may authorize it to coordinate and integrate its federally funded employment, training, and related services programs into a single, coordinated, comprehensive program, which reduces administrative costs. Section 5 of that Act (25 U.S.C. 3404), however, makes clear that the only programs that may be integrated in a plan submitted by a tribe are those under which an Indian tribe is eligible for receipt of funds under a statutory or administrative formula. Because the AIVRS program is a discretionary grant program, not a formula grant program, it is not eligible for consolidation under Public Law 102-477.

Changes:

None.

Training and Technical Assistance Funding (§§ 371.10-371.14)

Comments:

A number of commenters recognized the value of training and technical assistance and expressed support for these activities. However, most of these commenters did not believe that these activities should be provided at the expense of services for tribal VR consumers. While some commenters stated that tribal consumers would be better served by continuing to fund direct services rather than training for tribal vocational rehabilitation programs, others expressed the need for more balance in the funding of these activities.

Discussion:

New provisions in section 121(c) of the Act, implemented in subpart B of the AIVRS regulations, require the Commissioner to reserve not less than 1.8 percent and not more than 2 percent of the funds set aside for the AIVRS program for training and technical assistance to the governing bodies of Indian tribes, and consortia of those governing bodies, eligible for a grant under this program. While the Act provides the Department with the authority to determine the amount of the reservation within the statutory parameters, taking into consideration the needs of the AIVRS program, it must reserve at least 1.8 percent of the funds set aside for the AIVRS program. The Department believes that the rules in §§ 371.11 through 371.14 implementing section 121(c), as well as the rigorous requirements for training and technical assistance grantees contained in the regulatory priorities applicants must meet, will help to ensure that the training and technical assistance provided is designed to help improve the operation of AIVRS projects and the quality of services provided to their consumers.

Changes:

None.

Comment:

Two commenters recommended that the Department consider and explore alternate funding sources for training and technical assistance for the AIVRS program. One of these commenters suggested that these activities should be funded as a set-aside under the training and technical assistance component of the Act.

Discussion:

While we appreciate the commenters' suggestions, the Department is required to reserve funds for this purpose from the AIVRS set-aside, consistent with section 121(c) of the Act.

Change:

None.

Culturally Appropriate Services (§ 371.1)

Comments:

A number of commenters expressed support for AIVRS providing culturally appropriate vocational rehabilitation services to American Indians with disabilities and for recognizing subsistence as a permissible employment outcome. Some commenters, however, criticized our illustration of culturally appropriate services in the NPRM preamble—“(

i.e.

services traditionally used by Indian tribes)”—as incomplete and requested that we include examples of culturally appropriate services that match the broad diversity of Indian country.

Discussion:

We thank these commenters for their support. Given, however, the large number of American Indian tribes, including Alaskan Native villages and regional corporations, and their widely varying cultural practices, any list of further examples of culturally appropriate practices would also be incomplete and may exclude cultural practices that are unique to some tribes.

Changes:

None.

Eligibility

Providing Services “On or Near” the Reservation (§ 371.3)

Comments:

In response to the proposed language that AIVRS projects provide services to American Indians with disabilities who live on “or near” the reservation, some commenters requested guidance on how to define “near.” Other commenters stated that as a matter of tribal sovereignty, it should be left to the tribes, not the Federal government, to define “near” and to define their service areas, which they do in other contexts such as working with the U.S. Census Bureau or in other Federal programs.

Discussion:

We agree with the commenters that it should be the tribes who define “near” the reservation. The change allowing AIVRS projects to serve American Indians with disabilities who live “near” a reservation, as well as “on” a reservation, was made by the Workforce Investment Act (WIA), Public Law 105-120, in August 1998. We proposed adding “or near” to § 371.3 because, although we had implemented the statutory change in 1998, the regulations had not yet been updated to reflect the change. Consistent with our current practice under the statutory requirements, applicants for AIVRS grants will, as part of their applications, continue to define the service areas in which, and the populations to whom, they will provide services. RSA staff is always available to assist grantees or potential grantees in determining appropriate service areas for AIVRS grants that meet the criteria of “on or near” the applicant's reservation.

Changes:

None.

Tribal Organizations (§ 371.2, § 371.6—definitions)

Comment:

Some commenters objected to proposed § 371.2(a)(1)(ii), which makes tribal organizations eligible applicants under AIVRS. These commenters pointed out that tribal organizations, like some “urban” Indian organizations, need not be tribal governmental entities or even affiliated with tribes. As such, tribal organizations may not be sufficiently responsible to tribal governments, they may temporarily create programs just to establish eligibility, and they may take funding away from established AIVRS programs and from consumers in need of VR services.

Many other commenters requested that, while tribal organizations may be eligible for AIVRS grants, we should require an application from any tribal organization to have the approval of the tribe or tribes it plans to serve. A few

commenters asked who or what office must issue this approval; a few others noted that securing the necessary approvals may be difficult because an AIVRS project may provide services to members of several different tribes. Finally, some commenters suggested that there be a single tribal entity within the tribal government to conduct all AIVRS activities.

Discussion:

The amendments to WIOA added “tribal organizations” to the definition of “Indian tribe” in section 7(19)(B) of the Act. Because Indian tribes are eligible for grants under the AIVRS program, in § 371.2, the Department is implementing a statutory requirement: Tribal organizations are eligible for AIVRS grants. Specifically, Section 7(19)(B) includes in the definition of “Indian tribe,” “a tribal organization (as defined in section 4(l) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(l)).” Section 371.6 of the regulations adopts that definition. Under § 371.6, a tribal organization is:

1. The recognized governing body of any Indian tribe; or

2. Any legally established organization of Indians that is controlled, sanctioned, or chartered by the governing body of an Indian tribe; or

3. Any legally established organization of Indians that is democratically elected by the adult members of the Indian community to be served by the organization and that includes the maximum participation of Indians in all phases of its activities.

As such, if the organization is not the actual governing body of the tribe, it nevertheless has close ties to the governing body because the body has created it, authorized it, or is actually controlling it, or the organization has close ties to the tribal members because they have elected the membership of the tribal organization. Therefore, we do not believe that the concern expressed about “urban” tribal organizations that are unaffiliated with tribes competing with existing AIVRS projects, perhaps by creating pretextual vocational rehabilitation programs, is a likely outcome of this regulatory change. We also note that the tribal organization must also meet the other eligibility requirements under § 371.2(a), including that they be located on Federal or State reservations. If the tribal organization is not a tribal governing body, then the tribes that make up the tribal organization have to meet the reservation requirement, again creating a close connection with the tribes themselves.

Although we believe that the definition of “tribal organization” already requires a close connection with an Indian tribe, we agree with the commenters that applications from tribal organizations should have the approval of the tribal governments the organizations seek to serve. In part, the proposed regulations already required this.

If a tribal organization serves more than one tribe, § 371.2(a)(3) requires the organization to obtain the approval of each of the tribes it seeks to serve. This requirement already applies to a consortium and a tribal government seeking to serve more tribes than its own. However, the proposed regulations did not explicitly require a tribal organization that is not a tribal government and seeks to serve only one tribe, to obtain approval to apply for an AIVRS grant from that tribal government.

We are, therefore, adding this requirement as § 371.2(a)(2)(ii). This will ensure that it is the tribal governments that ultimately have the authority to determine the services provided to their members and the entity authorized to provide those services.

Approval must be a formal action taken by the tribal government. It will often come in the form of a resolution from the tribal council. However, as the forms of government among the tribes are so many and varied, we cannot make an exhaustive list of the entity that must issue the approval or specify what form the approval must take. It may be sufficient for the tribal council to authorize a tribal organization to apply for any health or social service grant on its behalf and provide those services to its members. The council may not have to pass resolutions for each grant application. However, these are matters dictated by tribal law, as is the decision regarding the entity that will provide tribal vocational rehabilitation services to its members.

As for the difficulty of securing approvals when multiple tribes are to be served, this change merely applies the existing approval requirement for consortia and inter-tribal agreements to tribal organizations, and our experience suggests that there is no great difficulty in securing the necessary approvals. The number of approvals may, in fact, be smaller than commenters suggested. The tribal organization needs approvals only from those tribes on (or near) whose reservations the tribal organization plans to provide services. The tribal organization is under no obligation to identify the tribal affiliation of all residents of those service areas who the AIVRS project may serve and who may have a different tribal affiliation, nor must it seek approval from those tribes.

Changes:

We have amended § 371.2(a)(2) and added new § 371.2(a)(2)(ii) to require that, in order to receive a grant under this section, a tribal organization that is not a governing body of an Indian tribe must have the approval of the tribe to be served by the organization.

Who may make an application under the AIVRS Program? (§ 371.2)

Comments:

None.

Discussion:

Section 371.2(a) implements the statutory authorization that permits applications for the AIVRS program to be made by the governing bodies of Indian tribes or consortia of those governing bodies. Section 371.2(a)(1) implements the Education Department General Administrative Requirement at 34 CFR 75.128 that groups of applicants can only apply either by designating one member of the group—one of the governing bodies—to apply on behalf of the group or by establishing a separate eligible legal entity to apply for the group. In the proposed regulations, § 371.2(a)(3) discussed grants being made to “the governing body of an Indian tribe, a consortium of those governing bodies, or a tribal organization.” However, in order to be consistent with 34 CFR 75.128 and § 371.2(a)(1), § 371.2(a)(3) must recognize that grants cannot go to a consortium itself but must go to a tribal governing body or a tribal organization on behalf of the consortium.

Changes:

We have revised final § 371.2(a)(3) to reflect that grants are made to “the governing body of an Indian tribe, either on its own behalf or on behalf of a consortium, or to a tribal organization. . . .”

Who Is Eligible To Receive Services (§ 371.3)

Comment:

A few commenters expressed concern about providing services to descendants of Alaska Natives. They asked about who determines their tribal membership and how those services would be funded.

Discussion:

Section 371.3 implements the statutory authorization in section 121(a) of the Act that makes American Indians with disabilities who reside on or near reservations eligible for services under AIVRS. WIOA amended Section 7(19)(A) to include within the definition of “American Indian” a “Native and a descendant of a Native as such terms are defined in subsections (b) and (r) of section 3 of the Alaska Native Claims

Settlement Act (ANCSA), 43 U.S.C. 1602.”

“Native” is defined in subsection (b) of section 3 of ANCSA as a citizen of the United States who is a person of one-fourth degree or more Alaska Indian (including Tsimshian Indians not enrolled in the Metlakatla Indian Community) Eskimo, or Aleut blood, or combination thereof. The term includes any Native as so defined either or both of whose adoptive parents are not Natives. It also includes, in the absence of proof of a minimum blood quantum, any citizen of the United States who is regarded as an Alaska Native by the Native village or Native group of which he claims to be a member and whose father or mother is (or, if deceased, was) regarded as Native by any village or group. Alaska native villages and regional village corporations are included in the Rehabilitation Act's definition of “Indian tribe,” and Alaska Natives are their members.

“Descendant of a Native” is defined in subsection (r) in section 3 of ANCSA as—

(1) A lineal descendant of a Native or of an individual who would have been a Native if such individual were alive on December 18, 1971, or

(2) An adoptee of a Native or of a descendant of a Native, whose adoption—

(A) Occurred prior to his or her majority,

and

(B) Is recognized at law or in equity.

We understand the essence of the commenters' concern to be that the Act makes descendants of natives eligible for services under AIVRS, but not all descendants of natives are members of their parents' native corporations or tribes, potentially resulting in AIVRS projects providing services to non-tribal members. However, the Act does not require tribes to make any determination about the membership status of those eligible; it merely prescribes the pool of individuals eligible for services funded by Federal money. While this change in the American Indians with disabilities eligible for services may increase the number of consumers seeking services, we do not believe it will be such a substantial increase that the affected AIVRS projects cannot absorb it.

Changes:

None.

Definitions of “Competitive Integrated Employment,” “Employment Outcome,” and “Subsistence” (§ 371.6)

Comments:

Some commenters expressed strong support for the definitions of “competitive integrated employment,” “employment outcome,” and “subsistence” in § 371.6. Several commenters recommended that the Secretary continue to recognize homemaker and unpaid family worker outcomes as appropriate vocational outcomes for purposes of the AIVRS program.

Alternatively, a few commenters suggested that we include homemaker and unpaid family worker outcomes within the definition of “subsistence.” One commenter recommended that we include a note in the definition of “employment outcome” that subsistence occupations are approved employment outcomes. Another commenter asked if we intend that the definition of “subsistence” apply only to individuals served through the AIVRS program or if it applies to all individuals served through the VR program, including those individuals who live in rural areas where few opportunities for competitive integrated employment exist. This commenter also asked if we propose any limits on hobby-type activities as self-employment outcomes.

One commenter requested that we clarify the meaning of “culturally appropriate” as used in the definition of “subsistence” and the preamble to the NPRM covering the VR program regulations by providing examples.

Finally, one commenter recommended that we standardize the definition of “competitive integrated employment” in § 371.6 with the definition of that term in 34 CFR 361.5(c)(9) for the State Vocational Rehabilitation (VR) Services program, noting that the two definitions vary in some technical respects.

In light of the interrelationship between the terms “competitive integrated employment,” “employment outcome,” and “subsistence,” we address the comments on these definitions together.

Discussion:

We appreciate the support expressed by the commenters. We believe that consistency in interpretation and implementation of the regulations governing the AIVRS and VR programs is essential given the large number of American Indians and Alaskan Natives with disabilities who are eligible for services from both programs, some of whom may be served by the programs sequentially or even simultaneously.

This is imperative for the definition of “employment outcome,” which is the basis for services provided by both programs. As explained in more detail in the final regulations governing the VR program published elsewhere in this issue of the

Federal Register

, we have eliminated uncompensated outcomes, including homemaker and unpaid family worker outcomes, from the scope of the definition of “employment outcome” in 34 CFR 361.5(c)(15). Although section 7(5) of the Act, as amended by WIOA, permits the Secretary to include within this definition other appropriate vocational outcomes, the Secretary must exercise this discretion in a manner consistent with the Act.

Because of the extensive emphasis on competitive integrated employment throughout the Act, as amended by WIOA, it is no longer consistent with the Act to include uncompensated outcomes within the scope of the definition of “employment outcome.” Because we believe it is necessary to implement the term consistently under both the VR and AIVRS programs, we cannot include homemaker and unpaid family worker outcomes within the scope of the definition of “employment outcome” solely for the purposes of the AIVRS program as the commenters requested. For these reasons also, we disagree with the recommendation to include homemaker and unpaid family worker outcomes within the definition of “subsistence” in § 371.6, which is defined as a form of self-employment and, thus, considered an allowable employment outcome under both the AIVRS and VR programs.

We define “subsistence” in § 371.6 for purposes of the AIVRS program to mean a form of self-employment in which individuals use culturally relevant or traditional methods to produce goods or services for household consumption or non-commercial barter and trade that constitute an important basis for the individual's livelihood. The definition of “employment outcome” in 34 CFR 361.5(c)(15) encompasses all forms of competitive integrated employment and specifically mentions self-employment. Because we consider subsistence occupations to be a form of self-employment, these occupations are already within the scope of the definition of “employment outcome,” and it is not necessary to revise the definition to refer specifically to subsistence as recommended by the commenters.

To ensure consistency in the interpretation of “competitive integrated employment” under both the VR and the AIVRS programs, we stated in the preamble to the NPRM for the VR program that we understand subsistence employment as a form of self-employment common to cultures of many American Indian tribes (see NPRM, State Vocational Rehabilitation Services Program, Supported Employment Services Program, and

Limitations on the Use of Subminimum Wage, 80 FR 21059, April 16, 2015). We do not intend that statement, or the inclusion of the definition of “subsistence” only in § 371.6, to limit services designed to assist individuals to achieve subsistence occupations to those served through the AIVRS program.

In addition, while we believe that subsistence occupations are most culturally relevant to American Indian and Alaskan Native tribes, we recognize that individuals may engage in traditional occupations in other native cultures. Thus, DSUs may find it appropriate to assist individuals from cultures other than American Indian and Alaskan Native tribes, such as individuals living in the Territories, to achieve self-employment in subsistence occupations. However, because the definition of “subsistence” in § 371.6 requires that the subsistence occupation be culturally relevant to the individual, we decline to extend the applicability of subsistence occupations to other individuals solely on the basis of their location in rural areas, even though there may be few opportunities for competitive integrated employment in those areas. Examples of subsistence occupations that are culturally relevant to American Indian or Alaskan Native tribes can include the exchange of fish caught, or grain raised, by the individual with the disability for other goods produced by other members of the tribe that are needed by the individual to live and maintain his or her home. Given, however, the large number of American Indian tribes, including Alaskan Native villages and regional corporations, and their widely varying cultural practices, any list of further examples of culturally relevant practices would also be incomplete and may exclude cultural practices that are unique to some tribes.

Since the definition of “subsistence” in § 371.6 requires that the activity be important to the individual's livelihood, AIVRS grantees cannot provide services to enable individuals to engage in mere hobbies, as hobbies do not meet the criteria for self-employment as an employment outcome.

Finally, to avoid any misperception that the definitions of “competitive integrated employment” in 34 CFR 361.5(c)(9) pertaining to the VR program and that in § 371.6 applicable to the AIVRS program differ based on the lack of technical consistency, we have made the definitions identical.

Changes:

We have made the definition of “competitive integrated employment” in final § 371.6 consistent with the definition of that term in 34 CFR 361.5(c)(9) by making technical changes.

Definition of “Supported Employment” (§ 371.6)

Comment:

One commenter noted that the definition of “supported employment” in the Act no longer includes “transitional employment for individuals with mental illness” and recommended that we remove reference to this type of employment from the definition of “supported employment.”

Discussion:

Many other organizations and individuals submitted comments, in addition to the one comment discussed here submitted in connection with the AIVRS regulations, on the definition of “supported employment” in the proposed State VR regulation, 34 CFR 361.5(c)(53). We discuss all of these comments in detail in the final rule amending 34 CFR 363, published elsewhere in this issue of the

Federal Register

. As a result of those comments, we have removed the reference to “transitional employment” from the definition of “supported employment” in § 361.5(c)(53) and have made other conforming changes to the definition of “supported employment” in § 371.6 so that it is consistent with the definition in § 361.5(c)(53).

Changes:

We have revised the definition of “supported employment” in final § 371.6 so that it is substantively identical to the definition of that term in § 361.5(c)(53). The only difference between the two definitions is that where § 361.5(c)(53) refers to a “Designated State Unit,” the service provider under the State VR program, the definition in § 371.6 refers to the “Tribal Vocational Rehabilitation Unit,” the appropriate term for the service provider under AIVRS.

Pre-Employment Transition Services and Coordination With AIVRS Projects (34 CFR 361.48(a), 34 CFR 361.24(d), and 34 CFR 361.65)

Comment:

Some commenters recommended that State VR agencies be required to include in their formal interagency agreements with AIVRS projects and to address in agreements with Tribal Education Agencies in the State how the State VR agency plans to provide equitable pre-employment transition services to American Indian students and American Indian youth with disabilities and how services to American Indian students with disabilities will be incorporated into the budgeting and spending plans for the State's 15% set aside for transition of students with disabilities.

Discussion:

We note at the outset that only American Indian students with disabilities, rather than American Indian youth with disabilities, are eligible for pre-employment transitions services, as explained in more detail in the discussion of comments on 34 CFR 361.48(a) in the final rule amending part 361 published elsewhere in this issue of the

Federal Register

. While we understand the commenters' concerns regarding the need to ensure that coordination among the DSU, AIVRS program, and educational agencies is taking place and that transition services, including pre-employment transition services, are provided to American Indian students with disabilities, the Department believes that the final regulations in part 361 accomplish this. The final regulation at 34 CFR 361.24 addresses the need for coordination among these entities and for providing transition services to American Indians living on or near a reservation. Section 361.24(d)(1) requires the VR services portion of the Unified or Combined State Plan to include a formal cooperative agreement with AIVRS programs. Section 361.24(d)(2) sets out requirements for that cooperative agreement, and those include strategies for providing transition planning under § 361.24(d)(2)(iii). Furthermore, the Federal funds reserved in accordance with 34 CFR 361.65, and any funds made available from State, local, or private funding sources, are to be used to provide pre-employment transition services to all students with disabilities, including American Indian students with disabilities, in need of such services. We also discuss comments on these sections in more detail in the final rule amending 34 CFR part 361 published elsewhere in this issue of the

Federal Register

.

Changes:

None.

Definition of “Transition Services” (34 CFR 361.5(c)(55) and 371.6)

Comments:

None.

Discussion:

We have made changes to the definition of “transition services” in final § 371.6 to make it consistent with the definition of that term in final 34 CFR 361.5(c)(55) for purposes of the AIVRS program. Specifically, we revised the definition to clarify that it applies to students and youth with disabilities and includes outreach to parents, or, if appropriate, representatives of the student or youth.

Changes:

We have revised the final § 371.6 so that the definition of “transition services” is consistent with the definition of the term in final 34 CFR 361.5(c)(55).

Evaluation of an Application for a Training and Technical Assistance Award (§ 371.14(b))

Comment:

A number of commenters recommended that, for a training and technical assistance award, the Secretary make mandatory a 10-point competitive preference priority for applications that include as project personnel in a substantive role individuals who have been employed by a tribal VR unit as a project director or VR counselor.

Discussion:

While we believe that this competitive preference priority in final § 371.14(b) should be available to the Secretary to implement the training and technical assistance requirement of section 121(c)(2) of the Act, we disagree with the commenters that the priority should be mandatory and that it should always be worth 10 points. When appropriate to an AIVRS training and technical assistance competition, we will publish this competitive preference priority, and its point value, in the notice inviting applications for the competition.

Changes:

None.

How does the Secretary evaluate an application? (§ 371.14(c))

Comments:

None.

Discussion:

When WIOA added a training and technical assistance authority to the AIVRS program, it gave the Secretary the ability to make awards by grant, cooperative agreement or contract. Since the Department generally makes these awards by grants using the procedures in part 75, which uses the peer review process identified in the statute, we added a subsection to the NPRM that provided that the Secretary would use the procedures in part 75, even when awarding a contract. However, upon further reflection, we have determined that there may be circumstances when the Department has an amount of funds that is too small to compete but could be used to support a contract consistent with the training and technical assistance authority, in the form of a task order or modification under an existing Department contract for example, in which case, the Department would not want to use the grant processes in part 75. Therefore, we have determined that it is more appropriate to change the language in this subsection to give the Secretary the authority to use part 75 if awarding a contract, where the Secretary determines it is appropriate but not require its use.

Changes:

We have revised final § 371.14(c) to give the Secretary the discretion to conduct the application process and make the subsequent award in accordance with 34 CFR part 75, but not require it.

What other factors does the Secretary consider in reviewing an application? (§ 371.32)

Comment:

A number of commenters recommended that, in addition to the competitive preference priority for the training and technical assistance award in § 371.14(b), the Secretary also make mandatory a 10-point competitive preference priority for applications for the AIVRS program that include as project personnel in a substantive role individuals who have been employed by a tribal VR unit as a project director or VR counselor.

Discussion:

We do not believe that this competitive preference is appropriate for the AIVRS program, whereas it is appropriate for the training and technical assistance program. While the quality of the project personnel is part of the selection criteria for both projects, the training and technical assistance applicants generally have a primary background in providing training, not necessarily VR services or VR services to American Indians. The competitive preference for training and technical assistance is a way to encourage applicants to consider personnel who have a background in the appropriate training and familiarity with the community that will be receiving the technical assistance. By contrast, the AIVRS projects require personnel with experience in tribal VR services.

We do think, however, that this regulatory section should include a provision implementing the statutory requirement to give priority consideration to applications for the continuation of programs that have been funded under section 121. Although the Department has implemented this statutory requirement through its notices inviting applications, we believe it is appropriate to have a corresponding regulatory provision for the statutory requirement.

Changes:

We have added final § 371.32(b), which provides that the Secretary may award a competitive preference to applications for the continuation of programs that have previously been funded under this program.

Stipends

Comment:

One commenter stated that tribal vocational rehabilitation programs should be able to pay a stipend for on-the-job training and work experiences as is done under the State VR program.

Discussion:

On-the-job training (OJT) and other work experiences (

e.g.

internships) are allowable vocational rehabilitation services for individuals under the State VR program (34 CFR 361.48(b)(6)) and the definition section of the AIVRS program regulations (final § 371.6(b)). A VR agency or AIVRS project may provide paid work experiences, such as OJT and internships, as a VR service so long as the agency determines that it is necessary for the individual to achieve an employment outcome. In all instances, the VR agency purchases goods or a service that benefit the consumer. Since the work experience is considered the goods or service, the VR agency “purchases” it from the employer and reimbursement is provided to employers for these paid work experiences. This is typically done through a contract between the vocational rehabilitation program and an employer under which funds may be included that would assist the employer in providing compensation to the trainee.

Changes:

None.

What are the special requirements pertaining to the protection, use, and release of personal information? (§ 371.44)

Comments:

None.

Discussion:

We anticipate that other Federal and State agencies, and researchers will have an increased interest in using the data required to be collected by programs established under the Act, including the AIVRS program. Therefore, after further departmental review, we have strengthened the protection of the confidentiality of personal information collected by the AIVRS program by requiring in final § 371.44 that Tribal Vocational Rehabilitation units enter into written agreements with any entity seeking access to this information for the purpose of audits, evaluations, research, or for other program purposes. This change is consistent with revisions to final 34 CFR 361.38 governing the protection of confidentiality of personal information collected by the VR program.

Changes:

We have revised final § 371.44(a), (d), and (e)(1) by requiring that Tribal Vocational Rehabilitation units enter into written agreements with other organizations and entities receiving personal AIVRS program information during the conduct of audits, evaluations, research, and for other program purposes.

Rehabilitation National Activities Program, 34 CFR Part 373

Summary of Changes

In the preamble of the NPRM, we discussed on pages 20998 through 20999 the major changes proposed to part 373 implementing the amendments to the Rehabilitation National Activities Program made by WIOA. These include: (1) A new name for the program—the Rehabilitation National Activities Program—that better describes the broad nature of the types of activities that may be funded under this authority; (2) as appropriate, the addition of a definition of “vocational rehabilitation services” and the replacement of the term “rehabilitation services” with “vocational rehabilitation services;” (3) the addition of two new statutory priorities pertaining to transition from education to employment and competitive integrated employment; and (4) the addition of four priorities to address the technical assistance and training needs of State vocational rehabilitation agencies and their personnel.

In addition to minor editorial and technical revisions, there is one difference between the NPRM and these final regulations. In final § 373.4, we added a paragraph (3) to the definition of “early intervention” that lists individuals receiving disability benefits from an employer's disability insurance policy.

Public Comment:

In response to our invitation in the NPRM, four parties submitted comments on the proposed regulations amending the Rehabilitation National Activities Program (part 373). We set out our analysis by section.

§ 373.4 Definitions, Early Intervention

Comment:

One commenter noted that people with emerging disabilities or disabilities that have increased in severity are among those most at risk for loss of employment. For these people, entering onto an employer's disability insurance plan is often the first step to public disability benefits. The commenter therefore recommended that we add this population to the list of example populations in the definition of “early intervention” in proposed § 373.4 that may receive early intervention services.

Discussion:

We agree with the commenter. As the populations listed in the definition are illustrative and not exclusive, we believe it is appropriate to call attention to this at-risk population.

Change:

We add a new paragraph (3) to the definition of “early intervention” that lists individuals receiving disability benefits from an employer's disability insurance policy.

§ 373.4 Definitions, “Individual With a Disability”

Comment:

One commenter suggested updating the definition of “Individual with a Disability” to follow 2008 statutory changes in the Americans With Disabilities Act.

Discussion:

This definition is based upon the definition in section 7 of the Act and thus cannot be changed to conform to a definition in another statute.

Changes:

None.

Protection and Advocacy of Individual Rights Program (PAIR), 34 CFR Part 381

Summary of Changes

In the preamble of the NPRM, we discussed on pages 20999 through 21001 the major changes proposed to part 381 that would implement the amendments to the PAIR program made by WIOA and WIA. With regard to the statutory changes made to section 509 by WIA, we proposed adding the protection and advocacy system serving the American Indian Consortium as an entity eligible to receive a PAIR grant.

With regard to statutory changes made to section 509 by WIOA, we proposed: (1) Clarifying that PAIR grantees have the same general authorities, including to access records and program income, as the protection and advocacy system established under the Developmental Disabilities Assistance and Bill of Rights Act of 2000; and (2) clarifying that the Secretary may award funds for the provision of training and technical assistance for PAIR grantees through a grant, contract, or cooperative agreement.

There are no differences between the NPRM and these final regulations, except that, as a result of further Departmental review, we clarify in final § 381.33(e) requirements governing the use of program income.

Public Comment:

In response to our invitation in the NPRM, three parties submitted comments on the proposed regulations amending the PAIR program (part 381). In general, these commenters support the proposed regulations. We provide an analysis of public comments by subject and section only for the regulation about which we received a request for clarification. In addition, we provide an explanation of the clarification in final § 381.33(e) about the use of program income.

Access to Records (§ 381.10)

Comments:

A few commenters supported the proposed changes to this section that PAIR grantees have the same authority to access records as the protection and advocacy system established under the Developmental Disabilities Assistance and Bill of Rights Act of 2000. However, one commenter recommended further clarifying when PAIR grantees can exercise this access authority by including specific examples. The commenter noted that, while this access authority has been challenged in the States, PAIR grantees ultimately have been successful in exercising this authority.

Discussion:

We appreciate the comments supporting this regulation. We disagree with the comment requesting that we further clarify the circumstances in which PAIR grantees can exercise their authority to access records by including examples in the regulation. As stated in the NPRM, the change is technical in nature as this long-standing authority existed prior to enactment of WIA or WIOA.

Therefore, we believe the proposed regulation was clear that PAIR grantees, as part of the protection and advocacy system, have the same authority to access records provided for under the Developmental Disabilities Assistance and Bill of Rights Act of 2000. For this reason, we believe these final regulations are consistent with the statute and no further change is warranted.

Change:

None.

Program Income (§ 381.33(e))

Comments:

None.

Discussion:

In further reviewing the interplay between § 381.33(e) and 2 CFR 200.305, the Department has determined additional clarification is necessary in final § 381.33(e), particularly with regard to the use of available program income.

There has been a long-standing government-wide requirement under the common rule implementing former OMB Circular A-102, and the former OMB guidance in Circular A-110, as codified by the Department at former 34 CFR 80.21(f)(2) and 74.22(g), respectively, that non-Federal grantees must expend program income prior to drawing down Federal grant funds. The Uniform Guidance, codified at 2 CFR part 200, was adopted by the Department at 2 CFR part 3474 on December 19, 2014 (79 FR 76091) and applies to all new and continuing awards made after December 26, 2014.

The new 2 CFR 200.305 specifies the payment procedures that non-Federal entities must use to draw down Federal funds; however, 2 CFR 200.305(a), which applies to State agencies, does not address whether designated

agencies that are State agencies should expend available program income funds before drawing down Federal funds, as had been the long-standing government-wide requirement under OMB Circulars A-102 and A-110.

This silence creates concern because 2 CFR 200.305(b)(5), which appears to apply to non-Federal entities other than States, requires that those entities expend available program income funds before requesting payments of Federal funds. While the silence in 2 CFR 200.305(a) creates an unintended ambiguity, we do not believe that this ambiguity should be construed to change the prior rule and remove the requirement that State agencies must expend program income funds before requesting additional Federal cash. No such policy change was discussed in the preambles to either the OMB final guidance in 2 CFR part 200, which was published on December 26, 2013 (78 FR 78589), or in the Interim Final Guidance published on December 19, 2014 (79 FR 75867).

Therefore, we believe it is essential that we resolve this unintended ambiguity here. To that end, we have amended § 381.33(e) in these final regulations to make clear that all designated agencies, regardless of their organizational structure, must expend program income before drawing down Federal funds. In so doing, we have revised final § 381.33(e)(2)(ii) to explicitly require PAIR grantees to expend available program income funds before requesting additional cash payments, as was the long-standing requirement under former 34 CFR 74.22(g) and 80.21(f)(2).

We believe this change is essential to protect the Federal interest by using program income to increase the funds devoted to the PAIR program and keeping to a minimum the interest costs to the Federal government of making grant funds available to the designated agencies. This change should not negatively affect designated agencies that are State agencies because this change merely maintains the status quo that existed under 34 CFR 80.21(f)(2).

We also have revised final § 381.33(e)(2) by requiring PAIR grantees to use program income only to supplement the PAIR grant. Upon closer examination of the grant formula set forth in the statute, we have concluded that the use of the deduction method would, in effect, result in a reduction of a PAIR's grant allotment. Absent specific statutory authority, such reductions would be inconsistent with the statute and general appropriations law principles. In reviewing the grantees' financial reports, we have found that very few, if any, designated agencies elect to use the deduction method. Instead, most, if not all, grantees elect to use the addition method, which is still permissible and, in fact, will be the only permissible use of program income under the PAIR program final regulations. We do not believe this change will negatively affect any grantee.

Changes:

We have revised final § 381.33(e)(2) to permit grantees to use program income only to supplement their PAIR grant and removed all references to the deduction method. We have also added a new § 381.33(e)(2)(ii) to make clear that all designated agencies must disburse program income prior to drawing down Federal funds or, as stated in 2 CFR 200.305(b)(5), before “requesting additional cash payments.” Finally, we have made other technical and conforming edits in final § 381.33.

Rehabilitation Training Program, 34 CFR Part 385

Summary of Changes

In the preamble of the NPRM, we discussed on pages 21001 through 21002 the major changes proposed to part 385 implementing the amendments to the Rehabilitation Training Program made by WIOA. These include: (1) Adding supported employment and economic and business development programs to the list of programs that may benefit individuals with disabilities; (2) emphasizing the importance of maintaining and upgrading the skills of personnel who provide supported employment services and customized employment services to individuals with the most significant disabilities, as well as personnel assisting individuals with disabilities whose employment outcome is self-employment, business ownership, or telecommuting; (3) adding a definition of “vocational rehabilitation services” and replacing the term “rehabilitation services” with “vocational rehabilitation services” as appropriate; and (4) adding definitions of “supported employment” and “assistive technology” consistent with definitions in title I of the Act.

Except for minor editorial and technical revisions, there are no differences between the NPRM and these final regulations.

Public Comment:

In response to our invitation in the NPRM, four parties submitted comments on the proposed regulations amending the Rehabilitation Training Program (part 385). We provide our analysis by subject.

General

Comment:

One commenter recommended a requirement that training program personnel consult with small business development centers. This commenter also recommended a requirement that training programs consult with workforce board business representatives about effective telecommuting and entrepreneurship practices in their area.

Discussion:

We agree that training personnel should consult with other professionals knowledgeable about small business development, since self-employment is an excellent employment option for some individuals with disabilities. For the same reason, we agree that consultation about telecommuting and entrepreneurship is appropriate. Nothing in the proposed regulations would preclude training programs or their personnel from consulting as the commenter recommends, but requiring this consultation is potentially burdensome and unnecessary.

Changes:

None.

§ 385.4 Definitions, “Individual with a Disability”

Comment:

One commenter suggested updating the definition of “Individual with a Disability” to align it with 2008 statutory changes in the Americans With Disabilities Act.

Discussion:

This definition is based upon the definition in section 7 of the Act and thus cannot be changed to conform to a definition in another statute.

Changes:

None.

Rehabilitation Long-Term Training Program, 34 CFR Part 386

Summary of Changes

In the preamble of the NPRM, we discussed on pages 21002 through 21006 the major changes proposed to part 386 implementing the amendments to the Rehabilitation Long-Term Training program made by WIOA, as well as those changes needed to update and improve the regulations. We proposed: (1) adding two areas to the training areas supported by this program (assisting and supporting individuals with disabilities pursuing self-employment, business ownership, and telecommuting; and supported employment services and customized employment services to individuals with the most significant disabilities); (2) reducing from 75 percent to 65 percent the required percentage of the total award that grantees must spend on financial assistance to scholars; (3) prohibiting scholars from concurrently

receiving financial assistance from multiple grants; and (4) requiring the grantee to document that the scholar will seek employment in the field of study in which the scholar was trained or where the field of study is directly relevant to the job functions being performed.

We also proposed a number of changes to the exit processes that will help scholars be more aware of the requirements of their service obligation, including: (1) setting out the consequences for a grantee that has failed to request or maintain the required documentation for a scholar who does not meet the service obligation; (2) allowing some scholars to start satisfying the service obligation before completion of the program of study but to prohibit other scholars who do not complete the program of study from performing the service obligation; and (3) disallowing internships, practicums, or any other work-related requirement necessary to complete the educational program as qualifying employment for the service obligation.

Finally, we proposed some changes regarding deferrals and exceptions. For an exception based on disability, the scholar must have a disability either that did not exist at the time the scholar entered the program or that has worsened since the scholar entered the program. The documentation of disability must be less than three months old. With regard to deferrals, the proposed changes included: (1) allowing for up to four years deferral for a member on active duty in the Armed Forces, an increase from the three years in prior regulations; and (2) restricting a deferral based on a scholar's pursuing higher education only to advanced education that is in the rehabilitation field.

There are four differences between the NPRM and these final regulations.

• We clarify in final § 386.20(b)(2)(iii) that the selection criterion applies only to those programs that require practica and field experiences as part of their curricula.

• To clarify allowable travel costs, we conform the language about student travel in final § 386.32(d) to the language of student travel in the definition of “scholarship” in final § 386.4.

• In final § 386.31(c), we clarify the prohibition on concurrent scholarships by setting out the grantee's obligation to make a good-faith effort to avoid awarding a scholarship to any scholar who is currently receiving another scholarship under this program.

• We further clarify the prohibition on concurrent scholarships by adding a new § 386.40(a)(4) stating that scholars are prohibited from receiving concurrent scholarships under this program.

Public Comment:

In response to our invitation in the NPRM, four parties submitted comments on the proposed regulations amending the Rehabilitation Long-Term Training program (part 386). We organize our discussion by section number.

§ 386.20 Selection Criteria

Comment:

One commenter stated that the selection criterion in proposed § 386.20(b)(2)(iii), evidence of focused practical and other field experiences, could not by its terms apply to short-term certificate programs that do not require practica or field experiences.

Discussion:

We agree that the language in § 386.20(b)(2)(iii) is potentially unclear in this way.

Change:

We have revised final § 386.20(b)(2)(iii) to state that evidence of focused practical and other field experiences is not required when those experiences are not part of the curricula of a short-term certificate program.

§ 386.31 Grant Funds

Comment:

One commenter raised concerns about the provision in proposed § 386.31(c) that prohibits a scholar from receiving concurrent scholarships from multiple projects, noting that this could inadvertently bar students from certificate areas that could increase their employability. The prohibition could, for example, bar a scholar on summer break from a program leading to a master's degree from receiving a scholarship to participate in a certificate program.

Discussion:

The prohibition in § 386.31(c) was intended to prevent the practice of funding scholars from multiple grants for the same academic term. This practice leads to complications in reporting and in accurately tracking whether the scholar is meeting the service obligation.

The provision at final 386.31(c) does not prohibit a scholar from receiving a scholarship for a summer certificate program while that scholar is in a master's degree supported by a scholarship under this program, so long as the scholar is not also enrolled in the master's degree program during the summer.

Changes:

Because final § 386.31(c) describes grantee responsibilities, we have reworded the provision to better reflect the intent behind it—that the grantee must make good faith efforts to ensure that concurrent scholarships under this program are not awarded to a scholar. In addition, in order to ensure that scholars understand their responsibilities, we have added a provision under final § 386.40(a)(4) that sets out the scholar's responsibility not to accept concurrent scholarships under this program and clarified that this prohibition applies to scholarships for the same academic term.

§ 386.32 Allowable Costs

Comment:

One commenter requested that limited travel to professional conferences be explicitly listed in § 386.32 as an allowable cost. The commenter pointed out that, in the past, grantees have been able to support scholars in this way.

Discussion:

We agree that limited travel to professional conferences has been, and should continue to be, an allowable cost. Section 386.4 defines “scholarship,” in part, as an award of financial assistance to a scholar for training and includes student travel in conjunction with training assignments. Limited travel to professional conferences would generally be allowable under this description.

Change:

We modified final § 386.32(d) to use this language and make clear that limited travel to professional conferences is an allowable cost.

§ 386.33 Requirements for Grantees

Comment:

One commenter stated that the requirement in proposed § 386.33(c)(2), that a scholar's job functions be “directly relevant” to the field of study in which his or her training was received, is potentially ambiguous and difficult to apply. The commenter noted, for example, that many States do not have a job category of Rehabilitation Counselor for the Deaf. A person might graduate from a deafness training program but get a job as a generalist and still see deaf, hard of hearing, and general caseload customers. It is unclear if this job is “directly relevant” to the scholar's field of study.

Discussion:

We agree with the commenter that decisions about the relationship between a scholar's training and eventual employment are complex and that decisions about whether the employment qualifies to repay the service obligation need to be made case-by-case. The proposed § 386.33 was our effort to address this issue. We believe this language provides the necessary flexibility for sometimes difficult case-by-case analyses. For example, an individual graduating from a program focused on rehabilitation of individuals who are deaf but who ultimately finds employment as a general VR counselor has job functions “directly relevant” to his or her field of study. The individual

is providing services for which he or she was specifically trained, and, as a practical matter, it is unrealistic in this case to expect all consumers served to be deaf.

Changes:

None.

§ 386.43 Failure To Meet Terms and Conditions of the Scholarship Agreement

Comment:

One commenter sought clarification about calculating the date in which repayment status begins under proposed § 386.43(e)(2). The commenter referred to a situation in which the grace period has ended but a scholar finds qualifying employment only several months later, asking specifically whether the scholar enters repayment immediately upon expiration or whether it is possible to be granted an extension in order to complete the service obligation.

Discussion:

According to final § 386.43(e)(2), a scholar enters into repayment status when the failure to enter into employment makes it impossible for that scholar to complete the employment obligation within the number of years required in final § 386.40(a)(8). Given that a scholar who has not entered into qualifying employment at the time the grace period has ended cannot satisfy the requirements in final § 386.40(a)(8), the scholar referenced above by the commenter would immediately be placed in repayment status once the grace period has ended. The Secretary has no explicit authority to grant an extension of time to this scholar based solely upon the failure to complete the service obligation by the time the grace period has ended. Section 386.41(c), however, allows the Secretary to grant a deferral of the repayment requirement under limited circumstances and based upon credible evidence submitted on behalf of the scholar. There is nothing in this provision that would prohibit the Secretary from considering the granting of a deferral of the repayment requirement for scholars that need only a limited amount of extra time to satisfy the service obligation.

Changes:

None.

Innovative Rehabilitation Training Program, 34 CFR Part 387

Summary of Changes

In the preamble of the NPRM, we discussed on pages 21006 through 21007 the major changes proposed to part 387 implementing the amendments to the Innovative Rehabilitation Training program made by WIOA. These include: (1) Adopting a new name for the program—Innovative Rehabilitation Training—that better describes the nature of activities to be funded under this authority; (2) clarifying that the Secretary may award grants to develop new and improved methods of training not only for the rehabilitation personnel of State vocational rehabilitation agencies, but also for rehabilitation personnel of other public or non-profit rehabilitation service agencies or organizations; and (3) addressing new statutory language in section 101(a)(7) of the Act related to rehabilitation personnel having a 21st century understanding of the evolving labor force and the needs of individuals with disabilities so they can more effectively provide vocational rehabilitation services to individuals with disabilities.

There are no differences between the NPRM and these final regulations.

Public Comment:

In response to our invitation in the NPRM, no parties submitted comments on the proposed regulations amending the Innovative Rehabilitation Training program (part 387).

Rehabilitation Short-Term Training Program, 34 CFR Part 390

Summary of Changes

In the preamble of the NPRM, we discussed on page 21007 the major change proposed to part 390 needed to improve the Rehabilitation Short-Term Training program. In the NPRM, we proposed to add an additional selection criterion for grant competitions under this program—evidence of training needs as identified through training needs assessment.

There are no differences between the NPRM and these final regulations.

Public Comment:

In response to our invitation in the NPRM, no parties submitted comments on the proposed regulation amending the Rehabilitation Short-Term Training program (part 390).

Training of Interpreters for Individuals Who are Deaf or Hard of Hearing and Individuals Who are Deaf-Blind, 34 CFR Part 396

Summary of Proposed Changes

In the preamble of the NPRM, we discussed on pages 21007 through 21009 the major changes proposed in part 396 implementing the amendments to the Training of Interpreters for Individuals Who Are Deaf or Hard of Hearing and Individuals Who Are Deaf-Blind program, as well as changes needed to improve the program. These included: (1) Adding individuals who are hard of hearing to the individuals served by this program; (2) amending the regulations to ensure that the program accurately reflects the training needs of qualified interpreters in order to effectively meet the communication needs of individuals who are deaf or hard of hearing and individuals who are deaf-blind; (3) amending the definition of a qualified professional in order to ensure that the highest level of competency is incorporated into the training of interpreters; (4) adding selection criteria for the program to encourage evidence-based and promising practices; and (5) adding priorities for increasing the skill level of interpreters in unserved or underserved geographic areas, existing programs that have demonstrated their ability to raise the skill level of interpreters to meet the highest standards approved by certifying associations, and specialized topical training.

There are a number of changes between the NRPM and these final regulations:

• In final § 396.1(a), we modified the description of the interpreter training program to more accurately describe what interpreters for the deaf, hard of hearing, and deaf-blind do.

• In final § 396.4(c), we modified the definitions of

individual who is hard of hearing

and

individual who is deaf

to remove phrases offensive to some.

• In § 396.4(c), we added a definition of

novice interpreter.

• In final § 396.31(c), we clarified that the selection criterion applies to any curricula submitted by an applicant.

• In final § 396.33(b), and with a conforming change in final § 396.20(b), we added a priority for serving unserved or underserved deaf, hard of hearing, and deaf-blind populations that are not defined by geographic area.

Public Comment:

In response to our invitation in the NPRM, four parties submitted comments on the proposed regulations amending the Training of Interpreters for Individuals Who Are Deaf or Hard of Hearing and Individuals Who Are Deaf-Blind program (part 396). We organize our discussion by section and subject.

§ 396.1 Description of the Program

Comment:

One commenter stated that the description of the program in proposed § 396.1(a) was not accurate. The commenter stated that the description of interpretation and transliteration is too narrow, involving only spoken language and limiting training activities to interpreters who can hear spoken language. Deaf interpreters, the commenter stated, are precluded from training described in this way.

The commenter also stated that the term “transliterate” is not always the correct term when describing the

activity of conveying spoken language messages into tactile mode (or vice versa); rather, this is often interpretation.

Discussion:

We agree with the commenter that our proposed description was inadequate.

Changes:

We have changed the description of the program in final § 396.1(a) to be more inclusive and to use the terms “transliterate” and “interpret” more accurately.

§ 396.2 Eligibility

Comment:

One commenter stated that the types of institutions that can apply for grant funds to train interpreters under this program should be limited to bachelor's degree granting institutions, because an individual must have a bachelor's degree in order to sit for the national performance examination for sign language interpreters.

Discussion:

Entities eligible for grants under this program are set by the Act and reflected in § 396.2.

Changes:

None.

§ 396.4 Definitions

Individual Who is Hard of Hearing

Comment:

One commenter recommended replacing the term “hearing impairment” in the definition of “individual who is hard of hearing” because it is offensive to some. The commenter proposed using “deaf, hard of hearing and DeafBlind individual” instead, because this language more accurately reflects language used by the deaf, hard of hearing, and DeafBlind communities.

Discussion:

We agree that we should try to avoid the use of language that some may find offensive.

Changes:

We have removed “hearing impairment” from the definition of “individual who is hard of hearing” in final § 396.4(c). Rather than inserting the language the commenter proposed, however, we have streamlined the definition. We made similar changes in the definition of “individual who is deaf” in this section.

However, the definition of “individual who is deaf-blind,” which also contains the phrase “hearing impairment,” is, in our experience, one that is more widely accepted. Therefore, we have not made changes to this definition.

Novice Interpreter

Comment:

One commenter noted that the NPRM contained no definition of “novice interpreter,” yet the term was defined in the August 3, 2005, notice of final priority (70 FR 44834). The commenter expressed uncertainty whether the absence of the term in the NPRM meant that we were removing the 2005 definition and recommended that we include an updated definition of “novice interpreter” in the final rule. The commenter suggested an updated definition.

Discussion:

The omission of the definition of “novice interpreter” in the NPRM was an oversight. In this final rule, we have built upon the 2005 definition of “novice interpreter,” taking into consideration the comment we received on the NPRM. There, we proposed an amendment to the definition of “qualified professional” to be consistent with the final priority published in the

Federal Register

on September 1, 1999 (64 FR 48068), and to mean an individual who has (1) met existing certification or evaluation requirements equivalent to the highest standards approved by certifying associations; or (2) successfully demonstrated interpreting skills that reflect the highest standards approved by certifying associations through prior work experience.

We proposed this change to ensure that the highest level of competency is incorporated into the training of interpreters in interpreter training programs funded by RSA. Since 2000, the Department has funded national and regional interpreter education centers that train qualified interpreters to meet the competencies equivalent to the highest standards approved by certifying associations. Thus, this standard has been in effect for 15 years, and we proposed to change the definition to reflect this reality.

The updated definition of “novice interpreter” complements the update to the definition of “qualified professional,” and we are making the update to the definition of “novice interpreter” for the same reasons. This definition of “novice interpreter” is also consistent with the update suggested in the comment we received.

Change:

We have revised final § 396.4(c) to include an updated definition of “novice interpreter.”

§ 396.31 Selection Criteria

Comment:

One commenter pointed out that the selection criterion proposed in § 396.31(c) says only that the Secretary will evaluate a proposed “curriculum” for the training of interpreters based upon evidence-based or promising practices when many curricula, in fact, could be and have been proposed.

Discussion:

We had no intention to suggest that only a single, universal curriculum existed or that applicants may propose only one curriculum in future competitions under this program.

Change:

We have modified the selection criterion to apply to “any curricula.”

§ 396.33 Priorities

Unserved and Underserved Populations

Comment:

One commenter supported the priority in proposed § 396.33(b)(1) for increasing the skills of interpreters for the deaf, hard of hearing, or the deaf-blind in unserved or underserved geographic areas. The commenter expressed concern, however, that this section does not include a priority for these individuals in unserved and underserved populations, who may not be located in easily defined geographic areas. The commenter observed that there are growing segments of deaf, hard of hearing, and deaf-blind communities that will increasingly challenge the interpreting workforce, including but not limited to individuals considered “Deaf+,” individuals from minority and immigrant communities, individuals with cochlear implants, individuals pursuing high-level professional training and careers, and individuals who lose their hearing later in life and have limited communication skills.

Discussion:

We agree with the commenter that we should have a priority for training interpreters to serve individuals who are deaf, hard of hearing, or deaf-blind in both unserved and underserved populations and in unserved and underserved geographic areas.

Changes:

We have amended final § 396.33(b)(1) to add a priority for serving unserved or underserved deaf, hard of hearing, or deaf-blind populations that may not be limited to specific geographic areas. We have made a conforming change in final § 396.20(b).

Bachelors' Degree, Accredited, Existing Programs

Comment:

One commenter urged RSA to include a priority for applications from postsecondary institutions that offer at least a bachelor's degree in interpreter education. The commenter also recommended an additional priority giving preference to programs that have achieved Commission on Collegiate Interpreter Education (CCIE) accreditation.

Discussion:

We created the priority for postsecondary institutions that offer at least a bachelors' degree in the August 3, 2005, notice of final priorities for the Interpreter Training Program (70 FR 44834). It is not necessary to recreate the priority here because the 2005 priority

still exists and can be used in future competitions.

Further, § 396.33(b)(2) already encompasses the accreditation priority the commenter described. The phrase “existing programs” refers to any program, including those at postsecondary institutions that offer and have awarded at least a bachelor's degree in interpreter education. While we will not give preference to CCIE or other certifying organizations, the phrase “highest standards approved by certifying associations” already includes them.

Changes:

None.

Comment:

One commenter asked whether the term “programs” in proposed § 396.33(b)(2) means either a pre-service or an in-service program.

Discussion:

The term “programs” in final § 396.33(b)(2) refers both to pre-service and in-service programs.

Changes:

None.

Consumer Education

Comment:

One commenter expressed concern about the lack of mention of consumer education in proposed § 396.33(b). The commenter indicated that this was a new area in the competitions for this program in 2005 and again in 2010, and the resulting deaf advocacy training has been important.

Discussion:

As the commenter indicated, interpreter training centers funded under this program have addressed consumer education over the past 10 years. We believe that promising practices and resources developed for consumer education, specifically those developed under final § 396.33(b)(3)—specialized topical training based on the needs of individuals who are deaf or hard of hearing and individuals who are deaf-blind—have been particularly effective. We agree that deaf advocacy training has been an important focus area for the training of interpreters for individuals who are deaf, hard of hearing, and individuals who are deaf-blind, and we can continue the training without adding a priority here.

Changes:

None.

§ 396.34—Cost Matching

Comment:

One commenter suggested that the requirement in proposed § 396.34 that the grantee contribute to the cost of a project under this program in an amount satisfactory to the Secretary may conflict with 2 CFR 200.306. The commenter also indicated that having the Secretary determine the amount of the match at the time of the grant award may delay grant activity.

Discussion:

The matching amount will be specified in the notice inviting applications for the program competition published in the

Federal Register

and will occur prior to the submittal of the grant application and prior to the grant award. This provision, therefore, does not conflict with 2 CFR 200.306.

Changes:

None.

General Comments

Comment:

One commenter indicated that replacing the term “skilled interpreter” with “qualified interpreter” does not accomplish much since neither term is particularly precise.

Discussion:

We use “qualified interpreter” simply to conform part 396 to section 302(f) of the Act.

Changes:

None.

Comment:

One commenter suggested changing the number of centers that receive funding under this program. Currently, five regional centers and one national center receive funding. The commenter suggested one national center, with three regional centers that focus on three areas: educating those individuals who are preparing interpreters, ensuring a strong language foundation in both American Sign Language and English for sign language interpreters, and developing a national interpreter education curriculum.

Discussion:

The proposed regulations do not address the structure of this program. When we run a competition to meet new and emerging needs of deaf consumers and the training of interpreters, we will publish a notice of proposed priority in the

Federal Register

and seek public comment about how to structure the program.

Changes:

None.

Regulations To Be Removed

In the preamble of the NPRM, we discussed on page 21009 those regulations that we proposed to remove as required by WIOA, which deauthorized the Projects with Industry program (part 379), the State Vocational Rehabilitation Unit In-Service Training program (part 388), the Migrants and Seasonal Farmworkers program (§ 369.1(b)(3) and § 369.2(c)), and the Recreation Programs for Individuals with Disabilities program (§ 369.1(b)(5) and § 369.2(d)).

We also proposed to remove, as duplicative or superseded, the balance of part 369 pertaining to three other kinds of vocational rehabilitation (VR) service projects: VR service projects for American Indians with disabilities, special projects and demonstrations for providing VR services to individuals with disabilities, and special projects and demonstrations for providing transitional rehabilitation services to youth with disabilities.

We proposed to remove as outdated part 376 governing the Special Projects and Demonstrations for Providing Transitional Rehabilitation Services to Youth with Disabilities program and part 377 governing the Demonstration Projects to Increase Client Choice program.

We proposed to remove as duplicative and outdated part 389 governing the Rehabilitation Continuing Education programs.

Because the Department's administration of grants under the State Vocational Rehabilitation Unit In-Service Training program and the Migrants and Seasonal Farmworkers Program will be complete on September 30, 2016, we proposed to make the removal of part 369 and part 388 effective on September 30, 2016.

Comment:

In response to our invitation in the NPRM, no parties submitted comments on the removal of any of these regulations.

Discussion:

Upon further review, the Department has determined that the remaining grant for the Migrants and Seasonal Farmworkers program can incorporate the pertinent provisions of Part 369 into its terms and conditions. Therefore, there is no need to delay the effective date for which part 369 will be removed because the terms and conditions will still apply to the one remaining grant after part 369 is removed. We have also determined that it makes more sense to make the removal of the part 388 regulations coincide with the start of the new fiscal year, rather than the end of the old fiscal year. Therefore, we have moved the removal date for part 388 forward one day to October 1, 2016.

Changes:

Part 369 will be removed when the final regulations take effect. Part 388 will be removed on October 1, 2016.

Regulatory Impact Analysis

Executive Order 12866

Under Executive Order 12866, the Secretary must determine whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—

(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or

State, local, or tribal governments or communities in a material way (also referred to as an “economically significant” rule);

(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or

(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.

This regulatory action is not a significant regulatory action subject to review by OMB under section 3(f) of Executive Order 12866.

We have also reviewed these regulations under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—

(1) Propose or adopt regulations only upon a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);

(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;

(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);

(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and

(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.

Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”

We have also determined that this regulatory action would not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.

In accordance with both Executive orders, the Department has assessed the potential costs and benefits, both quantitative and qualitative, of this regulatory action. The potential costs associated with this regulatory action are those resulting from statutory requirements and those we have determined as necessary for administering the Department's programs and activities. In assessing the potential costs and benefits—both quantitative and qualitative—of these regulations, we have determined that the benefits would justify the costs.

Part 367—Independent Living Services for Older Individuals Who Are Blind

In general, unless expressly noted below, we do not estimate that changes to this part will result in any additional costs to grantees.

Subpart B—Training and Technical Assistance

New Subpart B of Part 367 implements the WIOA amendment requiring the Department to reserve from 1.8 to 2 percent of appropriated funds for training and technical assistance to grantees. While this reservation will result in a reduction in funding available to grantees, we believe that these training and technical assistance projects will increase the efficiency of the program and provide substantial benefits to both grantees and the older individuals who are blind that they serve.

To ensure that grantees receive the maximum amount of funds available for the provision of services to individuals, we will initially provide funding for training and technical assistance at the minimum allowable level of 1.8 percent. Prior to this regulation, grantees have been largely responsible for meeting the training needs of their program staff. This may have contributed to duplicative training and technical assistance efforts across grantees that could have easily been coordinated nationally. The coordination of these efforts by RSA will generate efficiencies across the entire program, thus providing more benefits to grantees than they would have realized if the funds had been directly provided to them.

Based on the FY 2016 authorized appropriation of $33,317,000 for the OIB program under WIOA, the estimated set-aside is $599,706, calculated from the minimum percentage established by the Act. Therefore, if grantees were to receive no benefit from the training and technical assistance supported by the Department, the 56 grantees would experience a collective loss in benefits of $599,706. However, since the Department will sponsor training and technical assistance services directly for this group in the amount of $599,706, we expect there to be no net loss of benefits. Additionally, as noted above, the efficiencies realized by this centralization of training and technical assistance efforts may actually result in a net increase in benefits for grantees.

Subpart C—What are the application requirements under this part?

Under this Subpart, we have removed the requirement for States to seek to incorporate into the State Plan for Independent Living (SPIL) any new methods and approaches relating to independent living services for older individuals who are blind. Incorporating this information into the SPIL required minimal time (approximately 15 minutes) every three years upon submission of the SPIL; therefore, any savings realized from this change will be negligible.

Subpart E—How does the Secretary award formula grants?

Under Subpart E, we have clarified that OIB grantees are to inform the Secretary 45 days prior to the end of the fiscal year whether funds will be available for reallotment. We do not believe that this requirement will generate additional costs to grantees, as the change only provides a timeline for an action that is already occurring and does not, therefore, generate any new burden on grantees.

Part 370—Client Assistance Program

WIOA requires that the set-aside for training and technical assistance for CAP take effect in any fiscal year in which the appropriation equals or exceeds $14,000,000. Section 112(e)(1)(F) of the Act, as amended by WIOA, requires the Secretary to reserve not less than 1.8 percent and not more than 2.2 percent of the CAP appropriation for this purpose. In FY 2016, the appropriation for CAP is $13,000,000, and so the set-aside for training and technical assistance would not take effect. An increase of 7.7 percent in the program's appropriation would be required before the set-aside would become effective. Thus, the set-aside will not have a substantial impact on the activities of grantees for some time. Assuming the Department sets aside a minimum of 1.8 percent to ensure that grantees receive the maximum amount of funds available for

the provision of services to individuals when the appropriation reaches $14,000,000, the Department would be required to reserve $252,000 to provide training and technical assistance support to grantees. Additionally, as noted above in the discussion of costs and benefits associated with Part 367, we believe that the consolidation of training and technical assistance activities at the national level will ultimately yield net benefits to grantees greater than if those activities were coordinated locally.

Part 371—American Indian Vocational Rehabilitation Services Program

New Subpart B of Part 371 implements the WIOA amendment requiring the Department to reserve from 1.8 to 2 percent of appropriated funds for training and technical assistance to grantees. While this reservation will result in a reduction in funding available to grantees, we believe that these training and technical assistance projects will increase the efficiency of the program and provide substantial benefits to both grantees and American Indians with disabilities.

Based on the FY 2016 amount set aside by the Department from the State VR program for the AIVRS program (approximately $43,000,000), the estimated reservation of funds for training and technical assistance is $774,000. As noted above, since these funds are being used to provide services and support to grantees, we do not anticipate any net loss of benefit. However, if efficiencies are realized due to centralized coordination of these activities, grantees may experience a net gain in benefits.

Part 373—Rehabilitation National Activities Program

We do not anticipate any changes to this section resulting in increased burden or costs for grantees.

Part 381- Protection and Advocacy for Individual Rights Program

As it had in prior regulations, § 381.20(a)(1) requires the Secretary, when the PAIR appropriation equals or exceeds $5,500,000, to set aside between 1.8 and 2.2 percent of these funds for training and technical assistance. The amendments made by WIOA simply clarify that the funding mechanism for the training and technical assistance may include a grant, contract, or cooperative agreement, all of which had been available to the Secretary previously. We amended § 381.20(a)(1) to clarify explicitly the availability of these funding mechanisms for training and technical assistance. Since the requirement to provide training and technical assistance was triggered in FY 1994, the Department has historically funded the training and technical assistance at the 1.8 percent level to ensure that grantees receive the maximum amount of funds available for the provision of services to individuals. Therefore, the revision to § 381.20(a)(1) in these final regulations will have no impact on PAIR grantees since the amendment was primarily technical in nature.

Part 385—Rehabilitation Training

We do not anticipate any changes to this section resulting in increased burden or costs for grantees.

Part 386—Rehabilitation Long-Term Training

Except as detailed below, we do not anticipate changes to this section to result in increased burden or costs for grantees.

§ 386.31 (Funding Requirement)

Section 386.31 requires that program grantees dedicate 65 percent to scholarships rather than 75 percent as required by prior regulations. This requirement will apply to both the federal award and the non-federal share. This change acknowledges the fact that grantees incur costs in administering these programs, particularly in terms of staff time needed to track scholar progress in completing their program of study and their service obligation. This decrease in the cost to grantees brought about by changes in § 386.31 balances some of the increased costs created by changes made in other sections of the regulations. In FY 2014, the Department made approximately $17,075,000 in new or continuation awards under the Rehabilitation Long-Term Training program. Assuming all grantees made the minimum match of 10 percent of the project cost, the reduction in the scholarship requirement will free up approximately $1,897,000 in project funding to be used for activities other than scholarship support. While this does not represent any additional funding for grantees, it does represent additional flexibility provided by the regulation.

§ 386.33 (Disbursing Scholarships)

Changes to this section require grantees to document that scholars will seek employment in the field of study in which the scholar was provided training or employment where it can be demonstrated that the field of study is directly relevant to the job functions being performed. Currently, grantees obtain sufficient documentation of other requirements that we do not believe this new requirement will represent a substantial burden on grantees. However, if we assume that obtaining this additional documentation will take, on average, 10 minutes per scholar, and using a wage rate of $17.69 (the mean hourly wage for office and administrative support staff at colleges, universities, and professional schools) and the 1,367 scholars receiving support in FY 2014, we estimate this provision will cost $4,030.37.

§ 386.34 (Assurances)

Changes to this section require grantees to annually obtain signed executed agreements with scholars containing the terms and conditions outlined in this section. It has been the Department's policy to encourage annual updating of scholar information; these regulations simply formalize this policy. As such, we estimate that these changes to the regulation will have little actual impact on grantees or scholars. However, if grantees were previously only collecting these agreements once per scholar rather than every year that support is received, there will be additional costs. Of all scholars reported in qualifying employment in FY 2014, 88.4 percent received support for more than one year. If we assumed that this change required an additional half hour of time each year beyond the first year of support to update their information with their program, and using an average wage rate of $17.69, we estimate an additional cost of $10,641 (given that we estimate that 1,203 of the 1,367 scholars receiving support in FY 2014 were multi-year scholars). We emphasize that this is an overestimate, as this change simply conforms the regulations to current practice.

§ 386.40 (Requirements for Scholars)

In § 386.40(a)(7), we clarify the type of employment a scholar must obtain to complete the service obligation in order to ensure that the funds used for scholarships will benefit individuals with disabilities served through the State vocational rehabilitation program and related agencies. This change largely reflects current policy and should not result in an increased burden on grantees or scholars. Changes to § 386.40(b) establishes a new policy addressing when scholars may begin qualifying employment while § 386.40(c) affirms the longstanding RSA practice that scholars who pursued coursework on a part-time basis should have their service obligations calculated on a full-time equivalent basis. As noted above, 88.4 percent of the scholars completing their service obligations in

FY 2014 received support for more than one year and would have been, therefore, eligible to benefit from the changes in § 386.40(b). However, because the changes in § 386.40(b) do not change the length of a scholar's service obligation and § 386.40(c) simply codifies existing RSA practice, we do not estimate that these provisions will result in any net costs or savings. Finally, changes in § 386.40(d) make scholars in repayment status responsible for any collection costs if they do not provide appropriate information to the grantee in a timely manner but provide that information after being placed in repayment status. In FY 2014, the Department referred 44 scholars for repayment totaling $486,471. Assuming that collection costs total 3 percent of the balance of the repayment, we estimate total collection costs of $14,594. However, we note that collection costs, if the debts are referred to third-party collection agencies, can range as high as 30 percent. Nonetheless, if 5 percent of this repayment amount involved scholars who were referred to repayment based upon failing to provide the information in paragraph (a)(10) of this section and these scholars became eligible for a refund of any debts paid based upon the scholars subsequently providing the correct information, this additional requirement could save the Department $729.70 (using the assumption of a 3 percent collection cost) by making these scholars responsible for the collection costs. If we assume a higher rate of collection costs, the savings would be higher.

§ 386.41 (Granting Deferrals and Exceptions) and § 386.42 (Applying for Deferrals and Exceptions)

Sections 386.41 and 386.42 contain stricter regulations around exceptions and deferrals, particularly for individuals with disabilities, in order to assure that individuals who benefit from scholarships funded by this program are more likely to complete their service obligation. While these changes may have impacts on the specific decisions made by scholars, they will not have a financial impact on the costs or benefits for grantees, and will likely increase the benefits to individuals with disabilities served by State VR agencies and related agencies by ensuring that training is aligned with practice and that a greater percentage of scholars complete their service obligations rather than just repaying the cost of their scholarships.

Part 387—Innovative Rehabilitation Training Program

We do not anticipate any changes to this section resulting in increased burden or costs for grantees.

Part 390—Rehabilitation Short-Term Training Program

Changes to § 390.30 adds a selection criterion that the Secretary will review each application for evidence of training needs as identified through training needs assessments. While conducting a training needs assessment prior to application may result in increased costs for applicants, because the regulation simply adds this as one selection criterion among several and allows applicants to use needs assessments conducted by other entities, we do not anticipate that applicants will realize any actual increased costs associated with this provision.

Part 396—Training of Interpreters for Individuals Who Are Deaf or Hard of Hearing and Individuals Who Are Deaf-Blind

Changes to § 396.34 require grantees to provide matching funds to support projects in an amount determined by the Secretary at the time of the grant award. While this matching requirement did not previously exist in the regulations, it was a statutory requirement and, while the Department did not require grantees to document the match, we do not believe that any prior grantees did not contribute any funds to the project, either in cash or in kind. As such, we do not believe this provision will result in any increased costs for grantees.

Paperwork Reduction Act of 1995

The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid OMB control number. We display the valid OMB control numbers assigned to the collections of information in these final regulations at the end of the affected sections of the regulations.

Intergovernmental Review

These programs, except for the American Indian Vocational Rehabilitation Services Program, are subject to Executive Order 12372 and the regulations in 34 CFR part 79. One of the objectives of the Executive order is to foster an intergovernmental partnership and a strengthened federalism. The Executive order relies on processes developed by State and local governments for coordination and review of proposed Federal financial assistance.

This document provides early notification of our specific plans and actions for these programs.

Assessment of Educational Impact

In the NPRM we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available. We received no comments, and we do not believe that these final regulations would require transmission of this sort of information.

Federalism

Executive Order 13132 requires us to ensure meaningful and timely input by State and local elected officials in the development of regulatory policies that have federalism implications. “Federalism implications” means substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. In the NPRM, we stated that the proposed regulations may have federalism implications and encouraged State and local elected officials to review and provide comments on the proposed regulations. We received no comments on this subject.

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(Catalog of Federal Domestic Assistance Numbers: 84.240A Protection and Advocacy of Individual Rights; 84.161A Client Assistance Program; 84.177B Independent Living Services for Older Individuals Who

Are Blind; 84.250J American Indian Vocational Rehabilitation Services; 84.128G Vocational Rehabilitation Service Projects for Migratory Agricultural Workers and Seasonal Farmworkers with Disabilities Program; 84.234 Projects With Industry; 84.128J Recreational Programs; and 84.265 State Vocational Rehabilitation Services Unit In Service Training)

List of Subjects

34 CFR Part 367

Aged, Blind, Grant programs-education, Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 369

Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 370

Administrative practice and procedure, Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 371

Grant programs-Indians, Grant programs-social programs, Indians, Vocational rehabilitation

34 CFR Part 373

Grant programs-education, Vocational rehabilitation

34 CFR Part 376

Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation, Youth

34 CFR Part 377

Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 379

Business and industry, Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 381

Grant programs-social programs, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 385

Grant programs-education, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 386

Grant programs-education, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 387

Grant programs-education, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 388

Grant programs-education, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 389

Grant programs-education, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 390

Grant programs-education, Reporting and recordkeeping requirements, Vocational rehabilitation

34 CFR Part 396

Education of individuals with disabilities, Grant programs-education, Individuals with disabilities, Reporting and recordkeeping requirements

Dated: June 30, 2016.

John B. King, Jr.,

Secretary of Education.

For the reasons discussed in the preamble, under the authority of section 503(f) of the Workforce Innovation and Opportunity Act (WIOA) (Pub. L. 113-128) and section 12(c) of the Rehabilitation Act of 1973, as amended by WIOA (29 U.S.C. 709(c)), the Secretary of Education amends chapter III of title 34 of the Code of Federal Regulations as follows:

1. Part 367 is revised to read as follows:

PART 367—INDEPENDENT LIVING SERVICES FOR OLDER INDIVIDUALS WHO ARE BLIND

Subpart A—General

Sec.

367.1

What is the independent living services for older individuals who are blind program?

367.2

Who is eligible for an award?

367.3

What activities may the Secretary fund?

367.4

What regulations apply?

367.5

What definitions apply?

Subpart B—Training and Technical Assistance

367.20

What are the requirements for funding training and technical assistance under this chapter?

367.21

How does the Secretary use these funds to provide training and technical assistance?

367.22

How does the Secretary make an award?

367.23

How does the Secretary determine funding priorities?

367.24

How does the Secretary evaluate an application?

Subpart C—What are the application requirements under this Part?

367.30

How does a designated State agency (DSA) apply for an award?

367.31

What assurances must a DSA include in its application?

Subpart D—How does the Secretary award discretionary grants?

367.40

Under what circumstances does the Secretary award discretionary grants to States?

367.41

How does the Secretary evaluate an application for a discretionary grant?

Subpart E—How does the Secretary award formula grants?

367.50

Under what circumstances does the Secretary award formula grants to States?

367.51

How are allotments made?

367.52

How does the Secretary reallot funds under this program?

Subpart F—What conditions must be met after an award?

367.60

When may a DSA make subawards or contracts?

367.61

What matching requirements apply?

367.62

What requirements apply if the State's non-Federal share is in cash?

367.63

What requirements apply if the State's non-Federal share is in kind?

367.64

What is the prohibition against a State's condition of an award of a sub-award or contract based on cash or in-kind contributions?

367.65

What is program income and how may it be used?

367.66

What requirements apply to the obligation of Federal funds and program income?

367.67

May an individual's ability to pay be considered in determining his or her participation in the costs of OIB services?

367.68

What notice must be given about the Client Assistance Program (CAP)?

367.69

What are the special requirements pertaining to the protection, use, and release of personal information?

367.70

What access to records must be provided?

367.71

What records must be maintained?

Authority:

Sections 751-753 of the Rehabilitation Act of 1973, as amended; 29 U.S.C. 796j-796l, unless otherwise noted.

Subpart A—General

§ 367.1

What is the Independent Living Services for Older Individuals Who Are Blind program?

This program supports projects that—

(a) Provide any of the independent living (IL) services to older individuals who are blind that are described in § 367.3(b);

(b) Conduct activities that will improve or expand services for these individuals; and

(c) Conduct activities to help improve public understanding of the challenges of these individuals.

(Authority: Section 752 of the Rehabilitation Act of 1973, as amended; 29 U.S.C. 796k(a) and (d))

§ 367.2

Who is eligible for an award?

Any designated State agency (DSA) is eligible for an award under this program if the DSA—

(a) Is authorized to provide rehabilitation services to individuals who are blind; and

(b) Submits to and obtains approval from the Secretary of an application that meets the requirements of section 752(h) of the Act and §§ 367.30-367.31.

(Authority: Section 752(a)(2) and 752(h) of the Rehabilitation Act of 1973, as amended; 29 U.S.C. 796k(a)(2) and (h))

§ 367.3

What activities may the Secretary fund?

(a) The DSA may use funds awarded under this part for the activities described in § 367.1 and paragraph (b) of this section.

(b) For purposes of § 367.1(a), IL services for older individuals who are blind include—

(1) Services to help correct blindness, such as—

(i) Outreach services;

(ii) Visual screening;

(iii) Surgical or therapeutic treatment to prevent, correct, or modify disabling eye conditions; and

(iv) Hospitalization related to these services;

(2) The provision of eyeglasses and other visual aids;

(3) The provision of services and equipment to assist an older individual who is blind to become more mobile and more self-sufficient;

(4) Mobility training, Braille instruction, and other services and equipment to help an older individual who is blind adjust to blindness;

(5) Guide services, reader services, and transportation;

(6) Any other appropriate service designed to assist an older individual who is blind in coping with daily living activities, including supportive services and rehabilitation teaching services;

(7) IL skills training, information and referral services, peer counseling, individual advocacy training, facilitating the transition from nursing homes and other institutions to home and community-based residences with the requisite supports and services, and providing assistance to older individuals who are blind who are at risk of entering institutions so that the individuals may remain in the community; and

(8) Other IL services, as defined in § 367.5.

(Authority: Section 752(d) and (e) of the Rehabilitation Act of 1973, as amended; 29 U.S.C. 796k (d) and (e))

§ 367.4

What regulations apply?

The following regulations apply to the Independent Living Services for Older Individuals Who Are Blind program:

(a) The Education Department General Administrative Regulations (EDGAR) as follows:

(1) 34 CFR part 75 (Direct Grant Programs), with respect to grants under subpart B and D.

(2) 34 CFR part 76 (State-Administered Programs), with respect to grants under subpart E.

(3) 34 CFR part 77 (Definitions That Apply to Department Regulations).

(4) 34 CFR part 79 (Intergovernmental Review of Department of Education Programs and Activities).

(5) 34 CFR part 81 (General Education Provisions Act—Enforcement).

(6) 34 CFR part 82 (New Restrictions on Lobbying).

(7) 2 CFR part 180 (OMB Guidelines to Agencies on Debarment and Suspension (Nonprocurement)), as adopted at 2 CFR part 3485.

(8) 2 CFR part 200 (Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards), as adopted at 2 CFR part 3474.

(b) The regulations in this part 367.

(Authority: Sections 12(c) and 752 of the Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) and 796k)

§ 367.5

What definitions apply?

(a) The definitions of terms used in this part that are included in the regulations identified in § 367.4 as applying to this program.

(b) In addition, the following definitions also apply to this part:

(1)

Act

means the Rehabilitation Act, as amended by WIOA.

(2)

Advocacy

means pleading an individual's cause or speaking or writing in support of an individual. To the extent permitted by State law or the rules of the agency before which an individual is appearing, a non-lawyer may engage in advocacy on behalf of another individual. Advocacy may—

(i) Involve representing an individual—

(A) Before private entities or organizations, government agencies (whether State, local, or Federal), or in a court of law (whether State or Federal); or

(B) In ne

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