Job Training Partnership Act and Work Opportunity Tax Credit; Lower Living Standard Income Level

DEPARTMENT OF LABOR

Employment and Training Administration

Job Training Partnership Act and Work Opportunity Tax Credit;

Lower Living Standard Income Level

AGENCY: Employment and Training Administration, Labor.

ACTION: Notice of determination of lower living standard income level.

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SUMMARY: The Job Training Partnership Act (JTPA) provides that the term

``economically disadvantaged'' may be defined as 70 percent of the

``lower living standard income level'' (LLSIL). To provide the most

accurate data possible, the Department of Labor is issuing revised

figures for the LLSIL. The Internal Revenue Code also provides that the

term ``economically disadvantaged'' may be defined as 70 percent of the

LLSIL for purposes of the Work Opportunity Tax Credit (WOTC).

EFFECTIVE DATE: This notice is effective on April 25, 1997.

ADDRESSES: Send written comments to: Mr. Ron Putz, Office of Employment

and Training Programs, Employment and Training Administration,

Department of Labor, Room N-4463, 200 Constitution Avenue NW.,

Washington, DC 20210.

FOR FURTHER INFORMATION CONTACT:

Mr. Ron Putz, Telephone: 202-219-5305 (this is not a toll free number).

SUPPLEMENTARY INFORMATION: It is a purpose of the Job Training

Partnership Act (JTPA) ``to establish programs to prepare youth and

adults facing serious barriers to employment for participation in the

labor force by providing job training and other services that will

result in increased employment and earnings, increased educational and

occupational skills, and decreased welfare dependency, thereby

improving the quality of the work force and enhancing the productivity

and competitiveness of the Nation.'' JTPA Section 2 and 20 CFR 626.1.

JTPA Section 4(8) defines, for the purposes of JTPA eligibility, the

term ``economically disadvantaged'' in part by reference to the ``lower

living standard income level'' (LLSIL).

The LLSIL figures published in this notice shall be used to

determine whether an individual is economically disadvantaged for

applicable JTPA purposes. JTPA Section 4(16) defines the LLSIL as

follows:

The term ``lower living standard income level'' means that income

level (adjusted for regional, metropolitan, urban, and rural

differences and family size) determined annually by the Secretary [of

Labor] based on the most recent ``lower living family budget'' issued

by the Secretary.

Internal Revenue Code (I.R.C.) Section 51 established the Work

Opportunity Tax Credit (WOTC) for a portion of the wages paid by

employers from ``targeted'' groups. The LLSIL figures published in this

notice shall be used to determine whether an individual is a member of

one of the targeted groups for applicable WOTC purposes.

The most recent lower living family budget was issued by the

Secretary in the fall of 1981. Using those data, the 1981 LLSIL was

determined for programs under the now-repealed Comprehensive Employment

and Training Act, and for the WOTC. The four-person urban family budget

estimates previously published by the Bureau of Labor Statistics (BLS)

provided the basis for the Secretary to determine the LLSIL for

training and employment program operators. BLS terminated the four-

person family budget series in 1982, after publication of the Fall 1981

estimates.

Inder JTPA, the Employment and Training Administration (ETA)

published the 1996 updates to the LLSIL in the Federal Register of

April 3, 1996. 61 FR 14824. ETA has again updated the LLSIL to reflect

cost of living increases for 1996 by applying the percentage change in

the December 1996 Consumer Price Index for All Urban Consumers (CPI-U),

compared with the December 1995 CPI-U, to each of the April 3, 1996,

LLSIL figures. Those updated figures for a family of four are listed in

Table 1 below by region for both metropolitan and nonmetropolitan

areas. Since eligibility is determined by family income at 70 percent

of the LLSIL, pursuant to Section 4(8) of JTPA, those figures are

listed below as well.

Jurisdictions included in the various regions, based generally on

Census Divisions of the U.S. Department of Commerce, are as follows:

Northeast

Connecticut

Maine

Massachusetts

New Hampshire

New Jersey

New York

Pennsylvania

Rhode Island

Vermont

Virgin Islands

Midwest

Illinois

Indiana

Iowa

Kansas

Michigan

Minnesota

Missouri

Nebraska

North Dakota

Ohio

South Dakota

Wisconsin

South

Alabama

American Samoa

Arkansas

Delaware

District of Columbia

Florida

Georgia

Northern Marianas

Oklahoma

Palau

Puerto Rico

South Carolina

Kentucky

Louisiana

Marshall Islands

Maryland

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Mississippi

Micronesia

North Carolina

Tennessee

Texas

Virginia

West Virginia

West

Arizona

California

Colorado

Idaho

Montana

Nevada

New Mexico

Oregon

Utah

Washington

Wyoming

Additionally, separate figures have been provided for Alaska,

Hawaii, and Guam as indicated in Table 2 below.

For Alaska, Hawaii, and Guam, the 1997 figures were updated by

creating a ``State Index'' based on the ratio of the urban change in

the State (using Anchorage for Alaska and Honolulu for Hawaii and Guam)

compared to the West regional metropolitan change, and then applying

that index to the West regional nonmetropolitan change.

Data on 25 selected Metropolitan Statistical Areas (MSAs) are also

available. These are based on monthly, bimonthly or semiannual CLI-U

changes for a 12-month period ending in December 1996. The updated

LLSIL figures for these MSAs, and 70 percent of the LLSIL, rounded to

the next highest ten, are set forth in Table 3 below.

Table 4 below is a listing of each of the various figures at 70

percent of the updated 1997 LLSIL for family sizes of one to six

persons. For families larger than six persons, an amount equal to the

difference between the six-person and the five-person family income

levels should be added to the six-person family income level for each

additional person in the family. Where the poverty level for a

particular family size is greater than the corresponding LLSIL figure,

the figure is indicated in parentheses.

Section 4(8) of JTPA defines ``economically disadvantaged'' as,

among other things, an individual whose family income was not in excess

of the higher of the poverty level or 70 percent of the LLSIL. The

Department of Health and Human Services published the annual update of

the poverty-level guidelines at 62 FR 10856 (March 10, 1997).

Use of These Data

Based on these data, Governors should provide the appropriate

figures to service delivery areas (SDAs), State Employment Security

Agencies, and employers in their States to use in determining

eligibility for JTPA and WOTC. The Governor should designate the

appropriate LLSILs for use within the State from Tables 1 through 3.

Table 4 may be used with any of the levels designated.

Information may be provided by disseminating information on MSAs

and metropolitan and nonmetropolitan areas within the State, or it may

involve further calculations. For example, the State of New Jersey may

have four or more figures: Metropolitan, nonmetropolitan, for portions

of the State in the New York City MSA, and for those in the

Philadelphia MSA. If an SDA includes areas that would be covered by

more than one figure, the Governor may determine which is to be used.

Pursuant to the JTPA regulations at 20 CFR 627.200, guidelines,

interpretations, and definitions adopted by the Governor shall be

accepted by the Secretary to the extent that they are consistent with

the JTPA and the JTPA regulations.

Disclaimer on Statistical Uses

It should be noted that the publication of these figures is only

for the purpose of determining eligibility for applicable JTPA and WOTC

programs. BLS has not revised the lower living family budget since

1981, and has no plans to do so. The four-person urban family budget

estimates series has been terminated. The CPI-U adjustments used to

update the LLSIL for this publication are not precisely comparable,

most notably because certain tax items were included in the 1981 LLSIL,

but are not in the CPI-U.

Thus, these figures should not be used for any statistical

purposes, and are valid only for eligibility determination purposes

under the JTPA and WOTC programs.

Signed at Washington, DC, this 21st day of April, 1997.

Theodore Mastroianni,

Administrator, Office of Job Training Programs.

BILLING CODE 4510-30-M

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Appendix

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[FR Doc. 97-10699 Filed 4-24-97; 8:45 am]

BILLING CODE 4510-30-C