Projects With Industry

SUMMARY: The Secretary amends the regulations governing the Projects

With Industry (PWI) program to clarify statutory intent, reduce grantee

burden, address certain implementation problems, and enhance project

accountability.

EFFECTIVE DATE: These regulations take effect March 10, 1997.

FOR FURTHER INFORMATION CONTACT: Thomas E. Finch, U.S. Department of

Education, 600 Independence Avenue, SW., Room 3315, Mary E. Switzer

Building, Washington, DC 20202-2575. Telephone: (202) 205-8292.

Individuals who use a telecommunications device for the deaf (TDD) may

call the Federal Information Relay Service (FIRS) at 1-800-877-8339

between 8 a.m. and 8 p.m., Eastern time, Monday through Friday.

SUPPLEMENTARY INFORMATION: The PWI program is authorized by section 621

of the Rehabilitation Act of 1973, as amended (the Act). The purpose of

the PWI program is to create and expand job and career opportunities

for individuals with disabilities in the competitive labor market by

establishing partnerships between program grantees and private industry

to provide job training, job placement, and career advancement

activities.

On January 22, 1996, the Secretary published a notice of proposed

rulemaking (NPRM) for this program in the Federal Register (61 FR

1672). The major issues related to this program are discussed in

greater detail in the preamble to the NPRM.

The significant changes made in these final regulations from the

NPRM include revision of the definitions of ``placement,''

``competitive employment,'' and ``integrated setting,'' as well as an

additional application content requirement for a description of career

advancement services. These changes are discussed in detail in the

analysis of comments section of the preamble to the final regulations.

The Secretary invited comments on changes needed to improve the

compliance indicators in the NPRM, but has made no changes to the

indicators in these final regulations. The comments provided in

response to the NPRM, as well as the comments provided by interested

parties in subsequent follow-up meetings held by the Rehabilitation

Services Administration (RSA), will be used by the Department in

determining what changes to make to the compliance indicators. The

Secretary expects to propose specific revisions to the PWI compliance

indicators in the near future.

Goals 2000: Educate America Act

The Goals 2000: Educate America Act (Goals 2000) focuses the

Nation's education reform efforts on the eight National Education Goals

and provides a framework for meeting them. Goals 2000 promotes new

partnerships to strengthen schools and expands the Department's

capacities for helping communities to exchange ideas and obtain

information needed to achieve the goals.

These regulations address the National Education Goal that every

adult American will possess the knowledge and skills necessary to

compete in a global economy and exercise the rights and

responsibilities of citizenship.

Executive Order 12866

Assessment of Costs and Benefits

These final regulations have been reviewed in accordance with

Executive Order 12866. Under the terms of the order the Secretary has

assessed the potential costs and benefits of this regulatory action.

The potential costs associated with the final regulations are those

resulting from statutory requirements and those determined by the

Secretary as necessary for administering this program effectively and

efficiently.

In assessing the potential costs and benefits--both quantitative

and qualitative--of these final regulations, the Secretary has

determined that the benefits of the final regulations justify the

costs.

The Secretary has also determined that this regulatory action does

not unduly interfere with State, local, and tribal governments in the

exercise of their governmental functions.

Summary of Potential Costs and Benefits

The potential costs and benefits of these final regulations were

discussed in the preamble to the NPRM under the following headings:

More Accurate Reflection of Statutory Requirements, Reduction of

Grantee Burden, and Clarification of Program Requirements (61 FR 1677).

Analysis of Comments and Changes

In response to the Secretary's invitation in the NPRM, 87 parties

submitted comments on the proposed regulations. An analysis of the

comments and of the changes in the regulations since publication of the

NPRM follows.

The comments have been grouped according to subject, with

appropriate references to sections of the regulations. Technical and

other minor changes--and suggested changes the Secretary is not legally

authorized to make under the applicable statutory authority--are not

addressed.

Section 379.3 Eligibility for Services

Comments: Several commenters recommended alternative procedures for

determining eligibility for PWI services other than those specified in

the NPRM. One commenter wanted eligibility to be determined jointly by

the State vocational rehabilitation (VR) agency, the PWI grantee, and

the individual seeking PWI services. Another commenter stated that only

the VR agency or its designee should make eligibility determinations.

Another commenter wanted PWI grantees to be allowed to determine

eligibility for PWI services without VR agency review. Another

commenter wanted the final regulations to clarify that a PWI grantee is

responsible for making eligibility determinations even if the grant is

sub-contracted to another organization. A final commenter raised

concerns that some VR agencies do not respond to initial or preliminary

determinations of eligibility made by PWI grantees.

Discussion: Section 621(a)(3) of the Act prescribes the manner in

which eligibility for PWI services is to be determined. The VR agency

is initially authorized to make eligibility determinations in this

program, but if the VR agency fails to act, either by not making a

determination or failing to disagree within 60 days with a preliminary

determination of eligibility made by the PWI grantee, then the PWI

grantee can determine eligibility. There is no legal authority to

substitute a different eligibility determination process in the

regulations. Under the Department's grants regulations, grantees are

held responsible for all aspects of their project operations, even if

they subcontract project activities. Finally, the regulations address

concerns that some VR agencies do not respond to preliminary PWI

eligibility determinations by providing, consistent with the statute,

that if the VR agency fails to act within 60 days, then the preliminary

PWI eligibility

[[Page 5685]]

determination becomes a final determination.

Changes: The Secretary has revised the explanatory material in the

note following this section to clarify that if the VR agency has

referred an individual to a PWI project for services, then the VR

agency has already determined that the individual is eligible for

project services. In other instances, the PWI grantee makes an initial

determination of eligibility that becomes final if not countermanded by

the VR agency within 60 days.

Section 379.5 Definitions

Section 379.5(b)(2)(ii) Definition of ``Competitive Employment''--

Prevailing Community Wage Requirement

Comments: Several commenters opposed the requirement in the

proposed regulations that individuals in competitive employment earn at

least the prevailing wage for the same or similar work in the local

community performed by non-disabled individuals. Eight commenters

believed that it would be unduly burdensome for grantees to ascertain

the relevant prevailing wage given the potential differences in wages

provided by employers within the same community. A few commenters

stated that prevailing community wage rates are sometimes inflated and

that many job-seekers are unsuccessful in finding employment at the

prevailing community wage. Several commenters recommended that the

final regulations require only that the minimum wage be paid and that

PWI participants be afforded the same terms and benefits provided to

non-disabled co-workers in similar jobs, consistent with section 621(b)

(1) and (2) of the Act. Other commenters recommended that the wage

standard should be one of parity with the wages paid by the same

employer to non-disabled workers doing the same or similar job.

Discussion: The Secretary agrees that requiring individuals placed

by the PWI program into competitive employment to earn at least the

prevailing wage for the same or similar work in the local community

performed by non-disabled individuals is unduly restrictive and

potentially burdensome. The Secretary also agrees that a more

reasonable wage standard is one that is employer-based rather than

community-based and that requires equity in wage and terms and benefits

(e.g., insurance premiums, retirement contributions) with non-disabled

workers.

Changes: The Secretary has amended Sec. 379.5(b)(2)(ii) to define

``competitive work,'' in part, as work for which an individual earns at

least the minimum wage but not less than the customary or usual wage

and terms and benefits provided by the same employer to non-disabled

workers who perform the same or similar work.

Section 379.5(b)(3) Definition of Integrated Setting, as Part of the

Definition of ``Competitive Employment''

Comments: Several commenters were concerned that the proposed

standard for integration in competitive employment (the opportunity for

interaction with non-disabled individuals at the work site) would

preclude certain kinds of employment outcomes from the scope of

competitive employment. Specifically, the commenters identified self-

employment, home-based employment, and various forms of telecommuting

as examples of employment outcomes that are competitive, but are not

located in integrated settings. These commenters stated that these

employment options should be available to individuals with disabilities

served by the PWI program to the same extent that they are available to

non-disabled persons. Other commenters stated that individuals in

competitive employment should be required to interact with non-disabled

persons only to the extent that non-disabled persons in similar

positions interact with others.

Discussion: The Secretary agrees with those commenters who contend

that the best measure of integration in an employment setting for

individuals with disabilities is to require parity with the integration

experienced by non-disabled workers in similar positions. The Secretary

also believes that interaction between individuals with disabilities

and non-disabled persons need not be face-to-face in order to meet this

standard. Individuals with disabilities under the PWI program who are

self-employed or who telecommute may interact regularly with non-

disabled persons through a variety of mediums (e.g., telephone,

facsimile, or computer). Self-employment, home-based employment, and

other forms of employment in which individuals communicate regularly

from separate locations, therefore, would satisfy the integration

requirement of competitive employment as long as the individual

interacts with non-disabled persons, other than service providers, to

the same extent as a non-disabled person in a comparable job.

Changes: The Secretary has revised Sec. 379.5(b)(3) to establish a

standard of integration for individuals in competitive employment that

is based on ensuring the same level of interaction with non-disabled

persons as that experienced by a non-disabled worker in the same or

similar job.

Section 379.5(b)(5) Definition of ``Job Training''

Comments: One commenter recommended the inclusion of pre-employment

planning under the definition of job training. Another commenter

recommended expanding the definition of job training to include social

preparation for individuals interviewing for jobs. Ten commenters

recommended deleting the phrase ``provided prior to placement'' because

the phrase excludes training by employers or other entities after

placement. Two commenters recommended that attitudinal change training

be provided for employers under the definition of training. Four

commenters recommended that training be provided in an integrated

setting. Other commenters underscored the need for specific input on

the part of the Business Advisory Committee (BAC) in identifying and

prescribing training needs. Still other commenters stated that the

responsibility for defining the parameters of job training should be

the domain of the BAC. Another commenter stated that the emphasis on

skills training is contrary to current trends of ``one-stop career

centers'' and expressed doubts as to whether grantees have adequate

resources and expertise to provide job skills training.

Discussion: The Secretary believes that the final regulations give

projects sufficient flexibility to provide pre-employment planning and

interview preparation if these services are deemed necessary. However,

the Secretary believes that these activities fall under the definition

of job readiness training in Sec. 379.5(b)(4), rather than the

definition of job training under this section. The Secretary also

believes that attitudinal change training for employers is an

authorized activity under the PWI program, but does not believe it

falls within the scope of job training, as it is defined in this

section.

While section 621(a)(2)(B) of the Act requires that training be

provided in ``realistic work settings,'' the Secretary does not believe

that this can be interpreted to require projects to provide training in

an integrated setting. However, the Secretary encourages projects to

ensure that training is provided in an integrated setting to the extent

possible.

The Secretary strongly agrees with the commenters who stated that

the BAC should take an active role in prescribing training programs and

notes that this is consistent with section 621(a)(2)(A)(iv)

[[Page 5686]]

of the Act, which states that the BAC shall ``prescribe training

programs designed to develop appropriate job and career skills.'' The

Secretary does not believe that the definition of job training in this

section in any way weakens this statutory requirement.

The Secretary notes the concern of some commenters that grantees

may have insufficient resources to provide job training. The use of the

BAC, other private industry expertise, and active collaboration with

State VR agencies and other providers can supplement what individual

projects may lack in terms of resources for job training.

Changes: None.

Section 379.5(b)(7) Definition of ``Placement''

Comments: One commenter recommended that the term ``placement'' be

deleted throughout the regulations and replaced with the term ``PWI

employment outcome.'' This commenter believed the use of the term

``placement'' was confusing because the proposed definition includes

two elements: (1) Attaining competitive employment and (2) maintaining

it for a certain period.

Other commenters were concerned about the proposed minimum

retention period for maintaining competitive employment in order to

have the employment outcome considered a placement for purposes of

meeting the program compliance indicators. The NPRM proposed the option

of using the duration of the employer's normal probationary period or,

if the employer does not have an established probationary period, for

at least 90 days. The current regulatory time period for maintaining

employment is 60 days. These commenters stated that the use of a

probationary period was problematical for a variety of reasons, such as

(1) an employer's probationary period could be as short as two weeks,

and that timeframe would be inadequate; (2) many employers no longer

use probationary periods, so the option is not meaningful; and (3) if

some employers have long probationary periods, some projects might be

disinclined to place individuals with those employers. Some commenters

argued for a uniform Federal standard in the regulations that would

avoid variations among employers. Some of these commenters suggested

that there be no change from the current retention period of 60 days.

Other commenters recommended 90 days, 120 days, 180 days, or 12 months.

Some commenters objected to any specific timeframe in the regulations

and believed the retention period should be individually determined by

the individual with a disability, the counselor, and the employer.

Some commenters recommended that the phrase ``who has successfully

completed training'' be deleted from the definition because the

regulations recognize that not all persons served by a PWI project may

need and, therefore, receive job training.

Discussion: The Secretary does not believe the use of the term

``placement,'' as defined in the regulations, is confusing. The PWI

regulations for many years have defined ``placement'' to include a

required period of time in which a competitive employment outcome must

be maintained.

The Secretary agrees with those commenters who believe the use of a

probationary period option is problematical and that a uniform minimum

retention period prescribed in the regulations is desirable. The

Secretary also believes that the retention period should be longer than

the 60 days required in the current regulations in order to ensure that

the individual's employment remains stable. The Secretary has

determined that 90 days is the minimum acceptable standard and that

this lengthened time period will result in more successful placements.

At the same time, however, the Secretary recognizes that in some

instances 90 days may be too short a period to ensure job stability.

Section 621(a)(2)(E) of the Act requires projects to provide any

support services that may be required for an individual to maintain

employment. Therefore, the Secretary encourages projects to make

individualized determinations of whether to extend the 90-day period to

conform with an employer's longer probationary period if, at the end of

the 90 days, it is uncertain whether the individual will be able to

successfully satisfy the probationary period without support services

from the project.

The Secretary also agrees that the phrase ``who has successfully

completed training'' is inaccurate and should be removed from the

definition because some project participants may not need job training.

Changes: The Secretary has amended the definition of ``placement''

in the final regulations to provide for a minimum job retention period

of 90 days and to substitute the phrase ``who has received services''

for the phrase ``who has successfully completed training.''

Section 379.10(a) Project Requirements Regarding Job Training and the

Note to This Section

Comments: One commenter recommended deletion of the last three

sentences of the note, which specify that training provided after

placement (i.e., attaining competitive employment and maintaining it

for at least 90 days) or job-readiness training do not satisfy the

requirement that projects provide job training. Another commenter

suggested revising this requirement to allow projects the option of

providing only job readiness training. Some commenters suggested that

individual projects should have the responsibility of assessing each

participant's training needs and how that training will be provided.

Some commenters suggested that grantees should be allowed the

flexibility to work with employers in order to provide training on the

job. Some commenters questioned whether job training should be provided

for all participants. Two commenters stated that all grantees should

have an identifiable training component for individuals who lack job

skills, but that all program participants should not be required to

avail themselves of training. Other commenters mentioned the added

costs of providing job training and asked whether grant awards should

be increased to cover these costs.

Discussion: The Secretary disagrees with the commenter who suggests

deletion of the clarification in the note that training provided after

placement and job readiness training do not by themselves satisfy the

requirement in Sec. 379.10(a). In accordance with section 621(a)(2)(B)

of the Act, projects are required to provide training in order to

prepare the individuals for employment and career advancement in the

competitive market. The Secretary, therefore, believes that projects

should ensure that training, if deemed appropriate to the participant's

needs, is provided either before the individual begins employment or

within the first 90 days of employment (i.e., before the individual is

considered placed in accordance with the definition of ``placement'' in

Sec. 379.5(b)(7)). On-the-job training would meet the requirements of

this section if the project ensures its provision and it is provided

within the first 90 days of employment. The 90-day requirement, of

course, does not apply to employed individuals who are receiving career

advancement services from a PWI project.

The Secretary also believes that the job training requirement is

not met if a project provides only job readiness

[[Page 5687]]

training. While job readiness training is an authorized activity under

the PWI program, the Secretary believes that job readiness training

alone does not meet the statutory requirement that projects provide

training to prepare individuals for employment in the competitive labor

market. The final regulations, like the NPRM, therefore contain

separate definitions of ``job training'' and ``job readiness

training.'' The Secretary agrees with those commenters who suggested

that job training need not be provided to every participant. The

language in this section requires that job training be provided ``if

appropriate to the needs of each individual served by the project.''

However, the Secretary expects that every project will have a job

training component (whether the training is provided on-site, through

employers and other entities, or both), since a certain population of

individuals will enter the program without the job skills necessary to

be placed and advance in competitive employment.

The Secretary notes the concern of commenters regarding the costs

of providing job training. The Secretary believes the regulations give

projects sufficient flexibility to arrange with employers and other

entities to provide job training should they find that providing job

training themselves is too costly or for other reasons is not feasible.

Changes: The Secretary has added a statement to the note to

emphasize that if a project arranges for the provision of job training

by outside entities (e.g., an employer), the project must conduct

appropriate follow-up measures to ensure that training is provided. The

note is also amended to clarify that job training must be provided

either prior to, or within 90 days of, attaining competitive employment

and that job training provided by the employer after this 90-day

period, therefore, does not meet the requirement of Sec. 379.10(a).

Section 379.21(a)(1) Application Content Requirement Regarding Labor

Market Analysis

Comments: A number of commenters stated that a labor market

analysis obligates applicants to predict for five years the training

needs that will meet the demands of the labor market and that the labor

market changes too rapidly for this to be accomplished. Other

commenters recommended deleting the language regarding labor market

analysis. Other commenters stated that individuals with disabilities

may not fit appropriately into a market trend and may require

individualized job matching. A commenter recommended that each

application describe how existing labor market studies will be used in

securing employment and validating training needs.

Discussion: The Secretary does not intend to require the use of a

particular tool (e.g., a labor market analysis) to identify the needs

of the local labor market. If an applicant determines that a labor

market analysis is inappropriate for the type of project being

proposed, the applicant can choose a different method of identifying

local labor market needs. The requirement in Sec. 379.21(a)(1) is

intended to ensure that applicants have assessed labor market needs in

the geographic area to be served and have designed their projects in

accordance with the identified needs for people trained for specific

occupations. Applicants can determine labor market needs by either

performing their own labor market analyses or needs assessments in

conjunction with private industry or by using existing current labor

market analyses or needs assessments. The Secretary understands that

local labor market needs may change during the five-year duration of

the project and that these changes may, in some cases, necessitate

adjustments in the project. However, the Secretary believes that this

does not diminish the utility of an initial labor market analysis or

needs assessment. The Secretary also believes that the identification

of local labor market needs does not contravene the practice of

individualized job-matching for individuals with disabilities.

Changes: The Secretary has made minor changes to clarify that the

applicant may comply with Sec. 379.21(a)(1) either by using an existing

current labor market analysis or needs assessment or by performing a

labor market analysis or needs assessment in conjunction with private

industry.

Section 379.21(a)(4) Application Content Requirement Concerning

Unserved or Underserved Areas

Comments: One commenter recommended that an applicant for a PWI

grant be required to document geographic need through verification by

the State VR agency. This commenter wanted to avoid duplication of

awards and to ensure that services are provided in areas most in need.

Discussion: The Secretary encourages all applicants to consult with

the relevant State VR agency to ensure that services are to be provided

in areas where individuals are unserved or underserved, but does not

want to require this. It is the responsibility of each applicant to

explain in its grant application how the geographic area it proposes to

serve is unserved or underserved by the PWI program and to provide

whatever justification it considers necessary to support its position.

Changes: None.

Section 379.21(a)(7) Requirement Concerning Career Advancement

Services

Comments: Some commenters suggested that career advancement

services be addressed with an application content requirement rather

than as a compliance indicator.

Discussion: The 1992 Amendments to the Rehabilitation Act of 1973,

as amended, added career advancement services to the range of services

PWI projects are required to provide. In the NPRM, the Secretary

solicited comments on how best to address the career advancement

requirement. The Secretary agrees that an application content

requirement is the best way to implement the career advancement

services provision.

Changes: In response to commenters' suggestions, the Secretary has

added to this section the requirement that a grant application contain

a description of how career advancement services will be provided to

project participants.

Section 379.30 Recommendation of New Selection Criterion

Comments: One commenter recommended that applicants under this

program be required to include a plan for continuing the project after

the Federal grant period has ended.

Discussion: The Secretary finds no statutory basis, as exists for

the recreation programs authorized under section 316 of the Act, for

adding a criterion to require applicants to include a plan for

continuation of the project after the Federal grant period has ended.

Changes: None.

Section 379.30(a)(1) Selection Criterion: Extent of Need for Project--

Labor Market Analysis

Comments: A number of commenters suggested alternative language to

a ``labor market analysis'' and recommended tailoring a needs

assessment to local communities rather than to the national or regional

job market as implied by the term. Some commenters recommended that the

phrase ``labor market analysis'' be deleted.

Discussion: The Secretary intends, and the NPRM stated, that the

applicant's labor market analysis or needs assessment be conducted

``for the geographic area to be served.'' The Secretary does not intend

by using the

[[Page 5688]]

term ``labor market analysis'' to require the applicant to conduct an

analysis that is regional or national in scope. While the Secretary

expects that projects once established should work with local

businesses and the BAC to identify job opportunities for individuals

with disabilities, the Secretary does not believe this action

eliminates the need for an initial survey of local labor market needs.

An initial labor market analysis or needs assessment demonstrates a

need for the project and also enables the project to tailor its job

training and services to the needs of the local labor market.

Changes: The Secretary has made minor changes to clarify that the

applicant may satisfy Sec. 379.30(a)(1) either by using an existing

current labor market analysis or needs assessment or by performing a

labor market analysis or needs assessment in conjunction with private

industry.

Section 379.30(a)(2) Selection Criterion: Extent of Need for Project--

Labor Market Analysis

Comments: None.

Discussion: The Secretary believes the phrase ``occupations and

occupational categories'' is more precise than ``industry or

industries'' because it refers to a type of job or jobs for which

participants are to be trained (e.g., computer programmer) rather than

the industries in which they might be placed (e.g., the computer

industry).

Changes: The Secretary has amended Sec. 379.30(a)(2) in the final

regulations to clarify that the job training to be provided must meet

the identified needs for specific occupations or occupational

categories in the geographic area to be served.

Section 379.41(a)(f) Allowable Costs

Comments: One commenter recommended specifying under this section

on allowable costs that, if appropriate, grantees may modify facilities

and equipment of employers. Another commenter recommended the addition

of job modification and job development as allowable costs.

Discussion: The Secretary agrees with the commenters that the costs

of job development and modification and the costs of modifications of

employer facilities or equipment to be used by PWI program participants

should be specifically identified in the final regulations as

permissible expenditures. This is consistent with language in 34 CFR

379.10(d) (1) and (3), which requires grantees to undertake these

activities, to the extent appropriate.

Changes: The Secretary has amended Sec. 379.41(a) to include as

allowable costs job development and modification and modifications for

facilities and equipment of employers participating in the program.

Section 379.43 and Sec. 379.54(a) Annual Evaluation Report and

Compliance Indicator Data

Comments: One commenter did not agree with the proposed requirement

that projects submit annual evaluation report and compliance indicator

data 60 days after the end of the project year.

Discussion: The Secretary believes that the 60-day timeline is

reasonable for submission of project evaluation and compliance

indicator data in order to ensure timely receipt of project information

and to increase program accountability. In addition, the Secretary has

the option to extend this timeline for reasonable cause.

Changes: None.

Paperwork Reduction Act of 1995

Under the Paperwork Reduction Act of 1995, no persons are required

to respond to a collection of information unless it displays a valid

OMB control number. The valid OMB control number assigned to the

collection of information in these final regulations is displayed at

the end of the affected sections of the regulations.

Intergovernmental Review

This program is subject to the requirements of Executive Order

12372 and the regulations in 34 CFR Part 79. The objective of the

Executive order is to foster an intergovernmental partnership and a

strengthened federalism by relying on processes developed by State and

local governments for coordination and review of proposed Federal

financial assistance.

In accordance with the order, this document is intended to provide

early notification of the Department's specific plans and actions for

this program.

Assessment of Educational Impact

In the notice of proposed rulemaking, the Secretary requested

comments on whether the proposed regulations would require transmission

of information that is being gathered by or is available from any other

agency or authority of the United States.

Based on the response to the proposed regulations and on its own

review, the Department has determined that the regulations in this

document do not require transmission of information that is being

gathered by or is available from any other agency or authority of the

United States.

List of Subjects in 34 CFR Part 379

Education, Grant programs--education, Grant programs--social

programs, Reporting and recordkeeping requirements, vocational

rehabilitation.

Dated: October 25, 1996.

Judith E. Heumann,

Assistant Secretary for Special Education and Rehabilitative Services.

(Catalog of Federal Domestic Assistance Number 84.234 Projects With

Industry)

The Secretary amends Title 34 of the Code of Federal Regulations as

follows:

1. By revising part 379, subparts A through E, by revising the

heading of subpart F, and by adding a new Sec. 379.54 in subpart F to

read as follows:

PART 379--PROJECTS WITH INDUSTRY

Subpart A--General

Sec.

379.1 What is the Projects With Industry (PWI) program?

379.2 Who is eligible for a grant award under this program?

379.3 Who is eligible for services under this program?

379.4 What regulations apply?

379.5 What definitions apply?

Subpart B--What Kinds of Activities Does the Department of Education

Assist Under This Program?

379.10 What types of project activities are required of each

grantee under this program?

379.11 What additional types of project activities may be

authorized under this program?

Subpart C--How Does One Apply for an Award?

379.20 How does an eligible entity apply for an award?

379.21 What is the content of an application for an award?

Subpart D--How Does the Secretary Make a Grant?

379.30 What selection criteria does the Secretary use under this

program?

379.31 What other factors does the Secretary consider in reviewing

an application?

Subpart E--What Conditions Must Be Met by a Grantee?

379.40 What are the matching requirements?

379.41 What are allowable costs?

379.42 What are the requirements for a continuation award?

379.43 What are the additional reporting requirements?

[[Page 5689]]

Subpart F--What Compliance Indicator Requirements Must a Grantee Meet

To Receive Continuation Funding?

* * * * *

379.54 What are the reporting requirements for the compliance

indicators?

* * * * *

Authority: Sects. 12(c) and 621 of the Act; 29 U.S.C. 711(c) and

795g, unless otherwise noted.

Subpart A--General

Sec. 379.1 What is the Projects With Industry (PWI) program?

This program is designed to--

(a) Create and expand job and career opportunities for individuals

with disabilities in the competitive labor market by engaging the

talent and leadership of private industry as partners in the

rehabilitation process;

(b) Identify competitive job and career opportunities and the

skills needed to perform these jobs;

(c) Create practical settings for job readiness and job training

programs; and

(d) Provide job placements and career advancement.

(Authority: Sect. 621(a)(1) of the Act; 29 U.S.C. 795g(a)(1))

Sec. 379.2 Who is eligible for a grant award under this program?

(a) The Secretary may make a grant under this program to any--

(1) Community rehabilitation program provider;

(2) Designated State unit;

(3) Employer;

(4) Indian tribe or tribal organization;

(5) Labor Union;

(6) Nonprofit agency or organization;

(7) Trade association; or

(8) Other agency or organization with the capacity to create and

expand job and career opportunities for individuals with disabilities.

(b) New awards may be made only to those eligible entities

identified in paragraph (a) of this section that propose to serve

individuals with disabilities in States, portions of States, Indian

tribes, or tribal organizations that are currently unserved or

underserved by the PWI program.

(Authority: Section 621(a)(2) and 621(e)(2) of the Act; 29 U.S.C.

795g(a)(2) and 795g(e)(2))

Sec. 379.3 Who is eligible for services under this program?

(a) An individual is eligible for services under this program if

the appropriate State vocational rehabilitation unit determines the

individual to be an individual with a disability or an individual with

a severe disability, as defined in sections 7(8)(A) and 7(15)(A),

respectively, of the Act.

(b) In making the determination under paragraph (a) of this

section, the State vocational rehabilitation unit shall rely on the

determination made by the recipient of the grant under which the

services are provided, to the extent that the determination is

appropriate, available, and consistent with the requirements of the

Act.

(c) If a State vocational rehabilitation unit does not notify a

recipient of a grant within 60 days that the determination of the

recipient is inappropriate, the recipient of the grant may consider the

individual to be eligible for services.

(Authority: Sect. 621(a)(3) of the Act; 29 U.S.C. 795g(a)(3))

Appendix to Sec. 379.3

The following guidance is provided regarding the determination

of eligibility for PWI project services:

(1) If an individual is referred to the PWI project by the State

vocational rehabilitation (VR) unit and the individual has been

determined by the State VR unit to be an ``individual with a

disability'' under section 102(a)(1)(A) of the Act, then the PWI

grantee may initiate services to that individual. In these

instances, the State VR unit should provide documentation of this

determination to the PWI grantee. If the State VR unit has

determined that the individual also meets the definition of an

``individual with a severe disability'' under section 7(15)(A) of

the Act, the PWI grantee should be advised of that determination and

provided appropriate documentation of that determination.

(2) If an individual is not referred to the PWI project by the

State VR unit, then the PWI grantee makes an initial or preliminary

determination that the individual is eligible for services because

the individual meets the definition of an ``individual with a

disability'' or an ``individual with a severe disability.'' The

State VR unit has a maximum of 60 days to assess the appropriateness

of the preliminary determination. If the State VR unit does not

decide that the preliminary eligibility determination is

inappropriate within this time period, the eligibility determination

becomes final.

Sec. 379.4 What regulations apply?

The following regulations apply to the Projects With Industry

program:

(a) The regulations in this part 379; and

(b) The regulations in 34 CFR part 369, except for the regulations

in Secs. 369.30 and 369.31.

Authority: Sect. 621 of the Act; 29 U.S.C. 795g)

Sec. 379.5 What definitions apply?

(a) The definitions in 34 CFR part 369 apply to this program.

(b) The following definitions also apply to this program:

(1) Career advancement services mean services that develop specific

job skills beyond those required by the position currently held by an

individual with a disability to assist the individual to compete for a

promotion or achieve an advanced position.

(2) Competitive employment, as the placement outcome under this

program, means work--

(i) In the competitive labor market that is performed on a full-

time or part-time basis in an integrated setting; and

(ii) For which an individual is compensated at or above the minimum

wage, but not less than the customary or usual wage and terms and

benefits provided by the employer for the same or similar work

performed by individuals who are not disabled.

(3) Integrated setting, as part of the definition of competitive

employment, means a setting typically found in the community in which

individuals with disabilities interact with non-disabled individuals,

other than non-disabled individuals who are providing services to them,

to the same extent that non-disabled individuals in comparable

positions interact with other persons.

(4) Job readiness training, as used in Sec. 379.41(a), means--

(i) Training in job-seeking skills;

(ii) Training in the preparation of resumes or job applications;

(iii) Training in interviewing skills;

(iv) Participating in a job club; or

(v) Other related activities that may assist an individual to

secure competitive employment.

(5) Job training, as used in this part, means one or more of the

following training activities provided prior to placement, as that term

is defined in Sec. 379.5(b)(7):

(i) Occupational skills training.

(ii) On-the-job training.

(iii) Workplace training combined with related instruction.

(iv) Job skill upgrading and retraining.

(v) Training to enhance basic work skills and workplace

competencies.

(vi) On-site job coaching.

(6) Person served means an individual for whom services by a PWI

project have been initiated with the objective that those services will

result in a placement in competitive employment.

(7) Placement means the attainment of competitive employment by a

person who has received services from a PWI project and has maintained

employment for a period of at least 90 days.

(Authority: Sects. 12(c) and 621 of the Act; 29 U.S.C. 711(c) and

795g)

[[Page 5690]]

Subpart B--What Kinds of Activities Does the Department of

Education Assist Under This Program?

Sec. 379.10 What types of project activities are required of each

grantee under this program?

Each grantee under the PWI program shall--

(a) Arrange for the provision of, or provide individuals with

disabilities with, job training in a realistic work setting, if

appropriate to the needs of the individual, in order to prepare

individuals for employment and career advancement in the competitive

labor market;

(b) Provide individuals with disabilities with job placement and

career advancement services;

(c) Provide individuals with disabilities with supportive services

that are necessary to permit them to maintain the employment and career

advancement for which they have received training under this program;

(d) To the extent appropriate, provide for--

(1) The development and modification of jobs and careers to

accommodate the special needs of the individuals with disabilities

being trained and employed under this program;

(2) The purchase and distribution of rehabilitation technology to

meet the needs of individuals with disabilities at job sites; and

(3) The modification of any facilities or equipment of the employer

that are to be used by individuals with disabilities under this

program; and

(e) Provide for the establishment of a Business Advisory Council

(BAC) comprised of representatives of private industry, business

concerns, organized labor, and individuals with disabilities and their

representatives who will identify job and career availability within

the community, the skills necessary to perform those jobs and careers,

and prescribe appropriate training programs.

Appendix to Sec. 379.10

A PWI grantee can meet the requirements of Sec. 379.10(a) (1) by

directly providing job training to project participants, (2) by

arranging for the provision of this training by other entities and

taking appropriate follow-up measures to ensure that the training

is, in fact, provided, or (3) by a combination of both (1) and (2).

The job training provided must meet the definition of job training

in Sec. 379.5(b)(5) and must be provided as appropriate to the needs

of each individual served by the project. Although each individual

served by the project may not need job training, the Secretary

expects that each PWI project will have an identifiable job training

component that is available to those individuals who need it. In

order to meet the requirements of Sec. 379.10(a), the job training

must be provided while the individual is participating in the

project (i.e. prior to, or within 90 days of, attaining competitive

employment). Therefore, training provided by an employer more than

90 days after the individual begins competitive employment would not

meet this requirement. In addition, a project that provides only job

readiness training, as defined in Sec. 379.5(b)(4), would not meet

the requirements of Sec. 379.10(a).

(Authority: Sect. 621(a) of the Act; 29 U.S.C. 795g)

Sec. 379.11 What additional types of project activities may be

authorized under this program?

The Secretary may include, as part of grant agreements with

recipients under this program, authority for recipients to provide the

following types of technical assistance:

(a) Assisting employers in hiring individuals with disabilities.

(b) Improving or developing relationships between grant recipients

or prospective grant recipients and employers or organized labor.

(c) Assisting employers in understanding and meeting the

requirements of the Americans with Disabilities Act of 1990 (42 U.S.C

12101 et seq.) as that Act relates to employment of individuals with

disabilities.

(Authority: Sect. 621(a) of the Act; 29 U.S.C 795g)

Subpart C--How Does One Apply for an Award?

Sec. 379.20 How does an eligible entity apply for an award?

In order to apply for a grant, an eligible entity shall submit an

application to the Secretary in response to an application notice

published in the Federal Register.

(Approved by the Office of Management and Budget under control

number 1820-0612.)

(Authority: Sec. 621(e)(1)(B) of the Act; 29 U.S.C. 795g(e)(1)(B))

Sec. 379.21 What is the content of an application for an award?

(a) The grant application must include a description of--

(1) The proposed job training to prepare project participants for

specific jobs in the competitive labor market for which there is a need

in the geographic area to be served by the project, as identified by an

existing current labor market analysis or other needs assessment or one

conducted by the applicant in collaboration with private industry;

(2) The involvement of private industry in the design of the

proposed project and the manner in which the project will collaborate

with private industry in planning, implementing, and evaluating job

training, job placement, and career advancement activities;

(3) The responsibilities of the BAC and how it will interact with

the project in carrying out grant activities;

(4) The geographic area to be served by the project, including an

explanation of how the area is currently unserved or underserved by the

PWI program;

(5) A plan for evaluating annually the operation of the proposed

project, which, at a minimum, provides for collecting and submitting to

the Secretary the following information and any additional data needed

to determine compliance with the program compliance indicators

established in subpart F of this part:

(i) The numbers and types of individuals with disabilities served.

(ii) The types of services provided.

(iii) The sources of funding.

(iv) The percentage of resources committed to each type of service

provided.

(v) The extent to which the employment status and earning power of

individuals with disabilities changed following services.

(vi) The extent of capacity building activities, including

collaboration with business and industry and other organizations,

institutions, and agencies, including the State vocational

rehabilitation unit.

(vii) A comparison, if appropriate, of activities in prior years

with activities in the most recent year.

(viii) The number of project participants who were terminated from

project placements and the duration of those placements;

(6) A description of the manner in which the project will address

the needs of individuals with disabilities from minority backgrounds,

as required by 34 CFR 369.21; and

(7) A description of how career advancement services will be

provided to project participants.

(b) The grant application must also include assurances from the

applicant that--

(1) The project will carry out all activities required in

Sec. 379.10;

(2) Individuals with disabilities who are placed by the project

will receive compensation at or above the minimum wage, but not less

than the customary or usual wage paid by the employer for the same or

similar work performed by individuals who are not disabled;

(3) Individuals with disabilities who are placed by the project

will be given

[[Page 5691]]

terms and benefits of employment equal to those that are given to

similarly situated co-workers and will not be segregated from their co-

workers; and

(4) The project will maintain any records required by the Secretary

and make those records available for monitoring and audit purposes.

(Approved by the Office of Management and Budget under control

number 1820-0612.)

(Authority: Secs. 621(a)(4), 621(a)(5), 621(b), and 621(e)(1)(B) of

the Act; 29 U.S.C. 795g(a)(4), 795g(a)(5), 795g(b), and

795g(e)(1)(B))

Subpart D--How Does the Secretary Make a Grant?

Sec. 379.30 What selection criteria does the Secretary use under this

program?

The Secretary uses the following criteria to evaluate an

application:

(a) Extent of need for project (20 points). The Secretary reviews

each application to determine the extent to which the project meets

demonstrated needs. The Secretary looks for evidence that--

(1) The applicant has described an existing current labor market

analysis or other needs assessment, or one that it has performed in

collaboration with private industry, that shows, for the geographic

area to be served, a demand in the competitive labor market for the

types of jobs for which project participants will be trained; and

(2) The job training to be provided meets the identified needs for

personnel in specific occupations or occupational categories in the

geographic area to be served.

(b) Partnership with industry (25 points). The Secretary looks for

information that demonstrates--

(1) The extent of the project's proposed collaboration with private

industry in the planning, implementation, and evaluation of job

training, placement, and career advancement activities; and

(2) The extent of proposed participation of the BAC in the

identification of job and career opportunities, the skills necessary to

perform the jobs and careers identified, and the development of

training programs designed to develop these skills.

(c) Project design and plan of operation for achieving competitive

employment outcomes (25 points). The Secretary reviews each application

to determine--

(1) The extent to which the project goals and objectives for

achieving competitive employment outcomes for individuals with

disabilities to be served by the project are clearly stated and meet

the needs identified by the applicant and the purposes of the program;

(2) The extent to which the project provides for all services and

activities required under Sec. 379.10;

(3) The feasibility of proposed strategies and methods for

achieving project goals and objectives for competitive employment

outcomes for project participants;

(4) The extent to which project activities will be coordinated with

the State vocational rehabilitation unit and with other appropriate

community resources in order to ensure an adequate number of referrals

and a maximum use of comparable benefits and services;

(5) The extent to which the applicant's management plan will ensure

proper and efficient administration of the project; and

(6) Whether the applicant has proposed a realistic timeline for the

implementation of project activities to ensure timely accomplishment of

proposed goals and objectives to achieve competitive employment

outcomes for individuals with disabilities to be served by the project.

(d) Adequacy of resources and quality of key personnel (10 points).

The Secretary reviews each application to determine--

(1) The adequacy of the resources (including facilities, equipment,

and supplies) that the applicant plans to devote to the project;

(2) The quality of key personnel who will be involved in the

project, including--

(i) The qualifications of the project director;

(ii) The qualifications of each of the other key personnel to be

used in the project; and

(iii) The experience and training of key personnel in fields

related to the objectives and activities of the project; and

(3) The way the applicant plans to use its resources and personnel

to achieve the project's goals and objectives, including the time that

key personnel will commit to the project.

(e) Budget and cost effectiveness (10 points). The Secretary

reviews each application to determine the extent to which--

(1) The budget is adequate to support the project; and

(2) Costs are reasonable in relation to the objectives of the

project.

(f) Project evaluation (10 points). The Secretary reviews each

application to determine the quality of the proposed evaluation plan

with respect to--

(1) Evaluating project operations and outcomes;

(2) Involving the BAC in evaluating the project's job training,

placement, and career advancement activities;

(3) Meeting the annual evaluation reporting requirements in

Sec. 379.21(a)(5);

(4) Determining compliance with the indicators; and

(5) Addressing any deficiencies identified through project

evaluation.

(Approved by the Office of Management and Budget under control

number 1820-0612.)

(Authority: Secs. 12(c) and 621 of the Act; 29 U.S.C. 711(c) and

795g)

Sec. 379.31 What other factors does the Secretary consider in

reviewing an application?

In addition to the selection criteria in Sec. 379.30, the

Secretary, in making awards under this program, considers--

(a) The equitable distribution of projects among the States; and

(b) The past performance of the applicant in carrying out a similar

PWI project under previously awarded grants, as indicated by factors

such as compliance with grant conditions, soundness of programmatic and

financial management practices, and meeting the requirements of subpart

F of this part.

(Authority: Secs. 621(e)(2) and 621(f)(4) of the Act; 29 U.S.C.

795g(e)(2) and 795g(f)(4))

Subpart E--What Conditions Must Be Met by a Grantee?

Sec. 379.40 What are the matching requirements?

The Federal share may not be more than 80 percent of the total cost

of a project under this program.

(Authority: Sec. 621(c) of the Act; 29 U.S.C. 795g(c))

Appendix to Sec. 379.40

(a) For example, if the total cost of a project is $500,000, the

Federal share would be no more than $400,000 and the grantee's

required minimum share (matching contribution) would be $100,000

(provided in cash or through third party in-kind contributions). The

matching contribution is based upon the total cost of the project,

not on the amount of the Federal grant award.

(b) The matching contribution must comply with the requirements

of 34 CFR 74.23 (for grantees that are institutions of higher

education, hospitals, or other nonprofit organizations) or 34 CFR

80.24 (for grantees that are State, local, or Indian tribal

governments). The term third party in-kind contributions is defined

in either 34 CFR 74.2 or 34 CFR 80.3, as applicable to the type of

grantee.

Sec. 379.41 What are allowable costs?

In addition to those costs that are allowable in accordance with 34

CFR 74.27 and 34 CFR 80.22, the following items are allowable costs

under this program:

[[Page 5692]]

(a) The costs of job readiness training, as defined in

Sec. 379.5(b)(4); job training, as defined in Sec. 379.5(b)(5); job

placement services; job development and modification; and related

vocational rehabilitation services and supportive rehabilitation

services.

(b) Instruction and supervision of trainees.

(c) Training materials and supplies, including consumable

materials.

(d) Instructional aids.

(e) The purchase or modification of rehabilitation technology to

meet the needs of individuals with disabilities.

(f) Alteration and renovation appropriate and necessary to ensure

access to and use of buildings by persons with disabilities served by

the project.

(g) The modification of any facilities or equipment of the employer

to be used by individuals with disabilities under this program.

(Authority: Secs. 12(c) and 621 of the Act; 29 U.S.C. 711(c) and

795g))

Sec. 379.42 What are the requirements for a continuation award?

(a) A grantee that wants to receive a continuation award must--

(1) Comply with the provisions of 34 CFR 75.253(a), including

making substantial progress toward meeting the objectives in its

approved application and submitting all performance and financial

reports required by 34 CFR 75.118; and

(2) Submit data in accordance with Sec. 379.54 showing that it has

met the program compliance indicators established in Subpart F of this

part.

(b) In addition to the requirements in paragraph (a) of this

section, the following other conditions in 34 CFR 75.253(a) must be met

before the Secretary makes a continuation award:

(1) Congress must appropriate sufficient funds under the program.

(2) Continuation of the project must be in the best interest of the

Federal Government.

(Approved by the Office of Management and Budget under control

number 1820-0612.)

(Authority: Secs. 12(c) and 621(f)(4) of the Act; 29 U.S.C. 711(c)

and 795g(f)(4))

Sec. 379.43 What are the additional reporting requirements?

Each grantee shall submit the data from its annual evaluation of

project operations required under Sec. 379.21(a)(5) no later than 60

days after the end of each project year, unless the Secretary

authorizes a later submission date.

(Approved by the Office of Management and Budget under control

number 1820-0612.)

(Authority: Secs. 12(c) and 621 of the Act; 29 U.S.C. 711(c) and

795g)

Subpart F--What Compliance Indicator Requirements Must a Grantee

Meet To Receive Continuation Funding?

Sec. 379.54 What are the reporting requirements for the compliance

indicators?

(a) In order to receive continuation funding for the third or any

subsequent year of a PWI grant, each grantee must submit data for the

most recent complete project year no later than 60 days after the end

of that project year, unless the Secretary authorizes a later

submission date, in order for the Secretary to determine if the grantee

has met the program compliance indicators established in this Subpart

F.

(b) If the data for the most recent complete project year provided

under paragraph (a) of this section shows that a grantee has failed to

achieve the minimum composite score required in Sec. 379.52(f) to meet

the program compliance indicators, the grantee may, at its option,

submit data from the first 6 months of the current project year no

later than 60 days after the end of that 6-month period, unless the

Secretary authorizes a later submission date, to demonstrate that its

project performance has improved sufficiently to meet the minimum

composite score.

(Approved by the Office of Management and Budget under control

number 1820-0612.)

(Authority: Sec. 621(f)(2) of the Act; 29 U.S.C. 795g(f)(2))

Note: A grantee receives its second year of funding (or the

first continuation award) under this program before data from the

first complete project year is available. Data from the first

project year, however, must be submitted and is used (unless the

grantee exercises the option in paragraph (b) of this section) to

determine eligibility for the third year of funding (or the second

continuation award).

* * * * *

Sec. 379.53 [Amended]

2. Section 379.53 is amended by adding ``(Approved by the Office of

Management and Budget under control number 1820-0612.)'' before the

authority citation at the end of the section.

[FR Doc. 97-2834 Filed 2-5-97; 8:45 am]

BILLING CODE 4000-01-P