# Senior Community Service Employment Program; Notice of Proposed Rulemaking > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3AE8-17802 ## Record - **Collection:** Federal Register - **Document type:** Proposed Rule - **Published:** August 14, 2008 - **Citation:** 73 FR 47770 ## Text DEPARTMENT OF LABOR Employment and Training Administration 20 CFR Part 641 RIN 1205-AB48 Senior Community Service Employment Program; Notice of Proposed Rulemaking AGENCY: Employment and Training Administration, Labor. ACTION: Notice of proposed rulemaking with request for comments. SUMMARY: The Employment and Training Administration of the Department of Labor (Department) is issuing this Notice of Proposed Rulemaking (NPRM) to propose changes in the Senior Community Service Employment Program resulting from the 2006 Amendments to title V of the Older Americans Act, and to clarify various policies. Key proposed changes include the introduction of a 48-month limit on participation, regular competition for national grants, and an available increase in the proportion of grant funds that can be used for participant training and supportive services. Comments on this proposed rule are welcome according to the dates listed below. DATES: Interested persons are invited to submit comments on this proposed rule. To ensure consideration, comments must be received on or before October 14, 2008. Comments received after that date will be considered to the extent possible. Comments should be limited to the proposed changes and additions to the current regulations, all of which are discussed in the preamble to this NPRM, or to other changes to the current regulations which flow from the 2006 Amendments. ADDRESSES: You may submit comments, identified by Regulatory Information Number (RIN) 1205-AB48, by either of the following methods: • Federal e-Rulemaking Portal: www.regulations.gov. Follow the Web site instructions for submitting comments. • Mail and hand delivery/courier: Written comments, disk, and CD-Rom submissions may be mailed to Thomas M. Dowd, Administrator, Office of Policy Development and Research, U.S. Department of Labor, 200 Constitution Avenue, NW., Room N-5641, Washington, DC 20210. Instructions: Label all submissions with RIN 1205-AB48. Please be advised that the Department will post all comments received on www.regulations.gov without making any change to the comments, or redacting any information. The www.regulations.gov Web site is the Federal e-rulemaking portal and all comments posted there are available and accessible to the public. Therefore, the Department recommends that commenters safeguard any personal information such as Social Security Numbers, personal addresses, telephone numbers, and e-mail addresses included in their comments as such may become easily available to the public via the www.regulations.gov Web site. It is the responsibility of the commenter to safeguard his or her information. Also, please note that due to security concerns, postal mail delivery in Washington, DC, may be delayed. Therefore, the Department encourages the public to submit comments via the Internet as indicated above. Docket: The Department will make all the comments it receives available for public inspection during normal business hours at the above address. If you need assistance to review the comments, the Department will provide you with appropriate aids such as readers or print magnifiers. The Department will make copies of the rule available, upon request, in large print and electronic file on computer disk. The Department will consider providing the rule in other formats upon request. To schedule an appointment to review the comments and/or obtain the rule in an alternative format, contact the Office of Policy Development and Research at (202) 693-3700 (not a toll-free number). You may also contact this office at the address listed above. FOR FURTHER INFORMATION CONTACT: Sherril Hurd, Acting Team Leader, Regulations Unit, Office of Policy Development and Research, U.S. Department of Labor, 200 Constitution Avenue, NW., Room N-5641, Washington, DC 20210; telephone (202) 693-3700 (this is not a toll-free number). Individuals with hearing or speech impairments may access the telephone number above via TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339. SUPPLEMENTARY INFORMATION: The preamble to this proposed rule is organized as follows: I. Background—Provides a Brief Description of the Development of the Proposed Rule II. Section-By-Section Review of the Proposed Rule—Summarizes and Discusses Proposed Changes to the Senior Community Service Employment Program (SCSEP) Regulations III. Administrative Information—Sets Forth the Applicable Regulatory Requirements I. Background On October 17, 2006, President Bush signed the Older Americans Act (OAA) Amendments of 2006, Public Law 109-365 (2006 OAA). This law amended the statute authorizing SCSEP and necessitates changes to the SCSEP regulations. The Department's Employment and Training Administration (ETA) promulgated an IFR on June 29, 2007 that implemented changes in the SCSEP performance measurement system required by the 2006 OAA. This proposed rule proposes to implement the remainder of the changes in the SCSEP necessitated by the 2006 OAA, and to clarify various program policies. The SCSEP, authorized by title V of the OAA, is the only Federally-sponsored employment and training program targeted specifically to low-income older individuals who want to enter or re-enter the workforce. Participants must be unemployed, 55 years of age or older, and have incomes no more than 125 percent of the Federal poverty level. The program offers participants training at community service employment assignments in public and non-profit agencies. The goals of the program are to move SCSEP participants into unsubsidized employment so that they can achieve economic self-sufficiency, and to promote useful opportunities in community service activities. In the 2006 OAA, Congress expressed its sense of the benefits of the SCSEP, stating, “placing older individuals in community service positions strengthens the ability of the individuals to become self-sufficient, provides much-needed support to organizations that benefit from increased civic engagement, and strengthens the communities that are served by such organizations.” OAA section 516(2). Many of the policy initiatives contained in the 2000 OAA, Public Law 106-501, and reflected in the 2004 SCSEP final rule, 69 FR 19014, Apr. 19, 2004, are maintained in the 2006 OAA and this proposed rule. Other policies are amplified. Most notably, there is a greater emphasis on placing individuals in unsubsidized employment, as evidenced by the new 48-month limitation on participation in the SCSEP (OAA sec. 518(a)(3)(B); § 641.570 of this part); the new limitations on benefits (OAA sec. 502(c)(6)(A)(i); § 641.565 of this part); and the increase in available funds for training and supportive services to prepare participants for the unsubsidized workforce (OAA sec. 502(c)(6)(C); § 641.874 of this part). A focus on the transition of participants into unsubsidized employment allows more eligible individuals to be served by the SCSEP and thus to potentially benefit from employment opportunities and income gains. Coordination between the SCSEP and the programs under the Workforce Investment Act of 1998 (WIA), 29 U.S.C. 2801 et seq. , continues to be an important objective of the 2006 OAA. With the enactment of WIA in 1998, the SCSEP became a required partner in the workforce investment system. 29 U.S.C. 2841(b)(1)(B)(vi). In 2000, Congress amended the SCSEP to require coordination with the WIA One-Stop Delivery System (Pub. L. 106-501 sec. 505(c)(1)), including reciprocal use of assessment mechanisms and Individual Employment Plans (Pub. L. 106-501 sec. 502(b)(4)). The underlying notion of the One-Stop Delivery System is the coordination of programs, services, and governance structures, so that the customer has access to a seamless system of workforce investment services. Consistent with current SCSEP practice, both WIA and the 2006 OAA require any grantee operating a SCSEP project in a local area to negotiate a Memorandum of Understanding (MOU) with the Local Workforce Investment Board. WIA section 121; OAA section 511(b); see also OAA section 502(b)(1)(O). The MOU must detail the SCSEP project's involvement in the One-Stop Delivery System. In particular, SCSEP grantees/sub-recipients must make arrangements to provide their participants, eligible individuals the grantees are unable to serve, as well as SCSEP-ineligible individuals, with access to services available in the One-Stop Centers. OAA secs. 510, 511; §§ 641.210, 641.220 of this part. Because the SCSEP is a required partner under WIA, SCSEP grantees and sub-recipients must ensure that they are familiar with WIA's statutory and regulatory provisions. Congress is considering legislation to reauthorize WIA, and reauthorization may bring changes to the law. SCSEP grantees and sub-recipients must ensure that they keep current on any changes in WIA law that could impact their program. The 2006 OAA also increases the accountability of grantees by clearly requiring a competitive process for grant awards. This proposed rule implements the statute's requirement that the national SCSEP grants be re-competed regularly, generally every four years. OAA section 514(a); § 641.490(a) of this part. This proposed rule also implements the statute's requirement that a State compete its SCSEP grant if the current State grantee fails to meet its core performance goals for three consecutive years. OAA sec. 513(d)(3)(B)(iii); § 641.490(b) of this part. In addition, the 2006 OAA establishes new funding opportunities for pilot, demonstration, and evaluation projects (OAA sec. 502(e); § 641.600-640 of this part), expands the priority-for-service categories (OAA sec. 518(b); § 641.520 of this part), and modifies how the program determines income eligibility (OAA sec. 518(3)(A); § 641.510 of this part). To the extent that the 2006 OAA does not change the 2000 OAA, these proposed regulations do not change the statutory interpretations or policy positions that supported the current regulations. The SCSEP is an established program; we do not propose to begin anew with this proposed rule but rather build upon the regulatory framework that has developed over the years. The proposed changes, mostly necessitated by statutory revisions, are discussed further in the next section of the preamble. The Department notes that it will continue to use the name “Senior Community Service Employment Program” for this program, although the OAA refers to it in various terms. The Department solicits comments on this proposed rule. For ease of reading, the Department is publishing the full regulatory text for subparts B-F, H and I. The regulatory text that was amended in the IFR, which includes all of subpart G and some definitions in subpart A, is not reprinted here. With the exception of § 641.140 (definitions), the regulatory text herein includes the proposed changes as well as the several provisions that are unchanged. We are not reprinting unchanged definitions. The Department solicits comments on the proposed changes in this notice. We particularly invite comments, in accordance with the requirements of section 514(f) of the 2006 OAA, addressing any concerns that these proposed regulations significantly compromise the ability of grantees to serve their targeted populations of minority older individuals, in areas where substantial populations of minority individuals reside. II. Section-by-Section Review of the Proposed Rule This proposed rule amends subparts A-F, H, and I of part 641 of Title 20 of the Code of Federal Regulations. It proposes changes required by the 2006 OAA, and proposes to clarify various policies. The Department previously promulgated an IFR, 72 FR 35832, June 29, 2007, which addressed changes in the SCSEP performance measurement system required by the 2006 OAA. The IFR revised subpart G, which addresses performance accountability, and added several definitions to, and revised certain definitions within, subpart A that relate to the performance measures. The amendments that were contained in the IFR are not repeated here. The Department proposes to make two changes that affect many of the subparts. We now refer to sub-recipients along with grantees where the responsibility or requirement being discussed applies to not just the grantees, but their sub-recipients as well. We also change from the term “community service assignment” to “community service employment assignment” throughout this part to be consistent with a similar change in the language of the statute (see, e.g., OAA section 502(b)(1)(A)), and to emphasize the SCSEP's goal of employment in addition to community service (OAA sec. 502(a)(1)). By including “employment” in the phrase “community service employment assignment,” the Department does not mean that participants have a right to long-term employment under the SCSEP, however. The SCSEP provides temporary, subsidized, part-time employment assignments to prepare older workers for unsubsidized employment as well as to provide valuable community services. Subpart A—Purpose and Definitions What Does This Part Cover? (§ 641.100) Section 641.100 provides an overview of each subpart of the SCSEP regulations. As reflected in paragraph (c) the Department proposes to change the name of the State Plan, and to include a reference to the Plan's four-year strategy, both in accordance with the 2006 OAA and as further described in the preamble for subpart C, below. We propose to add a phrase to the description of subpart D to clarify that subpart D contains provisions relating to the grant application and responsibility review requirements for “the Department's award of SCSEP funds for State and National grants.” Subpart D does not apply to the pilot, demonstration, and evaluation grants described in subpart F. As is the case in the current regulations, proposed subpart F contains its own provision about applying for those grants (see § 641.620). The Department proposes to revise paragraph (f) of the overview to indicate that subpart F provides the rules for pilot, demonstration, and evaluation projects as provided at section 502(e) of the 2006 OAA. These projects replace the private sector training projects that were authorized under section 502(e) of the 2000 OAA, Public Law 106-501. In paragraph (g) we propose to replace the reference to sanctions with a reference to corrective actions for failure to meet core performance measures, to mirror the language of the 2006 OAA (see, e.g., OAA section 513(d)). Finally, in paragraph (h), we describe subpart H as concerning the administrative requirements for SCSEP “funds” rather than SCSEP “grants” because many of the requirements contained in subpart H are not limited to grantees. What Is the SCSEP? (§ 641.110) This section briefly describes the SCSEP. We propose to add the word “unemployed” to the description of individuals served to more thoroughly describe the program. In the past, grantees and applicants/participants have asked whether a person has to be unemployed to be eligible for the SCSEP. Unemployed is—and has been —an eligibility requirement. Also, whereas in the current regulations the program description speaks of “placing” participants in “community service positions,” the Department now proposes to state that the SCSEP “trains” participants in “community service employment assignments.” And, whereas the current regulations state that the SCSEP serves participants by “assisting them to transition to unsubsidized employment,” we propose to clarify that the SCSEP serves participants by “assisting them in developing skills and experience to facilitate their transition to unsubsidized employment.” We propose this change to provide more specificity about the services the SCSEP provides and how these services advance the goal of unsubsidized employment. What Are the Purposes of the SCSEP? (§ 641.120) This section describes the purposes of the SCSEP, and is based on the statement establishing the program in section 502(a)(1) of the OAA. The Department proposes to revise this section in accordance with changes in the 2006 OAA, which rearranges the ordering of the purposes. In the 2006 OAA, “foster[ing] individual economic self-sufficiency” is listed first among the purposes of the SCSEP; fostering and promoting useful community service activities was listed first in the 2000 OAA. We propose to amend our description accordingly. The Department interprets the placement of this purpose at the front of the list of purposes as consistent with an increased focus on placing participants in unsubsidized employment. We also propose to alter the statement of the goal concerning community service. The current regulations state that a purpose of the SCSEP is to “foster and promote useful part-time opportunities in community service activities.” We propose to change this to: “Promote useful part-time opportunities in community service employment assignments.” We omit the word “foster” from this phrase to be consistent with the language of the statute. Our use of the term community service employment assignment was discussed above, and is changed consistently in the rest of this proposed rule. What Is the Scope of This Part? (§ 641.130) The proposed change in this section concerns administrative issuances. The current regulations indicate that administrative guidance and information will be provided via “SCSEP Bulletins, technical assistance guides, and other SCSEP directives.” We propose to revise this section to reflect the current ETA advisory system. We now issue administrative guidance and information for the SCSEP through Training and Employment Guidance Letters (TEGLs), Training and Employment Notices (TENs), technical assistance guides, and other SCSEP guidance. The Department no longer uses Older Worker Bulletins to issue administrative guidance; however, previously issued Bulletins that have not been rescinded, and have not been superseded by the 2006 OAA, are still in effect. All valid administrative issuances, as well as an abundance of other program information, may be viewed at the SCSEP Web site, http://www.doleta.gov/seniors . What Definitions Apply to This Part? (§ 641.140) The Department proposes to amend several SCSEP definitions. New Definitions We propose to add the following five definitions: Pacific Island and Asian Americans: The Department adds the definition of Pacific Island and Asian Americans that appears in section 518(a)(5) of the 2006 OAA. Program operator: We move the definition of “first tier sub-recipient” from § 641.856 to the definitions section, rename it “program operators,” and expand it to make clear that it applies to all entities that operate a SCSEP program, not just to those entities that receive their funds directly from the grantee. Our intent is to clarify that all entities operating a SCSEP program, and not just those one tier down from direct SCSEP grantees, must adhere to program laws and regulations such as the requirement to track, record, and report administrative costs, and must limit those costs to comply with the administrative costs cap. Secretary: We clarify that Secretary means the Secretary of the Department of Labor. Supportive services: Section 518(a)(7) of the 2006 OAA defines supportive services and we adopt the statutory definition here. Unemployed: We adopt the definition from section 518(a)(8) of the 2006 OAA. Revised Definitions We propose to revise the following definitions: Authorized position level: We remove the sentence that appears at the end of the definition in the current regulations, which states that the authorized position level is calculated by dividing a grantee's total award by the national unit cost, because it is repetitive of other language in the definition. Community service: We revise the definition of community service to align more precisely with the statutory definition. We omit the opening phrase, “includes, but is not limited to,” and replace it with a provision at the end of the definition allowing the Secretary to include in the definition other services by rule as appropriate. In addition, we have included a lettered listing of the 2006 OAA's grouping of services. Equitable distribution report: In the phrase, “taking the needs of underserved counties into account,” we replace the word “counties” with “jurisdictions” to be inclusive of entities other than counties, such as incorporated cities, which may also be underserved. Grantee: We alter the list of possible entities that may serve as grantees to more closely follow the language of the 2006 OAA at section 502(b)(1). Accordingly, whereas the current regulations list both “States” and “agencies of a State government” as possible grantees, we now list only “State agencies.” Also, the 2006 OAA dropped language indicating that political subdivisions of a State, or a combination of such political subdivisions, could serve as a grantee; we therefore delete such language from this definition. We also modify the definition of grantee to eliminate the reference to section 502(e) grantees, since private sector training projects are no longer authorized, and to make technical corrections. Greatest economic need: We update the citation for this definition. Greatest social need: We alter the definition of greatest social need to make technical corrections and to update the statutory citation. Host agency: The Department revises the definition of host agency three ways. First, we insert the word “training” before “work site” to underscore that the community service employment assignment is a venue for training SCSEP participants. We also create a stand-alone sentence stating that political parties cannot be host agencies, for clarity. Concerning political parties, we note that we interpret section 502(b)(1)(D) of the 2006 OAA as containing a misplaced ending parenthesis. As political parties are not covered by section 501(c)(3) of the Internal Revenue Code, we consider that the final parenthesis should appear after the word “parties.” Our interpretation here simply maintains the same understanding of host agencies as existed under the 2000 OAA—political parties cannot be host agencies, and non-profit agencies that are 501(c)(3) may be host agencies. Finally, we include the word “sectarian” before “religious” to more closely adhere to the language of the OAA. Indian: We update the citation. Indian tribe: We insert a citation to the Alaska Native Claims Settlement Act in the definition of Indian tribe, as is done in the statutory definition. We also update the citation. Individual Employment Plan or IEP: We modify the definition of Individual Employment Plan by moving to the beginning of the definition the statement that the IEP is based on an assessment of the participant, because that fact is fundamental to the development of an IEP. We have added language to acknowledge that a recent assessment or IEP prepared by another employment and training program may be used in lieu of one prepared by the grantee or sub-recipient, reflecting language in the statute and in § 641.230, related to an assessment or IEP completed by the One-Stop delivery system. We delete the language concerning the “appropriate sequence of services” and add language referring to “a related service strategy,” reflecting language that has been added to the 2006 OAA. We add the word “appropriate” before “employment goal” to indicate that the employment goal should be one that reflects the assessment of the skills, talents, and training needs of the individual, and may need to be modified over time. We replace the phrase, “achievement of objectives,” with the phrase, “objectives that lead to the goal,” for increased clarity. We have added “a timeline for the achievement of the objectives” because we believe it is useful for the IEP to include target timeframes for the achievement of the identified objectives. We also make grammatical changes. Jobs for Veterans Act: We revise the definition of the Jobs for Veterans Act to clarify that the Jobs for Veterans Act is a distinct statute from the priority of service provision in the OAA, although we use the definition of veteran contained in the Jobs for Veterans Act to determine which participants qualify for the veterans' priority for service (§ 641.520). We also modify the description of which participants qualify for the veterans' preference to more closely follow the language of the Jobs for Veterans Act. OAA: We revise the definition of the Older Americans Act (OAA) to account for all amendments. Other participant (enrollee) costs: We revise the definition of other participant (enrollee) costs to make certain technical corrections, we replace the phrase “supportive services to assist” with “supportive services to enable,” to track the language of the statute, and we clarify that training costs may be incurred prior to commencing or concurrent with a community service employment assignment. Participant: We revise the definition of participant to clarify that an individual must be given a community service employment assignment to be considered a SCSEP participant, though the person need not have begun that assignment to be considered a SCSEP participant. This change makes it possible for participants to get paid their hourly wage for time spent on activities such as orientation and training before they begin working at their community service employment assignment. Poor employment prospects: The phrase “poor employment prospects” appeared in the 2000 OAA and the Department defines it in the 2004 SCSEP final rule. The Department used the definition of poor employment prospects in the current regulations as the basis for developing this revised definition which provides that a person with poor employment prospects is one who has a significant barrier to employment. The barriers listed in the definition are mainly the same characteristics that appear in this definition in the current regulations, but with minor changes to reduce redundancy. The Department interprets the 2006 OAA's term “poor employment prospects” to have the same meaning as the similar phrase which also appears in the 2006 OAA, “low employment prospects.” Thus, the same definition is used for the term low employment prospects, which is also part of this section, but was published in the Senior Community Service Employment Program; Performance Accountability IFR at 72 FR 35832, Jun. 29, 2007. Program Year: We alter the definition of Program Year to remove the statutory reference which no longer exists and to add the word “on” before “July 1.” The substance of the definition is not affected by these changes. Project: We revise the definition of project for increased readability, to remove the unnecessary phrase, “in a particular location within a State,” and to make technical corrections. We also change the phrase, “community service” to “service to communities” in light of the Sense of Congress provision at section 516 of the 2006 OAA which indicates that one benefit of SCSEP projects is their impact on communities. Recipient: We make technical corrections to the definition of recipient. Service area: We revise the definition of service area by adding the clarifying phrase, “in accordance with a grant agreement,” for increased accuracy. State grantee: We revise the definition of State grantee by adding the phrase, “or the highest government official,” after the word “Governor,” to account for those governmental jurisdictions that receive State SCSEP grants but do not have a Governor. State Plan: We revise the definition of State Plan to specify that the State Plan now includes a four-year strategy for, and describes the planning and implementation process for, the statewide provision of SCSEP services, in accordance with section 503(a)(1) of the 2006 OAA. Sub-recipient: Although in the current regulations the Department treats the terms sub-grantee and sub-recipient as synonymous, we now clarify that sub-recipient is the preferred term to use when referring to entities that receive SCSEP funds from grantees. Not all entities that receive SCSEP funds from grantees do so pursuant to a grant; in some cases the mechanism is a contract. Because the term sub-recipient is inclusive of both sub-grantees and sub-contractors, we do not provide separate definitions for these terms. The definition of sub-recipient that we employ is largely the same as the definition of sub-grantee that appears in the current regulations; we deleted one phrase referring to subcontracts because the definition now includes all varieties of sub-awards. Title V of the OAA: We revise the definition of title V of the OAA to account for all amendments. Tribal organization: We update the citation. Workforce Investment Act (WIA): We clarify in the definition of the Workforce Investment Act that references to this law include any and all amendments, and we make technical corrections to the citations. Deleted Definitions The Department proposes to omit several definitions that appear in the current regulations. First, we remove definitions of “placement into public or private unsubsidized employment” and “retention in public or private unsubsidized employment” because those performance measures no longer exist. They were replaced in the IFR by the common measures entry and six-months retention indicators. We also eliminate the definition of co-enrollment because it related to private sector 502(e) projects which are no longer authorized. We eliminate the definition of State workforce agency because that phrase no longer appears in this rule. Finally, we remove the definition of sub-grantee and replace it with the more technically accurate term: “sub-recipient.” Unchanged Definitions Definitions that remain unchanged are not reprinted. The Department added and amended some SCSEP definitions related to performance accountability in the SCSEP; Performance Accountability; IFR, 72 FR 35832, Jun. 29, 2007. Those new and amended definitions do not appear in this proposed rule, and comments on those amendments were sought in the IFR. Subpart B—Coordination With the Workforce Investment Act This subpart covers those provisions of the OAA that require coordination with WIA. Please note that WIA contains additional provisions that are relevant to the SCSEP. The 2006 OAA requires changes to § 641.240 of this part. In addition, the Department proposes several clarifying changes to the regulatory text. What Is the Relationship Between the SCSEP and the Workforce Investment Act? (§ 641.200) The only proposed changes we make in this section are to clarify that sub-recipients (and not just grantees) are included in the requirement to follow all WIA rules and regulations, and to make certain technical corrections to the citations. What Services, in Addition to the Applicable Core Services, Must SCSEP Grantees/Sub-Recipients Provide Through the One-Stop Delivery System? (§ 641.210) This section requires SCSEP grantees and sub-recipients to make arrangements to provide their participants, eligible individuals the grantees/sub-recipients are unable to serve, as well as SCSEP ineligible individuals, with access to other services available at the One-Stop Career Center. There is no change to this section other than two proposed clarifications. First, the Department clarifies that core services are those defined in the WIA regulations at § 662.240 of this title. Second, we also clarify that, in addition to providing eligible and ineligible individuals with access to other activities and programs carried out by other One-Stop partners as is provided in the current regulations, SCSEP grantees/sub-recipients must also make arrangements through the One-Stop Delivery System to provide eligible and ineligible individuals with referrals to WIA intensive and training services. As a required One-Stop partner, and in light of the statutory language in both WIA and title V of the 2006 OAA on the cross-use of individual assessments, it is desirable that SCSEP grantees and sub-recipients make appropriate referrals to the One-Stop system for intensive and training services. Does Title I of WIA Require the SCSEP To Use OAA Funds for Individuals Who Are Not Eligible for SCSEP Services or for Services That Are Not Authorized Under the OAA? (§ 641.220) This section states that even in the One-Stop Career Center environment, SCSEP projects are limited to serving SCSEP-eligible individuals. As discussed in the preamble section addressing SCSEP definitions (§ 641.140), the Department is proposing to revise the definition of participant to clarify that an individual must be given a community service employment assignment, though the person need not have begun that assignment, to be considered a SCSEP participant. Because of this proposed modification, we change the language, “are functioning in a community service assignment,” which had qualified the word participants, to “have each received a community service employment assignment.” We also propose to add language clarifying what an MOU is, and propose to cross-reference the WIA regulatory provisions that relate to the MOU. Must the Individual Assessment Conducted by the SCSEP Grantee/Sub-Recipient and the Assessment Performed by the One-Stop Delivery System Be Accepted for Use by Either Entity To Determine the Individual's Need for Services in the SCSEP and Adult Programs Under Title I-B of WIA? (§ 641.230) The only proposed changes the Department makes to this section are technical ones. We add the word “sub-recipient” to the heading for clarity. We also change the citation to the OAA to reflect the 2006 Amendments, and move the citation to after the first sentence, as the first sentence contains the provision located in the cited statutory section. Are SCSEP Participants Eligible for Intensive and Training Services Under Title I of WIA? (§ 641.240) This section addresses the eligibility of SCSEP participants for intensive and training services under title I of WIA. Under the OAA, SCSEP participants are not automatically eligible to receive intensive and training services under WIA, however Local Boards have the authority to deem SCSEP participants eligible to receive intensive and training services under title I of WIA. We note that WIA eligibility is not based on income except in the adult program when a local area determines that its funds are insufficient and provides priority to low-income individuals. Rather, WIA eligibility is based on the need for and utility of intensive and training services to obtain employment. The Department proposes to revise paragraph (a) by removing the opening word “yes” since it could be read to imply that SCSEP participants are automatically eligible for intensive and training services under title I of WIA, even though the subsequent text states the contrary. In paragraph (b) the Department proposes to make several changes. First, the current regulations state that, “SCSEP participants who have been assessed through a SCSEP IEP have received an intensive service.” An assessment is used in developing an IEP, but assessments are not accomplished through an IEP. Accordingly, to clarify the distinct roles of the assessment and the IEP, the phrase is proposed to read, “SCSEP participants who have been assessed and for whom an IEP has been developed have received an intensive service.” Also in paragraph (b), we propose to revise the sentence addressing SCSEP participants and training. Whereas the current regulations state, “SCSEP participants who seek unsubsidized employment as part of their SCSEP IEP, may require training to meet their objectives,” the proposed rule instead says, “[i]n order to enhance skill development related to the IEP, it may be necessary to provide training beyond the community service employment assignment to enable the participant to meet their unsubsidized employment objectives.” We propose this change to reinforce the role of the IEP, because unsubsidized employment is a goal for all of the SCSEP, not just certain participants, and to clarify that the training under discussion here is training other than that accomplished via the community service employment assignment. We also propose to add a reference to § 641.540, the section of these regulations that addresses participant training in depth. The Department proposes to delete what is paragraph (c) in the current regulations; the Department determined this paragraph conflicts with other relevant regulatory provisions. Paragraph (c) states that community service employment assignments are analogous to work experience activities or intensive services under WIA. This paragraph could create confusion with paragraph (a) of this section, which correctly states that SCSEP participants are not automatically eligible for WIA intensive and training services. Whether or not a community service employment assignment is considered to be an intensive service, a SCSEP participant must still meet the other WIA eligibility requirements to be eligible for training services. The Department also proposes to delete what is paragraph (d) in the current regulations because the subject of that paragraph is thoroughly covered in subpart E. Paragraph (d) indicates that SCSEP participants may be paid while receiving intensive or training services. An explanation of participant wages appears in § 641.565 of these regulations. Subpart C—The State Plan The Department proposes to change the title of this subpart to reflect a change in the name of the State Plan in the 2006 OAA from the prior term, the “State Senior Employment Services Coordination Plan.” This subpart of the regulations implements the new provisions in section 503 of the 2006 OAA, which direct the Governor, or the highest government official, of each State to submit a State Plan that contains a four-year strategy, and require that the State Plan be updated at least every two years. As reflected in these proposed regulations, the State Plan now has a broader role than merely coordination. Comments are welcome on requirements for the four-year strategy, as well as other changes affecting the State Plan that are identified in this preamble or other changes to the current regulations which flow from the 2006 Amendments. What Is the State Plan? (§ 641.300) This section describes the State Plan and emphasizes that it is intended to foster collaboration among SCSEP stakeholders. As noted above, the Department proposes to change the name of the State Plan to reflect the 2006 OAA. We also propose to add language reflecting the new requirement that the State Plan outline a four-year strategy for the statewide provision of community service and other authorized activities for eligible individuals under the SCSEP. The four-year strategy is one component of the State Plan; § 641.325 of these proposed regulations specifies additional information required in the State Plan. What Is a Four-Year Strategy? (§ 641.302) The 2006 OAA requires that States include a four-year strategy in the State Plan; in this proposed section, the Department explains what States must include in their four-year strategy. The four-year strategy is only one component of the State Plan; other elements are discussed in § 641.325 of these regulations. The 2006 OAA does not elaborate on the contents of the four-year strategy, but grants the Secretary authority to determine what provisions should be in the State Plan, consistent with title V. These proposed regulations specify what States must include in the four-year strategy. The Department views the four-year strategy as an opportunity for the State to take a longer-term view of the SCSEP in the State, including its role in workforce development, given projected changes in the State's demographics (particularly the number of older workers), economy, and labor market. In preparing the four-year strategy, the State should address the role of SCSEP vis-á-vis other workforce programs and initiatives as well as other programs serving older workers, and how the State and SCSEP grantees can utilize these other programs to maximize the services available to the SCSEP-eligible population. The four-year strategy also should be used by the State to examine and, as appropriate, plan longer-term changes to the design of the program within the State, such as changes in the utilization of SCSEP grantees and program operators to better achieve the goals of the program. To achieve the objectives described above, the Department proposes to require that the four-year strategy include the following specific elements. First, it must explain the State's long-term plan for achieving an equitable distribution of SCSEP positions within the State (the equitable distribution report, discussed in §§ 641.360 and 641.365, addresses this for the short-term). This information is required as part of the State Plan (see § 641.325), but the State should address equitable distribution over a longer period in its four-year strategy. The strategy must specifically address how, over the four-year period, the State intends to: (1) Move positions from over-served to underserved locations within the State, pursuant to § 641.365 of these regulations; (2) equitably serve rural and urban areas; and (3) serve individuals afforded priority for community service employment and other authorized activities, pursuant to § 641.520 of these regulations. Second, a related provision requires that the State explain its long-term strategy for avoiding disruptions to the program when new Census data that affects the distribution of SCSEP positions across the State becomes available, or when there is over-enrollment for any other reason. This information is included in the State Plan for the short-term, but the State should plan over a longer term for avoidance of disruptions when new Census data become available or there is over-enrollment. Third, the four-year strategy must provide the State's long-term plan for serving minority older individuals under the SCSEP. Section 515 of the 2006 OAA requires a report on services to minority individuals, and this element in the four-year strategy reinforces the law's focus on minority individuals and will provide information that may be used in the report. Fourth, the strategy must provide long-term projections for job growth in industries and occupations in the State that may provide employment opportunities for older workers, and how those relate to the types of unsubsidized jobs for which participants will be trained, and the types of skill training to be provided. The 2006 OAA added to the State Plan provisions the current and projected employment opportunities in the State, and it makes sense to look at this, in relation to the types of skill training provided to participants, not only in the short-term, but over the longer-term encompassed by the four-year strategy. Fifth, the four-year strategy must explain how the State plans to work with employers in the State to develop and promote opportunities for placement of SCSEP participants in unsubsidized employment. Working with employers to develop opportunities for placement of SCSEP participants in unsubsidized employment is an essential element of the program and necessary to achieve participation limits, so States should address this in their four-year strategy. Sixth, the four-year strategy must provide the long-term strategy for increasing the level of performance for entry into unsubsidized employment by SCSEP participants. Specifically, the strategy must demonstrate how the State will achieve the minimum levels of performance required by section 513(a)(2)(E)(ii) of the OAA and § 641.720(a)(6) of the SCSEP regulations (published in the IFR), which set forth the minimum percentage for the expected level of performance for entry into unsubsidized employment for each of fiscal years 2007-2011. The expected level of performance on this core indicator increases over this time period, from 21 percent in fiscal year 2007, to 25 percent in fiscal year 2011. The Department recognizes that these are minimum levels and that some grantees already perform well above these minimum levels. All grantees should strive to continuously improve their performance levels to assist enrollees in becoming self-sufficient, make available opportunities for other individuals to enroll in SCSEP, and better fulfill the objectives of the program. Seventh, the four-year strategy must indicate how the SCSEP activities of grantees will be coordinated with a number of other programs, initiatives, and entities. The State Plan must address coordination with WIA, but States should plan over a longer term to improve coordination with a variety of other programs, initiatives, and entities. These include: (1) Planned actions to coordinate with activities being carried out in the State under title I of WIA, including plans for utilizing the WIA One-Stop Delivery System and its partners to serve individuals aged 55 and older; (2) planned actions to coordinate with activities being carried out in the State under other titles of the OAA; (3) planned actions to coordinate with other public and private entities and programs that provide services to older Americans in the State (such as community and faith-based organizations, transportation programs, and programs for those with special needs or disabilities); and (4) planned actions to coordinate with other labor market and job training initiatives. These initiatives currently include the President's High Growth Job Training Initiative, Community-Based Job Training Grants, and the Workforce Innovation in Regional Economic Development (WIRED) Initiative. Eighth, the State should explain its long-term strategy to improve SCSEP services, and may include recommendations to the Department, as appropriate. This is derived from current State Plan Instructions (Older Worker Bulletin 01-04), which specify that the State Plan may include recommendations to the Secretary of Labor on actions to be taken by SCSEP grantees in the State to improve SCSEP services. The recommendations may include such topics as the location of positions, the types of community services, the time required to make changes in the distribution of positions, and the types of participants to be enrolled. Who Is Responsible for Developing and Submitting the State Plan? (§ 641.305) The only change we propose to this section is to add the phrase, “or the highest government official,” after the word “Governor”, to be inclusive of all jurisdictions that submit State Plans. May the Governor, or the Highest Government Official, Delegate Responsibility for Developing and Submitting the State Plan? (§ 641.310) The only proposed change to this provision is to add in the heading the phrase, “or the highest government official,” after the word, “Governor,” to be inclusive of jurisdictions where the head of the government is not a Governor. Who Participates in Developing the State Plan? (§ 641.315) This provision lists the individuals and organizations from whom the Governor, or the highest government official, is required to seek advice and recommendations related to the State Plan, in accordance with section 503(a)(2) of the OAA. The 2006 OAA changes the task of the Governor (or highest government official) from “obtaining” the advice and recommendations of these entities to “seeking” advice and recommendations. The Department therefore proposes to revise this section to use the word “seek.” We interpret this to mean that the Governor (or highest government official) must make a good faith effort to obtain advice and recommendations from the listed individuals and organizations, whether or not each of these chooses to submit its views. We also propose to replace the phrase “underserved older individuals” with “unemployed older individuals,” in accordance with the same change in the 2006 OAA. Must All National Grantees Operating Within a State Participate in the State Planning Process? (§ 641.320) Section 503(a)(2) of the OAA requires the Governor, or the highest government official, to seek the advice and recommendations of a number of different parties concerning SCSEP services in the State. Although that particular section of the OAA does not require national grantees to participate in the State Plan process, section 514(c)(6) of the OAA establishes that when selecting national grantees, the Department must consider an applicant's ability to coordinate their activities with other organizations at the State and local levels. The State Plan is the process by which SCSEP services are coordinated at the State level; accordingly, section 514(c)(6) effectively requires national grantees to participate in the State planning process. To clarify the source of this requirement, the Department proposes to omit the language referring to OAA section 503(a)(2) from paragraph (a) of this section. We have also updated the remaining citation in paragraph (a) to account for where this provision is located in the 2006 OAA. Paragraph (b) concerns exemptions from the requirement in paragraph (a); we propose several changes to this paragraph. The 2004 SCSEP final rule exempts national grantees serving older American Indians from the State planning process, based on section 503(a)(8) of the 2000 OAA, although the Department encourages their participation. The proposed regulation adds grantees serving older Pacific Island and Asian Americans to the grantee exemption from the requirement to participate in the State planning process, consistent with section 503(a)(8) of the 2006 OAA. However, the Department continues to encourage exempted grantees to participate in the State planning process in the areas in which they operate. Also in paragraph (b), we propose to change the phrase, “are exempted from participating in the planning requirements” to “are exempted from the requirement to participate in the State planning processes,” for clarity. The Department proposes to clarify in paragraph (b) that the exemption from the requirement to participate in the State planning process applies to grantees using funds specifically reserved for projects serving older American Indians and older Pacific Island and Asian Americans under OAA section 506(a)(3); this clarification is consistent with section 503(a)(8) of the 2006 OAA. We also propose to add new language concerning a grantee using both reserved and non-reserved funds. All grantees of non-reserved SCSEP funds, including grantees that have also received reserved funds, are required to participate in the State planning process per paragraph (a). Having applied for and accepted non-reserved funds, grantees become subject to the same coordination requirements as all other recipients of non-reserved funds. Accordingly, if a grantee that receives reserved funds under one grant is also awarded a non-reserved funds grant, the grantee is required to participate in the State planning process for purposes of the non-reserved funds grant. Finally, we propose to delete from paragraph (b) the statement that if an exempt grantee chooses not to participate in the State planning process it is required to describe its plan for serving its constituency in its grant application. This is redundant because all grant applications require applicants to describe such plans, regardless of past participation in the State planning process. We also make certain grammatical improvements. What Information Must Be Provided in the State Plan? (§ 641.325) This section lists the minimum requirements of the State Plan, consistent with section 503(a)(4) of the OAA. In the opening sentences of the proposed section we add a requirement that the State Plan include the State's four-year strategy, as required by section 503(a)(1) of the 2006 OAA and as described in § 641.302. Paragraph (a) remains unchanged. In paragraph (b), we propose to add a requirement that the State Plan provide information on the relative distribution of eligible individuals who are limited English proficient as required by 2006 OAA section 503 (a)(4)(C)(iii). In paragraph (c), we propose to replace the requirement to identify and address “the employment situations and the types of skills possessed by eligible individuals,” which appears in the current regulations, with a new requirement stemming from a revised section 503(a)(4)(D) of the 2006 OAA, that the plan provide information on the current and projected employment opportunities in the State (such as by providing employment statistics available under section 15 of the Wagner-Peyser Act (29 U.S.C. 491-2) by occupation) and the type of skills possessed by local eligible individuals. State labor market information is available through the following link to America's Career Information Network: http://www.acinet.org/acinet/crl/library.aspx?PostVal=10&CATID=52 . We propose to make these changes in accordance with the same changes in the 2006 OAA. Paragraph (d) currently requires a description of the localities and populations for which community service projects in the State are most needed. We propose to change this paragraph by removing the words, “community service” before the word “projects” to follow the same change in section 503(a)(4)(E) the 2006 OAA. We propose a slight modification to paragraph (e). Instead of requiring that the State Plan include actions taken “or” planned concerning coordination with WIA, we require the Plan to include actions taken “and/or” planned to capture actions already taken in addition to those being planned. What appears as paragraph (f) in the current regulations is moved to paragraph (g), and we propose a new paragraph (f), which would require that the State Plan describe the process used to seek advice and recommendations on the State Plan from representatives of organizations and individuals listed in § 641.315, and the process used to seek advice and recommendations on steps to coordinate SCSEP services with activities funded under title I of WIA from representatives of organizations listed in § 641.335. Since the 2006 OAA requires that advice and recommendations be sought from representatives of these organizations and individuals, the Department believes it is reasonable for the State Plan to describe how this input was obtained. Proposed paragraph (g) mirrors what is paragraph (f) in the current regulations, and requires the State Plan to describe the planning process, including opportunities for public comment. The only change to this paragraph is that we propose to add a reference to § 641.350, which requires the State to solicit public comments. There is no change to the text of what appears as paragraph (g) in the current regulations, although it appears as paragraph (h) here. The paragraph that is labeled (h) in the current regulations is labeled paragraph (i) here; the only change is that the reference to § 641.365 has been taken out of parentheses. Finally, the text that appears as paragraph (i) in the current regulations is repeated verbatim here although it is now labeled paragraph (j). How Should the State Plan Reflect Community Service Needs? (§ 641.330) There is no change to this provision. How Should the Governor, or the Highest Government Official, Address the Coordination of SCSEP Services With Activities Funded Under Title I of WIA? (§ 641.335) The only proposed change to this provision is to add in the heading the phrase, “or the highest government official,” after the word, “Governor,” to be inclusive of jurisdictions where the head of the government is not a Governor. How Often Must the Governor, or the Highest Government Official, Update the State Plan? (§ 641.340) The Department proposes to reword the heading question for this section because the former heading assumed an annual review of the State Plan, which is no longer required under the 2006 OAA, and to include the phrase, “or the highest government official,” to be inclusive of jurisdictions for which the head of the government is not a Governor. Instead, the 2006 OAA requires that the State Plan be reviewed, updated, and submitted to the Secretary not less often than every two years. The Department revises the proposed section to reflect the new requirement. We encourage States to review their State Plan more frequently than every two years, and make necessary adjustments and submit modifications as circumstances warrant. The Department intends for the State Plan to be a living document that will guide the strategic and ongoing operations of the SCSEP within the State. Prior to submitting an update of the State Plan to the Department the Governor, or highest government official, must seek the advice and recommendations of the individuals and organizations identified in § 641.315 about what, if any, changes are needed, and publish the State Plan, showing the changes, for public comment. We also propose to add cites to corresponding statutory provisions. What Are the Requirements for Modifying the State Plan? (§ 641.345) The Department proposes a new paragraph (a) to distinguish State Plan updates from State Plan modifications; the remaining paragraphs have been re-designated. Whereas States are required to update their State Plan not less often than every two years, modifications may be submitted anytime circumstances warrant. Both updates and modifications require an opportunity for the public to comment on the State Plan, but only in the event of a State Plan update (§ 641.340) are States required to seek the advice and comment of the individuals and organizations identified in § 641.315. Paragraph (b), which is labeled paragraph (a) in the current regulations, addresses what circumstances require a modification to the State Plan. The only changes we propose in paragraph (b) are changing the word “strategies” to “four-year strategy,” and adding the word “significant” before the word “changes.” We propose the latter change to clarify that trivial changes do not warrant a modification to the State Plan. In paragraph (c) we state that modifications to the State Plan must be open for public comment. We propose to delete a reference to § 641.325 from this paragraph because that section merely lists the required contents of the State Plan. We propose to leave intact the reference to § 641.350 which addresses soliciting public comment on the State Plan. In paragraph (d) we clarify that States need not seek the advice and recommendations of the individuals and organizations identified in § 641.315 when modifying the State Plan. Paragraph (e), which appears as paragraph (c) in the current regulations, remains unchanged. How Should Public Comments Be Solicited and Collected? (§ 641.350) There is no change to this provision. Who May Comment on the State Plan? (§ 641.355) There is no change to this provision. How Does the State Plan Relate to the Equitable Distribution Report? (§ 641.360) The equitable distribution report shows where SCSEP positions are located throughout a State on a grantee-by-grantee basis and is required by section 508 of the OAA. State grantees are responsible for preparing the report at the beginning of each fiscal year. SCSEP grantees use the equitable distribution report to improve on the distribution of SCSEP positions within the State. The information contained in the equitable distribution report is used in preparing the State Plan; however, the State Plan requires additional information. This section is substantively the same as in the current regulations, but the Department proposes to change the reference to the State Plan to reflect the statutory requirement, new to the 2006 OAA, that the Plan be updated and sent to the Secretary not less often than every two years, whereas in the current regulations we reference annual State Plans. The Department also proposes to remove redundant language concerning the role of the equitable distribution report. How Must the Equitable Distribution Provisions Be Reconciled With the Provision That Disruptions to Current Participants Should Be Avoided? (§ 641.365) This section is largely the same as in the current regulations, but since the 2006 OAA places time limits on participation in the SCSEP, the Department proposes to revise this section to provide a cross-reference to § 641.570 of these regulations, where the new time limit is addressed. We propose to remove the reference to § 641.575 because limits set on the amount of time a participant spends in a particular community service employment assignment do not affect the distribution of SCSEP positions. We also propose to rephrase the first sentence, concerning avoiding disruptions in services, for greater clarity. Finally, we make several grammatical and technical corrections. Subpart D—Grant Application and Responsibility Review Requirements for State and National SCSEP Grants This subpart covers the grant application, eligibility, and award requirements for all SCSEP grants under section 506 of the 2006 OAA, which describes distribution of assistance to State and national grantees. The Department proposes to change the title of this subpart to clarify that this subpart applies to National and State grants, but not the pilot, demonstration, and evaluation grants described in subpart F. The proposed changes in this subpart support an increased emphasis on the grantees' accountability for results in order to achieve enhanced program performance. This subpart describes organizations eligible to apply for SCSEP grants, application requirements, eligibility criteria, responsibility reviews, and how the Department will select grantees. Comments are welcome on the new and revised grant application, eligibility, and award requirements that are discussed in this preamble or other changes to this subpart which flow from the 2006 OAA. What Entities Are Eligible To Apply to the Department for Funds To Administer SCSEP Projects? (§ 641.400) The Department proposes to delete “community service” from the heading question of this section to be consistent with the rest of these regulations which generally refer simply to “SCSEP projects.” Section 502(b)(1) of the 2006 OAA authorizes the Secretary to make grants to public and nonprofit private agencies and organizations, agencies of a State, and tribal organizations, to administer SCSEP projects. This section is the corresponding regulatory provision. The Department proposes no changes to paragraph (a). In the current regulations, paragraph (b) specifies the eligible entities that can apply for national grant funds in a State if the national grantee consistently fails to meet State performance measures. The Department proposes to delete paragraph (b) because under the 2006 OAA, national grantees are held accountable only for their national goals. The Department proposes a few changes to former paragraph (c), which is now labeled paragraph (b), concerning State grants. First, we divide the paragraph into two parts. Proposed paragraph (b)(1) addresses the general statutory requirement that the Department award a SCSEP grant to each State. We propose to change the phrase, “enter into agreements with each State,” to, “award each State a grant,” for clarity. Also, whereas the current regulations provide that States can use individual State agencies, political subdivisions of a State, a combination of political subdivisions, or a national grantee operating in the State to administer SCSEP funds, the proposed paragraph provides that a State may designate only an individual State agency. We propose to delete the options concerning political subdivisions of a State to follow the same change in section 502(b)(1) of the 2006 OAA. We propose to delete the option of a national grantee operating in a State partly because, to date, all State grantees have been State agencies, and partly because in the event of the competition contemplated by paragraph (b)(2), all nonprofit private agencies and organizations are eligible to compete. Proposed paragraph (b)(2) provides that a State must compete for its SCSEP State grant funds in the event that the designated State grantee fails to meet the expected levels of performance for the core performance measures for three consecutive years. We propose to change what appears as the third sentence of paragraph (b) in the current regulations to the active voice for readability. We also propose to alter the statutory reference so that we now refer to the section of the statute that establishes State grant funding rather than the statutory section that requires that a State's funds being competed after repeated failure to meet performance measures. Finally, the Department proposes to add that the designated entity that failed to meet core performance measures for three consecutive years is not eligible to compete for SCSEP funds for the first full Program Year following the determination of the third year of consecutive failure. We add this sentence to ensure that the State competition acts as a consequence for repeated failure to perform. A similar provision governs national grantees; a national grantee that fails to meet the expected levels of performance for four consecutive years is ineligible to compete in the grant competition following the fourth year of consecutive failure (OAA sec. 513(d)(2)(B)(iii)). How Does an Eligible Entity Apply? (§ 641.410) This section directs interested applicants, including States, to follow instructions issued by the Department to apply for a SCSEP grant. National grants are competed, and the Department generally publishes application guidelines in Solicitations for Grant Applications (SGA) in the Federal Register . The Department usually issues instructions for State grants, which are not competed, in administrative guidance. In paragraph (a), the Department proposes to add “evaluation criteria” to the list of what is included in the application guidelines because these criteria will be set forth in the SGA for national funds and may change over time. We also propose to change the phrase, “State and national SCSEP funds,” to “national funds, and State funds,” because, under the 2006 OAA, those types of funds are awarded differently (competitively versus noncompetitively) and on a different timetable (annually for State versus multi-year for national). We also propose to delete what is the last sentence of paragraph (a) in the current regulations, because it redundantly provides that applications are to be submitted in accordance with Departmental instructions. Paragraph (b) implements OAA section 503(a)(5), which requires national grant applicants to provide their applications to the Governor, or the highest government official, of the State in which projects are proposed so that the Governor (or the highest government official) may make recommendations relating to position distribution. Grantees have generally provided Governors (or the highest government official) with executive summaries of their application; the Department will continue to consider such practice as fulfilling this requirement. The current regulations exempt Indian organizations from this requirement because they are exempt from State planning. The Department proposes to continue this exemption policy, again because it is consistent with the exemption from State planning under OAA section 503(a)(8). We propose to add organizations serving Pacific Island and Asian Americans to the exemption because the 2006 OAA also exempted those organizations from State planning. We propose to clarify that this exemption from submitting national grant applications to the Governor, or the highest government official, applies to Indian and Pacific Island and Asian American organizations seeking funding reserved under OAA section 506(a)(3). While it remains the policy of the Department that these organizations are not required to submit their applications to the Governor (or the highest government official), we nevertheless encourage such entities to submit their applications to the Governor(s) in the State(s) they propose to serve so that the Governor(s) may better plan the activities in their State(s). We also note that if a grantee that is awarded a grant with reserved funds chooses to compete for other, non-reserved SCSEP funds, such a grantee would be required to submit its non-reserved fund grant application to the Governor (or the highest government official). We also propose to add a phrase connecting the submission required in this paragraph to the Governor's (or the highest government official's) review, which is described in § 641.480 of these regulations. In paragraph (c), the Department proposes to delete the phrase, “community service project” from between the words “SCSEP” and “grant application” to be consistent with the rest of these regulations which merely refer to “SCSEP grants” or “SCSEP grant applications.” We also propose to expand the cross-reference to State Plan requirements so that readers are directed to the entirety of subpart C. What Are the Eligibility Criteria That Each Applicant Must Meet? (§ 641.420) The Department proposes to move the former § 641.420, which addresses what factors we consider in selecting grantees, to § 641.460, so that it follows all the provisions relating to grant application requirements, and we renumber the remaining sections accordingly. This renumbered section, which is § 641.430 in the current regulations, describes the eligibility criteria for SCSEP grant applicants. The Department proposes to update language in paragraph (a), specifying that applicants must demonstrate an ability to administer a program that serves the greatest number of eligible participants and most-in-need individuals, to reflect the language of section 514(c)(1) of the 2006 OAA. Paragraphs (b) and (c) remain the same. The Department proposes to add a new paragraph (d) relating to the applicant's past performance to conform with section 514(c)(4) of the 2006 OAA, and to re-designate the remaining paragraphs accordingly. For applicants that have previously received a SCSEP grant, this criterion addresses the applicant's prior performance in meeting SCSEP core and additional measures of performance. For applicants who have not received a SCSEP grant in the past, this addresses the applicant's prior performance under other Federal or State programs. The Department proposes to add a phrase in paragraph (e) (which is paragraph (d) in the current regulations) specifying that grantees must be able to move most-in-need individuals into unsubsidized employment, to reflect the eligibility criterion specified in section 514(c)(5) of the 2006 OAA. In paragraph (f), the Department proposes to add the word “activities” to clarify the focus of coordination at the State and local levels, in accordance with the same change in section 514(c)(6) of the 2006 OAA. We propose one change in paragraph (g), which is paragraph (f) in the current regulations. We propose to replace the word, “including” with the phrase, “as reflected in,” for clarity. The Department also proposes to add a new paragraph (h), requiring that grantees be able to administer a project that provides community service to be considered eligible, in order to be consistent with section 514(c)(8) of the 2006 OAA. The Department proposes to add the phrase “and in community services provided” in paragraph (i) when describing a grantee's ability to minimize disruption, in accordance with section 514(c)(9) of the 2006 OAA. In paragraph (j) (formerly paragraph (h)), we propose to replace “Secretary of Labor” with “Department” to be consistent with the rest of these regulations. What Are the Responsibility Conditions That an Applicant Must Meet? (§ 641.430) This section contains the responsibility review provisions codified in section 514(d) of the 2006 OAA. The Department proposes to add an opening phrase, “[s]ubject to § 641.440,” because that section addresses responsibility conditions that, alone, will disqualify a grant applicant. Also in the opening sentence, we propose to replace the phrase “any of the acts of misfeasance or malfeasance described in § 641.440(a)-(n) of this section” with the simpler, “any of the following acts,” because paragraphs (a) through (n) comprise the entirety of this section and all are acts of either misfeasance or malfeasance. In paragraph (a) the Department proposes to replace the word “sub-grantee” with “sub-recipient” for consistency throughout this proposed rule and with the description of sub-recipients in the Office of Management and Budget (OMB) Circular A-133. Accordingly, we delete the term “sub-contractors” from this paragraph because the term sub-recipients includes both sub-grantees and sub-contractors. In paragraph (e), the Department proposes to change the phrase, “meet applicable performance measures,” to “meet applicable core performance measures or address other applicable indicators of performance” to reflect the same change in section 514(d)(4)(E) of the 2006 OAA. In paragraph (k), we propose to delete the reference to 20 CFR 667.200(b) because SCSEP grantees/sub-recipients are not required to follow the audit requirements in that regulation. The audit requirements for the SCSEP are located in § 641.821, which is properly referenced in paragraph (k). We also propose several grammatical and clarifying changes. Are There Responsibility Conditions That Alone Will Disqualify an Applicant? (§ 641.440) The Department proposes to combine into paragraph (a) what are paragraphs (a) and (b) in the current regulations for increased clarity. In what is now paragraph (b), the Department proposes to clarify that we will determine the existence of significant fraud or criminal activity. We also propose to revise the language concerning handling Federal funds to be grammatically correct. The Department proposes to revise the last sentence on fraud or criminal activity determination for readability and to again clarify that the Department makes that determination. How Will the Department Examine the Responsibility of Eligible Entities? (§ 641.450) The Department proposes to remove the words “conduct a” and “of” from the phrase “conduct a review of available records,” for readability. What Factors Will the Department Consider in Selecting National Grantees? (§ 641.460) The Department proposes to move the former § 641.420, which addresses what factors we consider in selecting grantees, to § 641.460, so that it follows all the provisions relating to grant application requirements, and we renumber the remaining sections accordingly. Also, we propose to add the word, “national,” to the heading of this section because the Department only executes competitions for national grants. Although a State grant must be competed if the designated State agency fails to achieve its core performance levels for three consecutive years, it is the State rather than the Department that carries out such a competition. This section describes the criteria to be used for the selection of national SCSEP grantees. The Department proposes to drop the conditional language “if there is a full and open competition” because the 2006 OAA requires a regular competition for national grants. The Department also proposes to drop the reference to past performance among the rating criteria the Department will consider, and instead adds a new criterion relating to past performance in the section on eligibility criteria (§ 641.420). The Department makes this change in accordance with the 2006 Amendments to section 514(c)(4) of the OAA. We also propose to clarify in the second sentence that the sections to which we refer are sections of these regulations, to avoid any possible confusion with sections of the OAA. Under What Circumstances May the Department Reject an Application? (§ 641.465) The only change we propose to make to this section is removing the word “program” after “the SCSEP” because the “P” in the acronym SCSEP stands for program. What Happens If an Applicant's Application Is Rejected? (§ 641.470) The Department proposes to revise this section to accurately reflect the process currently used by the Department for applications that are not funded. Under the current process, non-selected entities that request an explanation are provided with feedback on the shortcomings of their proposal. We also propose to include a reference in paragraph (a) to § 641.900, which addresses the appeal process available to a rejected applicant. We propose to reword paragraph (b) to clarify that incumbent grantees are not to receive any technical assistance related to any new application/proposal which they are submitting or planning to submit for a possible new award. Any technical assistance that incumbent grantees receive must relate to activities and/or performance under the existing grant. The Department proposes to revise what appears as paragraph (c) in the current regulations in several ways. First, we propose to divide it into three paragraphs, now lettered (c), (d), and (f), for clarity. We also revise the text of what is paragraph (c) so that proposed paragraphs (c) and (d) accurately reflect and clarify the possible remedies on appeal. We propose to include another reference to § 641.900 in proposed paragraph (c). In paragraphs (c) and (d) we propose to change the word “slot” to “position” to be consistent with the use of the term “position” in the rest of these regulations. The Department proposes to add a new paragraph (e) to clarify that if a party is not satisfied with the Grant Officer's decision about whether the organization continues to meet the requirements of this part, whether positions will be awarded to the organization, and the timing of the award, the Grant Officer must return the decision to the Administrative Law Judge for review. We propose to re-designate the remaining paragraph, which appears as paragraph (d) in the current regulations, as paragraph (f). We also propose grammatical and clarifying changes. May the Governor, or the Highest Government Official, Make Recommendations to the Department on National Grant Applications? (§ 641.480) This section explains the Governor's, or the highest government official's, statutory authority under section 503(a)(5) of the OAA to make recommendations to the Department on grant applications before funds are awarded. We propose to add the word “national” to the heading because this section is limited in application to national grants. We propose to add to paragraph (a) a reference to § 641.410(b); that is the regulatory provision that requires national grant applicants to submit their application to the Governor, or the highest government official, of each State in which projects are proposed. We also propose to add a citation to the OAA. In paragraph (b), the Department proposes to drop the reference to the Governor making recommendations under noncompetitive conditions because national grants will now be competed on a regular basis. When Will the Department Compete SCSEP Grant Awards? (§ 641.490) This section outlines the circumstances under which there must be a competition for SCSEP funds. The Department proposes to divide paragraph (a) into two subparagraphs. In paragraph (a)(1), we propose to reflect the statutory requirement that the Department will generally hold a competition for national grants every four years. We also propose to state that we will publish a Solicitation for Grant Applications in the Federal Register . In paragraph (a)(2) we propose to add a sentence indicating that the statute gives the Department the authority to provide an additional one-year grant to national grantees. The Department makes these changes to paragraph (a) in accordance with section 514(a) of the 2006 OAA; we propose to add specific statutory cites to both subparagraphs of paragraph (a). The Department proposes to revise paragraph (b) to specify that when a State grantee fails to meet its expected levels of performance for the core indicators for three consecutive Program Years, the State must hold a full and open competition for the SCSEP funds allotted to the State. We propose this change in accordance with section 513(d)(3)(B)(iii) of the 2006 OAA, and propose to add a cite to this paragraph. When Must a State Compete Its SCSEP Award? (§ 641.495) The Department proposes a new section to address the competition that is required if a State grantee fails to meet its expected core levels of performance for three consecutive Program Years. Performance measures were discussed in the IFR, 72 FR 35832, June 29, 2007. Subpart E—Services to Participants This subpart covers services to SCSEP participants. The Department here proposes to implement new provisions in the 2006 OAA relating to income eligibility, priorities in enrollment of participants, changes in benefit policies, and time limits for program participation. We also address the types of services that participants may receive, procedures concerning termination from the program, and the grantee's responsibilities relating to participants. Comments are welcome on the proposed changes to subpart E described in this preamble or on other changes to subpart E which flow from the 2006 Amendments. Who Is Eligible To Participate in the SCSEP? (§ 641.500) This provision establishes the statutorily defined eligibility criteria. The Department proposes to move what was paragraph (b) of this section, concerning cross-border agreements, to § 641.515 of these regulations, which addresses participant recruitment and selection, because cross-border agreements are more relevant to participant recruitment than they are to participant eligibility. We propose to revise the remaining paragraph, which is paragraph (a) in the current regulations, to add the requirement that age- and income-eligible individuals must also be unemployed, as required by section 502(a)(1) of the 2006 OAA. In the current regulations, the requirement that the applicant be unemployed is only referenced in the regulations at § 641.120, relating to program purpose; the Department subsequently issued administrative guidance clarifying that being unemployed was an eligibility criterion (TEGL No. 13-04). We interpret section 502(a)(1) of the 2006 OAA as treating unemployment as a SCSEP eligibility criterion. Such an interpretation is consistent with the training purpose of this program, and is also consistent with the policy expressed in § 641.512 of these regulations that job-ready individuals cannot be enrolled in the SCSEP but should be referred to an employment provider. Moreover, including unemployment as an eligibility criterion is consistent with the role of the SCSEP as serving seniors who are most in need of employment and training services. We also propose to add the word, “Federal,” to clarify that the poverty guidelines we refer to are Federal poverty guidelines. When Is Eligibility Determined? (§ 641.505) This section states that initial eligibility is determined at the time of an individual's application. After the initial eligibility determination, grantees/sub-recipients are responsible for verifying the eligibility of participants at least once every 12 months, and may do so more frequently as circumstances require. The Department proposes to add the phrase, “including instances when enrollment is delayed,” to the last sentence of this section. Many grantees/sub-recipients maintain waiting lists and considerable time may pass from the time of initial eligibility determination to the time when a SCSEP position becomes available. Accordingly, we indicate through this additional phrase that delayed enrollment is one example of a circumstance when it may be appropriate to verify continued eligibility of an individual. How Is Applicant Income Computed? (§ 641.507) This proposed new section discusses computing income eligibility. We propose to move the section that is numbered § 641.507 in the current regulations, which addresses what types of participant income are included and excluded to § 641.510. Section 518(a)(4) of the 2006 OAA delineates the procedure for calculating participant income. The Department implemented these procedures effective January 1, 2007, when it issued TEGL No. 12-06. We now propose to establish the same procedures in this section. Grantees may calculate income based on the income received during the 12 months prior to application, or may annualize the income received during the 6 months prior to application. (Program guidance prior to TEGL No. 12-06 limited the calculation time period to the 6 months prior to application, annualized.) The Department encourages grantees to choose the computation method that is most favorable to each participant, on a case-by-case basis, for the broadest possible inclusion of eligible applicants. What Types of Income Are Included and Excluded for Participant Eligibility Determinations? (§ 641.510) The Department proposes to delete the heading and content of what appears as § 641.510 in the current regulations, which addresses terminating a participant who becomes income ineligible, because terminations are fully addressed in § 641.580. The content of what is § 641.510 in the current regulations is covered in § 641.580(b) of this proposed rule. The section addressing what types of income are included and excluded is numbered § 641.507 in the current regulations. We propose to move this heading to § 641.510 so that it may follow the section on computing income. The Department proposes to revise the substance of this section to include the 2006 OAA's requirements relating to income eligibility determinations and to refer to the administrative guidance that provides a complete explanation of SCSEP participant income eligibility determination procedures. Section 518(a)(3)(A) of the 2006 OAA excludes four sources of income from SCSEP income eligibility determinations. The Department issued administrative guidance in TEGL No. 12-06, which implemented these exclusions effective January 1, 2007. The Department implemented these exclusions prior to the effective date of the 2006 OAA (July 1, 2007) in order to alleviate the difficulties grantees and sub-recipients have encountered in recruiting sufficient numbers of eligible individuals under the prior income eligibility guidelines. In general, the Department utilizes definitions from the U.S. Census Bureau's Current Population Survey (CPS) to define income for the purposes of SCSEP income eligibility. However, in addition to the statutory exclusions noted above, TEGL No. 12-06 carries forward additional exceptions to the CPS definitions of income for purposes of SCSEP income eligibility determinations from guidance in effect prior to the 2006 OAA. The additional exceptions are based on the recognition that these income sources (e.g., child support, public assistance, income from employment and training programs) rise out of some state of dependency or are intended to encourage individuals drawing benefits to return to work and should not disqualify otherwise needy individuals. TEGL No. 12-06 is available on the SCSEP Web site, http://www.doleta.gov/seniors , under the Grantee Information, Technical Assistance link. May Grantees/Sub-Recipients Enroll Otherwise Eligible Individuals and Place Them Directly Into Unsubsidized Employment? (§ 641.512) The 2006 OAA and the Department encourage grantees/sub-recipients to work with those participants who are the most difficult to place, rather than those ready for immediate job placement, to provide them with the services necessary to develop the skills needed for job placement. The Department proposes to move and substantially revise what is § 641.560 in the current regulations and replace it with proposed § 641.512. We propose to change the heading from § 641.560 to clarify that the subject of this section is not participants but potential participants. We propose to move this provision to 641.512 so that it appears with more closely-related topics such as eligibility, recruitment, and selection. In the current regulations, § 641.560 encourages grantees not to enroll individuals who can be placed directly into unsubsidized employment. Proposed § 651.512 forbids grantees to enroll job-ready individuals, instead encouraging grantees to refer them to an employment provider such as the One-Stop Center for job placement assistance under WIA. In this way, the SCSEP can use its limited dollars to serve those who need the training the SCSEP provides, while individuals who do not need training can be served by an entity such as the One-Stop Career Center. How Must Grantees/Sub-Recipients Recruit and Select Eligible Individuals for Participation in the SCSEP? (§ 641.515) This section addresses recruitment and selection methods, including use of the One-Stop Delivery System, to ensure that the maximum number of eligible individuals have an opportunity to participate in the SCSEP. In the current regulations, paragraph (a) includes a list of persons (such as minority individuals and limited English speakers) whom grantees should seek to enroll in the SCSEP. The list derived from OAA section 502(b)(1)(M), which was amended in the 2006 OAA. Accordingly, the Department proposes to revise the list in paragraph (a) to reflect the amended statutory language. In paragraph (b), we propose to delete the sentence concerning listing community service opportunities with the State Workforce Agency because the corresponding statutory language was omitted from section 502(b)(1)(H) in the 2006 OAA. Paragraph (c), concerning cross-border agreements, is new to this section. In the current regulations this paragraph appears in § 641.500, which addresses eligibility. The Department proposes to move this paragraph because cross-border agreements are more relevant to participant recruitment than they are to participant eligibility. We propose to specify that grantees entering into cross-border agreements must submit such agreements to the Department “for approval” to reflect current practice. Also in paragraph (c), the Department proposes to replace the word “slot” with “position” to be consistent with the rest of this part. Finally we propose to replace the word, “between,” with, “among,” to allow for cross-border agreements involving more than two states. Are There Any Priorities That Grantees/Sub-Recipients Must Use in Selecting Eligible Individuals for Participation in the SCSEP? (§ 641.520) In paragraph (a) of this section, the Department proposes to list the new statutory selection priorities identified in section 518(b) of the 2006 OAA. In paragraph (b), we interpret the priority for veterans as we did in the current regulations, such that the veterans' priority is afforded to individuals meeting the requirements of section 2(a) of the Jobs for Veterans Act (JVA), Public Law 107-288 (2002), which includes certain spouses of veterans. In paragraph (c), we propose to specify an order for applying the priorities. The order has changed from what appears in the current regulations because the statutory priorities have changed. The proposed ordering of priorities incorporates the dual statutory priorities contained in the JVA and the OAA and is consistent with Departmental guidance on that topic (TEGL No. 5-03, available on the Department's Web site). Like other programs, veterans who also possess other of the OAA priority characteristics receive the highest preference. Because veteran status is a priority in both the OAA and the JVA, veterans without other of the OAA priority characteristics would be next in order of priority, followed by non-veterans with OAA priority characteristics. Are There Any Other Groups of Individuals Who Should Be Given Special Consideration When Selecting SCSEP Participants? (§ 641.525 in the Current Regulations) The Department proposes to delete the section that appears as 641.525 in the current regulations because the statutory provision upon which it is based, OAA section 502(b)(1)(M), is addressed in § 641.515(a). Must the Grantee/Subgrantee Always Select Priority or Preference Individuals? (§ 641.530 in the Current Regulations) The Department proposes to delete the section that appears as 641.530 in the current regulations, because according to section 518(b) of the 2006 OAA, a priority individual must always be chosen over a non-priority individual, when a choice must be made. We note that some grantees have ample program openings, so that all eligible individuals may be served. However, if there is only one opening and two eligible individuals apply, one of whom is a priority individual, the 2006 OAA requires that the priority individual be given the program position. What Services Must Grantees/Sub-Recipients Provide to Participants? (§ 641.535) This section sets forth those services that grantees/sub-recipients must provide to all SCSEP participants. Grantees are encouraged to utilize the WIA system to assist in accomplishing the responsibilities outlined in this section. Paragraph (a)(2) of this section describes the grantees'/sub-recipient's responsibility for assessing participants. The Department proposes to divide this paragraph into two subparts, the first addressing what should be assessed, and the second addressing the frequency of assessments. The sentence that now appears in proposed paragraph (a)(2)(i) is the first portion of paragraph (a)(2) in the current regulations. In proposed paragraph (a)(2)(ii) we revise the language that appears as the remaining portion of paragraph (a)(2) in the current regulations. We propose to state that the various assessment functions described in paragraph (a)(2)(i) of this section must be done initially upon program entry, and then subsequently as necessary, but at least two times a year. The initial assessment may count as one of the two that are required in the first year. This clarification is consistent with the expectation that unsubsidized employment is a goal for SCSEP, and all participants should be periodically assessed to check their progress toward transitioning to unsubsidized employment. We propose several changes to paragraph (a)(3) of this section, which concerns IEPs. First, we propose to divide this paragraph into two subparagraphs to clearly delineate grantee/sub-recipient responsibilities related to the IEP. We propose to add the phrase, “that includes an appropriate employment goal,” after, “develop an IEP,” in paragraph (a)(3)(i) because unsubsidized employment is a goal for all of the SCSEP, and every IEP should be oriented toward that eventual goal. We propose to remove the reference to § 641.260 that appears in the current regulations; such a section does not exist in the current regulations nor is it in the proposed regulation. Instead, § 641.230 provides that an assessment or IEP completed by the SCSEP satisfies any condition for an assessment, service strategy, or IEP completed at the One-Stop, and vice-versa, so we add a reference to that section in paragraph (a)(3)(i). We propose to add the word, “initial,” before the word, “assessment” in paragraph (a)(3)(i) to distinguish this assessment from subsequent assessments. Additionally, the Department proposes to change the wording in both subparagraphs of paragraph (a)(3) to refer to an individual participant and an IEP rather than using the plural “participants” and “IEPs;” we propose these changes to clarify that an IEP must be developed for each participant individually. We also propose to add the words “assessment and” between “WIA” and “IEP” to clarify that assessments and IEPs are distinct; an assessment is used to develop an IEP. Finally, in proposed paragraph (a)(3)(ii), which addresses updating the IEP, we make one change from the language that appears as the last portion of paragraph (a)(3) in the current regulations. We propose to add the word, “subsequent” before “participant assessments” to distinguish these assessments from the initial assessment. With regard to the assessments and IEPs discussed in paragraphs (a)(2) and (a)(3), we note that section 502(b)(1)(N) of the 2006 OAA requires that grantees/sub-recipients prepare an assessment of participants' skills, talents, and needs for services, and a “related service strategy.” The Department has determined that preparation of the IEP fulfills the requirement for a related service strategy. In paragraph (a)(4) of this section we propose to change the word “activity” to “assignment” to be consistent with the term “community service employment assignment” used throughout this proposed rule. Paragraph (a)(5) broadly addresses the training services that grantees/sub-recipients must provide to participants. (Section 641.540 addresses the specific types of training that may be provided.) In the current regulations there are two paragraphs concerning training: Paragraph (a)(5) addresses training specific to the community service employment assignment and paragraph (a)(6) addresses other training identified in participants' IEP. The Department proposes to merge those two paragraphs into a single paragraph because all training, whether or not initially provided specific to a community service assignment, must be consistent with a participant's IEP and should move the participant toward the goal of unsubsidized employment. Indeed, we consider the IEP to drive all services provided to participants, including training services. The remaining paragraphs have been renumbered accordingly. We note that it is still permissible to provide training that enables a participant to successfully fulfill the duties of his or her community service employment assignment. However, such training is acceptable only so long as it is consistent with the IEP. Further, all training must contribute to the eventual goal of unsubsidized employment. Clearly, IEPs and training needs will vary greatly among participants. Nevertheless, the course charted in the IEP should be pointed in the direction of unsubsidized employment, and any training provided should advance the participant further along in that same direction. Paragraph (a)(6), which appears as paragraph (a)(7) in the current regulations, remains unchanged. Proposed paragraphs (a)(7) and (a)(8) of this section appear in the current regulations, but are located at paragraphs (a)(12) and (a)(13). We propose to move them to paragraphs (a)(7) and (a)(8) to give a better sense of time order in the grantee's/sub-recipient's responsibilities. In paragraph (a)(7), the Department proposes to add the phrase “or referring participants to appropriate services” to more closely follow the statute and to indicate that, in addition to providing services directly or through WIA partner programs, SCSEP grantees/sub-recipients can use the One-Stop Centers to access the services of other service providers in the community. In paragraph (a)(9) of this section, the Department proposes to change the term “fringe benefits” to “benefits.” We propose to delete the word “fringe” from the phrase “fringe benefits” throughout this proposed rule, to reinforce the notion that the SCSEP is a temporary training program as opposed to a more permanent employment situation, and to correspond to the same change in section 502(c)(6)(A) of the 2006 OAA. The Department also proposes to specify in paragraph (a)(9) that participants must receive a wage while in training, to conform to the 2006 OAA at sections 502(b)(1)(I), 502(b)(1)(J), and 502(c)(6)(A), as well as during orientation. Lastly, we propose to add to this paragraph a reference to the specific regulation sections that address wages and benefits. The paragraphs that appear as (a)(9) and (a)(11) in the current regulations remain unchanged but appear here as paragraphs (a)(10) and (a)(11). The Department proposes to delete what is paragraph (a)(10) in the current regulations. That paragraph requires grantees to verify participant income at least once every 12 months and is repetitive of § 641.505. We also propose to delete what is paragraph (a)(14) in the current regulations, which discusses following up with participants to determine their need for supportive services after placement into unsubsidized employment, for two reasons. First, § 641.545 already permits grantees to provide or arrange for supportive services after placement into unsubsidized employment. Second, the paragraph's placement in the current regulations in this section meant that grantees/sub-recipients were required to follow up with participants to determine if they needed supportive services. Although the Department strongly encourages follow-up with participants to support them in their unsubsidized employment, it is not required. (OAA sec. 502(c)(6)(A)(iv)). We also propose to delete what is paragraph (a)(15) in the current regulations. That paragraph requires grantees/sub-recipients to follow up with former participants to determine whether that person was still employed. Although grantees/sub-recipients are still required to obtain retention data, it is not necessarily done by contacting the participant, nor is that a service provided to the participant, which is the subject of this section. Paragraph (b) of this section remains unchanged. Paragraph (c) of this section states that grantees may not use SCSEP funds for individuals who only need job search assistance or job referral services. We propose to add to this paragraph a parenthetical reference to § 641.512, which provides that grantees cannot enroll job-ready participants, but must refer them to an employment provider such as the One-Stop Center for job placement assistance. Finally, we propose several grammatical and technical corrections in this section. What Types of Training May Grantees/Sub-Recipients Provide to SCSEP Participants in Addition to the Training Received at the Community Service Employment Assignment? (§ 641.540) This section addresses the many forms that SCSEP training may take. Training received at the community service employment assignment is not within the scope of this section, however. The Department proposes to rephrase the heading accordingly, for clarity. For the same reason, we also propose to delete what appears in the current regulations as the last sentence of paragraph (a) of this section. Paragraph (a) provides the conceptual framework for training. The Department proposes to add the phrase “and that prepares them for unsubsidized employment” to this paragraph because SCSEP training should advance the participant toward the goal of unsubsidized employment. In paragraph (b), the Department proposes to replace training “before or after placement in” with “prior to beginning or concurrent with” a community service employment assignment. This change is consistent with statutory language at section 502(c)(6)(A)(ii) of the 2006 OAA, and clarifies that training may take place as soon as a participant has been assigned to a community service employment assignment even if the participant has not yet begun working at that assignment. Since the current regulations were published, online training has become more common. In many cases quality training can be obtained in an online environment that allows individuals with transportation difficulties access to training. Therefore, the Department proposes to add “online instruction” to the list of the types of training allowable in paragraph (c) to clarify that such instruction is an allowable use of training funds. The Department proposes to remove the following sentence which appears as paragraph (d) of this section in the current regulations: “Grantees and sub-recipients are encouraged to place a major emphasis on training available through on-the-job experience.” The Department proposes this change because secs. 502(b)(1)(I) and 502(c)(6)(A)(ii) of the 2006 OAA emphasize the importance of all types of training in the SCSEP, not only on-the-job training. What is paragraph (e) in the current regulations becomes proposed paragraph (d) and is unchanged. The Department proposes to split what is paragraph (f) in the current regulations into two paragraphs. The first portion, addressing paying for training, becomes paragraph (e). We revise the language in paragraph (e) to mirror the language at section 502(c)(6)(A)(ii) of the 2006 OAA. The second portion, addressing wages during training, stands alone as the new paragraph (f). The Department also proposes to change the new paragraph (f), to state that participants “must” be paid wages while in training, to be consistent with the amended statute. (OAA sec. 502(b)(1)(I)). We also propose to add a reference to the paragraph of the proposed rule that describes participants' wages. The Department proposes to broaden paragraph (g) to address supportive services generally, whereas the subject of this paragraph in the current regulations is, “travel and room and board.” We propose this change to conform with section 502(b)(1)(L) of the OAA. The Department encourages grantees and sub-recipients to seek outside sources of assistance to help provide supportive services to participants. We continue to say that a grantee/sub-recipient “may” pay for the costs of supportive services for two reasons: first, because we encourage grantees/sub-recipients to obtain supportive services from sources other than the grant whenever possible and second, because a grantee/sub-recipient is not required to provide supportive services when it determines that the supportive services would be too expensive, are not available, or would not be necessary to enable the participant to participate in the program. When a grantee/sub-recipient decides to approve supportive services, however, it must either pay for or obtain the services. Paragraph (h) explains that in addition to training paid for by the SCSEP, participants may obtain training on their own, if they wish. We propose to clarify that any such training would be at the participant's own expense. What Supportive Services May Grantees/Sub-Recipients Provide to Participants? (§ 641.545) This section addresses the supportive services that grantees/sub-recipients may provide to participants. In paragraph (a), the Department proposes to replace “supportive services to assist participants” with “supportive services that are necessary to enable an individual” to successfully participate in SCSEP projects, to conform to language in secs. 502(c)(6)(A)(iv) and 518(a)(7) of the 2006 OAA. The Department interprets this revision in statutory language concerning the purpose of supportive services to be somewhat more prescriptive. That is, the supportive services that are appropriately provided by the SCSEP are those that are necessary to make it possible for an individual to participate in the SCSEP—not just any supportive service that would assist an individual to participate in the program. Indeed, we view the new language as conveying a tighter requirement that the supportive services be more directly related to the eventual employment goal. At the same time, we also propose to change “child and adult care” to “dependent care,” “temporary shelter” to “housing,” and add needs-related payments, as examples of supportive services. These revisions are consistent with the language in OAA section 518(a)(7), and are chosen to be as inclusive as possible of all allowable supportive services. Therefore, while we interpret the purpose of SCSEP supportive services to be slightly narrower than in the past, the scope of available supportive services is slightly more expansive. We also propose to add to this paragraph a citation to the provision of the 2006 OAA that defines supportive services. Paragraph (b) remains unchanged. We propose to add a paragraph (c) to this section, and move to it a revised version of what appears in § 641.555(a) in the current regulations. Section 641.555(a) requires grantees to contact participants during the first six months following placement to determine their need for supportive services. In the proposed paragraph (c), the Department proposes to change “must” to “are encouraged to,” to clarify that there is no statutory requirement that grantees/sub-recipients follow-up with participants after they have been placed in unsubsidized employment. The statute allows such follow-up, however, and the Department strongly encourages it. Also in paragraph (c), the Department proposes to extend the time period during which grantees/sub-recipients may contact placed participants from 6 months to 12 months. We propose this change because one of the new additional SCSEP indicators of performance is retention in employment at one year; grantees/sub-recipients should be authorized to support placed participants in maintaining their employment throughout this one-year timeframe. The Department also proposes to change the word “during” to “throughout” in describing the 12 month period, to clarify that the Department prefers that grantees/sub-recipients not wait until 12 months have passed to contact a placed participant. Instead, we encourage grantees/sub-recipients to contact placed participants as often as necessary to ensure that they have the needed supportive services to maintain unsubsidized employment. SCSEP grantees/sub-recipients may utilize other organizations, including One-Stop partners, to contact the placed participants on behalf of the SCSEP, to determine if supportive services are necessary. SCSEP grantees/sub-recipients are authorized to pay for or arrange for necessary supportive services during this twelve month period. What Responsibility Do Grantees/Sub-Recipients Have To Place Participants in Unsubsidized Employment? (§ 641.550) This section outlines grantees'/sub-recipients' responsibility to place participants in unsubsidized employment. The Department proposes to change “should” to “must,” and “reasonable efforts” to “every effort,” in the proposed clause “grantees and sub-recipients must make every effort to place participants into unsubsidized employment.” We propose these changes to strengthen the emphasis on placement in unsubsidized employment, consistent with the 2006 OAA. The Department proposes to remove the phrase “in accordance with each participant's IEP,” which appears in the first sentence of this section in the current regulations, and the phrase that appears in the second sentence, “whose IEPs include an unsubsidized employment placement goal,” to emphasize that a goal for all of the SCSEP is to move participants into unsubsidized employment. Similarly, the Department proposes to remove the phrase “as many as possible” in the first sentence to again emphasize that unsubsidized employment is a goal for the SCSEP. Finally, the Department proposes to add the phrase “and because the SCSEP limits the amount of time a participant can remain in the program” to the first sentence because the 2006 OAA establishes a time limit for SCSEP participation that reinforces the responsibility to place participants in unsubsidized employment. (OAA sec. 518(a)(3)(B)). What Responsibility Do Grantees Have to Participants Who Have Been Placed in Unsubsidized Employment? (§ 641.555 in the Current Regulations) The Department proposes to remove this section from the regulations. We propose to move what is paragraph (a) of this section, addressing grantees contacting placed participants to determine their need for supportive services, to § 641.545(c). Paragraph (b) of this section requires grantees to contact participants to obtain retention data. Paragraph (c) of this section states that subparts G and H of this part may include follow-up requirements. We propose to remove paragraphs (b) and (c) because grantees are not required to contact former participants to obtain retention data; retention information is generally obtained through other means. May Grantees Place Participants Directly Into Unsubsidized Employment? (§ 641.560 in the Current Regulations) In the current regulations, this section encourages grantees not to enroll individuals who could be placed directly into unsubsidized employment. The Department proposes to remove this section; this topic is now addressed in a new § 641.512 in this part. What Policies Govern the Provision of Wages and Benefits to Participants? (§ 641.565) The Department proposes significant substantive changes to this section required by revisions in section 502(c)(6)(A)(i) of the 2006 OAA. The Department also proposes to change the formatting of this section to outline form, rather than paragraphs containing multiple sentences, for clarity. Paragraph (a) of this section addresses participant wages. In paragraph (a)(1)(i) we propose to delete the phrase “required by the grantee/subgrantee” after the word “training” because the 2006 OAA requires participants to be paid for all time spent in training. OAA section 502(b)(1)(I). Also, the SCSEP no longer uses the term “required training.” Although the program may in the past have considered training called for in the IEP to be “necessary” or “required” training, those terms are no longer employed. Indeed, under these proposed regulations all training provided by the SCSEP should be identified in the IEP. We also propose to remove the words “work in” before “community service employment assignments” because they are not needed in the amended language. We also propose to change “minimum” to “required” in the phrase, “highest applicable required wage,” because the prevailing rate of pay is not a minimum wage. In proposed paragraph (a)(1)(ii) the Department states that grantees may pay participants for time spent on WIA intensive services. This policy is not new; it is stated in § 641.240(d) in the current regulations. However, we propose to move the provision so that it appears here, in the provision relating to wages. Paragraph (a)(2) addresses the highest applicable required wage, and is essentially unchanged from the current regulations. The only change is to again change the word, “minimum” to “required,” in the phrase “highest applicable required wage” because the prevailing rate of pay is not a minimum wage. In paragraph (a)(3), the Department proposes to add language to clarify the grantee's/sub-recipient's responsibility to make any necessary adjustments in minimum wage rates during the course of the grant term, should such a change be required by Federal, State, or local statute. Grantees are responsible for managing their funds well and enrolling only as many participants as they have the capacity to serve. In determining how many participants to enroll, grantees should make reasonable efforts to anticipate any likely adjustments in the minimum wage rates that may be required during the grant term. Paragraph (b) of this section addresses benefits. The Department proposes to change the term “Fringe Benefits” to “Benefits” in the heading and remove “fringe” from the subheadings and in the text of the regulations. As discussed above, we propose this change throughout this part to reinforce the notion that the SCSEP is a temporary training program as opposed to a more permanent employment situation, and to adhere to the same change in section 502(c)(6)(A) of the 2006 OAA. The Department proposes to organize paragraph (b) to distinguish two categories of participant benefits: required and prohibited. These categories clearly communicate to grantees and sub-recipients both obligations and proscriptions. This organization is also consistent with language in the 2006 OAA. In the 2000 OAA, section 502(c)(6)(A)(i) merely described “enrollee wages and fringe benefits (including physical examinations),” but in the 2006 OAA the same section was expanded to mention various required and prohibited benefits. Proposed paragraph (b)(1) addresses required benefits. Grantees/sub-recipients must provide such benefits as are required by law. Grantees should determine which benefits are required by law in their area(s) and should submit that information as part of their grant application. Proposed paragraph (b)(1)(i) remains unchanged; in this paragraph we state that grantees/sub-recipients must provide benefits uniformly to all participants within a project or subproject. Proposed paragraph (b)(1)(ii) also remains unchanged, and provides that participants must be offered the opportunity to receive a physical examination annually. Proposed paragraphs (b)(1)(ii)(A) and (b)(1)(ii)(B), which further address physical examinations, also remain unchanged. We propose a new paragraph (b)(1)(ii)(C) in which we state that SCSEP funds may be used to pay the costs of the physical examinations. Some grantees and sub-recipients are able to obtain physical examinations at no cost, or locate other sources of assistance to pay for the examinations. The Department encourages this sort of leveraging of community resources. Nevertheless paying for the physical examinations with grant funds is an allowable SCSEP cost. Proposed paragraph (b)(1)(iii) addresses workers' compensation law; this paragraph is unchanged from the current regulations. Proposed paragraph (b)(1)(iv) concerns unemployment compensation. If State law requires grantees/sub-recipients to provide unemployment compensation coverage, then clearly it would be a required benefit under the SCSEP. For that reason, and to be consistent with the treatment of unemployment compensation coverage by the 2006 OAA as a required benefit, we propose to move and revise the regulatory provision addressing unemployment compensation to this paragraph. In the current regulations this provision is located at paragraph (b)(4) of this section, and is phrased in the negative (“[u]nless required by law, grantees may not * * *”). We propose to place this provision at paragraph (b)(1)(iv) and state that if it is required by State law, then grantees/sub-recipients must provide unemployment compensation coverage. We note that where not required by State law, unemployment compensation coverage is not an allowable benefit. The Department proposes to add a requirement at paragraph (b)(1)(v), in accordance with section 502(c)(6)(A)(i) of the 2006 OAA, requiring grantees and sub-recipients to provide compensation for scheduled work hours during which an employer's business is closed for a Federal holiday. For the limited purpose of implementing this provision, the Department proposes to interpret the word “employer” in section 502(c)(6)(A)(i) of the 2006 OAA to mean host agency. This interpretation will promote uniform treatment of SCSEP participants at the same host agency, regardless of which entity is the program operator. The Department broadly interprets the word “compensation” in this context to allow for a variety of practices. Grantees/sub-recipients may compensate participants for scheduled work hours during which a host agency is closed for a Federal holiday by methods such as paying for the time a participant would have worked had it not been a Federal holiday (essentially a paid day off), or allowing a participant to make up the missed work hours on other days. Other methods of compensation may be allowable, but must be discussed in the grant application. Whatever the method of compensation offered, the compensation must be used within a reasonable period of time, and within the Program Year. Grantees and sub-recipients may develop policies that require the use of offered compensation sooner, for example, within a pay period; such policies m [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3AE8-17802. Public record. Not legal advice.