[Federal Register Volume 76, Number 34 (Friday, February 18, 2011)]
[Proposed Rules]
[Pages 9517-9525]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-3536]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF LABOR
Veterans' Employment and Training Service
20 CFR Part 1001
RIN 1293-AA18
Uniform National Threshold Entered Employment Rate for Veterans
AGENCY: Veterans' Employment and Training Service, Labor.
ACTION: Notice of proposed rulemaking; request for comments.
-----------------------------------------------------------------------
SUMMARY: The Veterans' Employment and Training Service (VETS) of the
Department of Labor (the Department) is proposing a rule to implement a
uniform national threshold entered employment rate for veterans
applicable to State employment service delivery systems. The Department
undertakes this rulemaking in accordance with the Jobs for Veterans
Act, which requires the Department to implement that threshold rate by
regulation.
DATES: To ensure consideration, comments must be received on or before
April 19, 2011.
ADDRESSES: You may submit comments, identified by Regulatory
Information Number (RIN) 1293-AA18, by any one of the three following
methods:
Federal e-Rulemaking Portal: http://www.regulations.gov.
Follow the Web site instructions for submitting comments.
Mail/Hand Delivery/Courier: Written comments, disk, and
CD-ROM submissions may be mailed or delivered by hand delivery/courier
to The Veterans' Employment and Training Service, U.S. Department of
Labor, 200 Constitution Avenue, NW., Room S-1325, Washington, DC 20210.
Fax: Comments may be submitted by fax, with a cover page
to the attention of Patrick Hecker, at (202) 693-4755 (this is not a
toll-free number).
Instructions: Please submit your comments by only one method. All
submissions received must include the agency name, as well as RIN 1293-
AA18. The Department will post all comments received on http://www.regulations.gov without making any change to the comments,
including any personal information provided. The http://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 their
personal information such as Social Security Numbers, personal
addresses, telephone numbers, and e-mail addresses. 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, in order to ensure that
comments receive full consideration, 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 proposed rule
available, upon request, in large print or electronic file on computer
disk. The Department will consider providing the proposed rule in other
formats upon request. To schedule
[[Page 9518]]
an appointment to review the comments and/or obtain the proposed rule
in an alternate format, contact the office of Gordon Burke at (202)
693-4730 (VOICE) (this is not a toll-free number) or (202) 693-4760
(TTY/TDD). You may also contact Mr. Burke's office at the address
listed above.
FOR FURTHER INFORMATION CONTACT: Patrick Hecker, State Grants Lead,
Veterans' Employment and Training Service, U.S. Department of Labor,
200 Constitution Avenue, NW., Room S-1312, Washington, DC 20210, at
Hecker.Patrick@dol.gov, or at (202) 693-4709 (this is not a toll-free
number).
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 the proposed regulations.
III. Administrative Information--sets forth the applicable
regulatory requirements.
I. Background
On November 7, 2002, the Jobs for Veterans Act (JVA), Public Law
107-288 (Nov. 7, 2002) was signed into law. Section 4(a)(1) of the JVA
amended 38 U.S.C. 4102A to require that the Secretary of Labor
``establish, and update as appropriate, a comprehensive performance
accountability system (as described in subsection (f)) and carry out
annual performance reviews of veterans employment, training, and
placement services provided through employment service delivery
systems, including through disabled veterans' outreach program
specialists and through local veterans' employment representatives in
States receiving grants, contracts, or awards under this chapter.'' 38
U.S.C. 4102A(b)(7).
Section 4102A(f) referred to in the statutory quote above requires
the establishment of performance standards and outcome measures to
measure the performance of State employment service delivery systems.
Section 4101(7) of the statute defines ``employment service delivery
system'' to include ``labor exchange services * * * offered in
accordance with the Wagner-Peyser Act.'' The Department interprets this
definition to include the services delivered through the Wagner-Peyser
State Grants, funded by the Employment and Training Administration
(ETA), as well as the services delivered through the Jobs for Veterans
State Grants (JVSG), funded by VETS. In addition, the Department
interprets this definition to exclude the services funded through the
Workforce Investment Act of 1998 (WIA) (Pub. L. 105-220).
Under section 4102A(f), the standards and measures used to assess
performance of veterans' programs must be consistent with State
performance measures applicable under section 136(b) of the WIA. 38
U.S.C. 4102A(f)(2)(A); see also WIA section 136(b) (codified at 29
U.S.C. 2871(b)). The basic standards and measures applied by the
Department to measure performance under WIA are referred to in the
State employment service delivery systems as ``common measures.'' The
current methods of calculating the common measures are specified in
Training and Employment Guidance Letter (TEGL) No.17-05, issued on
February 17, 2006. This TEGL can be accessed at http://wdr.doleta.gov/directives/attach/TEGL17-05.pdf. The common measures for adult
workforce programs include a measure of the rate at which enrollees of
State employment service delivery systems enter employment. This is
referred to as the ``entered employment rate'' or EER. Under the common
measures, there is a comparable EER specifically applicable to veterans
and eligible persons. Application of that measure to all State
employment service delivery systems is implemented each year through
issuance of a Veterans' Program Letter (VPL), most recently VPL 08-10,
issued on June 29, 2010, which established the reporting and
performance measurement requirements for PY 2010. This VPL can be
accessed at: http://www.dol.gov/vets/VPLS/VPLDirectory.html.
This Proposed Rule establishes a uniform national threshold only
for the EER for veterans and eligible persons. If the calculation of
the standards and measures applied by the Department to measure
performance under WIA or under a successor program to WIA are revised
in the future by the Department through issuance of policy guidance,
the Proposed Rule provides that the revised method of calculating the
EER for veterans and eligible persons will be used in calculating the
uniform threshold EER for the purposes of the Proposed Rule. The method
of calculating the uniform national threshold EER for veterans and
eligible persons will be specified to State employment service delivery
systems in the annual VPL, as mentioned above.
As part of its responsibility for measuring the performance of
veterans' programs, the Department is required to establish a uniform
national threshold EER to be used in determining whether a State is
deficient with regard to its EER for veterans and eligible persons.
Section 4102A(c)(3) of Title 38 provides:
(A)(i) As a condition of a grant or contract under this section
for a program year, in the case of a State that the Secretary
determines has an entered employment rate for veterans that is
deficient for the preceding program year, the State shall develop a
corrective action plan to improve that rate for veterans in the
State. (ii) The State shall submit the corrective action plan to the
Secretary for approval, and if approved, shall expeditiously
implement the plan. (iii) If the Secretary does not approve a
corrective action plan submitted by the State under clause (i), the
Secretary shall take such steps as may be necessary to implement
corrective actions in the State to improve the entered-employment
rate for veterans in that State. (B) To carry out subparagraph (A),
the Secretary shall establish in regulations a uniform national
threshold entered-employment rate for veterans for a program year by
which determinations of deficiency may be made under subparagraph
(A). (C) In making a determination with respect to a deficiency
under subparagraph (A), the Secretary shall take into account the
applicable annual unemployment data for the State and consider other
factors, such as prevailing economic conditions, that affect
performance of individuals providing employment, training, and
placement services in the State.
The purpose of this Proposed Rule is to establish the uniform
national threshold EER, as required of the Secretary in 38 U.S.C.
4102A(c)(3)(B), for use in determining deficiencies in States'
performance in assisting veterans to meet their employment needs. The
Proposed Rule also explains how the threshold will be used in the
process of identifying those States to be reviewed for a potential
determination of deficiency, and it identifies certain factors, in
addition to the threshold, that will be included in the Department's
review to determine deficiency. 38 U.S.C. 4102A(c)(3)(C). Finally, in
those cases in which a State's EER is determined to be deficient, the
Proposed Rule identifies the procedure for the subsequent submission
and review of a corrective action plan (CAP), the delivery of technical
assistance (TA), and the initiation of the necessary steps to implement
corrective actions to improve the State's performance in assisting
veterans to meet their employment needs. 38 U.S.C. 4102A(c)(3)(A).
VETS is the agency of the Department with principal responsibility
for monitoring the performance of all State employment service delivery
systems with respect to the services received and outcomes experienced
by veterans. Since Program Year 2005 (July 1, 2005 through June 30,
2006), VETS has been collecting data from each State on the
[[Page 9519]]
EER achieved for veterans and eligible persons, and annually VETS
calculates the national EER for veterans and eligible persons. VETS is
taking this rulemaking action to establish the uniform national
threshold EER now since the common measures, including the EER for
veterans and eligible persons, have been in place for several years in
the State employment service delivery systems and there is empirical
data and a rational basis for proposing a uniform national threshold
EER for veterans and eligible persons.
To establish the uniform national threshold, VETS has considered a
variety of methodologies and has used actual EER results from Program
Years 2005 through (3rd Quarter) 2009 in order to test the validity of
the methodologies. VETS' goal was to establish a uniform national
threshold that would meet five criteria: the threshold should produce
reasonable results under varying economic conditions; the threshold
should relate directly to the national EER because the national EER is
the overall program performance measure related to entered employment
rates; the threshold should identify State agencies whose EERs are
demonstrably low; the threshold methodology should be easily explained
and readily grasped; and the annual threshold-setting process should
not conflict with or introduce confusion into the annual performance
goal-setting process conducted between VETS and each State agency.
VETS first developed and tested a two-step process setting the
uniform national threshold EER for veterans and determining which, if
any State agencies would be subject to a formal review to determine
whether or not a Corrective Action Plan would be required. First, VETS
would compare each State's program year EER with the national EER for
that program year. Then, the State's program year EER would be compared
to the State's average EER for the prior three program years. Those two
comparisons would provide the basis for identifying those States that
would undergo further review of their program year EERs. By comparing
each State's program year EER to the national EER for the same program
year while also comparing each State's program year EER to its own
average EER for the prior three program years, the process was intended
to balance application of a standard criterion with application of a
relative measure reflecting the variation among the States with respect
to economic conditions and other relevant factors. However, empirical
tests with State performance data from Program Years 2008 and 2009
demonstrated that this methodology did not produce reasonable results
under the conditions created by the economic recession experienced
during that period.
Another formula that was developed and tested involved averaging of
the annual national EERs, measuring the percentage of change over time,
and using the resultant change percentage as the uniform national
threshold EER; that benchmark would be used for comparisons of the
change percentages in the program year EERs achieved by each State for
the same time period. This methodology added complexity to the process,
and testing also demonstrated that averaging tends to skew the
resultant measure up or down. Therefore, VETS determined that the use
of a method involving averaging adds complexity without producing
reasonable results.
VETS then looked at simpler designs for calculating and applying
the uniform national threshold EER. One methodology used the national
EER for the program year before the subject program year as the basis
for calculating the threshold EER. The process would have involved
simply setting the threshold at a particular percentage of the national
EER from the prior year and comparing the State agencies' actual
achievements in the subject program year to that threshold percentage.
However, testing at several different levels, that is, percentages,
indicated that using the prior year's national EER as the basis for a
threshold also produces unreasonable results in years when there are
relatively unusual declines or upturns in economic conditions.
VETS then tested and selected a similar one-step methodology using
the national EER for the subject program year as the basis for
calculating the threshold EER. VETS chose to propose a 90% (of the
national EER) level as the threshold for identifying the State agencies
to be subject to a deficiency review each year because testing of that
threshold level most completely satisfies the five criteria stated
above. Testing of higher and lower threshold levels (e.g., 80 to 95% of
the national EER) produced results that in one or more ways failed to
satisfy those criteria.
II. Section-by-Section Review of the Proposed Rule
The Proposed Rule includes a total of eight sections. Sections
1001.160 through 1001.162 address the general aspects of the Proposed
Rule, such as purpose, scope and definitions. Sections 1001.163 and
1001.164 address the two EER measures that are at the heart of the
Proposed Rule: (a) A State's program year EER, which will be reviewed
annually for each State against the national threshold EER; and (b) the
uniform national threshold EER, which is the benchmark used in the
annual review of each State's program year EER. VETS proposes to use
the uniform national threshold EER as the criterion for evaluating each
State's program year EER because this methodology is reasonable, easy
to understand, and likely to promote continuous improvement in the
entered employment outcomes achieved for veterans and eligible persons.
Section 1001.165 states when the uniform national threshold EER will be
published each year, and Sec. 1001.166 explains how the two proposed
EER measures will be used in the process of determining whether or not
a State agency will be subject to a CAP in order to receive its next-
due Jobs for Veterans State grant. Section 1001.167 addresses other
monitoring of compliance regarding services to veterans.
What is the purpose and scope of this part? (Sec. 1001.160)
Section 1001.160 briefly describes the purpose of this regulation
and supplies the citation of the requirement in the JVA. It also
identifies the service providers to which this regulation applies, that
is, the agencies that comprise State employment service delivery
systems.
What definitions apply to this part? (Sec. 1001.161)
Section 1001.161 defines the terms used in this proposed rule. For
purposes of this Proposed Rule, the Department is interpreting the
statutory term ``employment service delivery system'' to include the
employment service delivery infrastructure, personnel, and services
provided through the combined funding of Wagner-Peyser State Grants and
JVSGs, but excluding those delivery systems provided through WIA grants
and governed by a separate performance system. A program year, which is
the performance period applicable to State employment service delivery
systems, is defined as the period from July 1 of a year through June 30
of the following year. A program year is numbered according to the
calendar year during which it begins.
How does the Department define veteran for purposes of this subpart?
(Sec. 1001.162)
The definition of veteran currently in effect for the State
employment service delivery systems operating under the Wagner-Peyser
and JVSG funding is
[[Page 9520]]
based on the definition of the term eligible veteran in 38 U.S.C.
4211(4), as referenced in 38 U.S.C. 4101(4). That definition of
eligible veteran includes a criterion requiring the individual to have
served over 180 days on active military duty. That definition of
veteran currently applies to eligibility for JVSG services and also
applies to the State employment service delivery systems (both the
Wagner-Peyser and JVSG components) for program reporting purposes.
The JVA enacted a new priority of service requirement for veterans
and eligible spouses in all employment and training programs funded by
the Department. The Department has implemented that requirement through
issuance of a final rule on veterans' priority of service at 20 CFR
Part 1010. Section 1010.110 of that rule clarifies that the definition
of veteran enacted for priority of service purposes at 38 U.S.C.
4215(a)(1)(A) refers to the definition of veteran at 38 U.S.C. 101(2),
which does not include the criterion requiring over 180 days of active
duty service. Section 1010.330(c)(2)(i) of the priority of service rule
further specifies that the latter, less restrictive, definition of
veteran will be applied in the future for reporting the services
received and the outcomes experienced by veterans and eligible spouses
served by employment and training programs funded by the Department.
In conjunction with issuance of the final rule on priority of
service, the Department also published an Information Collection
Request (ICR) which was approved by the Office of Management and Budget
(OMB) under OMB Control Number 1205-0468. The reporting specifications
authorized under that approval call for application of the less
restrictive definition of veteran to the Wagner-Peyser component of
State employment service delivery systems. The Department delayed
implementing this new requirement in light of the impact of the current
recession on the public workforce system, as well as the impact upon
the system of the various initiatives in response to the recession,
which were authorized under the American Recovery and Reinvestment Act.
It is not certain when the Department will implement the new reporting
specifications.
To accommodate the anticipated addition of the less restrictive
veteran definition for reporting by the Wagner-Peyser component of
State employment service delivery systems, the Department intends the
proposed rule's definition of veteran to have two stages. The first
stage will begin with application of the rule to the first program year
that begins following the effective date of the final rule. During the
first stage, all the EER measures implemented under the proposed rule
will reflect the more restrictive veteran definition. The second stage
will begin two years after the program year for which data are first
collected and reported on the less restrictive veteran definition. For
example, if priority of service reporting first applies to Wagner-
Peyser for PY 2011, the second stage of implementation of the proposed
rule will first apply for PY 2013. During the second stage, all the EER
measures implemented under the proposed rule will reflect the less
restrictive veteran definition. During the second stage of
implementation, any veteran who meets the more restrictive definition
will be considered to meet the less restrictive definition.
Applying the definition of veteran in two stages will enable
immediate implementation of the uniform national threshold EER under
the more restrictive veteran definition, while also establishing the
necessary period for implementing the uniform national threshold EER
using the less restrictive veteran definition. This addition of the new
definition of veteran for the Wagner-Peyser component of State
employment delivery systems will not increase the information
collection burden for the States, nor will it alter the calculation,
publication, or use of the EER for veterans and eligible persons, as
described in the sections that follow.
When the less restrictive definition of veteran takes effect for
these regulations and is applied to the Wagner-Peyser component of
State employment service delivery systems as required by the priority
of service final rule and the accompanying reporting specifications,
the more restrictive definition (i.e., 180+ days of active duty
service) also will be retained. That is because the Secretary is
required, by 38 U.S.C. 4107(c)(1), to report annually to the Senate and
House Veterans' Affairs Committees on employment and training services
for veterans. The statutory requirement for that report specifies that
it is to include information on the characteristics, services and
outcomes of ``eligible'' veterans who meet the more restrictive veteran
definition. Therefore, unless that specific reporting requirement is
amended through legislative action, the Wagner-Peyser component of
State employment service delivery systems will be reporting information
for veterans about their characteristics (such as their veteran
status), services received and outcomes experienced, under both
definitions.
What is the national entered employment rate (EER) and what is a
State's program year EER for purposes of this part? (Sec. 1001.163)
This proposed section discusses the two EER measures that will be
used in the evaluation process described by the proposed rule.
Generally, an EER for veterans and eligible persons looks at the
veterans and eligible persons who have participated in an employment
service delivery system and then exited that system. The EER measures
the number of these participants who are employed after exiting
compared to the total number of the participants who exited. The
calculation of the EER, as discussed above, is specified through
Departmental policy guidance issued in TEGL No.17-05, which describes
the calculation of all the common measures. The TEGL describes the
entered employment rate as:
Of those who are not employed at the date of participation: The
number of adult participants who are employed in the first quarter
after the exit quarter divided by the number of adult participants
who exit during the quarter.
This Proposed Rule uses this calculation of the EER as applied to
veterans and eligible persons who participate in State employment
service delivery systems, consistent with VPL 08-10. This calculation
is stated in proposed Sec. 1001.163(b).
Using this calculation method, VETS annually calculates the
national EER for veterans and eligible persons. As stated in proposed
Sec. 1001.163(c), the calculation of the national EER for veterans and
eligible persons measures the employment results for the group of
veterans and eligible persons who are not employed at the date of their
participation in the nationwide set of State employment service
delivery systems and then exit those systems during the set of four
exit quarters that is associated with the EER measure for a specific
four-quarter reporting period. This nationwide perspective on the State
employment service delivery systems looks at all the employment service
delivery systems in each State together as one national employment
service delivery system. The national EER for veterans and eligible
persons currently is computed by: (1) Summing, for the set of four exit
quarters, the total number of these veterans and eligible persons who
are employed in the first quarter after their exit quarter; (2)
summing, for the set of four exit quarters, the total number of these
veterans and eligible persons who exit
[[Page 9521]]
during the exit quarters; and, (3) dividing the first sum by the second
sum. This measure currently is compiled by the Labor Exchange Reporting
System (LERS), implemented by ETA, and currently is displayed in the
cell that appears in Row 6 at Column A-4 of the ETA 9002-D Report, as
defined in the ETA 9002 and VETS 200 DATA PREPARATION HANDBOOK; ET
HANDBOOK NO. 406 (OMB Approval No.: 1205-0240; Expiration Date: 03/31/
2012). The national EER resulting from this calculation is expressed as
a percentage that is rounded to the nearest tenth of a percent.
A State's program year EER is the EER for veterans and eligible
persons achieved by a single State's employment service delivery system
for the program year under review. It is calculated using the same
method as the national EER. A State's program year EER is discussed in
proposed Sec. 1001.163(d). A State's program year EER is expressed as
a percentage that is rounded to the nearest tenth of a percent. For the
balance of this preamble, a ``State's program year EER'' also may be
referred to simply as a ``program year EER.''
Section 1001.163(b) of the Proposed Rule specifies that the method
of calculation of the EER for veterans and eligible persons is
established based on policy guidance issued by the Department. As
indicated above, that method of calculation currently is: (a)
Established by TEGL No. 17-05; (b) implemented for reporting purposes
by ET HANDBOOK NO. 406; and, (c) applied to State employment service
delivery systems for veterans and eligible persons by VPL 08-10. If the
Department revises the calculation of the EER in the future through new
policy guidance, the revised method of calculation will apply to the
calculation of the national EER and a State's program year EER.
What is the uniform national threshold EER, and how is it calculated?
(Sec. 1001.164)
The uniform national threshold EER is equal to 90% of the national
EER for veterans and eligible persons (as defined in Sec.
1001.163(c)).
As discussed above for Sec. 1001.163 of the Proposed Rule, the
method of calculating the EER for veterans and eligible persons is
established through policy guidance. The Department may revise the
method of calculating the EER through the issuance of new policy
guidance. If this occurs, the uniform national threshold EER will
remain 90% of that newly-calculated national EER for veterans and
eligible persons.
VETS chose to propose the 90% (of the national EER) level as the
threshold for identifying the State agencies to be subject to a
deficiency review each year because testing of that threshold level
(using the empirical data available) most completely satisfies the five
criteria stated in the Background section above. Testing of higher and
lower threshold levels (e.g., 80 to 95% of the national EER) using
empirical data from prior years produced results that in one way or
another failed to satisfy those criteria.
When will the uniform national threshold EER be published? (Sec.
1001.165)
Complete, final program year results for the entered employment
outcomes achieved by each State agency typically are compiled by VETS
during the month of October following the end of each program year (on
June 30). For each program year, VETS will: (a) Finalize its
calculation of the uniform national threshold EER; (b) finalize its
calculation of each State's program year EER; and, (c) when
practicable, publish those results in December following the end of the
program year.
How will the uniform national threshold EER be used to evaluate whether
a State will be required to submit a corrective action plan (CAP)?
(Sec. 1001.166)
The JVA requires that the Department develop a uniform national
threshold EER by which determinations of deficiency may be made. 38
U.S.C. 4102A(c)(3)(B). If the Department determines that a State's
program year EER is deficient, the State must develop a CAP. 38 U.S.C.
4102A(c)(3)(A)(i). The law requires the Secretary to take into account
the annual unemployment data for the State and to consider other
factors that may have affected the program year EER for veterans and
eligible persons, such as prevailing economic conditions, before
requiring a CAP. 38 U.S.C. 4102A(c)(3)(C).
The Department proposes to use a simple comparison process to
identify those State agencies that need to undergo further review to
determine whether their program year EERs are deficient, resulting in
the need for a CAP. First, the Department will compare each State's
program year EER with the uniform national threshold EER (90% of the
national EER) for that program year. A State agency whose program year
EER does not meet or exceed the uniform national threshold will be
subject to a review by VETS to determine whether the program year EER
is deficient. For those States whose program year EER is determined to
be deficient, a CAP will be required.
VETS' review to determine deficiency will consider the degree to
which the State's program year EER fell short of the uniform national
threshold EER for that program year, as well as the annual unemployment
data for the State. The review also may include other relevant factors,
including other measures of prevailing economic conditions and regional
economic conditions, other measures of workforce program performance,
and/or any information the State may submit. The review will include
consultation with VETS field staff about findings from their on-site
reviews and desk audits of the State agency's implementation of
policies and procedures for services to veterans. The review also may
include consultation with staff affiliated with other agencies of the
Department, as appropriate.
The determination that a program year EER for any State is
deficient will be made on the basis of this review. Once a State's
program year EER has been determined to be deficient, the governing
statute envisions a cooperative relationship between that State and the
Department. Evidence of that intent is the inclusion in the statute of
specific authorization (at 38 U.S.C. 4102A(g)) for the Secretary to
provide technical assistance (TA) to any State whose program year EER
is determined to be deficient, including TA in the development of a
CAP.
The following illustrates how the uniform national threshold EER
and the State's program year EER will be compared. In these examples,
the program year hypothetically is Program Year (PY) 2009, the national
EER is 65.2%, and the uniform national threshold EER is 58.7%.
1. State agency 1 achieved a program year EER of 63.5%.
This State would be exempt from a deficiency review based solely on the
statistics because its program year EER exceeds the uniform national
threshold EER.
2. State agency 2 achieved a program year EER of 58.7%.
This State would be exempt from a deficiency review based solely on the
statistics because its program year EER equals the uniform national
threshold EER.
3. State 3 achieved a program year EER of 58.0%. This
State would be considered subject to a deficiency review because it
failed to meet or exceed the uniform national threshold EER.
If VETS' review determines a State's program year EER to be
deficient, the State will be required, as a condition for receipt of
the upcoming program year's JVSG grant, to submit a CAP to the Grant
Officer's Technical Representative by June 30 of the year following the
[[Page 9522]]
calendar year in which the program year under review ended. For any
State required to submit a CAP, VETS will provide TA in the development
of the CAP. The Department's review and (as required) comment on the
CAP will be handled in conjunction with the Department's review of that
State's annual application for funds under the JVSG program for the
upcoming fiscal year (which begins on October 1 of the year following
the calendar year in which the program year under review ended). Based
on review of the CAP submitted, VETS may provide additional TA to the
State. If the CAP is approved, the approval of the CAP will be
transmitted in conjunction with the approval of that State's JVSG
funding for the upcoming fiscal year. The State then must expeditiously
implement the CAP. If the CAP is not approved, VETS will take such
steps as necessary to implement corrective actions to improve the
State's EER for veterans and eligible persons. If the State fails to
cooperate with these corrective actions, VETS may take any actions
available to remedy non-compliance under 20 CFR part 658, subpart H.
These are the compliance measures available to the Assistant Secretary
for Veterans' Employment and Training through 20 CFR 1001.130(a).
In addition to the procedures specified in these regulations, will the
Department be conducting any other monitoring of compliance regarding
services to veterans? (Sec. 1001.167)
Yes. VETS, as the grantor agency for the JVSG, has primary
responsibility for initiating comprehensive compliance and performance
reviews of each State's employment service delivery system with respect
to the services received and outcomes experienced by veterans. The
specific procedures prescribed in this Proposed Rule are distinct from,
but related to, that overall monitoring responsibility.
These procedures also relate in a somewhat different way to the
joint monitoring of priority of service, to be conducted by VETS and
ETA according to 20 CFR 1010.240(b). Specifically, if a State's program
year EER is determined to be deficient for a given program year, that
fact would be one of the elements considered in monitoring priority of
service, since failure to fully implement priority of service could be
one of the contributors to a deficient program year EER.
III. Administrative Information
Regulatory Flexibility Analysis, Executive Order 13272, and Small
Business Regulatory Enforcement Fairness Act
The Regulatory Flexibility Act (RFA), 5 U.S.C. Chapter 6, requires
the Department to evaluate the economic impact of this proposed rule
with regard to small entities. The RFA defines small entities to
include small businesses, small organizations including not-for-profit
organizations, and small governmental jurisdictions. The Department has
determined, and has certified to the Chief Counsel for Advocacy, Small
Business Administration, that the proposed rule does not impose a
significant economic impact on a substantial number of such small
entities, because this Rule would directly impact only States and the
definition of small entities does not include States.
Executive Order 12866
Executive Order 12866 requires that for each ``significant
regulatory action'' proposed by the Department, the Department conduct
an assessment of the proposed regulatory action and provide OMB with
the proposed regulation and the requisite assessment prior to
publishing the regulation. A significant regulatory action is defined
to include an action that will have an annual effect on the economy of
$100 million or more, and/or an action that raises a novel legal or
policy issue. The uniform national threshold EER implemented by this
proposed rule will not have an annual effect on the economy of $100
million or more.
VETS estimates that the costs specifically attributable to
submitting and implementing a CAP would be about one percent of a State
agency's annual grant amount. Although VETS has not had recent
experience with a CAP and associated costs, past experience suggests
that one percent would be a reasonable estimate. States' JVSG grants
average about $3 million per year, so a typical State agency would be
expected to use an average of about $30,000 for CAP costs if a CAP were
to be required. Based on an analysis of the number of States that in
the past would have failed to meet the proposed uniform national
threshold level, VETS estimates that there would be no more than four
to six CAPS per year, and allowing for the possible inclusion of some
of the State agencies from larger States whose funding levels exceed
the average, VETS estimates that the upper range of the average annual
total cost for CAPs will not exceed $200,000 to $300,000. Furthermore,
if this estimate falls short of CAP development costs or if a CAP
requires the State agency to fund additional services for which its
JVSG is not adequate, the funds for developing the CAP or any
additional services will be provided through VETS' routine reallocation
procedure, which requires no additional appropriation and thus would
have no net effect on the economy.
This Proposed Rule could raise a novel legal or policy issue
arising out of legal mandates, the President's priorities, or the
principles set forth in the Executive Order. Therefore, the Department
has submitted this Proposed Rule to OMB for review.
Paperwork Reduction Act
The purposes of the Paperwork Reduction Act of 1995 (PRA), 44
U.S.C. 3501 et seq., include minimizing the paperwork burden on
affected entities. The PRA requires certain actions before an agency
can adopt or revise the collection of information, including publishing
a summary of the collection of information and a brief description of
the need for and proposed use of the information. This rule will not
require new or additional information collections, as defined in the
Act, from the affected entities. The Department has determined that a
State's obligation to develop and submit a CAP for approval does not
qualify as a collection of information, as defined by 5 CFR 1320.3(c),
because after receiving a determination of deficiency from VETS that
excludes the systemic factors beyond the State's control, the State is
required to develop and submit a CAP based on a self-diagnosis and
prescription that addresses the unique set of deficiencies embodied in
that State's policies and procedures. Therefore, a CAP does not qualify
as a ``collection of information'' under 5 CFR 1320.3(c), because it
does not result from identical questions nor is the content across
multiple CAPs in any way identical. In addition, a CAP does not qualify
as ``information'' under 5 CFR 1320.3(h) because the individuality of
the information provided in each State's CAP is consistent with a
response to a ``request for facts or opinions addressed to a single
person,'' which is excluded under 5 CFR 1320.3(h)(6).
Current reporting systems and requirements are not changed by this
Proposed Rule. VETS will calculate the uniform national threshold EER
using data from the existing approved data collection included in the
ETA 9002 and VETS 200 DATA PREPARATION
[[Page 9523]]
HANDBOOK; ET HANDBOOK NO. 406 (OMB Approval No.: 1205-0240; Expiration
Date: 03/31/2012). Therefore, this regulation does not impose on the
State employment service delivery systems any new information
collection that would require approval under the PRA.
Executive Order 13132
The Department has reviewed this proposed rule in accordance with
Executive Order 13132 regarding federalism and has determined that it
does not have ``federalism implications.'' The rule does not ``have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government.'' This
proposed rule implements the uniform national threshold EER for
veterans and eligible persons applicable to State employment service
delivery systems. This proposed rule does nothing to alter either the
relationship between the national government and the States, or the
distribution of power and responsibilities among the various levels of
government. Accordingly, this proposed rule does not have ``federalism
implications.''
Unfunded Mandates Reform Act of 1995
For purposes of the Unfunded Mandates Reform Act (UMRA) of 1995,
this rule does not include any Federal mandate that may result in
increased expenditures by State, local and Tribal governments, or by
the private sector. As this proposed rule does not impose any unfunded
Federal mandate, the UMRA is not implicated. As explained above,
current reporting requirements on the States are not changed by this
Proposed Rule. The Labor Exchange Reporting System (LERS) produces
program year EER results for 52 of the 54 reporting State employment
service delivery systems and calculates the first step toward a
national EER, based on inclusion of those 52 reporting units. For each
program year, VETS will supplement the results available from the LERS
by: (a) Incorporating the program year EER results for the two States
that are piloting a separate reporting system; and, (b) calculating the
uniform national threshold EER based on inclusion of the results for
all 54 reporting units. Therefore, this regulation does not impose any
new reporting or calculation requirement upon the State employment
service delivery systems. Some States may be required to institute
corrective actions under this rule. However, such actions are required
by statute. Moreover, the Department provides grant funds for the
administration of the JVSG program which may be used for any costs
associated with the imposition of a CAP.
Executive Order 13045
Executive Order 13045 concerns the protection of children from
environmental health risks and safety risks. This proposed rule
implements the uniform national threshold EER for veterans and eligible
persons applicable to State employment service delivery systems funded
by the Department. This proposed rule has no impact on safety or health
risks to children.
Executive Order 13175
Executive Order 13175 addresses the unique relationship between the
Federal Government and Indian Tribal governments. The order requires
Federal agencies to take certain actions when regulations have ``Tribal
implications.'' The order defines regulations as having ``Tribal
implications'' when they have substantial direct effects on one or more
Indian Tribes, on the relationship between the Federal Government and
Indian Tribes, or on the distribution of power and responsibilities
between the Federal Government and Indian Tribes. The Department has
reviewed this proposed rule and concludes that it does not have Tribal
implications for purposes of Executive Order 13175, as it does nothing
to affect either the relationship or the distribution of power and
responsibilities between the Federal Government and Indian Tribes.
Environmental Impact Assessment
The Department has reviewed this proposed rule in accordance with
the requirements of the National Environmental Policy Act (NEPA) of
1969 (42 U.S.C. 4321 et seq.), the regulations of the Council on
Environmental Quality (40 CFR part 1500), and the Department's NEPA
procedures (29 CFR part 11). The proposed rule will not have a
significant impact on the quality of the human environment, and thus
the Department has not prepared an environmental assessment or an
environmental impact statement.
Assessment of the Impact of Federal Regulations and Policies on
Families
Section 654 of the Treasury and General Government Appropriations
Act, enacted as part of the Omnibus Consolidated and Emergency
Supplemental Appropriations Act of 1999 (Pub. L. 105-277, 112 Stat.
2681), requires the Department to assess the impact of this rule on
family well-being. A rule that is determined to have a negative effect
on families must be supported with an adequate rationale. The
Department has assessed this proposed rule and has determined that it
will not have a negative effect on families.
Privacy Act
The Privacy Act of 1974 (5 U.S.C. 552a) provides safeguards to
individuals for their personal information which the Government
collects. The Act requires certain actions by an agency that collects
information on individuals when that information contains personally
identifying information such as Social Security Numbers or names.
Because this proposed rule does not require a new collection of
personally identifiable information, the Privacy Act does not apply in
this instance.
Executive Order 12630
This proposed rule is not subject to Executive Order 12630,
Governmental Actions and Interference with Constitutionally Protected
Property Rights, because it does not involve implementation of a policy
with takings implications.
Executive Order 12988
This proposed rule has been drafted and reviewed in accordance with
Executive Order 12988, Civil Justice Reform, and it will not unduly
burden the Federal court system. The proposed regulation has been
written so as to minimize litigation and provide a clear legal standard
for affected conduct, and has been reviewed carefully to eliminate
drafting errors and ambiguities.
Executive Order 13211
This proposed rule is not subject to Executive Order 13211, because
it will not have a significant adverse effect on the supply,
distribution, or use of energy.
Plain Language
The Department drafted this proposed rule in plain language.
Catalog of Federal Domestic Assistance Number
State employment service delivery systems consist of three formula
grant programs, operating within an integrated service delivery
infrastructure. Each of these three programs has been assigned a
Catalog of Federal Domestic Assistance (CFDA) Number. The three
programs are the Employment Service/Wagner-Peyser Funded Activities
(CFDA 17.207), the Disabled Veterans' Outreach Program (CFDA
17.801), and the Local Veterans'
[[Page 9524]]
Employment Representative Program (CFDA 17.804).
Signed at Washington, DC, this 10th day of February 2011.
Raymond M. Jefferson,
Assistant Secretary for Veterans' Employment and Training.
List of Subjects in 20 CFR Part 1001
Employment, Grant programs--Labor, Veterans.
For reasons stated in the preamble, the Department proposes to
amend 20 CFR Chapter IX as follows:
PART 1001--SERVICES FOR VETERANS
1. The authority citation for part 1001 continues to read as
follows:
Authority: 29 U.S.C. 49k; 38 U.S.C. chapters 41 and 42.
2. Add subpart G, consisting of Sec. Sec. 1001.160 through
1001.167, to read as follows:
Subpart G--Purpose and Definitions
Sec.
1001.160 What is the purpose and scope of this part?
1001.161 What definitions apply to this part?
1001.162 How does the Department define veteran for purposes of this
subpart?
1001.163 What is the national entered employment rate (EER) and what
is a State's program year EER for purposes of this part?
1001.164 What is the uniform national threshold EER, and how will it
be calculated?
1001.165 When will the uniform national threshold EER be published?
1001.166 How will the uniform national threshold EER be used to
evaluate whether a State will be required to submit a corrective
action plan (CAP)?
1001.167 In addition to the procedures specified in these
regulations, will the Department be conducting any other monitoring
of compliance regarding services to veterans?
Subpart G--Purpose and Definitions
Sec. 1001.160 What is the purpose and scope of this part?
(a) The purpose of this regulation is to fulfill the requirement of
38 U.S.C. 4102A(c)(3)(B) to establish a uniform national threshold
entered employment rate (EER) achieved for veterans and eligible
persons by the State employment service delivery systems. The
Department will use the threshold rate as part of its process for
determining whether a State's program year EER is deficient and whether
a corrective action plan (CAP) will be required of a State employment
service delivery system.
(b) This regulation is applicable to all State agencies that are
recipients of Wagner-Peyser State Grants, and/or Jobs for Veterans
State Grants.
Sec. 1001.161 What definitions apply to this part?
Department means the United States Department of Labor, including
its agencies and organizational units and their representatives.
Eligible person, as defined at 38 U.S.C. 4101(5), means:
(1) The spouse of any person who died of a service-connected
disability;
(2) The spouse of any member of the Armed Forces serving on active
duty who, at the time of application for assistance under this chapter,
is listed, pursuant to 37 U.S.C. 556 and regulations issued thereunder
by the Secretary concerned, in one or more of the following categories
and has been so listed for a total of more than ninety days:
(i) Missing in action,
(ii) Captured in line of duty by a hostile force, or
(iii) Forcibly detained or interned in line of duty by a foreign
government or power; or
(3) The spouse of any person who has a total disability permanent
in nature resulting from a service-connected disability or the spouse
of a veteran who died while a disability so evaluated was in existence.
Employment service delivery system, as defined at 38 U.S.C.
4101(7), means a service delivery system at which or through which
labor exchange services, including employment, training, and placement
services, are offered in accordance with the Wagner-Peyser Act.
Jobs for Veterans Act (JVA) means Public Law 107-288, 116 Stat.
2033 (2002).
Jobs for Veterans State Grant (JVSG) means an award of Federal
financial assistance by the Department to a State for the purposes of
the Disabled Veterans' Outreach Program or the Local Veterans'
Employment Representative Program.
Program year is the period from July 1 of a year through June 30 of
the following year and is numbered according to the calendar year in
which it begins.
Sec. 1001.162 How does the Department define veteran for purposes of
this subpart?
The Department applies two definitions of veteran for the purposes
of this subpart and has established two stages for the implementation
of these definitions.
(a) The first stage of implementation begins with application of
this subpart G to the first program year following [EFFECTIVE DATE OF
THE FINAL RULE]. As of that date, Veteran is defined as it is in 38
U.S.C. 4211(4):
(1) A person who served on active duty for a period of more than
180 days and was discharged or released therefrom with other than a
dishonorable discharge;
(2) Was discharged or released from active duty because of a
service-connected disability;
(3) As a member of a reserve component under an order to active
duty pursuant to 10 U.S.C. 12301(a), (d), or (g), 12302, or 12304,
served on active duty during a period of war or in a campaign or
expedition for which a campaign badge is authorized and was discharged
or released from such duty with other than a dishonorable discharge; or
(4) Was discharged or released from active duty by reason of a sole
survivorship discharge (as that term is defined in 10 U.S.C.1174(i)).
(b) The second stage of implementation begins with the first day of
the program year that begins two years after the first day of the
program year that State grantees begin collecting and maintaining data
as required by 20 CFR 1010.330(c). As of that date, Veteran will be
defined as it is for purposes of 38 U.S.C. 4215(a):
(1) A person who served in the active military, naval, or air
service, and who was discharged or released therefrom under conditions
other than dishonorable, as specified in 38 U.S.C. 101(2).
(2) Active service includes full-time Federal service in the
National Guard or a Reserve component, other than full-time duty for
training purposes.
(c) During the second stage of implementation, any veteran who
meets the definition specified in paragraph (a) of this section will be
considered to meet the definition specified in paragraph (b) of this
section.
(d) The Department will notify State grantees when they are
required to begin implementing 20 CFR 1010.330(c).
Sec. 1001.163 What is the national entered employment rate (EER) and
what is a State's program year EER for purposes of this part?
(a) For purposes of this part, the Department uses the EER for
veterans and eligible persons. This is the EER as applied to veterans
(as defined in Sec. 1001.162) and eligible persons (as defined in
Sec. 1001.161) who are participants in State employment service
delivery systems.
(b) The EER for veterans and eligible persons measures the number
of the participants described in paragraph (a)
[[Page 9525]]
of this section who are employed after exiting an employment service
delivery system compared to the total number of those participants who
exited. The method of calculation will be established through policy
guidance issued by the Department.
(c) The national EER for veterans and eligible persons is the EER
achieved by the national State employment service delivery system for
those veterans and eligible persons who are participants in all of the
State employment service delivery systems for the program year under
review. The national EER resulting from this calculation is expressed
as a percentage that is rounded to the nearest tenth of a percent.
(d) A State's program year EER is the EER for veterans and eligible
persons (as calculated in paragraph (b) of this section) achieved by a
single State's employment service delivery system for those veterans
and eligible persons who are included in the EER measure for that
State's employment service delivery system for the program year under
review. The program year EER resulting from this calculation is
expressed as a percentage that is rounded to the nearest tenth of a
percent.
Sec. 1001.164 What is the uniform national threshold EER, and how
will it be calculated?
(a) The uniform national threshold EER for a program year is equal
to 90% of the national EER for veterans and eligible persons (as
defined in Sec. 1001.163(c)).
(b) The uniform national threshold EER resulting from this
calculation is expressed as a percentage that is rounded to the nearest
tenth of a percent.
Sec. 1001.165 When will the uniform national threshold EER be
published?
When practicable, the Veterans' Employment and Training Service
(VETS) will publish the uniform national threshold EER for a given
program year by the end of December of the calendar year in which that
program year ends.
Sec. 1001.166 How will the uniform national threshold EER be used to
evaluate whether a State will be required to submit a corrective action
plan (CAP)?
(a) Comparison. Each State's program year EER will be compared to
the uniform national threshold EER for that program year. State
agencies that do not achieve a program year EER that equals or exceeds
the national threshold EER (90% of the national EER) for the year under
review will be subject to a review by VETS to determine whether the
program year EER is deficient.
(b) Review. For each State whose program year EER is subject to
review to determine deficiency, the review will consider the degree of
difference between the State's program year EER and the uniform
national threshold EER for that program year, as well as the annual
unemployment data for the State as compiled by the Bureau of Labor
Statistics.
(1) The review also may consider other relevant measures of
prevailing economic conditions and regional economic conditions, as
well as other measures of the performance of workforce programs and/or
any information the State may submit.
(2) The review will include consultation with VETS field staff
about findings from their on-site reviews and desk audits of State
agency implementation of policies and procedures for services to
veterans, and also may include consultation with staff affiliated with
other agencies of the Department, as appropriate.
(c) Requirement of a CAP. A State whose program year EER is
determined to be deficient will be required to submit a CAP to improve
the State's performance in assisting veterans to meet their employment
needs as a condition of receiving its next-due JVSG.
(1) Any State whose program year EER has been determined to be
deficient will be notified by March 31 of the year following the
calendar year in which the program year under review ended.
(2) For any State that is required to submit a CAP, VETS will
provide technical assistance (TA) regarding the development of the CAP.
The CAP must be submitted to the Grant Officer's Technical
Representative by June 30 of the year following the calendar year in
which the program year under review ended.
(3) VETS will review the CAP submitted by the State and determine
whether to approve it or to provide additional TA to the State.
(i) If VETS approves the CAP, the State must expeditiously
implement it.
(ii) If VETS does not approve the CAP, it will take such steps as
are necessary to implement corrective actions to improve the State's
EER for veterans and eligible persons.
(4) If a State fails to cooperate with the actions imposed by the
Department under paragraph (c)(3)(ii) of this section, the Assistant
Secretary for Veterans' Employment and Training may take any actions
available to remedy non-compliance under 20 CFR 1001.130(a) (referring
to the compliance measures discussed in 20 CFR part 658, subpart H).
Sec. 1001.167 In addition to the procedures specified in these
regulations, will the Department be conducting any other monitoring of
compliance regarding services to veterans?
Yes. VETS will continue to monitor compliance with the regulations
related to veterans' priority of service at 20 CFR 1010.240(b) jointly
with the Employment and Training Administration. If a State's program
year EER is determined to be deficient for a given program year, that
deficiency would constitute information to be considered in monitoring
priority of service, since failure to fully implement priority of
service could be one of the contributors to a deficient program year
EER.
[FR Doc. 2011-3536 Filed 2-17-11; 8:45 am]
BILLING CODE P