FY 2008 TAA base allocations and reserve funds

Accessible letter PDF: https://www.dol.gov/sites/dolgov/files/ETA/advisories/TEGL/2007/TEGL08-07acc.pdf

CLASSIFICATION
      EMPLOYMENT AND TRAINING ADMINISTRATION                   TAA
                  ADVISORY SYSTEM                              CORRESPONDENCE SYMBOL
             U.S. DEPARTMENT OF LABOR                          ONR
                  Washington, D.C. 20210                       DATE
                                                               September 27, 2007


TRAINING AND EMPLOYMENT GUIDANCE LETTER NO. 8-07

TO:           STATE WORKFORCE AGENCIES
              STATE WORKFORCE LIAISONS
              STATE TRADE COORDINATORS

FROM:         EMILY STOVER DeROCCO /s/
              Assistant Secretary

SUBJECT:      Fiscal Year (FY) 2008 State Base Allocations and the Process for Requesting
              Additional Trade Adjustment Assistance (TAA) Program Reserve Funds

1. Purpose. To provide states with the formula methodology used in developing the Fiscal
   Year (FY) 2008 base allocations and to describe the process for requesting additional TAA
   program reserve funds for training and job search and relocation allowances.

2. References. The Trade Act of 1974, as amended; the Governor-Secretary Agreement; 2 CFR
   Part 225 (codifying OMB Circular A-87); 20 CFR Part 617; 29 CFR Parts 96, 97, 98, and 99;
   Training and Employment Guidance Letter (TEGL) 2-04 “Trade Adjustment Assistance
   (TAA) Program Reserve Funds,” dated July 14, 2004; and TEGL 6-03 “ Fiscal Year (FY) 2004
   State Planning Estimates and Process for Requesting Additional Trade Adjustment
   Assistance (TAA) Funds for Training and Administration,” dated October 1, 2003.

3. Background. The Employment and Training Administration (ETA) revised its fund
   allocation process for the TAA program and implemented a formula-based methodology for
   distributing training funds on October 1, 2003 (TEGL 6-03). This approach enables states to
   receive a base allocation at the beginning of the fiscal year. The formula has proven
   effective in allowing states to better plan and manage resources for addressing the
   employment and training needs of TAA-certified workers.

   The funding formula facilitates the fair and equitable distribution of available resources for
   training; encourages states to serve the greatest number of people with the resources
   available in the current fiscal year; provides an incentive for states to fund training plans
   through the end of the current fiscal year rather than mortgaging this year’s funds for next


 RESCISSIONS                                          EXPIRATION DATE:
 None                                                 Continuing

   year’s needs; provides states with the ability to more effectively plan and manage the use of
   their TAA training resources; and is consistent with ETA’s goal to secure rapid, suitable, and
   long-term employment for adversely affected workers.

4. Overview of Funding Process. Pending TAA reauthorization legislation and/or FY 2008
   appropriations legislation, the attached base allocations assume the TAA program training
   cap will remain at $220 million. Should the TAA program appropriation change as a result
   of reauthorization, the base allocations will be adjusted using the same methodology used to
   formulate the attached allocations, which are equal to 75 percent, or $165 million, of $220
   million. The factors used in determining each state’s share of the formula funds include
   previous year accrued expenditures and participant levels. The remaining 25 percent, or $55
   million, should the funding levels remain the same, will be reserved for distribution to
   states experiencing large, unexpected layoffs or having training needs that exceed available
   funds.

   States must submit a fund request and demonstrate that at least 50 percent of all available
   TAA training funds have been accrued as expenditures, or otherwise demonstrate need, in
   order to access reserve funds. To apply for reserve funds, as well as job search and
   relocation allowance funds, states must use the Standard Form (SF) 424, Application for
   Federal Assistance and the ETA-9117, Trade Adjustment Assistance Reserve Funding
   Request Form (OMB Approval Number 1205-0275).

   An additional 15 percent will be added for program administration to any base allocation,
   reserve training funds or job search and relocation allowance funds awarded to states.

5. FY 2008 Fund Allocation Process. For FY 2008, the formula is the same as the formula
   established by TEGL 6-03 -- 75 percent of training funds are available to states by formula,
   and 25 percent will be held in reserve. The process is as follows:

   A. TAA Formula Funds: 75 percent of the assumed $220 million available for TAA
      training—or $165 million—is being distributed to states using the following formula:

       • 50 percent of TAA formula funds, or $82.5 million, is being distributed based on
         accrued training expenditures reported for FY 2005, FY 2006 and the first two
         quarters of FY 2007 on the SF-269, Financial Status Report (i.e., the sum of each state’s
         accrued expenditures for training for FY 2005, FY 2006 and the first two quarters of
         FY 2007, divided by 2.5).

       • 50 percent of TAA formula funds, or $82.5 million, is being distributed based on the
         average number of training participants for FY 2005, FY 2006 and the first two
         quarters of FY 2007 as reported on the ETA-563, Quarterly Determinations,
         Allowance Activities and Employability Services (OMB Approval Number 1205-0016)
         (i.e., the sum of each state’s reported participants for FY 2005, FY 2006 and the first
         two quarters of FY 2007, divided by 2.5).

           With regard to participant data, each fiscal year’s participants are calculated by
           taking new participants reported as enrolling in training during that year and

       adding them to individuals reported in training on the last day of the prior fiscal
       year. Participant level data include all trade-affected workers with an approved
       training plan, regardless of funding source.

   • To minimize significant fluctuations in state funding from prior years, the formula for
     FY 2008 also contains the “hold-harmless” feature used since implementation of the
     formula. The “hold-harmless” factor ensures that each state’s base allocation is at
     least 85 percent of the base allocation the state received in FY 2007.

   • In those instances where the formula approach would have given states less than
     $100,000, those states will not receive a base allocation and will need to use WIA
     formula funds for TAA training and/or request TAA reserve funds in accordance
     with the procedures described in Section B.

The base allocations for each state are attached.

B. TAA Reserve Funds: The remaining 25 percent of the $220 million requested for TAA
   training—or $55 million—will be designated for reserve funding. Reserve funds will be
   distributed to states on an as-needed basis and are designed to provide monies to those
   states that experience large, unexpected layoffs or have training needs that are not met
   by their base allocation. In order to be eligible for TAA reserve funds, states must
   demonstrate that at least 50 percent of all available TAA training funds during FY 2008
   have been expended on an accrual basis, or otherwise demonstrate need. States
   requesting reserve funds must complete the SF-424 and ETA-9117 and submit them in
   accordance with instructions contained in TEGL 2-04.

   In addition to the criteria contained in TEGL 2-04, factors that will be taken into
   consideration during the review of these funding requests will include the expenditure
   of FY 2008 base allocation funds; the expenditure of prior fiscal year TAA funds; the
   availability of WIA and other sources of funds; the number of participants currently
   enrolled in training; the number of participants with approved training plans who have
   not started training; the number of anticipated new enrollees; the number of petitions
   certified; the average take-up rate for training; the average training cost per participant;
   the average training duration; and the average training completion rate.

C. Job Search and Relocation Allowances: States may also request job search and
   relocation allowances for trade-affected workers who are unable to find employment
   within their local commuting area. These funds must be requested using the ETA-9117
   and may be submitted at any time or in combination with a request for reserve training
   funds.

D. TAA Program Administration Funds: States will continue receiving an additional 15
   percent of all base allocation, reserve, and job search/relocation allowances for program
   administration. The administrative funds will be included each time funds are obligated
   to states by ETA.

   The program administration estimates for each state are also included in the attachment.

   Consistent with the TAA Annual Cooperative Financial Agreement, ETA may recapture any
   funds that states are unable to utilize within a reasonable period of time, but only after
   consultation with and appropriate notification to state officials.

6. Program Reporting. The formula approach to distributing TAA funds emphasizes the
   importance of accurate and timely reporting of training participant and expenditure data on
   the ETA-563 and the new ETA-9130, U.S. DOL ETA Financial Report (successor to the SF-
   269, Financial Status Report, (OMB Approval Number 1205-0461). Reported data on these
   forms are critical in determining the level of funds states will receive each year for serving
   trade-affected workers. It is in each state’s best interest to ensure accuracy and timeliness of
   reported data in the ETA-563, ETA-9130, and the Trade Act Participant Report (TAPR)
   (OMB Approval Number 1205-0392). Data on the TAPR are used to derive the average
   training duration and the training completion rate when evaluating state requests for TAA
   reserve funds. In addition, accurate information on the SF-424 and ETA-9117 submitted by
   states is essential for assessing requests for TAA reserve funds and job search and relocation
   allowances.

7. Action Required. States should ensure that all trade and workforce investment program
   staff are informed and knowledgeable of this funding methodology.

8. Inquiries. States should direct all inquiries to the appropriate ETA regional office.

9. Attachment. FY 2008 State Base Allocations and Administrative Allotments

Attachment 1 PDF: https://www.dol.gov/sites/dolgov/files/ETA/advisories/TEGL/2007/TEGL08-07a1.pdf

Attachment
Fiscal Year (FY) 2008 TAA Training Base Allocations and Administrative Allotments

                                           FY 2008                FY 2008                  Total FY 2008
                                        Training Base           Administrative              TAA Base
                State                    Allocation              Allotment*                Allocation**
     Alabama                                 $2,302,891                 $345,434                 $2,648,325
     Alaska                                    $453,588                  $68,038                   $521,626
     Arizona                                 $1,763,614                 $264,542                 $2,028,156
     Arkansas                                $2,134,407                 $320,161                 $2,454,568
     California                              $8,039,756               $1,205,963                 $9,245,719
     Colorado                                $1,259,451                 $188,918                 $1,448,369
     Connecticut                             $1,666,896                 $250,034                 $1,916,930
     Delaware                                        $0                        $0                        $0
     District of Columbia                            $0                        $0                        $0
     Florida                                 $2,420,768                 $363,115                 $2,783,883
     Georgia                                 $2,728,195                 $409,229                 $3,137,424
     Hawaii                                          $0                        $0                        $0
     Idaho                                   $1,727,049                 $259,057                 $1,986,106
     Illinois                                $6,108,142                 $916,221                 $7,024,363
     Indiana                                 $5,869,808                 $880,471                 $6,750,279
     Iowa                                    $2,737,371                 $410,606                 $3,147,977
     Kansas                                  $2,005,469                 $300,820                 $2,306,289
     Kentucky                                $4,185,738                 $627,861                 $4,813,599
     Louisiana                                 $442,584                  $66,388                   $508,972
     Maine                                   $3,619,802                 $542,970                 $4,162,772
     Maryland                                  $722,081                 $108,312                   $830,393
     Massachusetts                           $4,908,229                 $736,234                 $5,644,463
     Michigan                                $7,017,486               $1,052,623                 $8,070,109
     Minnesota                               $2,894,147                 $434,122                 $3,328,269
     Mississippi                             $1,499,921                 $224,988                 $1,724,909
     Missouri                                $3,781,434                 $567,215                 $4,348,649
     Montana                                   $801,570                 $120,236                   $921,806
     Nebraska                                  $420,080                  $63,012                   $483,092
     Nevada                                    $183,172                  $27,476                   $210,648
     New Hampshire                             $469,016                  $70,352                   $539,368
     New Jersey                              $2,022,807                 $303,421                 $2,326,228
     New Mexico                                $336,857                  $50,529                   $387,386
     New York                                $2,965,506                 $444,826                 $3,410,332
     North Carolina                         $14,812,819               $2,221,923               $17,034,742
     North Dakota                                    $0                        $0                        $0
     Ohio                                    $5,400,512                 $810,078                 $6,210,590
     Oklahoma                                $1,692,461                 $253,869                 $1,946,330
     Oregon                                  $4,610,952                 $691,643                 $5,302,595
     Pennsylvania                           $13,049,996               $1,957,499               $15,007,495
     Puerto Rico                                     $0                        $0                        $0
     Rhode Island                              $955,579                 $143,337                 $1,098,916
     South Carolina                          $5,164,629                 $774,694                 $5,939,323
     South Dakota                              $498,826                  $74,824                   $573,650
     Tennessee                               $2,991,208                 $448,681                 $3,439,889
     Texas                                   $9,741,478               $1,461,222               $11,202,700
     Utah                                    $1,310,880                 $196,632                 $1,507,512
     Vermont                                   $267,558                  $40,134                   $307,692
     Virginia                                $6,316,175                 $947,426                 $7,263,601
     Washington                             $10,373,149               $1,555,972               $11,929,121
     West Virginia                           $1,907,784                 $286,168                 $2,193,952
     Wisconsin                               $8,418,159               $1,262,724                 $9,680,883
     Wyoming                                         $0                        $0                        $0
     US Total                              $165,000,000              $24,750,000              $189,750,000
      * Each state's administrative allotment represents 15% of its FY 2008 base allocation.
     ** Each state's allocation represents the sum of its FY 2008 base allocation and administrative allotment.