1999 JTPA state allotments and Wagner-Peyser estimates

Training and Employment Guidance Letter No. 11-98

U.S. Department of Labor
Employment and Training Administration
Washington, D.C. 20210

Classification: JPTA
Correspondence symbol: TD
Issue date: February 17, 1999
Rescissions: [blank in source]
Expiration date: Continuing

TO: All State JPTA Liaisons; All State Employment Security Agencies; All State Worker Adjustment Liaisons; All One-Stop Career Center System Leads

FROM: David Henson, Director, Office of Regional Management

SUBJECT: JTPA Allotments for Program Year (PY) and Calendar Year (CY) 1999; Wagner-Peyser Preliminary Planning Estimates for PY 1999

1. Purpose. To provide States with Job Training Partnership Act (JTPA) Titles II-A, II-C, and III allotments for PY 1999; Title II-B allotments for CY 1999; and preliminary planning estimates for PY 1999 public employment service (ES) activities, as required by Section 6(b)(5) of the Wagner-Peyser Act, as amended.

2. References. Wagner-Peyser Act, as amended (29 U.S.C. 49); 20 CFR 652 and 20 CFR 653; JTPA Sections 202, 252, 262, 302, and 601, as amended by the Job Training Reform Amendments Act of 1992; Training and Employment Guidance Letters (TEGL) Nos. 4-88, 4-95, Change 1, and 2-97, Change 1.

3. Background. The JTPA Titles II-A and III allotments, and the Wagner-Peyser Act preliminary planning estimates are for the program period July 1, 1999, through June 30, 2000. The Title II-B and II-C allotments are for the period April 1, 1999, through June 30, 2000. These allotments and preliminary planning estimates will be published in the Federal Register.

   The JTPA allotments and the Wagner-Peyser Act preliminary planning estimates are part of the Fiscal Year 1999 funds appropriated in the Omnibus Consolidated and Emergency Supplemental Appropriations Act of 1998, P.L. 105-277. These appropriations include $995,000,000 for Title II-A, the same as the PY 1998 Title II-A level; $871,000,000 for Title II-B, the same as the FY 1998 Title II-B level; $129,965,000 for Title II-C, the same as the PY 1998 Title II-C level; $1,405,510,000 for Title III, a 4.07 percent increase from PY 1998; and $761,735,000 for allotments to States under the Wagner-Peyser Act, the same as the PY 1998 level.

   For States which choose to fully or partially implement the Workforce Investment Act (WIA) during Program Year 1999, these allocations will be used to support activities authorized under that legislation with the exception noted below for Titles II-B and II-C. (NOTE: States must continue to operate under JTPA rules until their WIA plans have been approved.) As States implementing WIA during the upcoming program year make strategic decisions on how to approach the delivery of services, it will clearly not be business as usual. For example, the funding provided may call for different contracting decisions than have been the norm under JTPA. In States where Governors choose to wait until July 1, 2000, to implement WIA, these funds will continue to be used in accordance with JTPA rules. Transition guidance will be provided during this quarter.

   JTPA funds are provided through block grants to the States for employment and training programs. These allotments to States are based on formulas defined in the Act. Under Title II-A (Adult Training Program), States will receive $955 million for job training services for disadvantaged adults and others who face significant employment barriers.

   For 1999, Title II-B and Title II-C appropriations language allows the funds to be available for obligation on April 1, 1999. This early obligation will allow States to begin making expenditures in advance of the upcoming Summer Youth Employment and Training Program, as well as facilitate the move toward a consolidated youth funding stream. As in previous years, the appropriations bill contains the authority for Service Delivery Areas (SDAs), with approval of the Governor, to transfer up to 100% of the funds between the two youth programs.

   The Title II-B and Title II-C programs are still authorized as separate programs in 1999. As the allocations are being made available in April, State allocations to SDAs must be made available under JTPA rules. As such, Governors in early implementing States need to be aware that youth funds provided at this time are not available for State set-aside purposes as authorized under WIA.

   Dislocated workers are those who lose their jobs due to mass layoffs or plant closings, are long-term unemployed, or are eligible for or have exhausted unemployment insurance, and are unlikely to return to their previous occupation or industry. It is important to note that the Title III allotment formula has no "hold-harmless" provision. Thus, State allotments may show large gains or losses from the previous year due to changes in the relative share of unemployment. While States which have shown relative economic improvement may experience a large reduction in formula funds, there may still be significant layoffs in particular industries or sub-state areas. The Title III legislation does provide for a Title III National Reserve Account to respond to large-scale dislocations that could not be anticipated by formula. If layoffs occur in these States during PY 1999, the Department will consider requests for funds from these States.

   The public employment service program involves a Federal-State partnership between the U.S. Employment Service and the State Employment Security Agencies. Under the Wagner-Peyser Act, funds are allotted to each State to administer a labor exchange program responding to the needs of the State's employers and workers through a system of local employment service offices. Additional resources are available to States through grants for One-Stop Career Centers.

4. JTPA/Wagner-Peyser Joint Planning and Coordination Provisions. As plans are developed in accordance with relevant statutory provisions and schedules issued by the Department, States are reminded that particular attention needs to be given to the Governor's statement of goals and objectives for JTPA, and joint Wagner-Peyser/JTPA planning initiatives consistent with Section 8(b) of the Wagner-Peyser Act, as amended. In States where the Governor elects to implement the WIA in July 1999, planning must be prepared consistent with WIA planning guidance. WIA planning guidance will be provided during this quarter.

5. Procedures. Notices of Obligation (NOOs) for the Title II-A and III programs will be issued on July 1, 1999, under the PY 1999 JTPA Grant Agreement. A second NOO will be issued to each State after November 1, 1999, for Title III, to increase or reduce the funds available to the State to reflect the amount of reallotted funds the State gains or loses, as discussed in TEGL No. 4-88.

   Separate NOOs for the CY 1999 Title II-B and PY 1999 Title II-C program will be issued April 1, 1999 under the PY 1999 JTPA Grant Agreement. States will be required to submit a separate JTPA Title II Quarterly Status Report (JQSR) for CY 1999 Title II-B and PY 1999 II-C funds, and they will not be combined with Title II-A PY 1999 data. Additionally, States will draw cash under the Payment Management System (PMS) for Title II-B CY 1999 and II-C PY 1999 funds, and these funds will not be combined with Title II-A funds under PMS.

6. Title II-A Allotments. Attachment I is a comparison of PY 1998 and PY 1999 JTPA Title II-A allotments by State. For all States, Territories, Puerto Rico and the District of Columbia, the following data were used in computing the allotments:

   • Data for Areas of Substantial Unemployment (ASUs) are averages for the 12-month period, July 1997 through June 1998.

   • The number of excess unemployed individuals or the ASU excess (depending on which is higher) are averages for this same 12-month period.

   • The economically disadvantaged adult data (age 22 to 72, excluding college students and military) are from the 1990 Census.

   The allotments for the Territories are based on unemployment data from the 1990 Census, or if not available, the most recent data available. A 90-percent relative share "hold-harmless" of the Title II-A PY 1998 allotments for these areas and a minimum allotment of $75,000 were also applied in determining the allotments.

   Title II-A funds are to be distributed among designated SDAs according to the statutory formula contained in Section 202(b) of JTPA, as amended by Title VII, Miscellaneous Provisions, of the JTPA Amendments of 1992. This is the same formula that was used in the previous program year.

7. Title II-B Allotments. Attachment II is a comparison of CY 1998 and CY 1999 Title II-B allotments for all States, Territories, Puerto Rico and the District of Columbia. The data used for these allotments are the same data as were used for Title II-A allotments, except that data for the number of economically disadvantaged youth (age 16 to 21, excluding college students and military) from the 1990 Census were used.

   For the Territories and Native Americans, the allotments are based on the percentage of Title II-B funds each received for the previous year summer program.

   Title II-B funds for the 1999 Summer program are to be distributed among designated SDAs in accordance with the statutory formula contained in Section 252(b) of JTPA, as amended by Title VII, Miscellaneous Provisions, of the JTPA Amendments of 1992. This is the same formula that was used in the previous program year.

8. Title II-C Allotments. Attachment III is a comparison of PY 1998 and PY 1999 JTPA Title II-C allotments for all States, Territories, Puerto Rico and the District of Columbia. The data used for these allotments are the same data as were used for Title II-B allotments.

   The allotments for the Territories are based on unemployment data from the 1990 Census or, if not available, the most recent data available.

   Title II-C funds are to be distributed among designated SDAs according to the statutory formula contained in Section 262(b) of JTPA, as amended by Title VII, Miscellaneous Provisions, of the JTPA Amendments of 1992. (The Title II-C formula is the same as for Title II-B). This is the same formula that was used in the previous program year.

9. Title III Allotments. Attachment IV is a comparison of PY 1998 and PY 1999 JTPA Title III allotments for all States, Territories, Puerto Rico and the District of Columbia. The total appropriation includes 80 percent allotted by formula to the States, while 20 percent is retained for the National Reserve account, including funds allotted to the Territories.

   The unemployment data used for computing these State allotments, relative numbers of unemployed and relative numbers of excess unemployed, are monthly averages for the October 1997 through September 1998 period. Long-term unemployed data used were for CY 1997. Allotments for the Territories are based on the PY 1999 Title II-A allotments for these areas.

   Title III formula funds are to be distributed to State and substate grantees in accordance with the provisions in Section 302(c) and (d) of JTPA, as amended.

   Reallotments of these Title III formula funds, as provided for by Section 303 of JTPA, as amended, will be based on completed program year expenditure reports submitted by the States. Reports received after October 1, 1999, may not be reflected in the calculations for Title III reallotment. Title III allotments will be adjusted upward or downward, based on whether the State is eligible to share in reallotted funds or is subject to recapture of funds.

10. Wagner-Peyser Act Planning Estimates. Attachment V shows Wagner-Peyser preliminary planning estimates for PY 1999. These preliminary estimates have been produced using the formula set forth at Section 6 of the Wagner-Peyser Act, 29 U.S.C. 49e. They are based on monthly averages for the most current 12 months ending September 1998 for each State's share of the civilian labor force (CLF) and unemployment. Final planning estimates will be published in the Federal Register, based on Calendar Year 1998 data, as required by the Wagner-Peyser Act.

    The total planning estimate includes $18,000,000 or 2.363 percent of the total amount available which is being withheld from distribution to States to finance postage costs associated with the conduct of Wagner-Peyser Act labor exchange services for PY 1999.

    The Secretary of Labor is required to set aside 3 percent of the total available funds to assure that each State will have sufficient resources to maintain statewide employment services, as required under Section 6(b)(4) of the Wagner-Peyser Act. In accordance with this provision, $22,312,050, the 3 percent set-aside funds, are included in the total planning estimate. The set-aside funds are distributed in two steps to States which have lost in relative share of resources from the prior year. In step one, States which have a Civilian Labor Force (CLF) below one million and are below the median CLF density are maintained at 100 percent of their relative share of prior year resources. All remaining set-aside funds are distributed on a pro-rata basis in step two to all other States losing in relative share from the prior year but which do not meet the size and density criteria for step one.

    Ten percent of the total sums allotted to each State shall be reserved for use by the Governor to provide performance incentives for public ES offices; services for groups with special needs; and for the extra costs of exemplary models for delivering job services.

11. Additional Guidance. The Department of Labor recognizes the need for additional information relating to transition from JTPA to WIA. A separate issuance is planned in the near future which will address a variety of questions that are being raised.

12. Action. States should allocate these JTPA allotments in accordance with applicable statutory provisions. Until a WIA plan is approved, JTPA provisions apply.

13. Inquiries. Questions regarding this TEGL should be directed to your Regional Office.

14. Attachments.

    1. Title II-A Comparison

    2. Title II-B Comparison

    3. Title II-C Comparison

    4. Title III Comparison

    5. Wagner-Peyser Act Preliminary Estimates

Attachment I: JTPA Title II-A (Adult Training), PY 1998 and PY 1999

Official Attachment I

Attachment II: JTPA Title II-B (Summer Youth), CY 1998 and CY 1999

Official Attachment II

Attachment III: JTPA Title II-C (Youth Training), PY 1998 and PY 1999

Official Attachment III

Attachment IV: JTPA Title III (EDWAA), PY 1998 and PY 1999

Official Attachment IV

Attachment V: Employment Service (Wagner-Peyser), preliminary PY 1999 allotments to states

Official Attachment V