U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210

CLASSIFICATION

WOTC/WtW

CORRESPONDENCE SYMBOL

OWS

ISSUE DATE

March 6, 2001

RESCISSIONS

None

EXPIRATION DATE

December 31, 2001

DIRECTIVE

:

TRAINING AND EMPLOYMENT GUIDANCE LETTER NO. 13-00

 

TO

:

ALL STATE WORKFORCE LIAISONS
ALL STATE EMPLOYMENT SECURITY AGENCIES
ALL STATE WORKER ADJUSTMENT LIAISONS
ALL ONE-STOP CAREER CENTER SYSTEM LEADS

 

FROM

:

LENITA JACOBS-SIMMONS
Deputy Assistant Secretary

 

SUBJECT

:

Planning Guidelines for Employment Service (ES) Fiscal Year 2001 Cost Reimbursable Grants for Work Opportunity Tax Credit (WOTC)/Welfare-to-Work Tax Credit (WtW)Programs.

 

  1. Purpose. To provide planning estimates and guidance for Fiscal Year (FY) 2001 WOTC/WtW programs under the Wagner-Peyser Act Annual Funding Agreement.

  2. References. The Wagner-Peyser Act, Section 7(d); the Small Business Job Protection Act (P.L. 104-188); the Taxpayer Relief Act of 1997 (P.L. 105-34); the Tax and Trade Relief Extension Act of 1998 (P.L. 105-277); the Ticket to Work and Work Incentives Improvement Act of 1999 (P.L. 106-170); 29 CFR Parts 93, 96, 97 and 98; and OMB Circular A-87.

  3. Background. The WOTC/WtW tax credits were reauthorized for a 30-month period through December 31, 2001 (retroactive to the credits' expiration date of June 30, 1999) by the Ticket to Work and Work Incentives Improvement Act of 1999, signed December 17, 1999. State Employment Security Agencies (SESAs)are responsible for administering both tax credits, including the certification process, and for reporting on results.

  4. Grant Officer Authority. Pursuant to Training and Employment Information Notice No. 24-99, grant officer authority for the ES Base Formula allotments to States and the ES Cost Reimbursable Grants was transferred from the Employment and Training Administration (ETA) Regional Offices to the National Office. The National Office Grant Officer recently issued advance funding to all States under the new FY 2001 agreement and pursuant to a FY 2001 Continuing Resolution which authorized partial funding. Please note, however, that any remaining grant actions pertaining to pre-FY 2001 funds for the WOTC/WtW tax credit programs will continue to be handled through Regional Office Grant Officers.

  5. Work Opportunity/Welfare-to-Work Tax Credits Activities. The ES National Activities spending plan includes $20,000,000 for the WOTC/WtW programs. Of this total, $500,000 is being withheld to pay estimated WOTC/WtW postage costs. Of the remaining $19,500,000, $20,000 will be allotted to the Virgin Islands and the balance will be distributed based on a $64,000 minimum allotment and a 95% stop-loss/120% stop-gain from the FY 2000 allotment share percentage, based on a formula as follows: (1) 50% is allocated based on each State's relative share of total certifications issued for WOTC and for the WtW tax credit;(2) 30% is allocated based on each State's relative share of the civilian labor force (CLF); and (3) 20% is allocated based on each State's relative share of the adult recipients of Temporary Assistance for Needy Families (TANF). The data utilized for these factors reflect actual certifications reported for FY 2000, CY 1999 CLF averages, and adult recipients of TANF for FY 1999.

  6. General Administration. Regional Offices are responsible for field level review of the ES grants. This includes review and approval of State plans, analysis of expenditures and performance data, and on-site reviews. States are expected to administer WOTC/WtW funds in accordance with the Act and applicable regulations, and the terms and conditions of the Wagner-Peyser Act Annual Funding Agreement, which include administrative requirements and cost principles of Federal Regulations at 29 CFR Part 97 and OMB Circular A-87. Further, programs must also be administered in accordance with the policy and procedure guidance set forth in the second edition of ETA Handbook 408. Current ES Regulations at 20 CFR 658.400 Subpart E cover the complaint and appeals procedures. Other applicable regulatory provisions are incorporated in the grant plan Statement of Work (attached).

  7. Reporting. States are to plan for total expenditures (exclusive of "carry in" funds) by calendar quarter. A separate Financial Status Report (SF-269 -- long form) must be submitted quarterly by each State for each year of funds provided, until such time as all funds have been expended or the period of availability for the WOTC/WtW plan has expired, whichever occurs first. Expenditure reports (one original and two copies) are to be submitted to the appropriate ETA Regional Office. Timely submission of these reports is extremely important to ensure proper accounting of funds. Previous year fund balances will remain in the existing grant and should be expended under the current ETA (Regional Office) and State Master Agreement before any FY 2001 funds are expended. FY 2001 funds will be allocated and expended pursuant to the new Wagner-Peyser Act Annual Funding Agreement between the State and the ETA National Office.

  8. Grant and Plan Effective Date. Plans should cover the twelve (12) month period from the start of FY 2001, i.e., October 1, 2000 through September 30, 2001.

  9. Action Required. SESA Administrators are requested to:

    1. mmediately transmit this planning issuance to the appropriate State staff.

    2. Submit three (3) copies of the FY 2001 WOTC/WtW Annual Plan to the appropriate Regional Office. Plans should be prepared in accordance with Attachments I, II, and III (Grant Procedures, Allocation List, and Plan Narrative Instructions) and be submitted to the appropriate Regional Office by March 20, 2001.

      The Plan must include:

      1. Transmittal Letter;

      2. Application for Federal Assistance (SF 424);

      3. Budget Expenditure Plan (SF 424 A - Section D only);

      4. Plan Narrative: these plans should include only those activities that will be supported with FY 2001 funds.

  10. Inquiries. Program questions may be directed to your Regional Office contact person or to Carmen Ortiz (Office of Workforce Security, Division of USES/ALMIS) at (202)693-2786. All questions regarding grant and financial issues should be directed to Gwendolyn Baron-Simms or Fred Tello at (202)693-3309, or (202)693-3333, respectively.

  11. Attachments.

    1. Grant Procedures

    2. Allocations for FY 2001

    3. WOTC/WtW Plan Narrative Instructions