[nfbmi-talk] vr title i regulations

joe harcz Comcast joeharcz at comcast.net
Wed Sep 25 21:51:30 UTC 2013


Dear Commissioners,

I don't know if you have ever been sent the core federal regulations coverring the Voctional Rehabilitation programs by Mr. Rodgers. But these are the seminal instruments of BSBP's charge and obligations aside from those, of course relating to BEP programs which include pPublic Act 260 and the Randolph Shepard regulations.

Regardless these are based upon the Rehabilitation Act of 1973 without which BSBP would not exist to begin with.

This also answers most questions I've heard recently regarding the Vocational Rehabilitation Program and the requirements in the State Plan and annual updates to comply with this law and regulations.

I'm making this a plain text enclosure for those who are blind.

Sincerely,

Joe Harcz

State Vocational Rehabilitation Services Program; 34 CFR Part 361 Final regulations [OSERS][Federal Register: January 17, 2001 (Volume 66, Number 11)]

[Rules and Regulations]               

[Page 4379-4435]

>From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr17ja01-17]                         

 

 

[[Page 4379]]

 

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Part VI

 

 

 

 

 

Department of Education

 

 

 

 

 

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34 CFR Part 361

 

 

 

State Vocational Rehabilitation Services Program; Final Rule

 

 

[[Page 4380]]

 

 

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DEPARTMENT OF EDUCATION

 

34 CFR Part 361

 

RIN 1820-AB50

 



State Vocational Rehabilitation Services Program

 

AGENCY: Office of Special Education and Rehabilitative Services, 

Department of Education.

 

ACTION: Final regulations.

 

-----------------------------------------------------------------------

 

SUMMARY: The Secretary amends the regulations governing the State 

Vocational Rehabilitation Services Program. These amendments implement 

changes to the Rehabilitation Act of 1973 made by the Rehabilitation 

Act Amendments of 1998 that were contained in Title IV of the Workforce 

Investment Act of 1998 (WIA), enacted on August 7, 1998, and as further 

amended in 1998 by technical amendments in the Reading Excellence Act 

and the Carl D. Perkins Vocational and Applied Technology Education Act 

Amendments of 1998 (hereinafter collectively referred to as the 1998 

Amendments).

 

DATES: These regulations are effective February 16, 2001. However, 

affected parties do not have to comply with the information collection 

requirements in Secs. 361.10, 361.12, 361.13, 361.14, 361.15, 361.16, 

361.17, 361.18, 361.19, 361.20, 361.21, 361.22, 361.23, 361.24, 361.25, 

361.26, 361.27, 361.28, 361.29, 361.30, 361.31, 361.32, 361.34, 361.35, 

361.36, 361.37, 361.38, 361.40, 361.41, 361.46, 361.47, 361.48, 361.49, 

361.50, 361.51, 361.52, 361.53, 361.54, 361.55, 361.57, 361.60 and 

361.62 until the Department of Education publishes in the Federal 

Register the control numbers assigned by the Office of Management and 

Budget (OMB) to these information collection requirements. Publication 

of the control numbers notifies the public that OMB has approved these 

information collection requirements under the Paperwork Reduction Act 

of 1995.

 

FOR FURTHER INFORMATION CONTACT: Beverlee Stafford, U.S. Department of 

Education, 400 Maryland Avenue, SW., room 3014, Mary E. Switzer 

Building, Washington, DC 20202-2531. Telephone (202) 205-8831. If you 

use a telecommunications device for the deaf (TDD), you may call (202) 

205-5538.

    Individuals with disabilities may obtain this document in an 

alternative format (e.g., Braille, large print, audiotape, or computer 

diskette) on request to Katie Mincey, Director, Alternate Formats 

Center, U.S. Department of Education, 400 Maryland Avenue, SW., room 

1000, Mary E. Switzer Building, Washington, DC 20202-2531. Telephone 

(202) 260-9895. If you use a telecommunications device for the deaf 

(TDD), you may call the Federal Information Relay Service (FIRS) at 1-

800-877-8339.

 

SUPPLEMENTARY INFORMATION: The State Vocational Rehabilitation Services 

Program (VR program) is authorized by Title I of the Rehabilitation Act 

of 1973, as amended (Act) (29 U.S.C. 701-744). The VR program provides 

support to each State to assist it in operating a statewide 

comprehensive, coordinated, effective, efficient, and accountable State 

program, as an integral part of a statewide workforce investment 

system, to assess, plan, develop, and provide vocational rehabilitation 

(VR) services for individuals with disabilities so that those 

individuals may prepare for and engage in gainful employment consistent 

with their strengths, priorities, concerns, abilities, capabilities, 

interests, and informed choice.

    On February 28, 2000, we published a notice of proposed rulemaking 

(NPRM) for this part in the Federal Register (65 FR 10620). In the 

preamble to the NPRM, we discussed on pages 10620 through 10630 the 

major changes proposed to the regulations in 34 CFR part 361 as a 

result of the 1998 Amendments. These included the following:

     Streamlining the regulatory requirements pertaining to the 

State plan for the VR program by changing several State plan 

descriptions or assurances to program requirements that need not be 

addressed in the State plan. These proposed changes were intended to 

reduce the paperwork burden associated with the development of the 

State plan.

     Amending the regulations to reflect the responsibilities 

of the designated state unit (DSU or State unit) as a required partner 

in the One-Stop service delivery system (One-Stop system) established 

under Title I of the WIA, Pub. L. 105-22. For example, we proposed 

amending Sec. 361.4 to include among the regulations applicable to the 

VR program the One-Stop system requirements in 20 CFR part 662 and the 

civil rights requirements in 29 CFR part 37. In addition to these 

changes and, as noted later, amending other sections of the current 

regulations to reflect requirements in WIA, we discuss in some detail 

in the preamble to the NPRM (65 FR 10620 and 10621) the relationship 

between the VR program, the One-Stop system in general, and persons 

with disabilities. We suggest that you refer to that discussion for 

additional guidance in coordinating between One-Stop system components.

     Amending Sec. 361.5 to include a new definition of the 

term ``fair hearing board,'' a revised definition of ``physical or 

mental impairment,'' a new definition of the term ``qualified and 

impartial mediator,'' and several new statutory definitions found in 

WIA, including ``local workforce investment board,'' ``State workforce 

investment board,'' and ``Statewide workforce investment system.''

     Amending Sec. 361.10 to require that each State submit its 

State plan for the VR program on the same date that it submits either a 

State plan under section 112 of WIA or a State unified plan under 

section 501 of that Act.

     Amending Sec. 361.13 to expand the list of activities that 

are the responsibility of the DSU.

     Amending Sec. 361.18(c) to require, as appropriate, DSUs 

to address in a written plan their retraining, recruitment, hiring, and 

other strategies to ensure that their personnel meet the statutory 

standards related to the comprehensive system of personnel development.

     Amending Sec. 361.22 to reflect new statutory requirements 

that foster the transition of students from educational to VR services.

     Amending Sec. 361.23 to reflect both the VR program's 

responsibilities as a partner of the One-Stop system under WIA and the 

requirements in the 1988 Amendments related to interagency coordination 

between the VR program and other components of the statewide workforce 

investment system under WIA.

     Amending Sec. 361.26 to reflect the authority of States to 

use geographically earmarked funds without requesting a waiver of 

statewideness.

     Amending Sec. 361.29 to guide States in developing a 

required comprehensive, forward-thinking plan for administering and 

improving their VR programs.

     Conforming Sec. 361.30 solely to the requirement in the 

Act that DSUs provide VR services to eligible American Indians to the 

same extent as other significant populations of individuals with 

disabilities.

     Amending Sec. 361.31 to conform to the requirement in the 

Act that the DSU establish cooperative agreements with private 

nonprofit VR service providers.

     Removing Sec. 361.33 of the current regulations (regarding 

the use, assessment, and support of community rehabilitation programs) 

since these requirements are addressed in other

 

[[Page 4381]]

 

regulatory sections and reserving this section for future use.

     Amending Sec. 361.35 to reflect the requirement in section 

101(a)(18) of the Act that the State reserve a portion of its allotment 

under section 110 of the Act to further innovation and expansion of its 

VR program.

     Amending Sec. 361.36 to incorporate the requirement in the 

1998 Amendments that individuals who do not meet the State's order of 

selection criteria for receiving services be provided access to the 

DSU's information and referral system under Sec. 361.37.

     Amending Sec. 361.37 to reflect new requirements in the 

Act for referring individuals, including eligible individuals who do 

not meet the State's order of selection criteria for receiving 

services, to those components of the statewide workforce investment 

system best suited to meet an individual's employment needs.

     Amending Sec. 361.42 to implement new requirements in the 

Act regarding presumptive eligibility for Social Security recipients 

and beneficiaries and the use of trial work experiences as part of the 

assessment for determining eligibility, to revise regulatory 

requirements concerning extended evaluations, and to identify the type 

of personnel who must conduct eligibility determinations.

     Amending Sec. 361.45 to implement new requirements in the 

Act that expand an eligible individual's options for developing the 

Individualized Plan for Employment (IPE), enable individuals to receive 

technical assistance in developing their IPEs, specify the information 

that the DSU must provide to the eligible individual during IPE 

development, and detail applicable procedural requirements.

     Amending Sec. 361.47 to require the States to determine, 

with input from the State Rehabilitation Councils, the type of 

documentation that they will maintain for each applicant and eligible 

individual to meet the content items that must be included in each 

individual's record of services.

     Amending Sec. 361.52 to implement the expanded authority 

in the Act requiring that applicants and eligible individuals be able 

to exercise informed choice throughout the rehabilitation process.

     Amending Sec. 361.53 to require interagency agreements 

between the DSU and other appropriate public entities to ensure that 

eligible individuals with disabilities receive, in a timely manner, 

necessary services to which each party to the agreement has an 

obligation, or the authority, to contribute.

     Amending Sec. 361.54 to expand the list of VR services 

exempt from State financial needs tests to include interpreter services 

for individuals who are deaf or hard of hearing, reader services for 

individuals who are blind, and personal assistant services. Also, this 

section was amended to prohibit States from applying financial needs 

tests to individuals receiving Supplemental Security Income (SSI) or 

Social Security Disability Insurance (SSDI).

     Re-titling and Amending Sec. 361.56 to better reflect the 

requirements that must be met before the State unit can close the 

record of services for an individual who has achieved an employment 

outcome.

     Amending Sec. 361.57 to implement new requirements in the 

1998 Amendments regarding mediation and administrative review of 

disputes regarding the provision of VR services to applicants or 

eligible individuals.

     Amending Sec. 361.60 to reflect the elimination of 

statutory authority for the innovation and expansion grant program and 

to implement new statutory provisions regarding the use of 

geographically limited earmarked funds as part of the State's non-

Federal share.

    These final regulations contain several significant changes from 

the NPRM. We fully explain each of these changes in the Analysis of 

Comments and Changes in the appendix at the end of these final 

regulations.

 

Analysis of Comments and Changes

 

    In response to our invitation in the NPRM, 109 parties submitted 

comments on the proposed regulations. An analysis of the comments and 

of the changes in the regulations since publication of the NPRM is 

published as an appendix at the end of these final regulations.

    We discuss substantive issues under the sections of the regulations 

to which they pertain. Generally, we do not address technical and other 

minor changes--and suggested changes that the law does not authorize 

the Secretary to make.

 

National Education Goals

 

    The eight National Education Goals focus the Nation's education 

reform efforts and provide a framework for improving teaching and 

learning.

    These regulations address the National Education Goal that every 

adult American, including individuals with disabilities, will possess 

the knowledge and skills necessary to compete in a global economy and 

exercise the rights and responsibilities of citizenship.

 

Executive Order 12866

 

    We have reviewed these final regulations in accordance with 

Executive Order 12866. Under the terms of the order, we have assessed 

the potential costs and benefits of this regulatory action.

    The potential costs associated with the final regulations are those 

resulting from statutory requirements and those we have determined to 

be necessary for administering this program effectively and 

efficiently.

    In assessing the potential costs and benefits--both quantitative 

and qualitative--of these final regulations, we have determined that 

the benefits of the final regulations justify the costs.

    We also have determined that this regulatory action does not unduly 

interfere with State, local, and tribal governments in the exercise of 

their governmental functions.

 

Summary of Potential Costs and Benefits

 

    We discussed the potential costs and benefits of these final 

regulations in the preamble to the NPRM (65 FR 10630 and 10631) and 

throughout the section-by-section analysis (65 FR 10621 through 10630). 

Our analysis of potential costs and benefits generally remains the same 

as in the NPRM, although we include additional discussion of potential 

costs and benefits in the Appendix to these final regulations titled 

Analysis of Comments and Changes.

 

Intergovernmental Review

 

    This program is subject to Executive Order 12372 and the 

regulations in 34 CFR part 79. One of the objectives of the Executive 

order is to foster an intergovernmental partnership and a strengthened 

federalism. The Executive order relies on processes developed by State 

and local governments for coordination and review of proposed Federal 

financial assistance.

    This document provides early notification of our specific plans and 

actions for this program.

 

Federalism

 

    Executive Order 13132 requires us to ensure meaningful and timely 

input by State and local elected officials in the development of 

regulatory policies that have federalism implications. ``Federalism 

implications'' means substantial direct effects on the States, on the 

relationship between the National Government and the States, or on the 

distribution of power and

 

[[Page 4382]]

 

responsibilities among the various levels of government.

    These regulations implement various statutory changes to the State 

Vocational Rehabilitation Services Program. We do not believe that 

these regulations have federalism implications as defined in Executive 

Order 13132 or that they preempt State law. Accordingly, the Secretary 

has determined that these regulations do not contain policies that have 

federalism implications.

 

Assessment of Educational Impact

 

    In the NPRM we requested comments on whether the proposed 

regulations would require transmission of information that any other 

agency or authority of the United States gathers or makes available.

    Based on the response to the NPRM and our review, we have 

determined that these final regulations do not require transmission of 

information that any other agency or authority of the United States 

gathers or makes available.

 

Electronic Access to This Document

 

    You may view this document, as well as all other Department of 

Education documents published in the Federal Register, in text or Adobe 

Portable Document Format (PDF) on the Internet at either of the 

following sites:

 

http://ocfo.ed.gov/fedreg.htm

http://www.ed.gov/news.html

 

    To use PDF you must have Adobe Acrobat Reader, which is available 

free at either of the previous sites. If you have questions about using 

PDF, call the U.S. Government Printing Office (GPO), toll free, at 1-

888-293-6498; or in the Washington, DC, area at (202) 512-1530.

 

    Note: The official version of this document is the document 

published in the Federal Register. Free Internet access to the 

official edition of the Federal Register and the Code of Federal 

Regulations is available on GPO Access at: http://

www.access.gpo.gov/nara/index.html

 

(Catalog of Federal Domestic Assistance Number: 84.126 State 

Vocational Rehabilitation Services Program)

 

List of Subjects in 34 CFR Part 361

 

    Reporting and recordkeeping requirements, State-administered grant 

program--education, Vocational rehabilitation.

 

    Dated: December 7, 2000.

Richard W. Riley,

Secretary of Education.

    For the reasons discussed in the preamble, the Secretary amends 

title 34 of the Code of Federal Regulations by revising part 361 to 

read as follows:

 

PART 361--STATE VOCATIONAL REHABILITATION SERVICES PROGRAM

 

Subpart A--General

Sec.

361.1  Purpose.

361.2  Eligibility for a grant.

361.3  Authorized activities.

361.4  Applicable regulations.

361.5  Applicable definitions.

Subpart B--State Plan and Other Requirements for Vocational 

Rehabilitation Services

361.10  Submission, approval, and disapproval of the State plan.

361.11  Withholding of funds.

 

Administration

 

361.12  Methods of administration.

361.13  State agency for administration.

361.14  Substitute State agency.

361.15  Local administration.

361.16  Establishment of an independent commission or a State 

Rehabilitation Council.

361.17  Requirements for a State Rehabilitation Council.

361.18  Comprehensive system of personnel development.

361.19  Affirmative action for individuals with disabilities.

361.20  Public participation requirements.

361.21  Consultations regarding the administration of the State 

plan.

361.22  Coordination with education officials.

361.23  Requirements related to the statewide workforce investment 

system.

361.24  Cooperation and coordination with other entities.

361.25  Statewideness.

361.26  Waiver of statewideness.

361.27  Shared funding and administration of joint programs.

361.28  Third-party cooperative arrangements involving funds from 

other public agencies.

361.29  Statewide assessment; annual estimates; annual State goals 

and priorities; strategies; and progress reports.

361.30  Services to American Indians.

361.31  Cooperative agreements with private nonprofit organizations.

361.32  Use of profitmaking organizations for on-the-job training in 

connection with selected projects.

361.33  [Reserved.]

361.34  Supported employment State plan supplement.

361.35  Innovation and expansion activities.

361.36  Ability to serve all eligible individuals; order of 

selection for services.

361.37  Information and referral services.

361.38  Protection, use, and release of personal information.

361.39  State-imposed requirements.

361.40  Reports.

 

Provision and Scope of Services

 

361.41  Processing referrals and applications.

361.42   Assessment for determining eligibility and priority for 

services.

361.43   Procedures for ineligibility determination.

361.44   Closure without eligibility determination.

361.45  Development of the individualized plan for employment.

361.46  Content of the individualized plan for employment.

361.47  Record of services.

361.48  Scope of vocational rehabilitation services for individuals 

with disabilities.

361.49  Scope of vocational rehabilitation services for groups of 

individuals with disabilities.

361.50  Written policies governing the provision of services for 

individuals with disabilities.

361.51  Standards for facilities and providers of services.

361.52  Informed choice.

361.53  Comparable services and benefits.

361.54  Participation of individuals in cost of services based on 

financial need.

361.55  Annual review of individuals in extended employment or other 

employment under special certificate provisions of the Fair Labor 

Standards Act.

361.56  Requirements for closing the record of services of an 

individual who has achieved an employment outcome.

361.57  Review of determinations made by designated State unit 

personnel.

Subpart C--Financing of State Vocational Rehabilitation Programs

361.60  Matching requirements.

361.61  Limitation on use of funds for construction expenditures.

361.62  Maintenance of effort requirements.

361.63  Program income.

361.64  Obligation of Federal funds and program income.

361.65  Allotment and payment of Federal funds for vocational 

rehabilitation services.

Subpart D--[Reserved]

Subpart E--Evaluation Standards and Performance Indicators

361.80  Purpose.

361.81  Applicable definitions.

361.82  Evaluation standards.

361.84  Performance indicators.

361.86  Performance levels.

361.88  Reporting requirements.

361.89  Enforcement procedures.

 

    Authority: 29 U.S.C. 709(c), unless otherwise noted.

 

Subpart A--General

 

 

Sec. 361.1  Purpose.

 

    Under the State Vocational Rehabilitation Services Program 

(Program), the Secretary provides grants to assist States in operating 

statewide comprehensive, coordinated, effective, efficient, and 

accountable programs, each of which is--

    (a) An integral part of a statewide workforce investment system; 

and

    (b) Designed to assess, plan, develop, and provide vocational 

rehabilitation

 

[[Page 4383]]

 

services for individuals with disabilities, consistent with their 

strengths, resources, priorities, concerns, abilities, capabilities, 

interests, and informed choice, so that they may prepare for and engage 

in gainful employment.

 

(Authority: Section 100(a)(2) of the Act; 29 U.S.C. 720(a)(2))

 

 

Sec. 361.2  Eligibility for a grant.

 

    Any State that submits to the Secretary a State plan that meets the 

requirements of section 101(a) of the Act and this part is eligible for 

a grant under this Program.

 

(Authority: Section 101(a) of the Act; 29 U.S.C. 721(a))

 

 

Sec. 361.3  Authorized activities.

 

    The Secretary makes payments to a State to assist in--

    (a) The costs of providing vocational rehabilitation services under 

the State plan; and

    (b) Administrative costs under the State plan.

 

(Authority: Section 111(a)(1) of the Act; 29 U.S.C. 731(a)(1))

 

 

Sec. 361.4  Applicable regulations.

 

    The following regulations apply to this Program:

    (a) The Education Department General Administrative Regulations 

(EDGAR) as follows:

    (1) 34 CFR part 74 (Administration of Grants and Agreements with 

Institutions of Higher Education, Hospitals, and other Non-profit 

Organizations), with respect to subgrants to entities that are not 

State or local governments or Indian tribal organizations.

    (2) 34 CFR part 76 (State-Administered Programs).

    (3) 34 CFR part 77 (Definitions that Apply to Department 

Regulations).

    (4) 34 CFR part 79 (Intergovernmental Review of Department of 

Education Programs and Activities).

    (5) 34 CFR part 80 (Uniform Administrative Requirements for Grants 

and Cooperative Agreements to State and Local Governments), except for 

Sec. 80.24(a)(2).

    (6) 34 CFR part 81 (General Education Provisions Act--Enforcement).

    (7) 34 CFR part 82 (New Restrictions on Lobbying).

    (8) 34 CFR part 85 (Governmentwide Debarment and Suspension 

(Nonprocurement) and Governmentwide Requirements for Drug-Free 

Workplace (Grants)).

    (9) 34 CFR part 86 (Drug and Alcohol Abuse Prevention).

    (b) The regulations in this part 361.

    (c) 20 CFR part 662 (Description of One-Stop Service Delivery 

System under Title I of the Workforce Investment Act of 1998).

    (d) 29 CFR part 37, to the extent programs and activities are being 

conducted as part of the One-Stop service delivery system under section 

121(b) of the Workforce Investment Act of 1998.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

 

Sec. 361.5  Applicable definitions.

 

    (a) Definitions in EDGAR. The following terms used in this part are 

defined in 34 CFR 77.1:

 

 

Department

 

EDGAR

 

Fiscal year

 

Nonprofit

 

Private

 

Public

 

Secretary

 

    (b) Other definitions. The following definitions also apply to this 

part:

    (1) Act means the Rehabilitation Act of 1973, as amended (29 U.S.C. 

701 et seq.).

    (2) Administrative costs under the State plan means expenditures 

incurred in the performance of administrative functions under the 

vocational rehabilitation program carried out under this part, 

including expenses related to program planning, development, 

monitoring, and evaluation, including, but not limited to, expenses 

for--

    (i) Quality assurance;

    (ii) Budgeting, accounting, financial management, information 

systems, and related data processing;

    (iii) Providing information about the program to the public;

    (iv) Technical assistance and support services to other State 

agencies, private nonprofit organizations, and businesses and 

industries, except for technical assistance and support services 

described in Sec. 361.49(a)(4);

    (v) The State Rehabilitation Council and other advisory committees;

    (vi) Professional organization membership dues for designated State 

unit employees;

    (vii) The removal of architectural barriers in State vocational 

rehabilitation agency offices and State-operated rehabilitation 

facilities;

    (viii) Operating and maintaining designated State unit facilities, 

equipment, and grounds;

    (ix) Supplies;

    (x) Administration of the comprehensive system of personnel 

development described in Sec. 361.18, including personnel 

administration, administration of affirmative action plans, and 

training and staff development;

    (xi) Administrative salaries, including clerical and other support 

staff salaries, in support of these administrative functions;

    (xii) Travel costs related to carrying out the program, other than 

travel costs related to the provision of services;

    (xiii) Costs incurred in conducting reviews of determinations made 

by personnel of the designated State unit, including costs associated 

with mediation and impartial due process hearings under Sec. 361.57; 

and

    (xiv) Legal expenses required in the administration of the program.

 

(Authority: Section 7(1) of the Act; 29 U.S.C. 705(1))

 

    (3) American Indian means an individual who is a member of an 

Indian tribe.

 

(Authority: Section 7(19)(A) of the Act; 29 U.S.C. 705(19)(A))

 

    (4) Applicant means an individual who submits an application for 

vocational rehabilitation services in accordance with 

Sec. 361.41(b)(2).

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

    (5) Appropriate modes of communication means specialized aids and 

supports that enable an individual with a disability to comprehend and 

respond to information that is being communicated. Appropriate modes of 

communication include, but are not limited to, the use of interpreters, 

open and closed captioned videos, specialized telecommunications 

services and audio recordings, Brailled and large print materials, 

materials in electronic formats, augmentative communication devices, 

graphic presentations, and simple language materials.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

    (6) Assessment for determining eligibility and vocational 

rehabilitation needs means, as appropriate in each case--

    (i)(A) A review of existing data--

    (1) To determine if an individual is eligible for vocational 

rehabilitation services; and

    (2) To assign priority for an order of selection described in 

Sec. 361.36 in the States that use an order of selection; and

    (B) To the extent necessary, the provision of appropriate 

assessment activities to obtain necessary additional data to make the 

eligibility determination and assignment;

    (ii) To the extent additional data are necessary to make a 

determination of the employment outcomes and the nature and scope of 

vocational

 

[[Page 4384]]

 

rehabilitation services to be included in the individualized plan for 

employment of an eligible individual, a comprehensive assessment to 

determine the unique strengths, resources, priorities, concerns, 

abilities, capabilities, interests, and informed choice, including the 

need for supported employment, of the eligible individual. This 

comprehensive assessment--

    (A) Is limited to information that is necessary to identify the 

rehabilitation needs of the individual and to develop the 

individualized plan of employment of the eligible individual;

    (B) Uses as a primary source of information, to the maximum extent 

possible and appropriate and in accordance with confidentiality 

requirements--

    (1) Existing information obtained for the purposes of determining 

the eligibility of the individual and assigning priority for an order 

of selection described in Sec. 361.36 for the individual; and

    (2) Information that can be provided by the individual and, if 

appropriate, by the family of the individual;

    (C) May include, to the degree needed to make such a determination, 

an assessment of the personality, interests, interpersonal skills, 

intelligence and related functional capacities, educational 

achievements, work experience, vocational aptitudes, personal and 

social adjustments, and employment opportunities of the individual and 

the medical, psychiatric, psychological, and other pertinent 

vocational, educational, cultural, social, recreational, and 

environmental factors that affect the employment and rehabilitation 

needs of the individual; and

    (D) May include, to the degree needed, an appraisal of the patterns 

of work behavior of the individual and services needed for the 

individual to acquire occupational skills and to develop work 

attitudes, work habits, work tolerance, and social and behavior 

patterns necessary for successful job performance, including the use of 

work in real job situations to assess and develop the capacities of the 

individual to perform adequately in a work environment;

    (iii) Referral, for the provision of rehabilitation technology 

services to the individual, to assess and develop the capacities of the 

individual to perform in a work environment; and

    (iv) An exploration of the individual's abilities, capabilities, 

and capacity to perform in work situations, which must be assessed 

periodically during trial work experiences, including experiences in 

which the individual is provided appropriate supports and training.

 

(Authority: Section 7(2) of the Act; 29 U.S.C. 705(2))

 

    (7) Assistive technology device means any item, piece of equipment, 

or product system, whether acquired commercially off the shelf, 

modified, or customized, that is used to increase, maintain, or improve 

the functional capabilities of an individual with a disability.

 

(Authority: Section 7(3) of the Act; 29 U.S.C. 705(3))

 

    (8) Assistive technology service means any service that directly 

assists an individual with a disability in the selection, acquisition, 

or use of an assistive technology device, including--

    (i) The evaluation of the needs of an individual with a disability, 

including a functional evaluation of the individual in his or her 

customary environment;

    (ii) Purchasing, leasing, or otherwise providing for the 

acquisition by an individual with a disability of an assistive 

technology device;

    (iii) Selecting, designing, fitting, customizing, adapting, 

applying, maintaining, repairing, or replacing assistive technology 

devices;

    (iv) Coordinating and using other therapies, interventions, or 

services with assistive technology devices, such as those associated 

with existing education and rehabilitation plans and programs;

    (v) Training or technical assistance for an individual with a 

disability or, if appropriate, the family members, guardians, 

advocates, or authorized representatives of the individual; and

    (vi) Training or technical assistance for professionals (including 

individuals providing education and rehabilitation services), 

employers, or others who provide services to, employ, or are otherwise 

substantially involved in the major life functions of individuals with 

disabilities, to the extent that training or technical assistance is 

necessary to the achievement of an employment outcome by an individual 

with a disability.

 

(Authority: Sections 7(4) and 12(c) of the Act; 29 U.S.C. 705(4) and 

709(c))

 

    (9) Community rehabilitation program.

    (i) Community rehabilitation program means a program that provides 

directly or facilitates the provision of one or more of the following 

vocational rehabilitation services to individuals with disabilities to 

enable those individuals to maximize their opportunities for 

employment, including career advancement:

    (A) Medical, psychiatric, psychological, social, and vocational 

services that are provided under one management.

    (B) Testing, fitting, or training in the use of prosthetic and 

orthotic devices.

    (C) Recreational therapy.

    (D) Physical and occupational therapy.

    (E) Speech, language, and hearing therapy.

    (F) Psychiatric, psychological, and social services, including 

positive behavior management.

    (G) Assessment for determining eligibility and vocational 

rehabilitation needs.

    (H) Rehabilitation technology.

    (I) Job development, placement, and retention services.

    (J) Evaluation or control of specific disabilities.

    (K) Orientation and mobility services for individuals who are 

blind.

    (L) Extended employment.

    (M) Psychosocial rehabilitation services.

    (N) Supported employment services and extended services.

    (O) Services to family members if necessary to enable the applicant 

or eligible individual to achieve an employment outcome.

    (P) Personal assistance services.

    (Q) Services similar to the services described in paragraphs (A) 

through (P) of this definition.

    (ii) For the purposes of this definition, the word program means an 

agency, organization, or institution, or unit of an agency, 

organization, or institution, that provides directly or facilitates the 

provision of vocational rehabilitation services as one of its major 

functions.

    (10) Comparable services and benefits means--

    (i) Services and benefits that are--

    (A) Provided or paid for, in whole or in part, by other Federal, 

State, or local public agencies, by health insurance, or by employee 

benefits;

    (B) Available to the individual at the time needed to ensure the 

progress of the individual toward achieving the employment outcome in 

the individual's individualized plan for employment in accordance with 

Sec. 361.53; and

    (C) Commensurate to the services that the individual would 

otherwise receive from the designated State vocational rehabilitation 

agency.

    (ii) For the purposes of this definition, comparable benefits do 

not include awards and scholarships based on merit.

 

(Authority: Sections 12(c) and 101(a)(8) of the Act; 29 U.S.C. 

709(c) and 721(a)(8))

 

    (11) Competitive employment means work--

 

[[Page 4385]]

 

    (i) In the competitive labor market that is performed on a full-

time or part-time basis in an integrated setting; and

    (ii) For which an individual is compensated at or above the minimum 

wage, but not less than the customary wage and level of benefits paid 

by the employer for the same or similar work performed by individuals 

who are not disabled.

 

(Authority: Sections 7(11) and 12(c) of the Act; 29 U.S.C. 705(11) 

and 709(c))

 

    (12) Construction of a facility for a public or nonprofit community 

rehabilitation program means--

    (i) The acquisition of land in connection with the construction of 

a new building for a community rehabilitation program;

    (ii) The construction of new buildings;

    (iii) The acquisition of existing buildings;

    (iv) The expansion, remodeling, alteration, or renovation of 

existing buildings;

    (v) Architect's fees, site surveys, and soil investigation, if 

necessary, in connection with the construction project;

    (vi) The acquisition of initial fixed or movable equipment of any 

new, newly acquired, newly expanded, newly remodeled, newly altered, or 

newly renovated buildings that are to be used for community 

rehabilitation program purposes; and

    (vii) Other direct expenditures appropriate to the construction 

project, except costs of off-site improvements.

 

(Authority: Sections 7(6) and 12(c) of the Act; 29 U.S.C. 705(6) and 

709(c))

 

    (13) Designated State agency or State agency means the sole State 

agency, designated in accordance with Sec. 361.13(a), to administer, or 

supervise the local administration of, the State plan for vocational 

rehabilitation services. The term includes the State agency for 

individuals who are blind, if designated as the sole State agency with 

respect to that part of the plan relating to the vocational 

rehabilitation of individuals who are blind.

 

(Authority: Sections 7(8)(A) and 101(a)(2)(A) of the Act; 29 U.S.C. 

705(8)(A) and 721(a)(2)(A))

 

    (14) Designated State unit or State unit means either--

    (i) The State vocational rehabilitation bureau, division, or other 

organizational unit that is primarily concerned with vocational 

rehabilitation or vocational and other rehabilitation of individuals 

with disabilities and that is responsible for the administration of the 

vocational rehabilitation program of the State agency, as required 

under Sec. 361.13(b); or

    (ii) The State agency that is primarily concerned with vocational 

rehabilitation or vocational and other rehabilitation of individuals 

with disabilities.

 

(Authority: Sections 7(8)(B) and 101(a)(2)(B) of the Act; 29 U.S.C. 

705(8)(B) and 721(a)(2)(B))

 

    (15) Eligible individual means an applicant for vocational 

rehabilitation services who meets the eligibility requirements of 

Sec. 361.42(a).

 

(Authority: Sections 7(20)(A) and 102(a)(1) of the Act; 29 U.S.C. 

705(20)(A) and 722(a)(1))

 

    (16) Employment outcome means, with respect to an individual, 

entering or retaining full-time or, if appropriate, part-time 

competitive employment in the integrated labor market to the greatest 

extent practicable; supported employment; or any other type of 

employment, including self-employment, telecommuting, or business 

ownership, that is consistent with an individual's strengths, 

resources, priorities, concerns, abilities, capabilities, interests, 

and informed choice.

(Authority: Sections 7(11), 12(c), 100(a)(2), and 102(b)(3)(A) of 

the Act; 29 U.S.C. 705(11), 709(c), 720(a)(2), and 722(b)(3)(A))

    (17) Establishment, development, or improvement of a public or 

nonprofit community rehabilitation program means--

    (i) The establishment of a facility for a public or nonprofit 

community rehabilitation program as defined in paragraph (b)(18) of 

this section to provide vocational rehabilitation services to 

applicants or eligible individuals;

    (ii) Staffing, if necessary to establish, develop, or improve a 

community rehabilitation program for the purpose of providing 

vocational rehabilitation services to applicants or eligible 

individuals, for a maximum period of 4 years, with Federal financial 

participation available at the applicable matching rate for the 

following levels of staffing costs:

    (A) 100 percent of staffing costs for the first year.

    (B) 75 percent of staffing costs for the second year.

    (C) 60 percent of staffing costs for the third year.

    (D) 45 percent of staffing costs for the fourth year; and

    (iii) Other expenditures related to the establishment, development, 

or improvement of a community rehabilitation program that are necessary 

to make the program functional or increase its effectiveness in 

providing vocational rehabilitation services to applicants or eligible 

individuals, but are not ongoing operating expenses of the program.

 

(Authority: Sections 7(12) and 12(c) of the Act; 29 U.S.C. 705(12) 

and 709(c))

 

    (18) Establishment of a facility for a public or nonprofit 

community rehabilitation program means--

    (i) The acquisition of an existing building and, if necessary, the 

land in connection with the acquisition, if the building has been 

completed in all respects for at least 1 year prior to the date of 

acquisition and the Federal share of the cost of acquisition is not 

more than $300,000;

    (ii) The remodeling or alteration of an existing building, provided 

the estimated cost of remodeling or alteration does not exceed the 

appraised value of the existing building;

    (iii) The expansion of an existing building, provided that--

    (A) The existing building is complete in all respects;

    (B) The total size in square footage of the expanded building, 

notwithstanding the number of expansions, is not greater than twice the 

size of the existing building;

    (C) The expansion is joined structurally to the existing building 

and does not constitute a separate building; and

    (D) The costs of the expansion do not exceed the appraised value of 

the existing building;

    (iv) Architect's fees, site survey, and soil investigation, if 

necessary in connection with the acquisition, remodeling, alteration, 

or expansion of an existing building; and

    (v) The acquisition of fixed or movable equipment, including the 

costs of installation of the equipment, if necessary to establish, 

develop, or improve a community rehabilitation program.

 

(Authority: Sections 7(12) and 12(c) of the Act; 29 U.S.C. 705(12) 

and 709(c))

 

    (19) Extended employment means work in a non-integrated or 

sheltered setting for a public or private nonprofit agency or 

organization that provides compensation in accordance with the Fair 

Labor Standards Act and any needed support services to an individual 

with a disability to enable the individual to continue to train or 

otherwise prepare for competitive employment, unless the individual 

through informed choice chooses to remain in extended employment.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

    (20) Extended services means ongoing support services and other 

appropriate services that are needed to support and

 

[[Page 4386]]

 

maintain an individual with a most significant disability in supported 

employment and that are provided by a State agency, a private nonprofit 

organization, employer, or any other appropriate resource, from funds 

other than funds received under this part and 34 CFR part 363 after an 

individual with a most significant disability has made the transition 

from support provided by the designated State unit.

 

(Authority: Sections 7(13) and 623 of the Act; 29 U.S.C. 705(13) and 

795i)

 

    (21) Extreme medical risk means a probability of substantially 

increasing functional impairment or death if medical services, 

including mental health services, are not provided expeditiously.

 

(Authority: Sections 12(c) and 101(a)(8)(A)(i)(III) of the Act; 29 

U.S.C. 709(c) and 721(a)(8)(A)(i)(III))

 

    (22) Fair hearing board means a committee, body, or group of 

persons established by a State prior to January 1, 1985 that--

    (i) Is authorized under State law to review determinations made by 

personnel of the designated State unit that affect the provision of 

vocational rehabilitation services; and

    (ii) Carries out the responsibilities of the impartial hearing 

officer in accordance with the requirements in Sec. 361.57(j).

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

    (23) Family member, for purposes of receiving vocational 

rehabilitation services in accordance with Sec. 361.48(i), means an 

individual--

    (i) Who either--

    (A) Is a relative or guardian of an applicant or eligible 

individual; or

    (B) Lives in the same household as an applicant or eligible 

individual;

    (ii) Who has a substantial interest in the well-being of that 

individual; and

    (iii) Whose receipt of vocational rehabilitation services is 

necessary to enable the applicant or eligible individual to achieve an 

employment outcome.

 

(Authority: Sections 12(c) and 103(a)(17) of the Act; 29 U.S.C. 

709(c) and 723(a)(17))

 

    (24) Governor means a chief executive officer of a State.

 

(Authority: Section 7(15) of the Act; 29 U.S.C. 705(15))

 

    (25) Impartial hearing officer.

    (i) Impartial hearing officer means an individual who--

    (A) Is not an employee of a public agency (other than an 

administrative law judge, hearing examiner, or employee of an 

institution of higher education);

    (B) Is not a member of the State Rehabilitation Council for the 

designated State unit;

    (C) Has not been involved previously in the vocational 

rehabilitation of the applicant or eligible individual;

    (D) Has knowledge of the delivery of vocational rehabilitation 

services, the State plan, and the Federal and State regulations 

governing the provision of services;

    (E) Has received training with respect to the performance of 

official duties; and

    (F) Has no personal, professional, or financial interest that would 

be in conflict with the objectivity of the individual.

    (ii) An individual is not considered to be an employee of a public 

agency for the purposes of this definition solely because the 

individual is paid by the agency to serve as a hearing officer.

 

(Authority: Section 7(16) of the Act; 29 U.S.C. 705(16))

 

    (26) Indian tribe means any Federal or State Indian tribe, band, 

rancheria, pueblo, colony, or community, including any Alaskan native 

village or regional village corporation (as defined in or established 

pursuant to the Alaska Native Claims Settlement Act).

 

(Authority: Section 7(19)(B) of the Act; 29 U.S.C. 705(19)(B))

 

    (27) Individual who is blind means a person who is blind within the 

meaning of applicable State law. (Authority: Section 12(c) of the Act; 

29 U.S.C. 709(c))

    (28) Individual with a disability, except as provided in 

Sec. 361.5(b)(29), means an individual--

    (i) Who has a physical or mental impairment;

    (ii) Whose impairment constitutes or results in a substantial 

impediment to employment; and

    (iii) Who can benefit in terms of an employment outcome from the 

provision of vocational rehabilitation services.

 

(Authority: Section 7(20)(A) of the Act; 29 U.S.C. 705(20)(A))

 

    (29) Individual with a disability, for purposes of 

Secs. 361.5(b)(14), 361.13(a), 361.13(b)(1), 361.17(a), (b), (c), and 

(j), 361.18(b), 361.19, 361.20, 361.23(b)(2), 361.29(a) and (d)(5), and 

361.51(b), means an individual--

    (i) Who has a physical or mental impairment that substantially 

limits one or more major life activities;

    (ii) Who has a record of such an impairment; or

    (iii) Who is regarded as having such an impairment.

 

(Authority: Section 7(20)(B) of the Act; 29 U.S.C. 705(20)(B))

 

    (30) Individual with a most significant disability means an 

individual with a significant disability who meets the designated State 

unit's criteria for an individual with a most significant disability. 

These criteria must be consistent with the requirements in 

Sec. 361.36(d)(1) and (2).

 

(Authority: Sections 7(21)(E)(i) and 101(a)(5)(C) of the Act; 29 

U.S.C. 705(21)(E)(i) and 721(a)(5)(C))

 

    (31) Individual with a significant disability means an individual 

with a disability--

    (i) Who has a severe physical or mental impairment that seriously 

limits one or more functional capacities (such as mobility, 

communication, self-care, self-direction, interpersonal skills, work 

tolerance, or work skills) in terms of an employment outcome;

    (ii) Whose vocational rehabilitation can be expected to require 

multiple vocational rehabilitation services over an extended period of 

time; and

    (iii) Who has one or more physical or mental disabilities resulting 

from amputation, arthritis, autism, blindness, burn injury, cancer, 

cerebral palsy, cystic fibrosis, deafness, head injury, heart disease, 

hemiplegia, hemophilia, respiratory or pulmonary dysfunction, mental 

retardation, mental illness, multiple sclerosis, muscular dystrophy, 

musculo-skeletal disorders, neurological disorders (including stroke 

and epilepsy), spinal cord conditions (including paraplegia and 

quadriplegia), sickle cell anemia, specific learning disability, end-

stage renal disease, or another disability or combination of 

disabilities determined on the basis of an assessment for determining 

eligibility and vocational rehabilitation needs to cause comparable 

substantial functional limitation.

 

 

(Authority: Section 7(21)(A) of the Act; 29 U.S.C. 705(21)(A))

 

    (32) Individual's representative means any representative chosen by 

an applicant or eligible individual, as appropriate, including a 

parent, guardian, other family member, or advocate, unless a 

representative has been appointed by a court to represent the 

individual, in which case the court-appointed representative is the 

individual's representative.

 

(Authority: Sections 7(22) and 12(c) of the Act; 29 U.S.C. 705(22) 

and 709(c))

 

    (33) Integrated setting,--

    (i) With respect to the provision of services, means a setting 

typically found in the community in which applicants or eligible 

individuals interact with non-disabled individuals other than non-

disabled individuals who are

 

[[Page 4387]]

 

providing services to those applicants or eligible individuals;

    (ii) With respect to an employment outcome, means a setting 

typically found in the community in which applicants or eligible 

individuals interact with non-disabled individuals, other than non-

disabled individuals who are providing services to those applicants or 

eligible individuals, to the same extent that non-disabled individuals 

in comparable positions interact with other persons.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

    (34) Local workforce investment board means a local workforce 

investment board established under section 117 of the Workforce 

Investment Act of 1998.

 

(Authority: Section 7(25) of the Act; 29 U.S.C. 705(25))

 

    (35) Maintenance means monetary support provided to an individual 

for expenses, such as food, shelter, and clothing, that are in excess 

of the normal expenses of the individual and that are necessitated by 

the individual's participation in an assessment for determining 

eligibility and vocational rehabilitation needs or the individual's 

receipt of vocational rehabilitation services under an individualized 

plan for employment.

 

(Authority: Sections 12(c) and 103(a)(7) of the Act; 29 U.S.C. 

709(c) and 723(a)(7))

 

    (i) Examples: The following are examples of expenses that would 

meet the definition of maintenance. The examples are illustrative, do 

not address all possible circumstances, and are not intended to 

substitute for individual counselor judgment.

    Example 1: The cost of a uniform or other suitable clothing that 

is required for an individual's job placement or job-seeking 

activities.

    Example 2: The cost of short-term shelter that is required in 

order for an individual to participate in assessment activities or 

vocational training at a site that is not within commuting distance 

of an individual's home.

    Example 3: The initial one-time costs, such as a security 

deposit or charges for the initiation of utilities, that are 

required in order for an individual to relocate for a job placement.

    Example 4: The costs of an individual's participation in 

enrichment activities related to that individual's training program.

 

    (ii) [Reserved]

    (36) Mediation means the act or process of using an independent 

third party to act as a mediator, intermediary, or conciliator to 

assist persons or parties in settling differences or disputes prior to 

pursuing formal administrative or other legal remedies. Mediation under 

the program must be conducted in accordance with the requirements in 

Sec. 361.57(d) by a qualified and impartial mediator as defined in 

Sec. 361.5(b)(43).

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

    (37) Nonprofit, with respect to a community rehabilitation program, 

means a community rehabilitation program carried out by a corporation 

or association, no part of the net earnings of which inures, or may 

lawfully inure, to the benefit of any private shareholder or individual 

and the income of which is exempt from taxation under section 501(c)(3) 

of the Internal Revenue Code of 1986.

 

(Authority: Section 7(26) of the Act; 29 U.S.C. 705(26))

 

    (38) Ongoing support services, as used in the definition of 

``Supported employment''

    (i) Means services that are--

    (A) Needed to support and maintain an individual with a most 

significant disability in supported employment;

    (B) Identified based on a determination by the designated State 

unit of the individual's need as specified in an individualized plan 

for employment; and

    (C) Furnished by the designated State unit from the time of job 

placement until transition to extended services, unless post-employment 

services are provided following transition, and thereafter by one or 

more extended services providers throughout the individual's term of 

employment in a particular job placement or multiple placements if 

those placements are being provided under a program of transitional 

employment;

    (ii) Must include an assessment of employment stability and 

provision of specific services or the coordination of services at or 

away from the worksite that are needed to maintain stability based on--

    (A) At a minimum, twice-monthly monitoring at the worksite of each 

individual in supported employment; or

    (B) If under specific circumstances, especially at the request of 

the individual, the individualized plan for employment provides for 

off-site monitoring, twice monthly meetings with the individual;

    (iii) Consist of--

    (A) Any particularized assessment supplementary to the 

comprehensive assessment of rehabilitation needs described in paragraph 

(b)(6)(ii) of this section;

    (B) The provision of skilled job trainers who accompany the 

individual for intensive job skill training at the work site;

    (C) Job development and training;

    (D) Social skills training;

    (E) Regular observation or supervision of the individual;

    (F) Follow-up services including regular contact with the 

employers, the individuals, the parents, family members, guardians, 

advocates or authorized representatives of the individuals, and other 

suitable professional and informed advisors, in order to reinforce and 

stabilize the job placement;

    (G) Facilitation of natural supports at the worksite;

    (H) Any other service identified in the scope of vocational 

rehabilitation services for individuals, described in Sec. 361.48; or

    (I) Any service similar to the foregoing services.

 

(Authority: Sections 7(27) and 12(c) of the Act; 29 U.S.C. 705(27) 

and 709(c))

 

    (39) Personal assistance services means a range of services 

provided by one or more persons designed to assist an individual with a 

disability to perform daily living activities on or off the job that 

the individual would typically perform without assistance if the 

individual did not have a disability. The services must be designed to 

increase the individual's control in life and ability to perform 

everyday activities on or off the job. The services must be necessary 

to the achievement of an employment outcome and may be provided only 

while the individual is receiving other vocational rehabilitation 

services. The services may include training in managing, supervising, 

and directing personal assistance services.

 

(Authority: Sections 7(28), 102(b)(3)(B)(i)(I), and 103(a)(9) of the 

Act; 29 U.S.C. 705(28), 722(b)(3)(B)(i)(I), and 723(a)(9))

 

    (40) Physical and mental restoration services means--

    (i) Corrective surgery or therapeutic treatment that is likely, 

within a reasonable period of time, to correct or modify substantially 

a stable or slowly progressive physical or mental impairment that 

constitutes a substantial impediment to employment;

    (ii) Diagnosis of and treatment for mental or emotional disorders 

by qualified personnel in accordance with State licensure laws;

    (iii) Dentistry;

    (iv) Nursing services;

    (v) Necessary hospitalization (either inpatient or outpatient care) 

in connection with surgery or treatment and clinic services;

    (vi) Drugs and supplies;

    (vii) Prosthetic and orthotic devices;

    (viii) Eyeglasses and visual services, including visual training, 

and the

 

[[Page 4388]]

 

examination and services necessary for the prescription and provision 

of eyeglasses, contact lenses, microscopic lenses, telescopic lenses, 

and other special visual aids prescribed by personnel that are 

qualified in accordance with State licensure laws;

    (ix) Podiatry;

    (x) Physical therapy;

    (xi) Occupational therapy;

    (xii) Speech or hearing therapy;

    (xiii) Mental health services;

    (xiv) Treatment of either acute or chronic medical complications 

and emergencies that are associated with or arise out of the provision 

of physical and mental restoration services, or that are inherent in 

the condition under treatment;

    (xv) Special services for the treatment of individuals with end-

stage renal disease, including transplantation, dialysis, artificial 

kidneys, and supplies; and

    (xvi) Other medical or medically related rehabilitation services.

 

(Authority: Sections 12(c) and 103(a)(6) of the Act; 29 U.S.C. 

709(c) and 723(a)(6))

 

    (41) Physical or mental impairment means--

    (i) Any physiological disorder or condition, cosmetic 

disfigurement, or anatomical loss affecting one or more of the 

following body systems: neurological, musculo-skeletal, special sense 

organs, respiratory (including speech organs), cardiovascular, 

reproductive, digestive, genitourinary, hemic and lymphatic, skin, and 

endocrine; or

    (ii) Any mental or psychological disorder such as mental 

retardation, organic brain syndrome, emotional or mental illness, and 

specific learning disabilities.

 

(Authority: Sections 7(20)(A) and 12(c) of the Act; 29 U.S.C. 

705(20)(A) and 709(c))

 

    (42) Post-employment services means one or more of the services 

identified in Sec. 361.48 that are provided subsequent to the 

achievement of an employment outcome and that are necessary for an 

individual to maintain, regain, or advance in employment, consistent 

with the individual's strengths, resources, priorities, concerns, 

abilities, capabilities, interests, and informed choice.

 

(Authority: Sections 12(c) and 103(a)(18) of the Act; 29 U.S.C. 

709(c)) and 723(a)(18))

 

    Note to paragraph (b)(42): Post-employment services are intended 

to ensure that the employment outcome remains consistent with the 

individual's strengths, resources, priorities, concerns, abilities, 

capabilities, interests, and informed choice. These services are 

available to meet rehabilitation needs that do not require a complex 

and comprehensive provision of services and, thus, should be limited 

in scope and duration. If more comprehensive services are required, 

then a new rehabilitation effort should be considered. Post-

employment services are to be provided under an amended 

individualized plan for employment; thus, a re-determination of 

eligibility is not required. The provision of post-employment 

services is subject to the same requirements in this part as the 

provision of any other vocational rehabilitation service. Post-

employment services are available to assist an individual to 

maintain employment, e.g., the individual's employment is 

jeopardized because of conflicts with supervisors or co-workers, and 

the individual needs mental health services and counseling to 

maintain the employment; to regain employment, e.g., the 

individual's job is eliminated through reorganization and new 

placement services are needed; and to advance in employment, e.g., 

the employment is no longer consistent with the individual's 

strengths, resources, priorities, concerns, abilities, capabilities, 

interests, and informed choice.

 

    (43) Qualified and impartial mediator.

    (i) Qualified and impartial mediator means an individual who--

    (A) Is not an employee of a public agency (other than an 

administrative law judge, hearing examiner, employee of a State office 

of mediators, or employee of an institution of higher education);

    (B) Is not a member of the State Rehabilitation Council for the 

designated State unit;

    (C) Has not been involved previously in the vocational 

rehabilitation of the applicant or eligible individual;

    (D) Is knowledgeable of the vocational rehabilitation program and 

the applicable Federal and State laws, regulations, and policies 

governing the provision of vocational rehabilitation services;

    (E) Has been trained in effective mediation techniques consistent 

with any State-approved or -recognized certification, licensing, 

registration, or other requirements; and

    (F) Has no personal, professional, or financial interest that would 

be in conflict with the objectivity of the individual during the 

mediation proceedings.

    (ii) An individual serving as a mediator is not considered to be an 

employee of the designated State agency or designated State unit for 

the purposes of this definition solely because the individual is paid 

by the designated State agency or designated State unit to serve as a 

mediator.

 

(Authority: Sections 12(c) and 102(c)(4) of the Act; 29 U.S.C. 

709(c) and 722(c)(4))

 

    (44) Rehabilitation engineering means the systematic application of 

engineering sciences to design, develop, adapt, test, evaluate, apply, 

and distribute technological solutions to problems confronted by 

individuals with disabilities in functional areas, such as mobility, 

communications, hearing, vision, and cognition, and in activities 

associated with employment, independent living, education, and 

integration into the community.

 

(Authority: Section 7(12)(c) of the Act; 29 U.S.C. 709(c))

 

    (45) Rehabilitation technology means the systematic application of 

technologies, engineering methodologies, or scientific principles to 

meet the needs of, and address the barriers confronted by, individuals 

with disabilities in areas that include education, rehabilitation, 

employment, transportation, independent living, and recreation. The 

term includes rehabilitation engineering, assistive technology devices, 

and assistive technology services.

 

(Authority: Section 7(30) of the Act; 29 U.S.C. 705(30))

 

    (46) Reservation means a Federal or State Indian reservation, 

public domain Indian allotment, former Indian reservation in Oklahoma, 

and land held by incorporated Native groups, regional corporations, and 

village corporations under the provisions of the Alaska Native Claims 

Settlement Act.

 

(Authority: Section 121(c) of the Act; 29 U.S.C. 741(c))

 

    (47) Sole local agency means a unit or combination of units of 

general local government or one or more Indian tribes that has the sole 

responsibility under an agreement with, and the supervision of, the 

State agency to conduct a local or tribal vocational rehabilitation 

program, in accordance with the State plan.

 

(Authority: Section 7(24) of the Act; 29 U.S.C. 705(24))

 

    (48) State means any of the 50 States, the District of Columbia, 

the Commonwealth of Puerto Rico, the United States Virgin Islands, 

Guam, American Samoa, and the Commonwealth of the Northern Mariana 

Islands.

 

(Authority: Section 7(32) of the Act; 29 U.S.C. 705(32))

 

    (49) State workforce investment board means a State workforce 

investment board established under section 111 of the Workforce 

Investment Act of 1998.

 

(Authority: Section 7(33) of the Act; 29 U.S.C. 705(33))

 

    (50) Statewide workforce investment system means a system described 

in

 

[[Page 4389]]

 

section 111(d)(2) of the Workforce Investment Act of 1998.

 

(Authority: Section 7(34) of the Act; 29 U.S.C. 705(34))

 

    (51) State plan means the State plan for vocational rehabilitation 

services submitted under Sec. 361.10.

 

(Authority: Sections 12(c) and 101 of the Act; 29 U.S.C. 709(c) and 

721)

 

    (52) Substantial impediment to employment means that a physical or 

mental impairment (in light of attendant medical, psychological, 

vocational, educational, communication, and other related factors) 

hinders an individual from preparing for, entering into, engaging in, 

or retaining employment consistent with the individual's abilities and 

capabilities.

 

(Authority: Sections 7(20)(A) and 12(c) of the Act; 29 U.S.C. 

705(20)(A) and 709(c))

 

    (53) Supported employment means--

    (i) Competitive employment in an integrated setting, or employment 

in integrated work settings in which individuals are working toward 

competitive employment, consistent with the strengths, resources, 

priorities, concerns, abilities, capabilities, interests, and informed 

choice of the individuals with ongoing support services for individuals 

with the most significant disabilities--

    (A) For whom competitive employment has not traditionally occurred 

or for whom competitive employment has been interrupted or intermittent 

as a result of a significant disability; and

    (B) Who, because of the nature and severity of their disabilities, 

need intensive supported employment services from the designated State 

unit and extended services after transition as described in paragraph 

(b)(20) of this section to perform this work; or

    (ii) Transitional employment, as defined in paragraph (b)(54) of 

this section, for individuals with the most significant disabilities 

due to mental illness.

 

(Authority: Section 7(35) of the Act; 29 U.S.C. 705(35))

 

    (54) Supported employment services means ongoing support services 

and other appropriate services needed to support and maintain an 

individual with a most significant disability in supported employment 

that are provided by the designated State unit--

    (i) For a period of time not to exceed 18 months, unless under 

special circumstances the eligible individual and the rehabilitation 

counselor or coordinator jointly agree to extend the time to achieve 

the employment outcome identified in the individualized plan for 

employment; and

    (ii) Following transition, as post-employment services that are 

unavailable from an extended services provider and that are necessary 

to maintain or regain the job placement or advance in employment.

 

(Authority: Sections 7(36) and 12(c) of the Act; 29 U.S.C. 705(36) 

and 709(c))

 

    (55) Transition services means a coordinated set of activities for 

a student designed within an outcome-oriented process that promotes 

movement from school to post-school activities, including postsecondary 

education, vocational training, integrated employment (including 

supported employment), continuing and adult education, adult services, 

independent living, or community participation. The coordinated set of 

activities must be based upon the individual student's needs, taking 

into account the student's preferences and interests, and must include 

instruction, community experiences, the development of employment and 

other post-school adult living objectives, and, if appropriate, 

acquisition of daily living skills and functional vocational 

evaluation. Transition services must promote or facilitate the 

achievement of the employment outcome identified in the student's 

individualized plan for employment.

 

(Authority: Section 7(37) and 103(a)(15) of the Act; 29 U.S.C. 

705(37) and 723(a)(15))

 

    (56) Transitional employment, as used in the definition of 

``Supported employment,'' means a series of temporary job placements in 

competitive work in integrated settings with ongoing support services 

for individuals with the most significant disabilities due to mental 

illness. In transitional employment, the provision of ongoing support 

services must include continuing sequential job placements until job 

permanency is achieved.

 

(Authority: Sections 7(35)(B) and 12(c) of the Act; 29 U.S.C. 

705(35)(B) and 709(c)

 

    (57) Transportation means travel and related expenses that are 

necessary to enable an applicant or eligible individual to participate 

in a vocational rehabilitation service, including expenses for training 

in the use of public transportation vehicles and systems.

 

(Authority: 103(a)(8) of the Act; 29 U.S.C. 723(a)(8))

    (i) Examples: The following are examples of expenses that would 

meet the definition of transportation. The examples are purely 

illustrative, do not address all possible circumstances, and are not 

intended to substitute for individual counselor judgment.

    Example 1:  Travel and related expenses for a personal care 

attendant or aide if the services of that person are necessary to 

enable the applicant or eligible individual to travel to participate 

in any vocational rehabilitation service.

    Example 2:  The purchase and repair of vehicles, including vans, 

but not the modification of these vehicles, as modification would be 

considered a rehabilitation technology service.

    Example 3:  Relocation expenses incurred by an eligible 

individual in connection with a job placement that is a significant 

distance from the eligible individual's current residence.

 

    (ii) [Reserved]

    (58) Vocational rehabilitation services--

    (i) If provided to an individual, means those services listed in 

Sec. 361.48; and

    (ii) If provided for the benefit of groups of individuals, also 

means those services listed in Sec. 361.49.

 

(Authority: Sections 7(38) and 103(a) and (b) of the Act; 29 U.S.C. 

705(38), 723(a) and (b))

 

Subpart B--State Plan and Other Requirements for Vocational 

Rehabilitation Services

 

 

Sec. 361.10  Submission, approval, and disapproval of the State plan.

 

    (a) Purpose. For a State to receive a grant under this part, the 

designated State agency must submit to the Secretary, and obtain 

approval of, a State plan that contains a description of the State's 

vocational rehabilitation services program, the plans and policies to 

be followed in carrying out the program, and other information 

requested by the Secretary, in accordance with the requirements of this 

part.

    (b) Separate part relating to the vocational rehabilitation of 

individuals who are blind. If a separate State agency administers or 

supervises the administration of a separate part of the State plan 

relating to the vocational rehabilitation of individuals who are blind, 

that part of the State plan must separately conform to all requirements 

under this part that are applicable to a State plan.

    (c) State unified plan. The State may choose to submit the State 

plan for vocational rehabilitation services as part of the State 

unified plan under section 501 of the Workforce Investment Act of 1998. 

The portion of the State unified plan that includes the State plan for 

vocational rehabilitation services must meet the State plan 

requirements in this part.

 

[[Page 4390]]

 

    (d) Public participation. Prior to the adoption of any substantive 

policies or procedures governing the provision of vocational 

rehabilitation services under the State plan, including making any 

substantive amendment to those policies and procedures, the designated 

State agency must conduct public meetings throughout the State, in 

accordance with the requirements of Sec. 361.20.

    (e) Duration. The State plan remains in effect subject to the 

submission of modifications the State determines to be necessary or the 

Secretary may require based on a change in State policy, a change in 

Federal law, including regulations, an interpretation of the Act by a 

Federal court or the highest court of the State, or a finding by the 

Secretary of State noncompliance with the requirements of the Act or 

this part.

    (f) Submission of the State plan. The State must submit the State 

plan for approval--

    (1) To the Secretary on the same date that the State submits a 

State plan relating to the statewide workforce investment system under 

section 112 of the Workforce Investment Act of 1998;

    (2) As part of the State unified plan submitted under section 501 

of that Act; or

    (3) To the Secretary on the same date that the State submits a 

State unified plan under section 501 of that Act that does not include 

the State plan under this part.

    (g) Annual submission. (1) The State must submit to the Secretary 

for approval revisions to the State plan in accordance with paragraph 

(e) of this section and 34 CFR 76.140.

    (2) The State must submit to the Secretary reports containing 

annual updates of the information required under Secs. 361.18, 361.29, 

and 361.35 and any other updates of the information required under this 

part that are requested by the Secretary.

    (3) The State is not required to submit policies, procedures, or 

descriptions required under this part that have been previously 

submitted to the Secretary and that demonstrate that the State meets 

the requirements of this part, including any policies, procedures, or 

descriptions submitted under this part that are in effect on August 6, 

1998.

    (h) Approval. The Secretary approves any State plan and any 

revisions to the State plan that conform to the requirements of this 

part and section 101(a) of the Act.

    (i) Disapproval. The Secretary disapproves any State plan that does 

not conform to the requirements of this part and section 101(a) of the 

Act, in accordance with the following procedures:

    (1) Informal resolution. Prior to disapproving any State plan, the 

Secretary attempts to resolve disputes informally with State officials.

    (2) Notice. If, after reasonable effort has been made to resolve 

the dispute, no resolution has been reached, the Secretary provides 

notice to the State agency of the intention to disapprove the State 

plan and of the opportunity for a hearing.

    (3) State plan hearing. If the State agency requests a hearing, the 

Secretary designates one or more individuals, either from the 

Department or elsewhere, not responsible for or connected with the 

administration of this Program, to conduct a hearing in accordance with 

the provisions of 34 CFR part 81, subpart A.

    (4) Initial decision. The hearing officer issues an initial 

decision in accordance with 34 CFR 81.41.

    (5) Petition for review of an initial decision. The State agency 

may seek the Secretary's review of the initial decision in accordance 

with 34 CFR part 81.

    (6) Review by the Secretary. The Secretary reviews the initial 

decision in accordance with 34 CFR 81.43.

    (7) Final decision of the Department. The final decision of the 

Department is made in accordance with 34 CFR 81.44.

    (8) Judicial review. A State may appeal the Secretary's decision to 

disapprove the State plan by filing a petition for review with the 

United States Court of Appeals for the circuit in which the State is 

located, in accordance with section 107(d) of the Act.

 

(Authority: Sections 101(a) and (b), and 107(d) of the Act; 20 

U.S.C. 1231g(a); and 29 U.S.C. 721(a) and (b), and 727(d))

 

 

Sec. 361.11  Withholding of funds.

 

    (a) Basis for withholding. The Secretary may withhold or limit 

payments under section 111 or 622(a) of the Act, as provided by section 

107(c) and (d) of the Act, if the Secretary determines that--

    (1) The State plan, including the supported employment supplement, 

has been so changed that it no longer conforms with the requirements of 

this part or 34 CFR part 363; or

    (2) In the administration of the State plan, there has been a 

failure to comply substantially with any provision of that plan or a 

program improvement plan established in accordance with section 

106(b)(2) of the Act.

    (b) Informal resolution. Prior to withholding or limiting payments 

in accordance with this section, the Secretary attempts to resolve 

disputed issues informally with State officials.

    (c) Notice. If, after reasonable effort has been made to resolve 

the dispute, no resolution has been reached, the Secretary provides 

notice to the State agency of the intention to withhold or limit 

payments and of the opportunity for a hearing.

    (d) Withholding hearing. If the State agency requests a hearing, 

the Secretary designates one or more individuals, either from the 

Department or elsewhere, not responsible for or connected with the 

administration of this Program, to conduct a hearing in accordance with 

the provisions of 34 CFR part 81, subpart A.

    (e) Initial decision. The hearing officer issues an initial 

decision in accordance with 34 CFR 81.41.

    (f) Petition for review of an initial decision. The State agency 

may seek the Secretary's review of the initial decision in accordance 

with 34 CFR 81.42.

    (g) Review by the Secretary. The Secretary reviews the initial 

decision in accordance with 34 CFR 81.43.

    (h) Final decision of the Department. The final decision of the 

Department is made in accordance with 34 CFR 81.44.

    (i) Judicial review. A State may appeal the Secretary's decision to 

withhold or limit payments by filing a petition for review with the 

U.S. Court of Appeals for the circuit in which the State is located, in 

accordance with section 107(d) of the Act.

 

(Authority: Sections 101(b), 107(c), and 107(d) of the Act; 29 

U.S.C. 721(b), 727(c)(1) and (2), and 727(d))

 

Administration

 

 

Sec. 361.12  Methods of administration.

 

    The State plan must assure that the State agency, and the 

designated State unit if applicable, employs methods of administration 

found necessary by the Secretary for the proper and efficient 

administration of the plan and for carrying out all functions for which 

the State is responsible under the plan and this part. These methods 

must include procedures to ensure accurate data collection and 

financial accountability.

 

(Authority: Sections 101(a)(6) and (a)(10)(A) of the Act; 29 U.S.C. 

721(a)(6) and (a)(10)(A))

 

 

Sec. 361.13  State agency for administration.

 

    (a) Designation of State agency. The State plan must designate a 

State agency as the sole State agency to administer the State plan, or 

to supervise its administration in a political subdivision of the State 

by a sole local agency, in accordance with the following requirements:

    (1) General. Except as provided in paragraphs (a)(2) and (3) of 

this section,

 

[[Page 4391]]

 

the State plan must provide that the designated State agency is one of 

the following types of agencies:

    (i) A State agency that is primarily concerned with vocational 

rehabilitation or vocational and other rehabilitation of individuals 

with disabilities; or

    (ii) A State agency that includes a vocational rehabilitation unit 

as provided in paragraph (b) of this section.

    (2) American Samoa. In the case of American Samoa, the State plan 

must designate the Governor.

    (3) Designated State agency for individuals who are blind. If a 

State commission or other agency that provides assistance or services 

to individuals who are blind is authorized under State law to provide 

vocational rehabilitation services to individuals who are blind, and 

this commission or agency is primarily concerned with vocational 

rehabilitation or includes a vocational rehabilitation unit as provided 

in paragraph (b) of this section, the State plan may designate that 

agency as the sole State agency to administer the part of the plan 

under which vocational rehabilitation services are provided for 

individuals who are blind or to supervise its administration in a 

political subdivision of the State by a sole local agency.

    (b) Designation of State unit.

    (1) If the designated State agency is not of the type specified in 

paragraph (a)(1)(i) of this section or if the designated State agency 

specified in paragraph (a)(3) of this section is not primarily 

concerned with vocational rehabilitation or vocational and other 

rehabilitation of individuals with disabilities, the State plan must 

assure that the agency (or each agency if two agencies are designated) 

includes a vocational rehabilitation bureau, division, or unit that--

    (i) Is primarily concerned with vocational rehabilitation or 

vocational and other rehabilitation of individuals with disabilities 

and is responsible for the administration of the State agency's 

vocational rehabilitation program under the State plan;

    (ii) Has a full-time director;

    (iii) Has a staff, at least 90 percent of whom are employed full 

time on the rehabilitation work of the organizational unit; and

    (iv) Is located at an organizational level and has an 

organizational status within the State agency comparable to that of 

other major organizational units of the agency.

    (2) In the case of a State that has not designated a separate State 

agency for individuals who are blind, as provided for in paragraph 

(a)(3) of this section, the State may assign responsibility for the 

part of the plan under which vocational rehabilitation services are 

provided to individuals who are blind to one organizational unit of the 

designated State agency and may assign responsibility for the rest of 

the plan to another organizational unit of the designated State agency, 

with the provisions of paragraph (b)(1) of this section applying 

separately to each of these units.

    (c) Responsibility for administration.

    (1) At a minimum, the following activities are the responsibility 

of the designated State unit or the sole local agency under the 

supervision of the State unit:

    (i) All decisions affecting eligibility for vocational 

rehabilitation services, the nature and scope of available services, 

and the provision of these services.

    (ii) The determination to close the record of services of an 

individual who has achieved an employment outcome in accordance with 

Sec. 361.56.

    (iii) Policy formulation and implementation.

    (iv) The allocation and expenditure of vocational rehabilitation 

funds.

    (v) Participation as a partner in the One-Stop service delivery 

system under Title I of the Workforce Investment Act of 1998, in 

accordance with 20 CFR part 662.

    (2) The responsibility for the functions described in paragraph 

(c)(1) of this section may not be delegated to any other agency or 

individual.

 

(Authority: Section 101(a)(2) of the Act; 29 U.S.C. 721(a)(2))

 

 

Sec. 361.14  Substitute State agency.

 

    (a) General provisions.

    (1) If the Secretary has withheld all funding from a State under 

Sec. 361.11, the State may designate another agency to substitute for 

the designated State agency in carrying out the State's program of 

vocational rehabilitation services.

    (2) Any public or nonprofit private organization or agency within 

the State or any political subdivision of the State is eligible to be a 

substitute agency.

    (3) The substitute agency must submit a State plan that meets the 

requirements of this part.

    (4) The Secretary makes no grant to a substitute agency until the 

Secretary approves its plan.

    (b) Substitute agency matching share. The Secretary does not make 

any payment to a substitute agency unless it has provided assurances 

that it will contribute the same matching share as the State would have 

been required to contribute if the State agency were carrying out the 

vocational rehabilitation program.

 

(Authority: Section 107(c)(3) of the Act; 29 U.S.C. 727(c)(3))

 

 

Sec. 361.15  Local administration.

 

    (a) If the State plan provides for the administration of the plan 

by a local agency, the designated State agency must--

    (1) Ensure that each local agency is under the supervision of the 

designated State unit and is the sole local agency as defined in 

Sec. 361.5(b)(47) that is responsible for the administration of the 

program within the political subdivision that it serves; and

    (2) Develop methods that each local agency will use to administer 

the vocational rehabilitation program, in accordance with the State 

plan.

    (b) A separate local agency serving individuals who are blind may 

administer that part of the plan relating to vocational rehabilitation 

of individuals who are blind, under the supervision of the designated 

State unit for individuals who are blind.

 

(Authority: Sections 7(24) and 101(a)(2)(A) of the Act; 29 U.S.C. 

705(24) and 721(a)(2)(A))

 

Sec. 361.16  Establishment of an independent commission or a state 

rehabilitation council.

 

    (a) General requirement. Except as provided in paragraph (b) of 

this section, the State plan must contain one of the following two 

assurances:

    (1) An assurance that the designated State agency is an independent 

State commission that--

    (i) Is responsible under State law for operating, or overseeing the 

operation of, the vocational rehabilitation program in the State and is 

primarily concerned with vocational rehabilitation or vocational and 

other rehabilitation services, in accordance with Sec. 361.13(a)(1)(i);

    (ii) Is consumer-controlled by persons who--

    (A) Are individuals with physical or mental impairments that 

substantially limit major life activities; and

    (B) Represent individuals with a broad range of disabilities, 

unless the designated State unit under the direction of the commission 

is the State agency for individuals who are blind;

    (iii) Includes family members, advocates, or other representatives 

of individuals with mental impairments; and

    (iv) Conducts the functions identified in Sec. 361.17(h)(4).

    (2) An assurance that--

 

[[Page 4392]]

 

    (i) The State has established a State Rehabilitation Council 

(Council) that meets the requirements of Sec. 361.17;

    (ii) The designated State unit, in accordance with Sec. 361.29, 

jointly develops, agrees to, and reviews annually State goals and 

priorities and jointly submits to the Secretary annual reports of 

progress with the Council;

    (iii) The designated State unit regularly consults with the Council 

regarding the development, implementation, and revision of State 

policies and procedures of general applicability pertaining to the 

provision of vocational rehabilitation services;

    (iv) The designated State unit transmits to the Council--

    (A) All plans, reports, and other information required under this 

part to be submitted to the Secretary;

    (B) All policies and information on all practices and procedures of 

general applicability provided to or used by rehabilitation personnel 

providing vocational rehabilitation services under this part; and

    (C) Copies of due process hearing decisions issued under this part 

and transmitted in a manner to ensure that the identity of the 

participants in the hearings is kept confidential; and

    (v) The State plan, and any revision to the State plan, includes a 

summary of input provided by the Council, including recommendations 

from the annual report of the Council, the review and analysis of 

consumer satisfaction described in Sec. 361.17(h)(4), and other reports 

prepared by the Council, and the designated State unit's response to 

the input and recommendations, including explanations of reasons for 

rejecting any input or recommendation of the Council.

    (b) Exception for separate State agency for individuals who are 

blind. In the case of a State that designates a separate State agency 

under Sec. 361.13(a)(3) to administer the part of the State plan under 

which vocational rehabilitation services are provided to individuals 

who are blind, the State must either establish a separate State 

Rehabilitation Council for each agency that does not meet the 

requirements in paragraph (a)(1) of this section or establish one State 

Rehabilitation Council for both agencies if neither agency meets the 

requirements of paragraph (a)(1) of this section.

 

(Authority: Sections 101(a)(21) of the Act; 29 U.S.C. 721(a)(21))

 

 

Sec. 361.17  Requirements for a state rehabilitation council.

 

    If the State has established a Council under Sec. 361.16(a)(2) or 

(b), the Council must meet the following requirements:

    (a) Appointment.

    (1) The members of the Council must be appointed by the Governor 

or, in the case of a State that, under State law, vests authority for 

the administration of the activities carried out under this part in an 

entity other than the Governor (such as one or more houses of the State 

legislature or an independent board), the chief officer of that entity.

    (2) The appointing authority must select members of the Council 

after soliciting recommendations from representatives of organizations 

representing a broad range of individuals with disabilities and 

organizations interested in individuals with disabilities. In selecting 

members, the appointing authority must consider, to the greatest extent 

practicable, the extent to which minority populations are represented 

on the Council.

    (b) Composition.

    (1) General. Except as provided in paragraph (b)(3) of this 

section, the Council must be composed of at least 15 members, 

including--

    (i) At least one representative of the Statewide Independent Living 

Council, who must be the chairperson or other designee of the Statewide 

Independent Living Council;

    (ii) At least one representative of a parent training and 

information center established pursuant to section 682(a) of the 

Individuals with Disabilities Education Act;

    (iii) At least one representative of the Client Assistance Program 

established under 34 CFR part 370, who must be the director of or other 

individual recommended by the Client Assistance Program;

    (iv) At least one qualified vocational rehabilitation counselor 

with knowledge of and experience with vocational rehabilitation 

programs who serves as an ex officio, nonvoting member of the Council 

if employed by the designated State agency;

    (v) At least one representative of community rehabilitation program 

service providers;

    (vi) Four representatives of business, industry, and labor;

    (vii) Representatives of disability groups that include a cross 

section of--

    (A) Individuals with physical, cognitive, sensory, and mental 

disabilities; and

    (B) Representatives of individuals with disabilities who have 

difficulty representing themselves or are unable due to their 

disabilities to represent themselves;

    (viii) Current or former applicants for, or recipients of, 

vocational rehabilitation services;

    (ix) In a State in which one or more projects are carried out under 

section 121 of the Act (American Indian Vocational Rehabilitation 

Services), at least one representative of the directors of the 

projects;

    (x) At least one representative of the State educational agency 

responsible for the public education of students with disabilities who 

are eligible to receive services under this part and part B of the 

Individuals with Disabilities Education Act;

    (xi) At least one representative of the State workforce investment 

board; and

    (xii) The director of the designated State unit as an ex officio, 

nonvoting member of the Council.

    (2) Employees of the designated State agency. Employees of the 

designated State agency may serve only as nonvoting members of the 

Council. This provision does not apply to the representative appointed 

pursuant to paragraph (b)(1)(iii) of this section.

    (3) Composition of a separate Council for a separate State agency 

for individuals who are blind. Except as provided in paragraph (b)(4) 

of this section, if the State establishes a separate Council for a 

separate State agency for individuals who are blind, that Council 

must--

    (i) Conform with all of the composition requirements for a Council 

under paragraph (b)(1) of this section, except the requirements in 

paragraph (b)(1)(vii), unless the exception in paragraph (b)(4) of this 

section applies; and

    (ii) Include--

    (A) At least one representative of a disability advocacy group 

representing individuals who are blind; and

    (B) At least one representative of an individual who is blind, has 

multiple disabilities, and has difficulty representing himself or 

herself or is unable due to disabilities to represent himself or 

herself.

    (4) Exception. If State law in effect on October 29, 1992 requires 

a separate Council under paragraph (b)(3) of this section to have fewer 

than 15 members, the separate Council is in compliance with the 

composition requirements in paragraphs (b)(1)(vi) and (b)(1)(viii) of 

this section if it includes at least one representative who meets the 

requirements for each of those paragraphs.

    (c) Majority.

    (1) A majority of the Council members must be individuals with 

disabilities who meet the requirements of Sec. 361.5(b)(29) and are not 

employed by the designated State unit.

    (2) In the case of a separate Council established under 

Sec. 361.16(b), a majority

 

[[Page 4393]]

 

of the Council members must be individuals who are blind and are not 

employed by the designated State unit.

    (d) Chairperson. The chairperson must be--

    (1) Selected by the members of the Council from among the voting 

members of the Council, subject to the veto power of the Governor; or

    (2) In States in which the Governor does not have veto power 

pursuant to State law, the appointing authority described in paragraph 

(a)(1) of this section must designate a member of the Council to serve 

as the chairperson of the Council or must require the Council to 

designate a member to serve as chairperson.

    (e) Terms of appointment.

    (1) Each member of the Council must be appointed for a term of no 

more than 3 years, and each member of the Council, other than a 

representative identified in paragraph (b)(1)(iii) or (ix) of this 

section, may serve for no more than two consecutive full terms.

    (2) A member appointed to fill a vacancy occurring prior to the end 

of the term for which the predecessor was appointed must be appointed 

for the remainder of the predecessor's term.

    (3) The terms of service of the members initially appointed must 

be, as specified by the appointing authority as described in paragraph 

(a)(1) of this section, for varied numbers of years to ensure that 

terms expire on a staggered basis.

    (f) Vacancies.

    (1) A vacancy in the membership of the Council must be filled in 

the same manner as the original appointment, except the appointing 

authority as described in paragraph (a)(1) of this section may delegate 

the authority to fill that vacancy to the remaining members of the 

Council after making the original appointment.

    (2) No vacancy affects the power of the remaining members to 

execute the duties of the Council.

    (g) Conflict of interest. No member of the Council shall cast a 

vote on any matter that would provide direct financial benefit to the 

member or the member's organization or otherwise give the appearance of 

a conflict of interest under State law.

    (h) Functions. The Council must, after consulting with the State 

workforce investment board--

    (1) Review, analyze, and advise the designated State unit regarding 

the performance of the State unit's responsibilities under this part, 

particularly responsibilities related to--

    (i) Eligibility, including order of selection;

    (ii) The extent, scope, and effectiveness of services provided; and

    (iii) Functions performed by State agencies that affect or 

potentially affect the ability of individuals with disabilities in 

achieving employment outcomes under this part;

    (2) In partnership with the designated State unit--

    (i) Develop, agree to, and review State goals and priorities in 

accordance with Sec. 361.29(c); and

    (ii) Evaluate the effectiveness of the vocational rehabilitation 

program and submit reports of progress to the Secretary in accordance 

with Sec. 361.29(e);

    (3) Advise the designated State agency and the designated State 

unit regarding activities carried out under this part and assist in the 

preparation of the State plan and amendments to the plan, applications, 

reports, needs assessments, and evaluations required by this part;

    (4) To the extent feasible, conduct a review and analysis of the 

effectiveness of, and consumer satisfaction with--

    (i) The functions performed by the designated State agency;

    (ii) The vocational rehabilitation services provided by State 

agencies and other public and private entities responsible for 

providing vocational rehabilitation services to individuals with 

disabilities under the Act; and

    (iii) The employment outcomes achieved by eligible individuals 

receiving services under this part, including the availability of 

health and other employment benefits in connection with those 

employment outcomes;

    (5) Prepare and submit to the Governor and to the Secretary no 

later than 90 days after the end of the Federal fiscal year an annual 

report on the status of vocational rehabilitation programs operated 

within the State and make the report available to the public through 

appropriate modes of communication;

    (6) To avoid duplication of efforts and enhance the number of 

individuals served, coordinate activities with the activities of other 

councils within the State, including the Statewide Independent Living 

Council established under 34 CFR part 364, the advisory panel 

established under section 612(a)(21) of the Individuals with 

Disabilities Education Act, the State Developmental Disabilities 

Planning Council described in section 124 of the Developmental 

Disabilities Assistance and Bill of Rights Act, the State mental health 

planning council established under section 1914(a) of the Public Health 

Service Act, and the State workforce investment board;

    (7) Provide for coordination and the establishment of working 

relationships between the designated State agency and the Statewide 

Independent Living Council and centers for independent living within 

the State; and

    (8) Perform other comparable functions, consistent with the purpose 

of this part, as the Council determines to be appropriate, that are 

comparable to the other functions performed by the Council.

    (i) Resources.

    (1) The Council, in conjunction with the designated State unit, 

must prepare a plan for the provision of resources, including staff and 

other personnel, that may be necessary and sufficient for the Council 

to carry out its functions under this part.

    (2) The resource plan must, to the maximum extent possible, rely on 

the use of resources in existence during the period of implementation 

of the plan.

    (3) Any disagreements between the designated State unit and the 

Council regarding the amount of resources necessary to carry out the 

functions of the Council must be resolved by the Governor, consistent 

with paragraphs (i)(1) and (2) of this section.

    (4) The Council must, consistent with State law, supervise and 

evaluate the staff and personnel that are necessary to carry out its 

functions.

    (5) Those staff and personnel that are assisting the Council in 

carrying out its functions may not be assigned duties by the designated 

State unit or any other agency or office of the State that would create 

a conflict of interest.

    (j) Meetings. The Council must--

    (1) Convene at least four meetings a year in locations determined 

by the Council to be necessary to conduct Council business. The 

meetings must be publicly announced, open, and accessible to the 

general public, including individuals with disabilities, unless there 

is a valid reason for an executive session; and

    (2) Conduct forums or hearings, as appropriate, that are publicly 

announced, open, and accessible to the public, including individuals 

with disabilities.

    (k) Compensation. Funds appropriated under Title I of the Act, 

except funds to carry out sections 112 and 121 of the Act, may be used 

to compensate and reimburse the expenses of Council members in 

accordance with section 105(g) of the Act.

 

(Authority: Section 105 of the Act; 29 U.S.C. 725)

 

[[Page 4394]]

 

Sec. 361.18  Comprehensive system of personnel development.

 

    The State plan must describe the procedures and activities the 

State agency will undertake to establish and maintain a comprehensive 

system of personnel development designed to ensure an adequate supply 

of qualified rehabilitation personnel, including professionals and 

paraprofessionals, for the designated State unit. If the State agency 

has a State Rehabilitation Council, this description must, at a 

minimum, specify that the Council has an opportunity to review and 

comment on the development of plans, policies, and procedures necessary 

to meet the requirements of paragraphs (b) through (d) of this section. 

This description must also conform with the following requirements:

    (a) Data system on personnel and personnel development. The State 

plan must describe the development and maintenance of a system by the 

State agency for collecting and analyzing on an annual basis data on 

qualified personnel needs and personnel development, in accordance with 

the following requirements:

    (1) Data on qualified personnel needs must include--

    (i) The number of personnel who are employed by the State agency in 

the provision of vocational rehabilitation services in relation to the 

number of individuals served, broken down by personnel category;

    (ii) The number of personnel currently needed by the State agency 

to provide vocational rehabilitation services, broken down by personnel 

category; and

    (iii) Projections of the number of personnel, broken down by 

personnel category, who will be needed by the State agency to provide 

vocational rehabilitation services in the State in 5 years based on 

projections of the number of individuals to be served, including 

individuals with significant disabilities, the number of personnel 

expected to retire or leave the field, and other relevant factors.

    (2) Data on personnel development must include--

    (i) A list of the institutions of higher education in the State 

that are preparing vocational rehabilitation professionals, by type of 

program;

    (ii) The number of students enrolled at each of those institutions, 

broken down by type of program; and

    (iii) The number of students who graduated during the prior year 

from each of those institutions with certification or licensure, or 

with the credentials for certification or licensure, broken down by the 

personnel category for which they have received, or have the 

credentials to receive, certification or licensure.

    (b) Plan for recruitment, preparation, and retention of qualified 

personnel. The State plan must describe the development, updating, and 

implementation of a plan to address the current and projected needs for 

personnel who are qualified in accordance with paragraph (c) of this 

section. The plan must identify the personnel needs based on the data 

collection and analysis system described in paragraph (a) of this 

section and must provide for the coordination and facilitation of 

efforts between the designated State unit and institutions of higher 

education and professional associations to recruit, prepare, and retain 

personnel who are qualified in accordance with paragraph (c) of this 

section, including personnel from minority backgrounds and personnel 

who are individuals with disabilities.

    (c) Personnel standards.

    (1) The State plan must include the State agency's policies and 

describe the procedures the State agency will undertake to establish 

and maintain standards to ensure that all professional and 

paraprofessional personnel needed within the designated State unit to 

carry out this part are appropriately and adequately prepared and 

trained, including--

    (i) Standards that are consistent with any national or State-

approved or -recognized certification, licensing, or registration 

requirements, or, in the absence of these requirements, other 

comparable requirements (including State personnel requirements) that 

apply to the profession or discipline in which that category of 

personnel is providing vocational rehabilitation services; and

    (ii) To the extent that existing standards are not based on the 

highest requirements in the State, the steps the State is currently 

taking and the steps the State plans to take to retrain or hire 

personnel to meet standards that are based on the highest requirements 

in the State, including measures to notify State unit personnel, the 

institutions of higher education identified under paragraph (a)(2)(i) 

of this section, and other public agencies of these steps and the 

timelines for taking each step. The steps taken by the State unit under 

this paragraph must be described in a written plan that includes--

    (A) Specific strategies for retraining, recruiting, and hiring 

personnel;

    (B) The specific time period by which all State unit personnel will 

meet the standards described in paragraph (c)(1)(i) of this section;

    (C) Procedures for evaluating the State unit's progress in hiring 

or retraining personnel to meet applicable personnel standards within 

the time period established under paragraph (c)(1)(ii)(B) of this 

section; and

    (D) In instances in which the State unit is unable to immediately 

hire new personnel who meet the requirements in paragraph (c)(1)(i) of 

this section, the initial minimum qualifications that the designated 

State unit will require of newly hired personnel and a plan for 

training those individuals to meet applicable requirements within the 

time period established under paragraph (c)(1)(ii)(B) of this section.

    (2) As used in this section--

    (i) Highest requirements in the State applicable to that profession 

or discipline means the highest entry-level academic degree needed for 

any national or State-approved or -recognized certification, licensing, 

registration, or, in the absence of these requirements, other 

comparable requirements that apply to that profession or discipline. 

The current requirements of all State statutes and regulations of other 

agencies in the State applicable to that profession or discipline must 

be considered and must be kept on file by the designated State unit and 

available to the public.

    (ii) Profession or discipline means a specific occupational 

category, including any paraprofessional occupational category, that--

    (A) Provides rehabilitation services to individuals with 

disabilities;

    (B) Has been established or designated by the State unit; and

    (C) Has a specified scope of responsibility.

    (d) Staff development.

    (1) The State plan must include the State agency's policies and 

describe the procedures and activities the State agency will undertake 

to ensure that all personnel employed by the State unit receive 

appropriate and adequate training, including a description of--

    (i) A system of staff development for rehabilitation professionals 

and paraprofessionals within the State unit, particularly with respect 

to assessment, vocational counseling, job placement, and rehabilitation 

technology; and

    (ii) Procedures for acquiring and disseminating to rehabilitation 

professionals and paraprofessionals within the designated State unit 

significant knowledge from research and other sources.

    (2) The specific training areas for staff development must be based 

on the

 

[[Page 4395]]

 

needs of each State unit and may include, but are not limited to--

    (i) Training regarding the Workforce Investment Act of 1998 and the 

amendments to the Rehabilitation Act of 1973 made by the Rehabilitation 

Act Amendments of 1998;

    (ii) Training with respect to the requirements of the Americans 

with Disabilities Act, the Individuals with Disabilities Education Act, 

and Social Security work incentive programs, including programs under 

the Ticket to Work and Work Incentives Improvement Act of 1999, 

training to facilitate informed choice under this program, and training 

to improve the provision of services to culturally diverse populations; 

and

    (iii) Activities related to--

    (A) Recruitment and retention of qualified rehabilitation 

personnel;

    (B) Succession planning; and

    (C) Leadership development and capacity building.

    (e) Personnel to address individual communication needs. The State 

plan must describe how the State unit--

    (1) Includes among its personnel, or obtains the services of, 

individuals able to communicate in the native languages of applicants 

and eligible individuals who have limited English speaking ability; and

    (2) Includes among its personnel, or obtains the services of, 

individuals able to communicate with applicants and eligible 

individuals in appropriate modes of communication.

    (f) Coordination with personnel development under the Individuals 

with Disabilities Education Act. The State plan must describe the 

procedures and activities the State agency will undertake to coordinate 

its comprehensive system of personnel development under the Act with 

personnel development under the Individuals with Disabilities Education 

Act.

 

(Authority: Section 101(a)(7) of the Act; 29 U.S.C. 721(a)(7))

 

 

Sec. 361.19  Affirmative action for individuals with disabilities.

 

    The State plan must assure that the State agency takes affirmative 

action to employ and advance in employment qualified individuals with 

disabilities covered under and on the same terms and conditions as 

stated in section 503 of the Act.

 

(Authority: Section 101(a)(6)(B) of the Act; 29 U.S.C. 721(a)(6)(B))

 

 

Sec. 361.20  Public participation requirements.

 

    (a) Conduct of public meetings. The State plan must assure that 

prior to the adoption of any substantive policies or procedures 

governing the provision of vocational rehabilitation services under the 

State plan, including making any substantive amendments to the policies 

and procedures, the designated State agency conducts public meetings 

throughout the State to provide the public, including individuals with 

disabilities, an opportunity to comment on the policies or procedures.

    (b) Notice requirements. The State plan must assure that the 

designated State agency, prior to conducting the public meetings, 

provides appropriate and sufficient notice throughout the State of the 

meetings in accordance with--

    (1) State law governing public meetings; or

    (2) In the absence of State law governing public meetings, 

procedures developed by the designated State agency in consultation 

with the State Rehabilitation Council.

    (c) Summary of input of the State Rehabilitation Council. The State 

plan must provide a summary of the input of the State Rehabilitation 

Council, if the State agency has a Council, into the State plan and any 

amendment to the plan, in accordance with Sec. 361.16(a)(2)(v).

    (d) Special consultation requirements. The State plan must assure 

that the State agency actively consults with the director of the Client 

Assistance Program, the State Rehabilitation Council, if the State 

agency has a Council, and, as appropriate, Indian tribes, tribal 

organizations, and native Hawaiian organizations on its policies and 

procedures governing the provision of vocational rehabilitation 

services under the State plan.

    (e) Appropriate modes of communication. The State unit must provide 

to the public, through appropriate modes of communication, notices of 

the public meetings, any materials furnished prior to or during the 

public meetings, and the policies and procedures governing the 

provision of vocational rehabilitation services under the State plan.

 

(Authority: Sections 101(a)(16)(A) and 105(c)(3) of the Act; 29 

U.S.C. 721(a)(16)(A), and 725(c)(3))

 

 

Sec. 361.21  Consultations regarding the administration of the state 

plan.

 

    The State plan must assure that, in connection with matters of 

general policy arising in the administration of the State plan, the 

designated State agency takes into account the views of--

    (a) Individuals and groups of individuals who are recipients of 

vocational rehabilitation services or, as appropriate, the individuals' 

representatives;

    (b) Personnel working in programs that provide vocational 

rehabilitation services to individuals with disabilities;

    (c) Providers of vocational rehabilitation services to individuals 

with disabilities;

    (d) The director of the Client Assistance Program; and

    (e) The State Rehabilitation Council, if the State has a Council.

 

(Authority: Sections 101(a)(16)(B) of the Act; 29 U.S.C. 

721(a)(16)(B))

 

Sec. 361.22  Coordination with education officials.

 

    (a) Plans, policies, and procedures. (1) The State plan must 

contain plans, policies, and procedures for coordination between the 

designated State agency and education officials responsible for the 

public education of students with disabilities that are designed to 

facilitate the transition of students with disabilities from the 

receipt of educational services in school to the receipt of vocational 

rehabilitation services under the responsibility of the designated 

State agency.

    (2) These plans, policies, and procedures in paragraph (a)(1) of 

this section must provide for the development and approval of an 

individualized plan for employment in accordance with Sec. 361.45 as 

early as possible during the transition planning process but, at the 

latest, by the time each student determined to be eligible for 

vocational rehabilitation services leaves the school setting or, if the 

designated State unit is operating under an order of selection, before 

each eligible student able to be served under the order leaves the 

school setting.

    (b) Formal interagency agreement. The State plan must include 

information on a formal interagency agreement with the State 

educational agency that, at a minimum, provides for--

    (1) Consultation and technical assistance to assist educational 

agencies in planning for the transition of students with disabilities 

from school to post-school activities, including vocational 

rehabilitation services;

    (2) Transition planning by personnel of the designated State agency 

and educational agency personnel for students with disabilities that 

facilitates the development and completion of their individualized 

education programs (IEPs) under section 614(d) of the Individuals with 

Disabilities Education Act;

    (3) The roles and responsibilities, including financial 

responsibilities, of

 

[[Page 4396]]

 

each agency, including provisions for determining State lead agencies 

and qualified personnel responsible for transition services; and

    (4) Procedures for outreach to and identification of students with 

disabilities who are in need of transition services. Outreach to these 

students should occur as early as possible during the transition 

planning process and must include, at a minimum, a description of the 

purpose of the vocational rehabilitation program, eligibility 

requirements, application procedures, and scope of services that may be 

provided to eligible individuals.

 

(Authority: Section 101(a)(11)(D) of the Act; 29 U.S.C. 721 

(a)(11)(D))

 

 

Sec. 361.23  Requirements related to the statewide workforce investment 

system.

 

    (a) Responsibilities as a partner of the One-Stop service delivery 

system. As a required partner in the One-Stop service delivery system 

(which is part of the statewide workforce investment system under Title 

I of the Workforce Investment Act of 1998), the designated State unit 

must carry out the following functions consistent with the Act, this 

part, Title I of the Workforce Investment Act of 1998, and the 

regulations in 20 CFR part 662:

    (1) Make available to participants through the One-Stop service 

delivery system the core services (as described in 20 CFR 662.240) that 

are applicable to the Program administered by the designated State unit 

under this part.

    (2) Use a portion of funds made available to the Program 

administered by the designated State unit under this part, consistent 

with the Act and this part, to--

    (i) Create and maintain the One-Stop service delivery system; and

    (ii) Provide core services (as described in 20 CFR 662.240).

    (3) Enter into a memorandum of understanding (MOU) with the Local 

Workforce Investment Board under section 117 of the Workforce 

Investment Act of 1998 relating to the operation of the One-Stop 

service delivery system that meets the requirements of section 121(c) 

of the Workforce Investment Act and 20 CFR 662.300, including a 

description of services, how the cost of the identified services and 

operating costs of the system will be funded, and methods for 

referrals.

    (4) Participate in the operation of the One-Stop service delivery 

system consistent with the terms of the MOU and the requirements of the 

Act and this part.

    (5) Provide representation on the Local Workforce Investment Board 

under section 117 of the Workforce Investment Act of 1998.

    (b) Cooperative agreements with One-Stop partners. (1) The State 

plan must assure that the designated State unit or the designated State 

agency enters into cooperative agreements with the other entities that 

are partners under the One-Stop service delivery system under Title I 

of the Workforce Investment Act of 1998 and replicates those agreements 

at the local level between individual offices of the designated State 

unit and local entities carrying out the One-Stop service delivery 

system or other activities through the statewide workforce investment 

system.

    (2) Cooperative agreements developed under paragraph (b)(1) of this 

section may provide for--

    (i) Intercomponent training and technical assistance regarding--

    (A) The availability and benefits of, and information on 

eligibility standards for, vocational rehabilitation services; and

    (B) The promotion of equal, effective and meaningful participation 

by individuals with disabilities in the One-Stop service delivery 

system and other workforce investment activities through the promotion 

of program accessibility consistent with the requirements of the 

Americans with Disabilities Act of 1990 and section 504 of the Act, the 

use of nondiscriminatory policies and procedures, and the provision of 

reasonable accommodations, auxiliary aids and services, and 

rehabilitation technology for individuals with disabilities;

    (ii) The use of information and financial management systems that 

link all of the partners of the One-Stop service delivery system to one 

another and to other electronic networks, including nonvisual 

electronic networks, and that relate to subjects such as employment 

statistics, job vacancies, career planning, and workforce investment 

activities;

    (iii) The use of customer service features such as common intake 

and referral procedures, customer databases, resource information, and 

human services hotlines;

    (iv) The establishment of cooperative efforts with employers to 

facilitate job placement and carry out other activities that the 

designated State unit and the employers determine to be appropriate;

    (v) The identification of staff roles, responsibilities, and 

available resources and specification of the financial responsibility 

of each partner of the One-Stop service delivery system with respect to 

providing and paying for necessary services, consistent with the 

requirements of the Act, this part, other Federal requirements, and 

State law; and

    (vi) The specification of procedures for resolving disputes among 

partners of the One-Stop service delivery system.

 

(Authority: Section 101(a)(11)(A) of the Act; 29 U.S.C. 

721(a)(11)(A); Sections 121 and 134 of the Workforce Investment Act 

of 1998; 29 U.S.C. 2841 and 2864)

 

 

Sec. 361.24  Cooperation and coordination with other entities.

 

    (a) Interagency cooperation. The State plan must describe the 

designated State agency's cooperation with and use of the services and 

facilities of Federal, State, and local agencies and programs, 

including programs carried out by the Under Secretary for Rural 

Development of the Department of Agriculture and State use contracting 

programs, to the extent that those agencies and programs are not 

carrying out activities through the statewide workforce investment 

system.

    (b) Coordination with the Statewide Independent Living Council and 

independent living centers. The State plan must assure that the 

designated State unit, the Statewide Independent Living Council 

established under 34 CFR part 364, and the independent living centers 

established under 34 CFR part 366 have developed working relationships 

and coordinate their activities.

    (c) Cooperative agreement with recipients of grants for services to 

American Indians.

    (1) General. In applicable cases, the State plan must assure that 

the designated State agency has entered into a formal cooperative 

agreement with each grant recipient in the State that receives funds 

under part C of the Act (American Indian Vocational Rehabilitation 

Services).

    (2) Contents of formal cooperative agreement. The agreement 

required under paragraph (a)(1) of this section must describe 

strategies for collaboration and coordination in providing vocational 

rehabilitation services to American Indians who are individuals with 

disabilities, including--

    (i) Strategies for interagency referral and information sharing 

that will assist in eligibility determinations and the development of 

individualized plans for employment;

    (ii) Procedures for ensuring that American Indians who are 

individuals with disabilities and are living near a reservation or 

tribal service area are provided vocational rehabilitation services; 

and

    (iii) Provisions for sharing resources in cooperative studies and 

assessments,

 

[[Page 4397]]

 

joint training activities, and other collaborative activities designed 

to improve the provision of services to American Indians who are 

individuals with disabilities.

    (d) Reciprocal referral services between two designated State units 

in the same State. If there is a separate designated State unit for 

individuals who are blind, the two designated State units must 

establish reciprocal referral services, use each other's services and 

facilities to the extent feasible, jointly plan activities to improve 

services in the State for individuals with multiple impairments, 

including visual impairments, and otherwise cooperate to provide more 

effective services, including, if appropriate, entering into a written 

cooperative agreement.

 

(Authority: Sections 12(c) and 101(a)(11)(C), (E), and (F) of the 

Act; 29 U.S.C. 709(c) and 721(a)(11) (C), (E), and (F))

 

 

Sec. 361.25  Statewideness.

 

    The State plan must assure that services provided under the State 

plan will be available in all political subdivisions of the State, 

unless a waiver of statewideness is requested and approved in 

accordance with Sec. 361.26.

 

(Authority: Section 101(a)(4) of the Act; 29 U.S.C. 721(a)(4))

 

 

Sec. 361.26  Waiver of statewideness.

 

    (a) Availability. The State unit may provide services in one or 

more political subdivisions of the State that increase services or 

expand the scope of services that are available statewide under the 

State plan if--

    (1) The non-Federal share of the cost of these services is met from 

funds provided by a local public agency, including funds contributed to 

a local public agency by a private agency, organization, or individual;

    (2) The services are likely to promote the vocational 

rehabilitation of substantially larger numbers of individuals with 

disabilities or of individuals with disabilities with particular types 

of impairments; and

    (3) For purposes other than those specified in Sec. 361.60(b)(3)(i) 

and consistent with the requirements in Sec. 361.60(b)(3)(ii), the 

State includes in its State plan, and the Secretary approves, a waiver 

of the statewideness requirement, in accordance with the requirements 

of paragraph (b) of this section.

    (b) Request for waiver. The request for a waiver of statewideness 

must--

    (1) Identify the types of services to be provided;

    (2) Contain a written assurance from the local public agency that 

it will make available to the State unit the non-Federal share of 

funds;

    (3) Contain a written assurance that State unit approval will be 

obtained for each proposed service before it is put into effect; and

    (4) Contain a written assurance that all other State plan 

requirements, including a State's order of selection requirements, will 

apply to all services approved under the waiver.

 

(Authority: Section 101(a)(4) of the Act; 29 U.S.C. 721(a)(4))

 

 

Sec. 361.27  Shared funding and administration of joint programs.

 

    (a) If the State plan provides for the designated State agency to 

share funding and administrative responsibility with another State 

agency or local public agency to carry out a joint program to provide 

services to individuals with disabilities, the State must submit to the 

Secretary for approval a plan that describes its shared funding and 

administrative arrangement.

    (b) The plan under paragraph (a) of this section must include--

    (1) A description of the nature and scope of the joint program;

    (2) The services to be provided under the joint program;

    (3) The respective roles of each participating agency in the 

administration and provision of services; and

    (4) The share of the costs to be assumed by each agency.

    (c) If a proposed joint program does not comply with the 

statewideness requirement in Sec. 361.25, the State unit must obtain a 

waiver of statewideness, in accordance with Sec. 361.26.

 

(Authority: Section 101(a)(2)(A) of the Act; 29 U.S.C. 721(a)(2)(A))

 

 

Sec. 361.28  Third-party cooperative arrangements involving funds from 

other public agencies.

 

    (a) The designated State unit may enter into a third-party 

cooperative arrangement for providing or administering vocational 

rehabilitation services with another State agency or a local public 

agency that is furnishing part or all of the non-Federal share, if the 

designated State unit ensures that--

    (1) The services provided by the cooperating agency are not the 

customary or typical services provided by that agency but are new 

services that have a vocational rehabilitation focus or existing 

services that have been modified, adapted, expanded, or reconfigured to 

have a vocational rehabilitation focus;

    (2) The services provided by the cooperating agency are only 

available to applicants for, or recipients of, services from the 

designated State unit;

    (3) Program expenditures and staff providing services under the 

cooperative arrangement are under the administrative supervision of the 

designated State unit; and

    (4) All State plan requirements, including a State's order of 

selection, will apply to all services provided under the cooperative 

program.

    (b) If a third party cooperative agreement does not comply with the 

statewideness requirement in Sec. 361.25, the State unit must obtain a 

waiver of statewideness, in accordance with Sec. 361.26.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

Sec. 361.29  Statewide assessment; annual estimates; annual State goals 

and priorities; strategies; and progress reports.

 

    (a) Comprehensive statewide assessment. (1) The State plan must 

include--

    (i) The results of a comprehensive, statewide assessment, jointly 

conducted by the designated State unit and the State Rehabilitation 

Council (if the State unit has a Council) every 3 years describing the 

rehabilitation needs of individuals with disabilities residing within 

the State, particularly the vocational rehabilitation services needs 

of--

    (A) Individuals with the most significant disabilities, including 

their need for supported employment services;

    (B) Individuals with disabilities who are minorities and 

individuals with disabilities who have been unserved or underserved by 

the vocational rehabilitation program carried out under this part; and

    (C) Individuals with disabilities served through other components 

of the statewide workforce investment system as identified by those 

individuals and personnel assisting those individuals through the 

components of the system; and

    (ii) An assessment of the need to establish, develop, or improve 

community rehabilitation programs within the State.

    (2) The State plan must assure that the State will submit to the 

Secretary a report containing information regarding updates to the 

assessments under paragraph (a) of this section for any year in which 

the State updates the assessments.

    (b) Annual estimates. The State plan must include, and must assure 

that the State will annually submit a report to the Secretary that 

includes, State estimates of--

 

[[Page 4398]]

 

    (1) The number of individuals in the State who are eligible for 

services under this part;

    (2) The number of eligible individuals who will receive services 

provided with funds provided under part B of Title I of the Act and 

under part B of Title VI of the Act, including, if the designated State 

agency uses an order of selection in accordance with Sec. 361.36, 

estimates of the number of individuals to be served under each priority 

category within the order; and

    (3) The costs of the services described in paragraph (b)(1) of this 

section, including, if the designated State agency uses an order of 

selection, the service costs for each priority category within the 

order.

    (c) Goals and priorities.

    (1) In general. The State plan must identify the goals and 

priorities of the State in carrying out the program.

    (2) Council. The goals and priorities must be jointly developed, 

agreed to, reviewed annually, and, as necessary, revised by the 

designated State unit and the State Rehabilitation Council, if the 

State unit has a Council.

    (3) Submission. The State plan must assure that the State will 

submit to the Secretary a report containing information regarding 

revisions in the goals and priorities for any year in which the State 

revises the goals and priorities.

    (4) Basis for goals and priorities. The State goals and priorities 

must be based on an analysis of--

    (i) The comprehensive statewide assessment described in paragraph 

(a) of this section, including any updates to the assessment;

    (ii) The performance of the State on the standards and indicators 

established under section 106 of the Act; and

    (iii) Other available information on the operation and the 

effectiveness of the vocational rehabilitation program carried out in 

the State, including any reports received from the State Rehabilitation 

Council under Sec. 361.17(h) and the findings and recommendations from 

monitoring activities conducted under section 107 of the Act.

    (5) Service and outcome goals for categories in order of selection. 

If the designated State agency uses an order of selection in accordance 

with Sec. 361.36, the State plan must identify the State's service and 

outcome goals and the time within which these goals may be achieved for 

individuals in each priority category within the order.

    (d)Strategies. The State plan must describe the strategies the 

State will use to address the needs identified in the assessment 

conducted under paragraph (a) of this section and achieve the goals and 

priorities identified in paragraph (c) of this section, including--

    (1) The methods to be used to expand and improve services to 

individuals with disabilities, including how a broad range of assistive 

technology services and assistive technology devices will be provided 

to those individuals at each stage of the rehabilitation process and 

how those services and devices will be provided to individuals with 

disabilities on a statewide basis;

    (2) Outreach procedures to identify and serve individuals with 

disabilities who are minorities and individuals with disabilities who 

have been unserved or underserved by the vocational rehabilitation 

program;

    (3) As applicable, the plan of the State for establishing, 

developing, or improving community rehabilitation programs;

    (4) Strategies to improve the performance of the State with respect 

to the evaluation standards and performance indicators established 

pursuant to section 106 of the Act; and

    (5) Strategies for assisting other components of the statewide 

workforce investment system in assisting individuals with disabilities.

    (e) Evaluation and reports of progress. (1) The State plan must 

include--

    (i) The results of an evaluation of the effectiveness of the 

vocational rehabilitation program; and

    (ii) A joint report by the designated State unit and the State 

Rehabilitation Council, if the State unit has a Council, to the 

Secretary on the progress made in improving the effectiveness of the 

program from the previous year. This evaluation and joint report must 

include--

    (A) An evaluation of the extent to which the goals and priorities 

identified in paragraph (c) of this section were achieved;

    (B) A description of the strategies that contributed to the 

achievement of the goals and priorities;

    (C) To the extent to which the goals and priorities were not 

achieved, a description of the factors that impeded that achievement; 

and

    (D) An assessment of the performance of the State on the standards 

and indicators established pursuant to section 106 of the Act.

    (2) The State plan must assure that the designated State unit and 

the State Rehabilitation Council, if the State unit has a Council, will 

jointly submit to the Secretary an annual report that contains the 

information described in paragraph (e)(1) of this section.

 

(Authority: Section 101(a)(15) of the Act; 29 U.S.C. 721(a)(15))

 

 

Sec. 361.30  Services to American Indians.

 

    The State plan must assure that the designated State agency 

provides vocational rehabilitation services to American Indians who are 

individuals with disabilities residing in the State to the same extent 

as the designated State agency provides vocational rehabilitation 

services to other significant populations of individuals with 

disabilities residing in the State.

 

(Authority: Sections 101(a)(13) and 121(b)(3) of the Act; 29 U.S.C. 

721(a)(13) and 741(b)(3))

 

 

Sec. 361.31  Cooperative agreements with private nonprofit 

organizations.

 

    The State plan must describe the manner in which cooperative 

agreements with private nonprofit vocational rehabilitation service 

providers will be established.

 

(Authority: Sections 101(a)(24)(B); 29 U.S.C. 721(a)(24)(B))

 

 

Sec. 361.32  Use of profitmaking organizations for on-the-job training 

in connection with selected projects.

 

    The State plan must assure that the designated State agency has the 

authority to enter into contracts with for-profit organizations for the 

purpose of providing, as vocational rehabilitation services, on-the-job 

training and related programs for individuals with disabilities under 

the Projects With Industry program, 34 CFR part 379, if the designated 

State agency has determined that for-profit agencies are better 

qualified to provide needed vocational rehabilitation services than 

nonprofit agencies and organizations.

 

(Authority: Section 101(a)(24)(A) of the Act; 29 U.S.C. 

721(a)(24)(A))

 

 

Sec. 361.33  [Reserved]

 

 

Sec. 361.34  Supported employment State plan supplement.

 

    (a) The State plan must assure that the State has an acceptable 

plan under 34 CFR part 363 that provides for the use of funds under 

that part to supplement funds under this part for the cost of services 

leading to supported employment.

    (b) The supported employment plan, including any needed annual 

revisions, must be submitted as a supplement to the State plan 

submitted under this part.

 

(Authority: Sections 101(a)(22) and 625(a) of the Act; 29 U.S.C. 

721(a)(22) and 795(k))

 

 

Sec. 361.35  Innovation and expansion activities.

 

    (a) The State plan must assure that the State will reserve and use 

a portion of the funds allotted to the State under section 110 of the 

Act--

    (1) For the development and implementation of innovative

 

[[Page 4399]]

 

approaches to expand and improve the provision of vocational 

rehabilitation services to individuals with disabilities, particularly 

individuals with the most significant disabilities, consistent with the 

findings of the comprehensive, statewide assessment of the 

rehabilitation needs of individuals with disabilities under 

Sec. 361.29(a) and the State's goals and priorities under 

Sec. 361.29(c); and

    (2) To support the funding of--

    (i) The State Rehabilitation Council, if the State has a Council, 

consistent with the resource plan identified in Sec. 361.17(i); and

    (ii) The Statewide Independent Living Council, consistent with the 

plan prepared under 34 CFR 364.21(i).

    (b) The State plan must--

    (1) Describe how the reserved funds will be used; and

    (2) Include, on an annual basis, a report describing how the 

reserved funds were used during the preceding year.

 

(Authority: Section 101(a)(18) of the Act; 29 U.S.C. 721(a)(18))

 

 

Sec. 361.36  Ability to serve all eligible individuals; order of 

selection for services.

 

    (a) General provisions.

    (1) The designated State unit either must be able to provide the 

full range of services listed in section 103(a) of the Act and 

Sec. 361.48, as appropriate, to all eligible individuals or, in the 

event that vocational rehabilitation services cannot be provided to all 

eligible individuals in the State who apply for the services, include 

in the State plan the order to be followed in selecting eligible 

individuals to be provided vocational rehabilitation services.

    (2) The ability of the designated State unit to provide the full 

range of vocational rehabilitation services to all eligible individuals 

must be supported by a determination that satisfies the requirements of 

paragraph (b) or (c) of this section and a determination that, on the 

basis of the designated State unit's projected fiscal and personnel 

resources and its assessment of the rehabilitation needs of individuals 

with significant disabilities within the State, it can--

    (i) Continue to provide services to all individuals currently 

receiving services;

    (ii) Provide assessment services to all individuals expected to 

apply for services in the next fiscal year;

    (iii) Provide services to all individuals who are expected to be 

determined eligible in the next fiscal year; and

    (iv) Meet all program requirements.

    (3) If the designated State unit is unable to provide the full 

range vocational rehabilitation services to all eligible individuals in 

the State who apply for the services, the State plan must--

    (i) Show the order to be followed in selecting eligible individuals 

to be provided vocational rehabilitation services;

    (ii) Provide a justification for the order of selection;

    (iii) Identify service and outcome goals and the time within which 

the goals may be achieved for individuals in each priority category 

within the order, as required under Sec. 361.29(c)(5); and

    (iv) Assure that--

    (A) In accordance with criteria established by the State for the 

order of selection, individuals with the most significant disabilities 

will be selected first for the provision of vocational rehabilitation 

services; and

    (B) Individuals who do not meet the order of selection criteria 

will have access to services provided through the information and 

referral system established under Sec. 361.37.

    (b) Basis for assurance that services can be provided to all 

eligible individuals.

    (1) For a designated State unit that determined, for the current 

fiscal year and the preceding fiscal year, that it is able to provide 

the full range of services, as appropriate, to all eligible 

individuals, the State unit, during the current fiscal and preceding 

fiscal year, must have in fact--

    (i) Provided assessment services to all applicants and the full 

range of services, as appropriate, to all eligible individuals;

    (ii) Made referral forms widely available throughout the State;

    (iii) Conducted outreach efforts to identify and serve individuals 

with disabilities who have been unserved or underserved by the 

vocational rehabilitation system; and

    (iv) Not delayed, through waiting lists or other means, 

determinations of eligibility, the development of individualized plans 

for employment for individuals determined eligible for vocational 

rehabilitation services, or the provision of services for eligible 

individuals for whom individualized plans for employment have been 

developed.

    (2) For a designated State unit that was unable to provide the full 

range of services to all eligible individuals during the current or 

preceding fiscal year or that has not met the requirements in paragraph 

(b)(1) of this section, the determination that the designated State 

unit is able to provide the full range of vocational rehabilitation 

services to all eligible individuals in the next fiscal year must be 

based on--

    (i) Circumstances that have changed that will allow the designated 

State unit to meet the requirements of paragraph (a)(2) of this section 

in the next fiscal year, including--

    (A) An estimate of the number of and projected costs of serving, in 

the next fiscal year, individuals with existing individualized plans 

for employment;

    (B) The projected number of individuals with disabilities who will 

apply for services and will be determined eligible in the next fiscal 

year and the projected costs of serving those individuals;

    (C) The projected costs of administering the program in the next 

fiscal year, including, but not limited to, costs of staff salaries and 

benefits, outreach activities, and required statewide studies; and

    (D) The projected revenues and projected number of qualified 

personnel for the program in the next fiscal year;

    (ii) Comparable data, as relevant, for the current or preceding 

fiscal year, or for both years, of the costs listed in paragraphs 

(b)(2)(i)(A) through (C) of this section and the resources identified 

in paragraph (b)(2)(i)(D) of this section and an explanation of any 

projected increases or decreases in these costs and resources; and

    (iii) A determination that the projected revenues and the projected 

number of qualified personnel for the program in the next fiscal year 

are adequate to cover the costs identified in paragraphs (b)(2)(i)(A) 

through (C) of this section to ensure the provision of the full range 

of services, as appropriate, to all eligible individuals.

    (c) Determining need for establishing and implementing an order of 

selection.

    (1) The designated State unit must determine, prior to the 

beginning of each fiscal year, whether to establish and implement an 

order of selection.

    (2) If the designated State unit determines that it does not need 

to establish an order of selection, it must reevaluate this 

determination whenever changed circumstances during the course of a 

fiscal year, such as a decrease in its fiscal or personnel resources or 

an increase in its program costs, indicate that it may no longer be 

able to provide the full range of services, as appropriate, to all 

eligible individuals, as described in paragraph (a)(2) of this section.

    (3) If a DSU establishes an order of selection, but determines that 

it does not need to implement that order at the beginning of the fiscal 

year, it must continue to meet the requirements of paragraph (a)(2) of 

this section, or it must implement the order of selection

 

[[Page 4400]]

 

by closing one or more priority categories.

    (d) Establishing an order of selection.

    (1) Basis for order of selection. An order of selection must be 

based on a refinement of the three criteria in the definition of 

``individual with a significant disability'' in section 7(21)(A) of the 

Act and Sec. 361.5(b)(31).

    (2) Factors that cannot be used in determining order of selection 

of eligible individuals. An order of selection may not be based on any 

other factors, including--

    (i) Any duration of residency requirement, provided the individual 

is present in the State;

    (ii) Type of disability;

    (iii) Age, gender, race, color, or national origin;

    (iv) Source of referral;

    (v) Type of expected employment outcome;

    (vi) The need for specific services or anticipated cost of services 

required by an individual; or

    (vii) The income level of an individual or an individual's family.

    (e) Administrative requirements. In administering the order of 

selection, the designated State unit must--

    (1) Implement the order of selection on a statewide basis;

    (2) Notify all eligible individuals of the priority categories in a 

State's order of selection, their assignment to a particular category, 

and their right to appeal their category assignment;

    (3) Continue to provide all needed services to any eligible 

individual who has begun to receive services under an individualized 

plan for employment prior to the effective date of the order of 

selection, irrespective of the severity of the individual's disability; 

and

    (4) Ensure that its funding arrangements for providing services 

under the State plan, including third-party arrangements and awards 

under the establishment authority, are consistent with the order of 

selection. If any funding arrangements are inconsistent with the order 

of selection, the designated State unit must renegotiate these funding 

arrangements so that they are consistent with the order of selection.

    (f) State Rehabilitation Council. The designated State unit must 

consult with the State Rehabilitation Council, if the State unit has a 

Council, regarding the--

    (1) Need to establish an order of selection, including any 

reevaluation of the need under paragraph (c)(2) of this section;

    (2) Priority categories of the particular order of selection;

    (3) Criteria for determining individuals with the most significant 

disabilities; and

    (4) Administration of the order of selection.

 

(Authority: Sections 12(d); 101(a)(5); 101(a)(12); 101(a)(15)(A), 

(B) and (C); 101(a)(21)(A)(ii); and 504(a) of the Act; 29 U.S.C. 

709(d), 721(a)(5), 721(a)(12), 721(a)(15)(A), (B) and (C); 

721(a)(21)(A)(ii), and 794(a))

 

 

Sec. 361.37  Information and referral services.

 

    (a) General provisions. The State plan must assure that--

    (1) The designated State agency will implement an information and 

referral system adequate to ensure that individuals with disabilities, 

including eligible individuals who do not meet the agency's order of 

selection criteria for receiving vocational rehabilitation services if 

the agency is operating on an order of selection, are provided accurate 

vocational rehabilitation information and guidance (which may include 

counseling and referral for job placement) using appropriate modes of 

communication to assist them in preparing for, securing, retaining, or 

regaining employment; and

    (2) The designated State agency will refer individuals with 

disabilities to other appropriate Federal and State programs, including 

other components of the statewide workforce investment system.

    (b) Criteria for appropriate referrals. In making the referrals 

identified in paragraph (a)(2) of this section, the designated State 

unit must--

    (1) Refer the individual to Federal or State programs, including 

programs carried out by other components of the statewide workforce 

investment system, best suited to address the specific employment needs 

of an individual with a disability; and

    (2) Provide the individual who is being referred--

    (i) A notice of the referral by the designated State agency to the 

agency carrying out the program;

    (ii) Information identifying a specific point of contact within the 

agency to which the individual is being referred; and

    (iii) Information and advice regarding the most suitable services 

to assist the individual to prepare for, secure, retain, or regain 

employment.

    (c) Order of selection. In providing the information and referral 

services under this section to eligible individuals who are not in the 

priority category or categories to receive vocational rehabilitation 

services under the State's order of selection, the State unit must 

identify, as part of its reporting under section 101(a)(10) of the Act 

and Sec. 361.40, the number of eligible individuals who did not meet 

the agency's order of selection criteria for receiving vocational 

rehabilitation services and did receive information and referral 

services under this section.

 

(Authority: Sections 101(a)(5)(D) and (20) and 101(a)(10)(C)(ii) of 

the Act; 29 U.S.C. 721(a)(5)(D) and (20) and (a)(10)(C)(ii))

 

 

Sec. 361.38  Protection, use, and release of personal information.

 

    (a) General provisions.

    (1) The State agency and the State unit must adopt and implement 

written policies and procedures to safeguard the confidentiality of all 

personal information, including photographs and lists of names. These 

policies and procedures must ensure that--

    (i) Specific safeguards are established to protect current and 

stored personal information;

    (ii) All applicants and eligible individuals and, as appropriate, 

those individuals' representatives, service providers, cooperating 

agencies, and interested persons are informed through appropriate modes 

of communication of the confidentiality of personal information and the 

conditions for accessing and releasing this information;

    (iii) All applicants or their representatives are informed about 

the State unit's need to collect personal information and the policies 

governing its use, including--

    (A) Identification of the authority under which information is 

collected;

    (B) Explanation of the principal purposes for which the State unit 

intends to use or release the information;

    (C) Explanation of whether providing requested information to the 

State unit is mandatory or voluntary and the effects of not providing 

requested information;

    (D) Identification of those situations in which the State unit 

requires or does not require informed written consent of the individual 

before information may be released; and

    (E) Identification of other agencies to which information is 

routinely released;

    (iv) An explanation of State policies and procedures affecting 

personal information will be provided to each individual in that 

individual's native language or through the appropriate mode of 

communication; and

    (v) These policies and procedures provide no fewer protections for 

individuals than State laws and regulations.

    (2) The State unit may establish reasonable fees to cover 

extraordinary costs of duplicating records or making extensive searches 

and must establish policies and procedures governing access to records.

 

[[Page 4401]]

 

    (b) State program use. All personal information in the possession 

of the State agency or the designated State unit must be used only for 

the purposes directly connected with the administration of the 

vocational rehabilitation program. Information containing identifiable 

personal information may not be shared with advisory or other bodies 

that do not have official responsibility for administration of the 

program. In the administration of the program, the State unit may 

obtain personal information from service providers and cooperating 

agencies under assurances that the information may not be further 

divulged, except as provided under paragraphs (c), (d), and (e) of this 

section.

    (c) Release to applicants and eligible individuals.

    (1) Except as provided in paragraphs (c)(2) and (c)(3) of this 

section, if requested in writing by an applicant or eligible 

individual, the State unit must make all requested information in that 

individual's record of services accessible to and must release the 

information to the individual or the individual's representative in a 

timely manner.

    (2) Medical, psychological, or other information that the State 

unit determines may be harmful to the individual may not be released 

directly to the individual, but must be provided to the individual 

through a third party chosen by the individual, which may include, 

among others, an advocate, a family member, or a qualified medical or 

mental health professional, unless a representative has been appointed 

by a court to represent the individual, in which case the information 

must be released to the court-appointed representative.

    (3) If personal information has been obtained from another agency 

or organization, it may be released only by, or under the conditions 

established by, the other agency or organization.

    (4) An applicant or eligible individual who believes that 

information in the individual's record of services is inaccurate or 

misleading may request that the designated State unit amend the 

information. If the information is not amended, the request for an 

amendment must be documented in the record of services, consistent with 

Sec. 361.47(a)(12).

    (d) Release for audit, evaluation, and research. Personal 

information may be released to an organization, agency, or individual 

engaged in audit, evaluation, or research only for purposes directly 

connected with the administration of the vocational rehabilitation 

program or for purposes that would significantly improve the quality of 

life for applicants and eligible individuals and only if the 

organization, agency, or individual assures that--

    (1) The information will be used only for the purposes for which it 

is being provided;

    (2) The information will be released only to persons officially 

connected with the audit, evaluation, or research;

    (3) The information will not be released to the involved 

individual;

    (4) The information will be managed in a manner to safeguard 

confidentiality; and

    (5) The final product will not reveal any personal identifying 

information without the informed written consent of the involved 

individual or the individual's representative.

    (e) Release to other programs or authorities.

    (1) Upon receiving the informed written consent of the individual 

or, if appropriate, the individual's representative, the State unit may 

release personal information to another agency or organization for its 

program purposes only to the extent that the information may be 

released to the involved individual or the individual's representative 

and only to the extent that the other agency or organization 

demonstrates that the information requested is necessary for its 

program.

    (2) Medical or psychological information that the State unit 

determines may be harmful to the individual may be released if the 

other agency or organization assures the State unit that the 

information will be used only for the purpose for which it is being 

provided and will not be further released to the individual.

    (3) The State unit must release personal information if required by 

Federal law or regulations.

    (4) The State unit must release personal information in response to 

investigations in connection with law enforcement, fraud, or abuse, 

unless expressly prohibited by Federal or State laws or regulations, 

and in response to an order issued by a judge, magistrate, or other 

authorized judicial officer.

    (5) The State unit also may release personal information in order 

to protect the individual or others if the individual poses a threat to 

his or her safety or to the safety of others.

 

(Authority: Sections 12(c) and 101(a)(6)(A) of the Act; 29 U.S.C. 

709(c) and 721(a)(6)(A))

 

 

Sec. 361.39  State-imposed requirements.

 

    The designated State unit must, upon request, identify those 

regulations and policies relating to the administration or operation of 

its vocational rehabilitation program that are State-imposed, including 

any regulations or policy based on State interpretation of any Federal 

law, regulations, or guideline.

 

(Authority: Section 17 of the Act; 29 U.S.C. 714)

 

 

Sec. 361.40  Reports.

 

    (a) The State plan must assure that the designated State agency 

will submit reports, including reports required under sections 13, 14, 

and 101(a)(10) of the Act--

    (1) In the form and level of detail and at the time required by the 

Secretary regarding applicants for and eligible individuals receiving 

services under this part; and

    (2) In a manner that provides a complete count (other than the 

information obtained through sampling consistent with section 

101(a)(10)(E) of the Act) of the applicants and eligible individuals 

to--

    (i) Permit the greatest possible cross-classification of data; and

    (ii) Protect the confidentiality of the identity of each 

individual.

    (b) The designated State agency must comply with any requirements 

necessary to ensure the accuracy and verification of those reports.

 

(Authority: Section 101(a)(10)(A) and (F) of the Act; 29 U.S.C. 

721(a)(10)(A) and (F))

 

Provision and Scope of Services

 

 

Sec. 361.41  Processing referrals and applications.

 

    (a) Referrals. The designated State unit must establish and 

implement standards for the prompt and equitable handling of referrals 

of individuals for vocational rehabilitation services, including 

referrals of individuals made through the One-Stop service delivery 

systems established under section 121 of the Workforce Investment Act 

of 1998. The standards must include timelines for making good faith 

efforts to inform these individuals of application requirements and to 

gather information necessary to initiate an assessment for determining 

eligibility and priority for services.

    (b) Applications.

    (1) Once an individual has submitted an application for vocational 

rehabilitation services, including applications made through common 

intake procedures in One-Stop centers established under section 121 of 

the Workforce Investment Act of 1998, an eligibility determination must 

be made within 60 days, unless--

    (i) Exceptional and unforeseen circumstances beyond the control of 

the designated State unit preclude making an eligibility determination 

within 60 days and the designated State unit and

 

[[Page 4402]]

 

the individual agree to a specific extension of time; or

    (ii) An exploration of the individual's abilities, capabilities, 

and capacity to perform in work situations is carried out in accordance 

with Sec. 361.42(e) or, if appropriate, an extended evaluation is 

carried out in accordance with Sec. 361.42(f).

    (2) An individual is considered to have submitted an application 

when the individual or the individual's representative, as 

appropriate--

    (i)(A) Has completed and signed an agency application form;

    (B) Has completed a common intake application form in a One-Stop 

center requesting vocational rehabilitation services; or

    (C) Has otherwise requested services from the designated State 

unit;

    (ii) Has provided to the designated State unit information 

necessary to initiate an assessment to determine eligibility and 

priority for services; and

    (iii) Is available to complete the assessment process.

    (3) The designated State unit must ensure that its application 

forms are widely available throughout the State, particularly in the 

One-Stop centers established under section 121 of the Workforce 

Investment Act of 1998.

 

(Authority: Sections 101(a)(6)(A) and 102(a)(6) of the Act; 29 

U.S.C. 721(a)(6)(A) and 722(a)(6))

 

Sec. 361.42  Assessment for determining eligibility and priority for 

services.

 

    In order to determine whether an individual is eligible for 

vocational rehabilitation services and the individual's priority under 

an order of selection for services (if the State is operating under an 

order of selection), the designated State unit must conduct an 

assessment for determining eligibility and priority for services. The 

assessment must be conducted in the most integrated setting possible, 

consistent with the individual's needs and informed choice, and in 

accordance with the following provisions:

    (a) Eligibility requirements.

    (1) Basic requirements. The designated State unit's determination 

of an applicant's eligibility for vocational rehabilitation services 

must be based only on the following requirements:

    (i) A determination by qualified personnel that the applicant has a 

physical or mental impairment.

    (ii) A determination by qualified personnel that the applicant's 

physical or mental impairment constitutes or results in a substantial 

impediment to employment for the applicant.

    (iii) A determination by a qualified vocational rehabilitation 

counselor employed by the designated State unit that the applicant 

requires vocational rehabilitation services to prepare for, secure, 

retain, or regain employment consistent with the applicant's unique 

strengths, resources, priorities, concerns, abilities, capabilities, 

interests, and informed choice.

    (iv) A presumption, in accordance with paragraph (a)(2) of this 

section, that the applicant can benefit in terms of an employment 

outcome from the provision of vocational rehabilitation services.

    (2) Presumption of benefit. The designated State unit must presume 

that an applicant who meets the eligibility requirements in paragraphs 

(a)(1)(i) and (ii) of this section can benefit in terms of an 

employment outcome unless it demonstrates, based on clear and 

convincing evidence, that the applicant is incapable of benefiting in 

terms of an employment outcome from vocational rehabilitation services 

due to the severity of the applicant's disability.

    (3) Presumption of eligibility for Social Security recipients and 

beneficiaries.

    (i) Any applicant who has been determined eligible for Social 

Security benefits under Title II or Title XVI of the Social Security 

Act is--

    (A) Presumed eligible for vocational rehabilitation services under 

paragraphs (a)(1) and (2) of this section; and

    (B) Considered an individual with a significant disability as 

defined in Sec. 361.5(b)(31).

    (ii) If an applicant for vocational rehabilitation services asserts 

that he or she is eligible for Social Security benefits under Title II 

or Title XVI of the Social Security Act (and, therefore, is presumed 

eligible for vocational rehabilitation services under paragraph 

(a)(3)(i)(A) of this section), but is unable to provide appropriate 

evidence, such as an award letter, to support that assertion, the State 

unit must verify the applicant's eligibility under Title II or Title 

XVI of the Social Security Act by contacting the Social Security 

Administration. This verification must be made within a reasonable 

period of time that enables the State unit to determine the applicant's 

eligibility for vocational rehabilitation services within 60 days of 

the individual submitting an application for services in accordance 

with Sec. 361.41(b)(2).

    (4) Achievement of an employment outcome. Any eligible individual, 

including an individual whose eligibility for vocational rehabilitation 

services is based on the individual being eligible for Social Security 

benefits under Title II or Title XVI of the Social Security Act, must 

intend to achieve an employment outcome that is consistent with the 

applicant's unique strengths, resources, priorities, concerns, 

abilities, capabilities, interests, and informed choice.

    (i) The State unit is responsible for informing individuals, 

through its application process for vocational rehabilitation services, 

that individuals who receive services under the program must intend to 

achieve an employment outcome.

    (ii) The applicant's completion of the application process for 

vocational rehabilitation services is sufficient evidence of the 

individual's intent to achieve an employment outcome, and no additional 

demonstration on the part of the applicant is required for purposes of 

satisfying paragraph (a)(4) of this section.

    (5) Interpretation. Nothing in this section, including paragraph 

(a)(3)(i), is to be construed to create an entitlement to any 

vocational rehabilitation service.

    (b) Interim determination of eligibility.

    (1) The designated State unit may initiate the provision of 

vocational rehabilitation services for an applicant on the basis of an 

interim determination of eligibility prior to the 60-day period 

described in Sec. 361.41(b)(2).

    (2) If a State chooses to make interim determinations of 

eligibility, the designated State unit must--

    (i) Establish criteria and conditions for making those 

determinations;

    (ii) Develop and implement procedures for making the 

determinations; and

    (iii) Determine the scope of services that may be provided pending 

the final determination of eligibility.

    (3) If a State elects to use an interim eligibility determination, 

the designated State unit must make a final determination of 

eligibility within 60 days of the individual submitting an application 

for services in accordance with Sec. 361.41(b)(2).

    (c) Prohibited factors.

    (1) The State plan must assure that the State unit will not impose, 

as part of determining eligibility under this section, a duration of 

residence requirement that excludes from services any applicant who is 

present in the State.

    (2) In making a determination of eligibility under this section, 

the designated State unit also must ensure that--

    (i) No applicant or group of applicants is excluded or found 

ineligible solely on the basis of the type of disability; and

    (ii) The eligibility requirements are applied without regard to 

the--

    (A) Age, gender, race, color, or national origin of the applicant;

 

[[Page 4403]]

 

    (B) Type of expected employment outcome;

    (C) Source of referral for vocational rehabilitation services; and

    (D) Particular service needs or anticipated cost of services 

required by an applicant or the income level of an applicant or 

applicant's family.

    (d) Review and assessment of data for eligibility determination. 

Except as provided in paragraph (e) of this section, the designated 

State unit--

    (1) Must base its determination of each of the basic eligibility 

requirements in paragraph (a) of this section on--

    (i) A review and assessment of existing data, including counselor 

observations, education records, information provided by the individual 

or the individual's family, particularly information used by education 

officials, and determinations made by officials of other agencies; and

    (ii) To the extent existing data do not describe the current 

functioning of the individual or are unavailable, insufficient, or 

inappropriate to make an eligibility determination, an assessment of 

additional data resulting from the provision of vocational 

rehabilitation services, including trial work experiences, assistive 

technology devices and services, personal assistance services, and any 

other support services that are necessary to determine whether an 

individual is eligible; and

    (2) Must base its presumption under paragraph (a)(3)(i) of this 

section that an applicant who has been determined eligible for Social 

Security benefits under Title II or Title XVI of the Social Security 

Act satisfies each of the basic eligibility requirements in paragraph 

(a) of this section on determinations made by the Social Security 

Administration.

    (e) Trial work experiences for individuals with significant 

disabilities.

    (1) Prior to any determination that an individual with a disability 

is incapable of benefiting from vocational rehabilitation services in 

terms of an employment outcome because of the severity of that 

individual's disability, the designated State unit must conduct an 

exploration of the individual's abilities, capabilities, and capacity 

to perform in realistic work situations to determine whether or not 

there is clear and convincing evidence to support such a determination.

    (2)(i) The designated State unit must develop a written plan to 

assess periodically the individual's abilities, capabilities, and 

capacity to perform in work situations through the use of trial work 

experiences, which must be provided in the most integrated setting 

possible, consistent with the informed choice and rehabilitation needs 

of the individual.

    (ii) Trial work experiences include supported employment, on-the-

job training, and other experiences using realistic work settings.

    (iii) Trial work experiences must be of sufficient variety and over 

a sufficient period of time for the designated State unit to determine 

that--

    (A) There is sufficient evidence to conclude that the individual 

can benefit from the provision of vocational rehabilitation services in 

terms of an employment outcome; or

    (B) There is clear and convincing evidence that the individual is 

incapable of benefiting from vocational rehabilitation services in 

terms of an employment outcome due to the severity of the individual's 

disability.

    (iv) The designated State unit must provide appropriate supports, 

including assistive technology devices and services and personal 

assistance services, to accommodate the rehabilitation needs of the 

individual during the trial work experiences.

    (f) Extended evaluation for certain individuals with significant 

disabilities.

    (1) Under limited circumstances if an individual cannot take 

advantage of trial work experiences or if options for trial work 

experiences have been exhausted before the State unit is able to make 

the determinations described in paragraph (e)(2)(iii) of this section, 

the designated State unit must conduct an extended evaluation to make 

these determinations.

    (2) During the extended evaluation period, vocational 

rehabilitation services must be provided in the most integrated setting 

possible, consistent with the informed choice and rehabilitation needs 

of the individual.

    (3) During the extended evaluation period, the designated State 

unit must develop a written plan for providing services necessary to 

make a determination under paragraph (e)(2)(iii) of this section.

    (4) During the extended evaluation period, the designated State 

unit provides only those services that are necessary to make the 

determinations described in paragraph (e)(2)(iii) of this section and 

terminates extended evaluation services when the State unit is able to 

make the determinations.

    (g) Data for determination of priority for services under an order 

of selection. If the designated State unit is operating under an order 

of selection for services, as provided in Sec. 361.36, the State unit 

must base its priority assignments on--

    (1) A review of the data that was developed under paragraphs (d) 

and (e) of this section to make the eligibility determination; and

    (2) An assessment of additional data, to the extent necessary.

 

(Authority: Sections 7(2)(A), 7(2)(B)(ii)(I), 7(2)(C), 7(2)(D), 

101(a)(12), 102(a)(1), 102(a)(2), 102(a)(3), 102(a)(4)(A), 

102(a)(4)(B), 102(a)(4)(C), 103(a)(1), 103(a)(9), 103(a)(10) and 

103(a)(14) of the Act; 29 U.S.C. 705(2)(A), 705(2)(B)(ii)(I), 

705(2)(C), 705(2)(D), 721(a)(12), 722(a)(1), 722(a)(2), 722(a)(3), 

722(a)(4)(A), 722(a)(4)(B), 722(a)(4)(C), 723(a)(1), 723(a)(9), 

723(a)(10) and 723(a)(14))

 

 

    Note to Sec. 361.42: Clear and convincing evidence means that 

the designated State unit shall have a high degree of certainty 

before it can conclude that an individual is incapable of benefiting 

from services in terms of an employment outcome. The ``clear and 

convincing'' standard constitutes the highest standard used in our 

civil system of law and is to be individually applied on a case-by-

case basis. The term clear means unequivocal. For example, the use 

of an intelligence test result alone would not constitute clear and 

convincing evidence. Clear and convincing evidence might include a 

description of assessments, including situational assessments and 

supported employment assessments, from service providers who have 

concluded that they would be unable to meet the individual's needs 

due to the severity of the individual's disability. The 

demonstration of ``clear and convincing evidence'' must include, if 

appropriate, a functional assessment of skill development 

activities, with any necessary supports (including assistive 

technology), in real life settings. (S. Rep. No. 357, 102d Cong., 

2d. Sess. 37-38 (1992))

 

Sec. 361.43  Procedures for ineligibility determination.

 

    If the State unit determines that an applicant is ineligible for 

vocational rehabilitation services or determines that an individual 

receiving services under an individualized plan for employment is no 

longer eligible for services, the State unit must--

    (a) Make the determination only after providing an opportunity for 

full consultation with the individual or, as appropriate, with the 

individual's representative;

    (b) Inform the individual in writing, supplemented as necessary by 

other appropriate modes of communication consistent with the informed 

choice of the individual, of the ineligibility determination, including 

the reasons for that determination, the requirements under this 

section, and the means by which the individual may express and seek 

remedy for any dissatisfaction, including the procedures for review of 

State unit personnel determinations in accordance with Sec. 361.57;

    (c) Provide the individual with a description of services available 

from a

 

[[Page 4404]]

 

client assistance program established under 34 CFR part 370 and 

information on how to contact that program;

    (d) Refer the individual to other training or employment-related 

programs that are part of the One-Stop service delivery system under 

the Workforce Investment Act; and

    (e) Review within 12 months and annually thereafter if requested by 

the individual or, if appropriate, by the individual's representative 

any ineligibility determination that is based on a finding that the 

individual is incapable of achieving an employment outcome. This review 

need not be conducted in situations in which the individual has refused 

it, the individual is no longer present in the State, the individual's 

whereabouts are unknown, or the individual's medical condition is 

rapidly progressive or terminal.

 

(Authority: Sections 102(a)(5) and 102(c) of the Act; 29 U.S.C. 

722(a)(5) and 722(c))

 

 

Sec. 361.44  Closure without eligibility determination.

 

    The designated State unit may not close an applicant's record of 

services prior to making an eligibility determination unless the 

applicant declines to participate in, or is unavailable to complete, an 

assessment for determining eligibility and priority for services, and 

the State unit has made a reasonable number of attempts to contact the 

applicant or, if appropriate, the applicant's representative to 

encourage the applicant's participation.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

 

Sec. 361.45  Development of the individualized plan for employment.

 

    (a) General requirements. The State plan must assure that--

    (1) An individualized plan for employment (IPE) meeting the 

requirements of this section and Sec. 361.46 is developed and 

implemented in a timely manner for each individual determined to be 

eligible for vocational rehabilitation services or, if the designated 

State unit is operating under an order of selection in accordance with 

Sec. 361.36, for each eligible individual to whom the State unit is 

able to provide services; and

    (2) Services will be provided in accordance with the provisions of 

the IPE.

    (b) Purpose. 

    (1) The designated State unit must conduct an assessment for 

determining vocational rehabilitation needs, if appropriate, for each 

eligible individual or, if the State is operating under an order of 

selection, for each eligible individual to whom the State is able to 

provide services. The purpose of this assessment is to determine the 

employment outcome, and the nature and scope of vocational 

rehabilitation services to be included in the IPE.

    (2) The IPE must--

    (i) Be designed to achieve the specific employment outcome that is 

selected by the individual consistent with the individual's unique 

strengths, resources, priorities, concerns, abilities, capabilities, 

interests, and informed choice; and

    (ii) To the maximum extent appropriate, result in employment in an 

integrated setting.

    (c) Required information. The State unit must provide the following 

information to each eligible individual or, as appropriate, the 

individual's representative, in writing and, if appropriate, in the 

native language or mode of communication of the individual or the 

individual's representative:

    (1) Options for developing an IPE. Information on the available 

options for developing the IPE, including the option that an eligible 

individual or, as appropriate, the individual's representative may 

develop all or part of the IPE--

    (i) Without assistance from the State unit or other entity; or

    (ii) With assistance from--

    (A) A qualified vocational rehabilitation counselor employed by the 

State unit;

    (B) A qualified vocational rehabilitation counselor who is not 

employed by the State unit; or

    (C) Resources other than those in paragraph (A) or (B) of this 

section.

    (2) Additional information. Additional information to assist the 

eligible individual or, as appropriate, the individual's representative 

in developing the IPE, including--

    (i) Information describing the full range of components that must 

be included in an IPE;

    (ii) As appropriate to each eligible individual--

    (A) An explanation of agency guidelines and criteria for 

determining an eligible individual's financial commitments under an 

IPE;

    (B) Information on the availability of assistance in completing 

State unit forms required as part of the IPE; and

    (C) Additional information that the eligible individual requests or 

the State unit determines to be necessary to the development of the 

IPE;

    (iii) A description of the rights and remedies available to the 

individual, including, if appropriate, recourse to the processes 

described in Sec. 361.57; and

    (iv) A description of the availability of a client assistance 

program established under 34 CFR part 370 and information on how to 

contact the client assistance program.

    (d) Mandatory procedures. The designated State unit must ensure 

that--

    (1) The IPE is a written document prepared on forms provided by the 

State unit;

    (2) The IPE is developed and implemented in a manner that gives 

eligible individuals the opportunity to exercise informed choice, 

consistent with Sec. 361.52, in selecting--

    (i) The employment outcome, including the employment setting;

    (ii) The specific vocational rehabilitation services needed to 

achieve the employment outcome, including the settings in which 

services will be provided;

    (iii) The entity or entities that will provide the vocational 

rehabilitation services; and

    (iv) The methods available for procuring the services;

    (3) The IPE is--

    (i) Agreed to and signed by the eligible individual or, as 

appropriate, the individual's representative; and

    (ii) Approved and signed by a qualified vocational rehabilitation 

counselor employed by the designated State unit;

    (4) A copy of the IPE and a copy of any amendments to the IPE are 

provided to the eligible individual or, as appropriate, to the 

individual's representative, in writing and, if appropriate, in the 

native language or mode of communication of the individual or, as 

appropriate, the individual's representative;

    (5) The IPE is reviewed at least annually by a qualified vocational 

rehabilitation counselor and the eligible individual or, as 

appropriate, the individual's representative to assess the eligible 

individual's progress in achieving the identified employment outcome;

    (6) The IPE is amended, as necessary, by the individual or, as 

appropriate, the individual's representative, in collaboration with a 

representative of the State unit or a qualified vocational 

rehabilitation counselor (to the extent determined to be appropriate by 

the individual), if there are substantive changes in the employment 

outcome, the vocational rehabilitation services to be provided, or the 

providers of the vocational rehabilitation services;

    (7) Amendments to the IPE do not take effect until agreed to and 

signed by the eligible individual or, as appropriate, the individual's 

representative and by a qualified vocational rehabilitation counselor

 

[[Page 4405]]

 

employed by the designated State unit; and

    (8) An IPE for a student with a disability receiving special 

education services is developed--

    (i) In consideration of the student's IEP; and

    (ii) In accordance with the plans, policies, procedures, and terms 

of the interagency agreement required under Sec. 361.22.

    (e) Standards for developing the IPE. The designated State unit 

must establish and implement standards for the prompt development of 

IPEs for the individuals identified under paragraph (a) of this 

section, including timelines that take into consideration the needs of 

the individuals.

    (f) Data for preparing the IPE.

    (1) Preparation without comprehensive assessment. To the extent 

possible, the employment outcome and the nature and scope of 

rehabilitation services to be included in the individual's IPE must be 

determined based on the data used for the assessment of eligibility and 

priority for services under Sec. 361.42.

    (2) Preparation based on comprehensive assessment.

    (i) If additional data are necessary to determine the employment 

outcome and the nature and scope of services to be included in the IPE 

of an eligible individual, the State unit must conduct a comprehensive 

assessment of the unique strengths, resources, priorities, concerns, 

abilities, capabilities, interests, and informed choice, including the 

need for supported employment services, of the eligible individual, in 

the most integrated setting possible, consistent with the informed 

choice of the individual in accordance with the provisions of 

Sec. 361.5(b)(6)(ii).

    (ii) In preparing the comprehensive assessment, the State unit must 

use, to the maximum extent possible and appropriate and in accordance 

with confidentiality requirements, existing information that is current 

as of the date of the development of the IPE, including--

    (A) Information available from other programs and providers, 

particularly information used by education officials and the Social 

Security Administration;

    (B) Information provided by the individual and the individual's 

family; and

    (C) Information obtained under the assessment for determining the 

individual's eligibility and vocational rehabilitation needs.

 

(Authority: Sections 7(2)(B), 101(a)(9), 102(b)(1), 102(b)(2), 

102(c) and 103(a)(1); 29 U.S.C. 705(2)(B), 721(a)(9), 722(b)(1), 

722(b)(2), 722(c) and 723(a)(1))

 

 

Sec. 361.46  Content of the individualized plan for employment.

 

    (a) Mandatory components. Regardless of the approach in 

Sec. 361.45(c)(1) that an eligible individual selects for purposes of 

developing the IPE, each IPE must include--

    (1) A description of the specific employment outcome that is chosen 

by the eligible individual that--

    (i) Is consistent with the individual's unique strengths, 

resources, priorities, concerns, abilities, capabilities, career 

interests, and informed choice; and

    (ii) To the maximum extent appropriate, results in employment in an 

integrated setting;

    (2) A description of the specific rehabilitation services under 

Sec. 361.48 that are--

    (i) Needed to achieve the employment outcome, including, as 

appropriate, the provision of assistive technology devices, assistive 

technology services, and personal assistance services, including 

training in the management of those services; and

    (ii) Provided in the most integrated setting that is appropriate 

for the services involved and is consistent with the informed choice of 

the eligible individual;

    (3) Timelines for the achievement of the employment outcome and for 

the initiation of services;

    (4) A description of the entity or entities chosen by the eligible 

individual or, as appropriate, the individual's representative that 

will provide the vocational rehabilitation services and the methods 

used to procure those services;

    (5) A description of the criteria that will be used to evaluate 

progress toward achievement of the employment outcome; and

    (6) The terms and conditions of the IPE, including, as appropriate, 

information describing--

    (i) The responsibilities of the designated State unit;

    (ii) The responsibilities of the eligible individual, including--

    (A) The responsibilities the individual will assume in relation to 

achieving the employment outcome;

    (B) If applicable, the extent of the individual's participation in 

paying for the cost of services; and

    (C) The responsibility of the individual with regard to applying 

for and securing comparable services and benefits as described in 

Sec. 361.53; and

    (iii) The responsibilities of other entities as the result of 

arrangements made pursuant to the comparable services or benefits 

requirements in Sec. 361.53.

    (b) Supported employment requirements. An IPE for an individual 

with a most significant disability for whom an employment outcome in a 

supported employment setting has been determined to be appropriate 

must--

    (1) Specify the supported employment services to be provided by the 

designated State unit;

    (2) Specify the expected extended services needed, which may 

include natural supports;

    (3) Identify the source of extended services or, to the extent that 

it is not possible to identify the source of extended services at the 

time the IPE is developed, include a description of the basis for 

concluding that there is a reasonable expectation that those sources 

will become available;

    (4) Provide for periodic monitoring to ensure that the individual 

is making satisfactory progress toward meeting the weekly work 

requirement established in the IPE by the time of transition to 

extended services;

    (5) Provide for the coordination of services provided under an IPE 

with services provided under other individualized plans established 

under other Federal or State programs;

    (6) To the extent that job skills training is provided, identify 

that the training will be provided on site; and

    (7) Include placement in an integrated setting for the maximum 

number of hours possible based on the unique strengths, resources, 

priorities, concerns, abilities, capabilities, interests, and informed 

choice of individuals with the most significant disabilities.

    (c) Post-employment services. The IPE for each individual must 

contain, as determined to be necessary, statements concerning--

    (1) The expected need for post-employment services prior to closing 

the record of services of an individual who has achieved an employment 

outcome;

    (2) A description of the terms and conditions for the provision of 

any post-employment services; and

    (3) If appropriate, a statement of how post-employment services 

will be provided or arranged through other entities as the result of 

arrangements made pursuant to the comparable services or benefits 

requirements in Sec. 361.53.

    (d) Coordination of services for students with disabilities who are 

receiving special education services. The IPE for a student with a 

disability who is receiving special education services must be 

coordinated with the

 

[[Page 4406]]

 

IEP for that individual in terms of the goals, objectives, and services 

identified in the IEP.

 

(Authority: Sections 101(a)(8), 101(a)(9), 102(b)(3), and 625(b)(6) 

of the Act; 29 U.S.C. 721(a)(8), 721(a)(9), 722(b)(3), and 795(k))

 

 

Sec. 361.47  Record of services.

 

    (a) The designated State unit must maintain for each applicant and 

eligible individual a record of services that includes, to the extent 

pertinent, the following documentation:

    (1) If an applicant has been determined to be an eligible 

individual, documentation supporting that determination in accordance 

with the requirements under Sec. 361.42.

    (2) If an applicant or eligible individual receiving services under 

an IPE has been determined to be ineligible, documentation supporting 

that determination in accordance with the requirements under 

Sec. 361.43.

    (3) Documentation that describes the justification for closing an 

applicant's or eligible individual's record of services if that closure 

is based on reasons other than ineligibility, including, as 

appropriate, documentation indicating that the State unit has satisfied 

the requirements in Sec. 361.44.

    (4) If an individual has been determined to be an individual with a 

significant disability or an individual with a most significant 

disability, documentation supporting that determination.

    (5) If an individual with a significant disability requires an 

exploration of abilities, capabilities, and capacity to perform in 

realistic work situations through the use of trial work experiences or, 

as appropriate, an extended evaluation to determine whether the 

individual is an eligible individual, documentation supporting the need 

for, and the plan relating to, that exploration or, as appropriate, 

extended evaluation and documentation regarding the periodic 

assessments carried out during the trial work experiences or, as 

appropriate, the extended evaluation, in accordance with the 

requirements under Sec. 361.42(e) and (f).

    (6) The IPE, and any amendments to the IPE, consistent with the 

requirements under Sec. 361.46.

    (7) Documentation describing the extent to which the applicant or 

eligible individual exercised informed choice regarding the provision 

of assessment services and the extent to which the eligible individual 

exercised informed choice in the development of the IPE with respect to 

the selection of the specific employment outcome, the specific 

vocational rehabilitation services needed to achieve the employment 

outcome, the entity to provide the services, the employment setting, 

the settings in which the services will be provided, and the methods to 

procure the services.

    (8) In the event that the IPE provides for services or an 

employment outcome in a non-integrated setting, a justification to 

support the non-integrated setting.

    (9) In the event that an individual obtains competitive employment, 

verification that the individual is compensated at or above the minimum 

wage and that the individual's wage and level of benefits are not less 

than that customarily paid by the employer for the same or similar work 

performed by non-disabled individuals in accordance with 

Sec. 361.5(b)(11)(ii).

    (10) In the event that an individual obtains an employment outcome 

in an extended employment setting in a community rehabilitation program 

or any other employment under section 14(c) of the Fair Labor Standards 

Act, documentation of the results of the annual reviews required under 

Sec. 361.55, the individual's input into those reviews, and the 

individual's or, if appropriate, the individual's representative's 

acknowledgement that those reviews were conducted.

    (11) Documentation concerning any action or decision resulting from 

a request by an individual under Sec. 361.57 for a review of 

determinations made by designated State unit personnel.

    (12) In the event that an applicant or eligible individual requests 

under Sec. 361.38(c)(4) that documentation in the record of services be 

amended and the documentation is not amended, documentation of the 

request.

    (13) In the event an individual is referred to another program 

through the State unit's information and referral system under 

Sec. 361.37, including other components of the statewide workforce 

investment system, documentation on the nature and scope of services 

provided by the designated State unit to the individual and on the 

referral itself, consistent with the requirements of Sec. 361.37.

    (14) In the event an individual's record of service is closed under 

Sec. 361.56, documentation that demonstrates the services provided 

under the individual's IPE contributed to the achievement of the 

employment outcome.

    (15) In the event an individual's record of service is closed under 

Sec. 361.56, documentation verifying that the provisions of Sec. 361.56 

have been satisfied.

    (b) The State unit, in consultation with the State Rehabilitation 

Council if the State has a Council, must determine the type of 

documentation that the State unit must maintain for each applicant and 

eligible individual in order to meet the requirements in paragraph (a) 

of this section.

 

(Authority: Sections 101(a)(6), (9), (14), (20) and 102(a), (b), and 

(d) of the Act; 29 U.S.C. 721(a)(6), (9), (14), (20) and 722(a),(b), 

and (d))

 

 

Sec. 361.48  Scope of vocational rehabilitation services for 

individuals with disabilities.

 

    As appropriate to the vocational rehabilitation needs of each 

individual and consistent with each individual's informed choice, the 

designated State unit must ensure that the following vocational 

rehabilitation services are available to assist the individual with a 

disability in preparing for, securing, retaining, or regaining an 

employment outcome that is consistent with the individual's strengths, 

resources, priorities, concerns, abilities, capabilities, interests, 

and informed choice:

    (a) Assessment for determining eligibility and priority for 

services by qualified personnel, including, if appropriate, an 

assessment by personnel skilled in rehabilitation technology, in 

accordance with Sec. 361.42.

    (b) Assessment for determining vocational rehabilitation needs by 

qualified personnel, including, if appropriate, an assessment by 

personnel skilled in rehabilitation technology, in accordance with 

Sec. 361.45.

    (c) Vocational rehabilitation counseling and guidance, including 

information and support services to assist an individual in exercising 

informed choice in accordance with Sec. 361.52.

    (d) Referral and other services necessary to assist applicants and 

eligible individuals to secure needed services from other agencies, 

including other components of the statewide workforce investment 

system, in accordance with Secs. 361.23, 361.24, and 361.37, and to 

advise those individuals about client assistance programs established 

under 34 CFR part 370.

    (e) In accordance with the definition in Sec. 361.5(b)(40), 

physical and mental restoration services, to the extent that financial 

support is not readily available from a source other than the 

designated State unit (such as through health insurance or a comparable 

service or benefit as defined in Sec. 361.5(b)(10)).

    (f) Vocational and other training services, including personal and 

vocational adjustment training, books, tools, and other training 

materials,

 

[[Page 4407]]

 

except that no training or training services in an institution of 

higher education (universities, colleges, community or junior colleges, 

vocational schools, technical institutes, or hospital schools of 

nursing) may be paid for with funds under this part unless maximum 

efforts have been made by the State unit and the individual to secure 

grant assistance in whole or in part from other sources to pay for that 

training.

    (g) Maintenance, in accordance with the definition of that term in 

Sec. 361.5(b)(35).

    (h) Transportation in connection with the rendering of any 

vocational rehabilitation service and in accordance with the definition 

of that term in Sec. 361.5(b)(57).

    (i) Vocational rehabilitation services to family members, as 

defined in Sec. 361.5(b)(23), of an applicant or eligible individual if 

necessary to enable the applicant or eligible individual to achieve an 

employment outcome.

    (j) Interpreter services, including sign language and oral 

interpreter services, for individuals who are deaf or hard of hearing 

and tactile interpreting services for individuals who are deaf-blind 

provided by qualified personnel.

    (k) Reader services, rehabilitation teaching services, and 

orientation and mobility services for individuals who are blind.

    (l) Job-related services, including job search and placement 

assistance, job retention services, follow-up services, and follow-

along services.

    (m) Supported employment services in accordance with the definition 

of that term in Sec. 361.5(b)(54).

    (n) Personal assistance services in accordance with the definition 

of that term in Sec. 361.5(b)(39).

    (o) Post-employment services in accordance with the definition of 

that term in Sec. 361.5(b)(42).

    (p) Occupational licenses, tools, equipment, initial stocks, and 

supplies.

    (q) Rehabilitation technology in accordance with the definition of 

that term in Sec. 361.5(b)(45), including vehicular modification, 

telecommunications, sensory, and other technological aids and devices.

    (r) Transition services in accordance with the definition of that 

term in Sec. 361.5(b)(55).

    (s) Technical assistance and other consultation services to conduct 

market analyses, develop business plans, and otherwise provide 

resources, to the extent those resources are authorized to be provided 

through the statewide workforce investment system, to eligible 

individuals who are pursuing self-employment or telecommuting or 

establishing a small business operation as an employment outcome.

    (t) Other goods and services determined necessary for the 

individual with a disability to achieve an employment outcome.

 

(Authority: Section 103(a) of the Act; 29 U.S.C. 723(a))

 

 

Sec. 361.49  Scope of vocational rehabilitation services for groups of 

individuals with disabilities.

 

    (a) The designated State unit may also provide for the following 

vocational rehabilitation services for the benefit of groups of 

individuals with disabilities:

    (1) The establishment, development, or improvement of a public or 

other nonprofit community rehabilitation program that is used to 

provide vocational rehabilitation services that promote integration and 

competitive employment, including, under special circumstances, the 

construction of a facility for a public or nonprofit community 

rehabilitation program. Examples of ``special circumstances'' include 

the destruction by natural disaster of the only available center 

serving an area or a State determination that construction is necessary 

in a rural area because no other public agencies or private nonprofit 

organizations are currently able to provide vocational rehabilitation 

services to individuals.

    (2) Telecommunications systems that have the potential for 

substantially improving vocational rehabilitation service delivery 

methods and developing appropriate programming to meet the particular 

needs of individuals with disabilities, including telephone, 

television, video description services, satellite, tactile-vibratory 

devices, and similar systems, as appropriate.

    (3) Special services to provide nonvisual access to information for 

individuals who are blind, including the use of telecommunications, 

Braille, sound recordings, or other appropriate media; captioned 

television, films, or video cassettes for individuals who are deaf or 

hard of hearing; tactile materials for individuals who are deaf-blind; 

and other special services that provide information through tactile, 

vibratory, auditory, and visual media.

    (4) Technical assistance and support services to businesses that 

are not subject to Title I of the Americans with Disabilities Act of 

1990 and that are seeking to employ individuals with disabilities.

    (5) In the case of any small business enterprise operated by 

individuals with significant disabilities under the supervision of the 

designated State unit, including enterprises established under the 

Randolph-Sheppard program, management services and supervision provided 

by the State unit along with the acquisition by the State unit of 

vending facilities or other equipment, initial stocks and supplies, and 

initial operating expenses, in accordance with the following 

requirements:

    (i) ``Management services and supervision'' includes inspection, 

quality control, consultation, accounting, regulating, in-service 

training, and related services provided on a systematic basis to 

support and improve small business enterprises operated by individuals 

with significant disabilities. ``Management services and supervision'' 

may be provided throughout the operation of the small business 

enterprise.

    (ii) ``Initial stocks and supplies'' includes those items necessary 

to the establishment of a new business enterprise during the initial 

establishment period, which may not exceed 6 months.

    (iii) Costs of establishing a small business enterprise may include 

operational costs during the initial establishment period, which may 

not exceed 6 months.

    (iv) If the designated State unit provides for these services, it 

must ensure that only individuals with significant disabilities will be 

selected to participate in this supervised program.

    (v) If the designated State unit provides for these services and 

chooses to set aside funds from the proceeds of the operation of the 

small business enterprises, the State unit must maintain a description 

of the methods used in setting aside funds and the purposes for which 

funds are set aside. Funds may be used only for small business 

enterprises purposes, and benefits that are provided to operators from 

set-aside funds must be provided on an equitable basis.

    (6) Other services that promise to contribute substantially to the 

rehabilitation of a group of individuals but that are not related 

directly to the individualized plan for employment of any one 

individual. Examples of those other services might include the purchase 

or lease of a bus to provide transportation to a group of applicants or 

eligible individuals or the purchase of equipment or instructional 

materials that would benefit a group of applicants or eligible 

individuals.

    (7) Consultative and technical assistance services to assist 

educational agencies in planning for the transition of students with 

disabilities from school to post-school activities, including 

employment.

 

[[Page 4408]]

 

    (b) If the designated State unit provides for vocational 

rehabilitation services for groups of individuals, it must--

    (1) Develop and maintain written policies covering the nature and 

scope of each of the vocational rehabilitation services it provides and 

the criteria under which each service is provided; and

    (2) Maintain information to ensure the proper and efficient 

administration of those services in the form and detail and at the time 

required by the Secretary, including the types of services provided, 

the costs of those services, and, to the extent feasible, estimates of 

the numbers of individuals benefiting from those services.

 

(Authority: Sections 12(c), 101(a)(6)(A), and 103(b) of the Act; 29 

U.S.C. 709(c), 721(a)(6), and 723(b))

 

 

Sec. 361.50  Written policies governing the provision of services for 

individuals with disabilities.

 

    (a) Policies. The State unit must develop and maintain written 

policies covering the nature and scope of each of the vocational 

rehabilitation services specified in Sec. 361.48 and the criteria under 

which each service is provided. The policies must ensure that the 

provision of services is based on the rehabilitation needs of each 

individual as identified in that individual's IPE and is consistent 

with the individual's informed choice. The written policies may not 

establish any arbitrary limits on the nature and scope of vocational 

rehabilitation services to be provided to the individual to achieve an 

employment outcome. The policies must be developed in accordance with 

the following provisions:

    (b) Out-of-State services.

    (1) The State unit may establish a preference for in-State 

services, provided that the preference does not effectively deny an 

individual a necessary service. If the individual chooses an out-of-

State service at a higher cost than an in-State service, if either 

service would meet the individual's rehabilitation needs, the 

designated State unit is not responsible for those costs in excess of 

the cost of the in-State service.

    (2) The State unit may not establish policies that effectively 

prohibit the provision of out-of-State services.

    (c) Payment for services.

    (1) The State unit must establish and maintain written policies to 

govern the rates of payment for all purchased vocational rehabilitation 

services.

    (2) The State unit may establish a fee schedule designed to ensure 

a reasonable cost to the program for each service, if the schedule is--

    (i) Not so low as to effectively deny an individual a necessary 

service; and

    (ii) Not absolute and permits exceptions so that individual needs 

can be addressed.

    (3) The State unit may not place absolute dollar limits on specific 

service categories or on the total services provided to an individual.

    (d) Duration of services.

    (1) The State unit may establish reasonable time periods for the 

provision of services provided that the time periods are--

    (i) Not so short as to effectively deny an individual a necessary 

service; and

    (ii) Not absolute and permit exceptions so that individual needs 

can be addressed.

    (2) The State unit may not establish absolute time limits on the 

provision of specific services or on the provision of services to an 

individual. The duration of each service needed by an individual must 

be determined on an individual basis and reflected in that individual's 

individualized plan for employment.

    (e) Authorization of services. The State unit must establish 

policies related to the timely authorization of services, including any 

conditions under which verbal authorization can be given.

 

(Authority: Sections 12(c) and 101(a)(6) of the Act and 29 U.S.C. 

709(c) and 721(a)(6))

 

Sec. 361.51  Standards for facilities and providers of services.

 

    (a) Accessibility of facilities. The State plan must assure that 

any facility used in connection with the delivery of vocational 

rehabilitation services under this part meets program accessibility 

requirements consistent with the requirements, as applicable, of the 

Architectural Barriers Act of 1968, the Americans with Disabilities Act 

of 1990, section 504 of the Act, and the regulations implementing these 

laws.

    (b) Affirmative action. The State plan must assure that community 

rehabilitation programs that receive assistance under part B of Title I 

of the Act take affirmative action to employ and advance in employment 

qualified individuals with disabilities covered under and on the same 

terms and conditions as in section 503 of the Act.

    (c) Special communication needs personnel. The designated State 

unit must ensure that providers of vocational rehabilitation services 

are able to communicate--

    (1) In the native language of applicants and eligible individuals 

who have limited English speaking ability; and

    (2) By using appropriate modes of communication used by applicants 

and eligible individuals.

 

(Authority: Sections 12(c) and 101(a)(6)(B) and (C) of the Act; 29 

U.S.C. 709(c) and 721(a)(6)(B) and (C))

 

Sec. 361.52  Informed choice.

 

    (a) General provision. The State plan must assure that applicants 

and eligible individuals or, as appropriate, their representatives are 

provided information and support services to assist applicants and 

eligible individuals in exercising informed choice throughout the 

rehabilitation process consistent with the provisions of section 102(d) 

of the Act and the requirements of this section.

    (b) Written policies and procedures. The designated State unit, in 

consultation with its State Rehabilitation Council, if it has a 

Council, must develop and implement written policies and procedures 

that enable an applicant or eligible individual to exercise informed 

choice throughout the vocational rehabilitation process. These policies 

and procedures must provide for--

    (1) Informing each applicant and eligible individual (including 

students with disabilities who are making the transition from programs 

under the responsibility of an educational agency to programs under the 

responsibility of the designated State unit), through appropriate modes 

of communication, about the availability of and opportunities to 

exercise informed choice, including the availability of support 

services for individuals with cognitive or other disabilities who 

require assistance in exercising informed choice throughout the 

vocational rehabilitation process;

    (2) Assisting applicants and eligible individuals in exercising 

informed choice in decisions related to the provision of assessment 

services;

    (3) Developing and implementing flexible procurement policies and 

methods that facilitate the provision of vocational rehabilitation 

services and that afford eligible individuals meaningful choices among 

the methods used to procure vocational rehabilitation services;

    (4) Assisting eligible individuals or, as appropriate, the 

individuals' representatives in acquiring information that enables them 

to exercise informed choice in the development of their IPEs with 

respect to the selection of the--

    (i) Employment outcome;

    (ii) Specific vocational rehabilitation services needed to achieve 

the employment outcome;

 

[[Page 4409]]

 

    (iii) Entity that will provide the services;

    (iv) Employment setting and the settings in which the services will 

be provided; and

    (v) Methods available for procuring the services; and

    (5) Ensuring that the availability and scope of informed choice is 

consistent with the obligations of the designated State agency under 

this part.

    (c) Information and assistance in the selection of vocational 

rehabilitation services and service providers. In assisting an 

applicant and eligible individual in exercising informed choice during 

the assessment for determining eligibility and vocational 

rehabilitation needs and during development of the IPE, the designated 

State unit must provide the individual or the individual's 

representative, or assist the individual or the individual's 

representative in acquiring, information necessary to make an informed 

choice about the specific vocational rehabilitation services, including 

the providers of those services, that are needed to achieve the 

individual's employment outcome. This information must include, at a 

minimum, information relating to the--

    (1) Cost, accessibility, and duration of potential services;

    (2) Consumer satisfaction with those services to the extent that 

information relating to consumer satisfaction is available;

    (3) Qualifications of potential service providers;

    (4) Types of services offered by the potential providers;

    (5) Degree to which services are provided in integrated settings; 

and

    (6) Outcomes achieved by individuals working with service 

providers, to the extent that such information is available.

    (d) Methods or sources of information. In providing or assisting 

the individual or the individual's representative in acquiring the 

information required under paragraph (c) of this section, the State 

unit may use, but is not limited to, the following methods or sources 

of information:

    (1) Lists of services and service providers.

    (2) Periodic consumer satisfaction surveys and reports.

    (3) Referrals to other consumers, consumer groups, or disability 

advisory councils qualified to discuss the services or service 

providers.

    (4) Relevant accreditation, certification, or other information 

relating to the qualifications of service providers.

    (5) Opportunities for individuals to visit or experience various 

work and service provider settings.

 

(Authority: Sections 12(c), 101(a)(19); 102(b)(2)(B) and 102(d) of 

the Act; 29 U.S.C. 709(c), 721(a)(19); 722(b)(2)(B) and 722(d))

 

Sec. 361.53  Comparable services and benefits.

 

    (a) Determination of availability. The State plan must assure that 

prior to providing any vocational rehabilitation services, except those 

services listed in paragraph (b) of this section, to an eligible 

individual, or to members of the individual's family, the State unit 

must determine whether comparable services and benefits, as defined in 

Sec. 361.5(b)(10), exist under any other program and whether those 

services and benefits are available to the individual unless such a 

determination would interrupt or delay--

    (1) The progress of the individual toward achieving the employment 

outcome identified in the individualized plan for employment;

    (2) An immediate job placement; or

    (3) The provision of vocational rehabilitation services to any 

individual who is determined to be at extreme medical risk, based on 

medical evidence provided by an appropriate qualified medical 

professional.

    (b) Exempt services. The following vocational rehabilitation 

services described in Sec. 361.48(a) are exempt from a determination of 

the availability of comparable services and benefits under paragraph 

(a) of this section:

    (1) Assessment for determining eligibility and vocational 

rehabilitation needs.

    (2) Counseling and guidance, including information and support 

services to assist an individual in exercising informed choice.

    (3) Referral and other services to secure needed services from 

other agencies, including other components of the statewide workforce 

investment system, if those services are not available under this part.

    (4) Job-related services, including job search and placement 

assistance, job retention services, follow-up services, and follow-

along services.

    (5) Rehabilitation technology, including telecommunications, 

sensory, and other technological aids and devices.

    (6) Post-employment services consisting of the services listed 

under paragraphs (b)(1) through (5) of this section.

    (c) Provision of services.

    (1) If comparable services or benefits exist under any other 

program and are available to the individual at the time needed to 

ensure the progress of the individual toward achieving the employment 

outcome in the individual's IPE, the designated State unit must use 

those comparable services or benefits to meet, in whole or part, the 

costs of the vocational rehabilitation services.

    (2) If comparable services or benefits exist under any other 

program, but are not available to the individual at the time needed to 

ensure the progress of the individual toward achieving the employment 

outcome in the individual's IPE, the designated State unit must provide 

vocational rehabilitation services until those comparable services and 

benefits become available.

    (d) Interagency coordination.

    (1) The State plan must assure that the Governor, in consultation 

with the entity in the State responsible for the vocational 

rehabilitation program and other appropriate agencies, will ensure that 

an interagency agreement or other mechanism for interagency 

coordination takes effect between the designated State vocational 

rehabilitation unit and any appropriate public entity, including the 

State entity responsible for administering the State medicaid program, 

a public institution of higher education, and a component of the 

statewide workforce investment system, to ensure the provision of 

vocational rehabilitation services (other than those services listed in 

paragraph (b) of this section) that are included in the IPE, including 

the provision of those vocational rehabilitation services during the 

pendency of any interagency dispute in accordance with the provisions 

of paragraph (d)(3)(iii) of this section.

    (2) The Governor may meet the requirements of paragraph (d)(1) of 

this section through--

    (i) A State statute or regulation;

    (ii) A signed agreement between the respective officials of the 

public entities that clearly identifies the responsibilities of each 

public entity for the provision of the services; or

    (iii) Another appropriate mechanism as determined by the designated 

State vocational rehabilitation unit.

    (3) The interagency agreement or other mechanism for interagency 

coordination must include the following:

    (i) Agency financial responsibility. An identification of, or 

description of a method for defining, the financial responsibility of 

the public entity for providing the vocational rehabilitation services 

other than those listed in paragraph (b) of this section and a 

provision stating the financial

 

[[Page 4410]]

 

responsibility of the public entity for providing those services.

    (ii) Conditions, terms, and procedures of reimbursement. 

Information specifying the conditions, terms, and procedures under 

which the designated State unit must be reimbursed by the other public 

entities for providing vocational rehabilitation services based on the 

terms of the interagency agreement or other mechanism for interagency 

coordination.

    (iii) Interagency disputes. Information specifying procedures for 

resolving interagency disputes under the interagency agreement or other 

mechanism for interagency coordination, including procedures under 

which the designated State unit may initiate proceedings to secure 

reimbursement from other public entities or otherwise implement the 

provisions of the agreement or mechanism.

    (iv) Procedures for coordination of services. Information 

specifying policies and procedures for public entities to determine and 

identify interagency coordination responsibilities of each public 

entity to promote the coordination and timely delivery of vocational 

rehabilitation services other than those listed in paragraph (b) of 

this section.

    (e) Responsibilities under other law.

    (1) If a public entity (other than the designated State unit) is 

obligated under Federal law (such as the Americans with Disabilities 

Act, section 504 of the Act, or section 188 of the Workforce Investment 

Act) or State law, or assigned responsibility under State policy or an 

interagency agreement established under this section, to provide or pay 

for any services considered to be vocational rehabilitation services 

(e.g., interpreter services under Sec. 361.48(j)), other than those 

services listed in paragraph (b) of this section, the public entity 

must fulfill that obligation or responsibility through--

    (i) The terms of the interagency agreement or other requirements of 

this section;

    (ii) Providing or paying for the service directly or by contract; 

or

    (iii) Other arrangement.

    (2) If a public entity other than the designated State unit fails 

to provide or pay for vocational rehabilitation services for an 

eligible individual as established under this section, the designated 

State unit must provide or pay for those services to the individual and 

may claim reimbursement for the services from the public entity that 

failed to provide or pay for those services. The public entity must 

reimburse the designated State unit pursuant to the terms of the 

interagency agreement or other mechanism described in paragraph (d) of 

this section in accordance with the procedures established in the 

agreement or mechanism pursuant to paragraph (d)(3)(ii) of this 

section.

 

(Authority: Sections 12(c) and 101(a)(8) of the Act; 29 U.S.C. 

709(c) and 721(a)(8))

 

Sec. 361.54  Participation of individuals in cost of services based on 

financial need.

 

    (a) No Federal requirement. There is no Federal requirement that 

the financial need of individuals be considered in the provision of 

vocational rehabilitation services.

    (b) State unit requirements. 

    (1) The State unit may choose to consider the financial need of 

eligible individuals or individuals who are receiving services through 

trial work experiences under Sec. 361.42(e) or during an extended 

evaluation under Sec. 361.42(f) for purposes of determining the extent 

of their participation in the costs of vocational rehabilitation 

services, other than those services identified in paragraph (b)(3) of 

this section.

    (2) If the State unit chooses to consider financial need--

    (i) It must maintain written policies--

    (A) Explaining the method for determining the financial need of an 

eligible individual; and

    (B) Specifying the types of vocational rehabilitation services for 

which the unit has established a financial needs test;

    (ii) The policies must be applied uniformly to all individuals in 

similar circumstances;

    (iii) The policies may require different levels of need for 

different geographic regions in the State, but must be applied 

uniformly to all individuals within each geographic region; and

    (iv) The policies must ensure that the level of an individual's 

participation in the cost of vocational rehabilitation services is--

    (A) Reasonable;

    (B) Based on the individual's financial need, including 

consideration of any disability-related expenses paid by the 

individual; and

    (C) Not so high as to effectively deny the individual a necessary 

service.

    (3) The designated State unit may not apply a financial needs test, 

or require the financial participation of the individual--

    (i) As a condition for furnishing the following vocational 

rehabilitation services:

    (A) Assessment for determining eligibility and priority for 

services under Sec. 361.48(a), except those non-assessment services 

that are provided to an individual with a significant disability during 

either an exploration of the individual's abilities, capabilities, and 

capacity to perform in work situations through the use of trial work 

experiences under Sec. 361.42(e) or an extended evaluation under 

Sec. 361.42(f).

    (B) Assessment for determining vocational rehabilitation needs 

under Sec. 361.48(b).

    (C) Vocational rehabilitation counseling and guidance under 

Sec. 361.48(c).

    (D) Referral and other services under Sec. 361.48(d).

    (E) Job-related services under Sec. 361.48(l).

    (F) Personal assistance services under Sec. 361.48(n).

    (G) Any auxiliary aid or service (e.g., interpreter services under 

Sec. 361.48(j), reader services under Sec. 361.48(k)) that an 

individual with a disability requires under section 504 of the Act (29 

U.S.C. 794) or the Americans with Disabilities Act (42 U.S.C. 12101, et 

seq.), or regulations implementing those laws, in order for the 

individual to participate in the VR program as authorized under this 

part; or

    (ii) As a condition for furnishing any vocational rehabilitation 

service if the individual in need of the service has been determined 

eligible for Social Security benefits under Titles II or XVI of the 

Social Security Act.

 

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

 

Sec. 361.55  Annual review of individuals in extended employment or 

other employment under special certificate provisions of the Fair Labor 

Standards Act.

 

    The State plan must assure that the designated State unit--

    (a) Annually reviews and reevaluates the status of each individual 

with a disability served under the vocational rehabilitation program 

who has achieved an employment outcome either in an extended employment 

setting in a community rehabilitation program or in any other 

employment setting in which the individual is compensated in accordance 

with section 14(c) of the Fair Labor Standards Act for 2 years after 

the individual achieves the employment outcome (and thereafter if 

requested by the individual or, if appropriate, the individual's 

representative) to determine the interests, priorities, and needs of 

the individual with respect to competitive employment or training for 

competitive employment;

    (b) Enables the individual or, if appropriate, the individual's

 

[[Page 4411]]

 

representative to provide input into the review and reevaluation and 

documents that input in the record of services, consistent with 

Sec. 361.47(a)(10), with the individual's or, as appropriate, the 

individual's representative's signed acknowledgment that the review and 

reevaluation have been conducted; and

    (c) Makes maximum efforts, including identifying and providing 

vocational rehabilitation services, reasonable accommodations, and 

other necessary support services, to assist the individuals identified 

in paragraph (a) of this section in engaging in competitive employment 

as defined in Sec. 361.5(b)(11).

 

(Authority: Section 101(a)(14) of the Act; 29 U.S.C. 721(a)(14))

 

 

Sec. 361.56  Requirements for closing the record of services of an 

individual who has achieved an employment outcome.

 

    The record of services of an individual who has achieved an 

employment outcome may be closed only if all of the following 

requirements are met:

    (a) Employment outcome achieved. The individual has achieved the 

employment outcome that is described in the individual's IPE in 

accordance with Sec. 361.46(a)(1) and is--

    (1) Consistent with the individual's strengths, resources, 

priorities, concerns, abilities, capabilities, interests, and informed 

choice; and (2) In the most integrated setting possible, consistent 

with the individual's informed choice.

    (b) Employment outcome maintained. The individual has maintained 

the employment outcome for an appropriate period of time, but not less 

than 90 days, necessary to ensure the stability of the employment 

outcome, and the individual no longer needs vocational rehabilitation 

services.

    (c) Satisfactory outcome. At the end of the appropriate period 

under paragraph (b) of this section, the individual and the qualified 

rehabilitation counselor employed by the designated State unit consider 

the employment outcome to be satisfactory and agree that the individual 

is performing well in the employment.

    (d) Post-employment services. The individual is informed through 

appropriate modes of communication of the availability of post-

employment services.

 

(Authority: Sections 12(c), 101(a)(6), and 106(a)(2) of the Act; 29 

U.S.C. 711(c), 721(a)(6), and 726(a)(2))

 

Sec. 361.57  Review of determinations made by designated State unit 

personnel.

 

    (a) Procedures. The designated State unit must develop and 

implement procedures to ensure that an applicant or eligible individual 

who is dissatisfied with any determination made by personnel of the 

designated State unit that affects the provision of vocational 

rehabilitation services may request, or, if appropriate, may request 

through the individual's representative, a timely review of that 

determination. The procedures must be in accordance with paragraphs (b) 

through (k) of this section:

    (b) General requirements.

    (1) Notification. Procedures established by the State unit under 

this section must provide an applicant or eligible individual or, as 

appropriate, the individual's representative notice of--

    (i) The right to obtain review of State unit determinations that 

affect the provision of vocational rehabilitation services through an 

impartial due process hearing under paragraph (e) of this section;

    (ii) The right to pursue mediation under paragraph (d) of this 

section with respect to determinations made by designated State unit 

personnel that affect the provision of vocational rehabilitation 

services to an applicant or eligible individual;

    (iii) The names and addresses of individuals with whom requests for 

mediation or due process hearings may be filed;

    (iv) The manner in which a mediator or impartial hearing officer 

may be selected consistent with the requirements of paragraphs (d) and 

(f) of this section; and

    (v) The availability of the client assistance program, established 

under 34 CFR part 370, to assist the applicant or eligible individual 

during mediation sessions or impartial due process hearings.

    (2) Timing. Notice described in paragraph (b)(1) of this section 

must be provided in writing--

    (i) At the time the individual applies for vocational 

rehabilitation services under this part;

    (ii) At the time the individual is assigned to a category in the 

State's order of selection, if the State has established an order of 

selection under Sec. 361.36;

    (iii) At the time the IPE is developed; and

    (iv) Whenever vocational rehabilitation services for an individual 

are reduced, suspended, or terminated.

    (3) Evidence and representation. Procedures established under this 

section must--

    (i) Provide an applicant or eligible individual or, as appropriate, 

the individual's representative with an opportunity to submit during 

mediation sessions or due process hearings evidence and other 

information that supports the applicant's or eligible individual's 

position; and

    (ii) Allow an applicant or eligible individual to be represented 

during mediation sessions or due process hearings by counsel or other 

advocate selected by the applicant or eligible individual.

    (4) Impact on provision of services. The State unit may not 

institute a suspension, reduction, or termination of vocational 

rehabilitation services being provided to an applicant or eligible 

individual, including evaluation and assessment services and IPE 

development, pending a resolution through mediation, pending a decision 

by a hearing officer or reviewing official, or pending informal 

resolution under this section unless--

    (i) The individual or, in appropriate cases, the individual's 

representative requests a suspension, reduction, or termination of 

services; or

    (ii) The State agency has evidence that the services have been 

obtained through misrepresentation, fraud, collusion, or criminal 

conduct on the part of the individual or the individual's 

representative.

    (5) Ineligibility. Applicants who are found ineligible for 

vocational rehabilitation services and previously eligible individuals 

who are determined to be no longer eligible for vocational 

rehabilitation services pursuant to Sec. 361.43 are permitted to 

challenge the determinations of ineligibility under the procedures 

described in this section.

    (c) Informal dispute resolution. The State unit may develop an 

informal process for resolving a request for review without conducting 

mediation or a formal hearing. A State's informal process must not be 

used to deny the right of an applicant or eligible individual to a 

hearing under paragraph (e) of this section or any other right provided 

under this part, including the right to pursue mediation under 

paragraph (d) of this section. If informal resolution under this 

paragraph or mediation under paragraph (d) of this section is not 

successful in resolving the dispute within the time period established 

under paragraph (e)(1) of this section, a formal hearing must be 

conducted within that same time period, unless the parties agree to a 

specific extension of time.

 

[[Page 4412]]

 

    (d) Mediation.

    (1) The State must establish and implement procedures, as required 

under paragraph (b)(1)(ii) of this section, to allow an applicant or 

eligible individual and the State unit to resolve disputes involving 

State unit determinations that affect the provision of vocational 

rehabilitation services through a mediation process that must be made 

available, at a minimum, whenever an applicant or eligible individual 

or, as appropriate, the individual's representative requests an 

impartial due process hearing under this section.

    (2) Mediation procedures established by the State unit under 

paragraph (d) must ensure that--

    (i) Participation in the mediation process is voluntary on the part 

of the applicant or eligible individual, as appropriate, and on the 

part of the State unit;

    (ii) Use of the mediation process is not used to deny or delay the 

applicant's or eligible individual's right to pursue resolution of the 

dispute through an impartial hearing held within the time period 

specified in paragraph (e)(1) of this section or any other rights 

provided under this part. At any point during the mediation process, 

either party or the mediator may elect to terminate the mediation. In 

the event mediation is terminated, either party may pursue resolution 

through an impartial hearing;

    (iii) The mediation process is conducted by a qualified and 

impartial mediator, as defined in Sec. 361.5(b)(43), who must be 

selected from a list of qualified and impartial mediators maintained by 

the State--

    (A) On a random basis;

    (B) By agreement between the director of the designated State unit 

and the applicant or eligible individual or, as appropriate, the 

individual's representative; or

    (C) In accordance with a procedure established in the State for 

assigning mediators, provided this procedure ensures the neutrality of 

the mediator assigned; and

    (iv) Mediation sessions are scheduled and conducted in a timely 

manner and are held in a location and manner that is convenient to the 

parties to the dispute.

    (3) Discussions that occur during the mediation process must be 

kept confidential and may not be used as evidence in any subsequent due 

process hearings or civil proceedings, and the parties to the mediation 

process may be required to sign a confidentiality pledge prior to the 

commencement of the process.

    (4) An agreement reached by the parties to the dispute in the 

mediation process must be described in a written mediation agreement 

that is developed by the parties with the assistance of the qualified 

and impartial mediator and signed by both parties. Copies of the 

agreement must be sent to both parties.

    (5) The costs of the mediation process must be paid by the State. 

The State is not required to pay for any costs related to the 

representation of an applicant or eligible individual authorized under 

paragraph (b)(3)(ii) of this section.

    (e) Impartial due process hearings. The State unit must establish 

and implement formal review procedures, as required under paragraph 

(b)(1)(i) of this section, that provide that--

    (1) A hearing conducted by an impartial hearing officer, selected 

in accordance with paragraph (f) of this section, must be held within 

60 days of an applicant's or eligible individual's request for review 

of a determination made by personnel of the State unit that affects the 

provision of vocational rehabilitation services to the individual, 

unless informal resolution or a mediation agreement is achieved prior 

to the 60th day or the parties agree to a specific extension of time;

    (2) In addition to the rights described in paragraph (b)(3) of this 

section, the applicant or eligible individual or, if appropriate, the 

individual's representative must be given the opportunity to present 

witnesses during the hearing and to examine all witnesses and other 

relevant sources of information and evidence;

    (3) The impartial hearing officer must--

    (i) Make a decision based on the provisions of the approved State 

plan, the Act, Federal vocational rehabilitation regulations, and State 

regulations and policies that are consistent with Federal requirements; 

and

    (ii) Provide to the individual or, if appropriate, the individual's 

representative and to the State unit a full written report of the 

findings and grounds for the decision within 30 days of the completion 

of the hearing; and

    (4) The hearing officer's decision is final, except that a party 

may request an impartial review under paragraph (g)(1) of this section 

if the State has established procedures for that review, and a party 

involved in a hearing may bring a civil action under paragraph (i) of 

this section.

    (f) Selection of impartial hearing officers. The impartial hearing 

officer for a particular case must be selected--

    (1) From a list of qualified impartial hearing officers maintained 

by the State unit. Impartial hearing officers included on the list must 

be--

    (i) Identified by the State unit if the State unit is an 

independent commission; or

    (ii) Jointly identified by the State unit and the State 

Rehabilitation Council if the State has a Council; and

    (2)(i) On a random basis; or

    (ii) By agreement between the director of the designated State unit 

and the applicant or eligible individual or, as appropriate, the 

individual's representative.

    (g) Administrative review of hearing officer's decision. The State 

may establish procedures to enable a party who is dissatisfied with the 

decision of the impartial hearing officer to seek an impartial 

administrative review of the decision under paragraph (e)(3) of this 

section in accordance with the following requirements:

    (1) A request for administrative review under paragraph (g) of this 

section must be made within 20 days of the mailing of the impartial 

hearing officer's decision.

    (2) Administrative review of the hearing officer's decision must be 

conducted by--

    (i) The chief official of the designated State agency if the State 

has established both a designated State agency and a designated State 

unit under Sec. 361.13(b); or

    (ii) An official from the office of the Governor.

    (3) The reviewing official described in paragraph (g)(2)(i) of this 

section--

    (i) Provides both parties with an opportunity to submit additional 

evidence and information relevant to a final decision concerning the 

matter under review;

    (ii) May not overturn or modify the hearing officer's decision, or 

any part of that decision, that supports the position of the applicant 

or eligible individual unless the reviewing official concludes, based 

on clear and convincing evidence, that the decision of the impartial 

hearing officer is clearly erroneous on the basis of being contrary to 

the approved State plan, the Act, Federal vocational rehabilitation 

regulations, or State regulations and policies that are consistent with 

Federal requirements;

    (iii) Makes an independent, final decision following a review of 

the entire hearing record and provides the decision in writing, 

including a full report of the findings and the statutory, regulatory, 

or policy grounds for the decision, to the applicant or eligible 

individual or, as appropriate, the individual's representative and to 

the State unit within 30 days of the request

 

[[Page 4413]]

 

for administrative review under paragraph (g)(1) of this section; and

    (iv) May not delegate the responsibility for making the final 

decision under paragraph (g) of this section to any officer or employee 

of the designated State unit.

    (4) The reviewing official's decision under paragraph (g) of this 

section is final unless either party brings a civil action under 

paragraph (i) of this section.

    (h) Implementation of final decisions. If a party brings a civil 

action under paragraph (h) of this section to challenge the final 

decision of a hearing officer under paragraph (e) of this section or to 

challenge the final decision of a State reviewing official under 

paragraph (g) of this section, the final decision of the hearing 

officer or State reviewing official must be implemented pending review 

by the court.

    (i) Civil action.

    (1) Any party who disagrees with the findings and decision of an 

impartial hearing officer under paragraph (e) of this section in a 

State that has not established administrative review procedures under 

paragraph (g) of this section and any party who disagrees with the 

findings and decision under paragraph (g)(3)(iii) of this section have 

a right to bring a civil action with respect to the matter in dispute. 

The action may be brought in any State court of competent jurisdiction 

or in a district court of the United States of competent jurisdiction 

without regard to the amount in controversy.

    (2) In any action brought under paragraph (i) of this section, the 

court--

    (i) Receives the records related to the impartial due process 

hearing and the records related to the administrative review process, 

if applicable;

    (ii) Hears additional evidence at the request of a party; and

    (iii) Basing its decision on the preponderance of the evidence, 

grants the relief that the court determines to be appropriate.

    (j) State fair hearing board. A fair hearing board as defined in 

Sec. 361.5(b)(22) is authorized to carry out the responsibilities of 

the impartial hearing officer under paragraph (e) of this section in 

accordance with the following criteria:

    (1) The fair hearing board may conduct due process hearings either 

collectively or by assigning responsibility for conducting the hearing 

to one or more members of the fair hearing board.

    (2) The final decision issued by the fair hearing board following a 

hearing under paragraph (j)(1) of this section must be made 

collectively by, or by a majority vote of, the fair hearing board.

    (3) The provisions of paragraphs (b)(1), (2), and (3) of this 

section that relate to due process hearings and of paragraphs (e), (f), 

(g), and (h) of this section do not apply to fair hearing boards under 

this paragraph (j).

    (k) Data collection.

    (1) The director of the designated State unit must collect and 

submit, at a minimum, the following data to the Commissioner of the 

Rehabilitation Services Administration (RSA) for inclusion each year in 

the annual report to Congress under section 13 of the Act:

    (i) A copy of the standards used by State reviewing officials for 

reviewing decisions made by impartial hearing officers under this 

section.

    (ii) The number of mediations held, including the number of 

mediation agreements reached.

    (iii) The number of hearings and reviews sought from impartial 

hearing officers and State reviewing officials, including the type of 

complaints and the issues involved.

    (iv) The number of hearing officer decisions that were not reviewed 

by administrative reviewing officials.

    (v) The number of hearing decisions that were reviewed by State 

reviewing officials and, based on these reviews, the number of hearing 

decisions that were--

    (A) Sustained in favor of an applicant or eligible individual;

    (B) Sustained in favor of the designated State unit;

    (C) Reversed in whole or in part in favor of the applicant or 

eligible individual; and

    (D) Reversed in whole or in part in favor of the State unit.

    (2) The State unit director also must collect and submit to the 

Commissioner of RSA copies of all final decisions issued by impartial 

hearing officers under paragraph (e) of this section and by State 

review officials under paragraph (g) of this section.

    (3) The confidentiality of records of applicants and eligible 

individuals maintained by the State unit may not preclude the access of 

the RSA Commissioner to those records for the purposes described in 

this section.

 

(Authority: Section 102(c) of the Act; 29 U.S.C. 722(c))

 

Subpart C--Financing of State Vocational Rehabilitation Programs

 

 

Sec. 361.60  Matching requirements.

 

    (a) Federal share.

    (1) General. Except as provided in paragraph (a)(2) of this 

section, the Federal share for expenditures made by the State under the 

State plan, including expenditures for the provision of vocational 

rehabilitation services and the administration of the State plan, is 

78.7 percent.

    (2) Construction projects. The Federal share for expenditures made 

for the construction of a facility for community rehabilitation program 

purposes may not be more than 50 percent of the total cost of the 

project.

    (b) Non-Federal share.

    (1) General. Except as provided in paragraph (b)(2) and (3) of this 

section, expenditures made under the State plan to meet the non-Federal 

share under this section must be consistent with the provisions of 34 

CFR 80.24.

    (2) Third party in-kind contributions. Third party in-kind 

contributions specified in 34 CFR 80.24(a)(2) may not be used to meet 

the non-Federal share under this section.

    (3) Contributions by private entities. Expenditures made from 

contributions by private organizations, agencies, or individuals that 

are deposited in the account of the State agency or sole local agency 

in accordance with State law and that are earmarked, under a condition 

imposed by the contributor, may be used as part of the non-Federal 

share under this section if the funds are earmarked for--

    (i) Meeting in whole or in part the State's share for establishing 

a community rehabilitation program or constructing a particular 

facility for community rehabilitation program purposes;

    (ii) Particular geographic areas within the State for any purpose 

under the State plan, other than those described in paragraph (b)(3)(i) 

of this section, in accordance with the following criteria:

    (A) Before funds that are earmarked for a particular geographic 

area may be used as part of the non-Federal share, the State must 

notify the Secretary that the State cannot provide the full non-Federal 

share without using these funds.

    (B) Funds that are earmarked for a particular geographic area may 

be used as part of the non-Federal share without requesting a waiver of 

statewideness under Sec. 361.26.

    (C) Except as provided in paragraph (b)(3)(i) of this section, all 

Federal funds must be used on a statewide basis consistent with 

Sec. 361.25, unless a waiver of statewideness is obtained under 

Sec. 361.26; and

    (iii) Any other purpose under the State plan, provided the 

expenditures do not benefit in any way the donor, an individual to whom 

the donor is related by blood or marriage or with whom the donor has a 

close personal relationship,

 

[[Page 4414]]

 

or an individual, entity, or organization with whom the donor shares a 

financial interest. The Secretary does not consider a donor's receipt 

from the State unit of a grant, subgrant, or contract with funds 

allotted under this part to be a benefit for the purposes of this 

paragraph if the grant, subgrant, or contract is awarded under the 

State's regular competitive procedures.

 

(Authority: Sections 7(14), 101(a)(3), 101(a)(4) and 104 of the Act; 

29 U.S.C. 706(14), 721(a)(3), 721(a)(4) and 724))

 

    Example for paragraph (b)(3): Contributions may be earmarked in 

accordance with Sec. 361.60(b)(3)(iii) for providing particular 

services (e.g., rehabilitation technology services); serving 

individuals with certain types of disabilities (e.g., individuals 

who are blind), consistent with the State's order of selection, if 

applicable; providing services to special groups that State or 

Federal law permits to be targeted for services (e.g., students with 

disabilities who are receiving special education services), 

consistent with the State's order of selection, if applicable; or 

carrying out particular types of administrative activities 

permissible under State law. Contributions also may be restricted to 

particular geographic areas to increase services or expand the scope 

of services that are available statewide under the State plan in 

accordance with the requirements in Sec. 361.60(b)(3)(ii).

 

 

Sec. 361.61  Limitation on use of funds for construction expenditures.

 

    No more than 10 percent of a State's allotment for any fiscal year 

under section 110 of the Act may be spent on the construction of 

facilities for community rehabilitation program purposes.

 

(Authority: Section 101(a)(17)(A) of the Act; 29 U.S.C. 

721(a)(17)(A))

 

Sec. 361.62  Maintenance of effort requirements.

 

    (a) General requirements.

 

    (1) The Secretary reduces the amount otherwise payable to a State 

for a fiscal year by the amount by which the total expenditures from 

non-Federal sources under the State plan for the previous fiscal year 

were less than the total of those expenditures for the fiscal year 2 

years prior to the previous fiscal year.

 

    Example: For fiscal year 2001, a State's maintenance of effort 

level is based on the amount of its expenditures from non-Federal 

sources for fiscal year 1999. Thus, if the State's non-Federal 

expenditures in 2001 are less than they were in 1999, the State has 

a maintenance of effort deficit, and the Secretary reduces the 

State's allotment in 2002 by the amount of that deficit.

 

    (2) If, at the time the Secretary makes a determination that a 

State has failed to meet its maintenance of effort requirements, it is 

too late for the Secretary to make a reduction in accordance with 

paragraph (a)(1) of this section, then the Secretary recovers the 

amount of the maintenance of effort deficit through audit disallowance.

    (b) Specific requirements for construction of facilities. If the 

State provides for the construction of a facility for community 

rehabilitation program purposes, the amount of the State's share of 

expenditures for vocational rehabilitation services under the plan, 

other than for the construction of a facility for community 

rehabilitation program purposes or the establishment of a facility for 

community rehabilitation purposes, must be at least equal to the 

expenditures for those services for the second prior fiscal year. If a 

State fails to meet the requirements of this paragraph, the Secretary 

recovers the amount of the maintenance of effort deficit through audit 

disallowance.

    (c) Separate State agency for vocational rehabilitation services 

for individuals who are blind. If there is a separate part of the State 

plan administered by a separate State agency to provide vocational 

rehabilitation services for individuals who are blind--

    (1) Satisfaction of the maintenance of effort requirements under 

paragraphs (a) and (b) of this section are determined based on the 

total amount of a State's non-Federal expenditures under both parts of 

the State plan; and

    (2) If a State fails to meet any maintenance of effort requirement, 

the Secretary reduces the amount otherwise payable to the State for 

that fiscal year under each part of the plan in direct relation to the 

amount by which expenditures from non-Federal sources under each part 

of the plan in the previous fiscal year were less than they were for 

that part of the plan for the fiscal year 2 years prior to the previous 

fiscal year.

    (d) Waiver or modification.

    (1) The Secretary may waive or modify the maintenance of effort 

requirement in paragraph (a)(1) of this section if the Secretary 

determines that a waiver or modification is necessary to permit the 

State to respond to exceptional or uncontrollable circumstances, such 

as a major natural disaster or a serious economic downturn, that--

    (i) Cause significant unanticipated expenditures or reductions in 

revenue that result in a general reduction of programs within the 

State; or

    (ii) Require the State to make substantial expenditures in the 

vocational rehabilitation program for long-term purposes due to the 

one-time costs associated with the construction of a facility for 

community rehabilitation program purposes, the establishment of a 

facility for community rehabilitation program purposes, or the 

acquisition of equipment.

    (2) The Secretary may waive or modify the maintenance of effort 

requirement in paragraph (b) of this section or the 10 percent 

allotment limitation in Sec. 361.61 if the Secretary determines that a 

waiver or modification is necessary to permit the State to respond to 

exceptional or uncontrollable circumstances, such as a major natural 

disaster, that result in significant destruction of existing facilities 

and require the State to make substantial expenditures for the 

construction of a facility for community rehabilitation program 

purposes or the establishment of a facility for community 

rehabilitation program purposes in order to provide vocational 

rehabilitation services.

    (3) A written request for waiver or modification, including 

supporting justification, must be submitted to the Secretary as soon as 

the State determines that an exceptional or uncontrollable circumstance 

will prevent it from making its required expenditures from non-Federal 

sources.

 

(Authority: Sections 101(a)(17) and 111(a)(2) of the Act; 29 U.S.C. 

721(a)(17) and 731(a)(2))

 

 

Sec. 361.63  Program income.

 

    (a) Definition. For purposes of this section, program income means 

gross income received by the State that is directly generated by an 

activity supported under this part.

    (b) Sources. Sources of program income include, but are not limited 

to, payments from the Social Security Administration for assisting 

Social Security beneficiaries and recipients to achieve employment 

outcomes, payments received from workers' compensation funds, fees for 

services to defray part or all of the costs of services provided to 

particular individuals, and income generated by a State-operated 

community rehabilitation program.

    (c) Use of program income.

    (1) Except as provided in paragraph (c)(2) of this section, program 

income, whenever earned, must be used for the provision of vocational 

rehabilitation services and the administration of the State plan. 

Program income is considered earned when it is received.

    (2) Payments provided to a State from the Social Security 

Administration for assisting Social Security beneficiaries and 

recipients to achieve employment outcomes may also be used to carry out 

programs under part B of Title I of the Act (client assistance), part B 

of Title VI

 

[[Page 4415]]

 

of the Act (supported employment), and Title VII of the Act 

(independent living).

    (3) The State is authorized to treat program income as--

    (i) An addition to the grant funds to be used for additional 

allowable program expenditures, in accordance with 34 CFR 80.25(g)(2); 

or

    (ii) A deduction from total allowable costs, in accordance with 34 

CFR 80.25(g)(1).

    (4) Program income cannot be used to meet the non-Federal share 

requirement under Sec. 361.60.

 

(Authority: Section 108 of the Act; 29 U.S.C. 728; 34 CFR 80.25)

 

 

Sec. 361.64  Obligation of Federal funds and program income.

 

    (a) Except as provided in paragraph (b) of this section, any 

Federal funds, including reallotted funds, that are appropriated for a 

fiscal year to carry out a program under this part that are not 

obligated by the State by the beginning of the succeeding fiscal year 

and any program income received during a fiscal year that is not 

obligated by the State by the beginning of the succeeding fiscal year 

remain available for obligation by the State during that succeeding 

fiscal year.

    (b) Federal funds appropriated for a fiscal year remain available 

for obligation in the succeeding fiscal year only to the extent that 

the State met the matching requirement for those Federal funds by 

obligating, in accordance with 34 CFR 76.707, the non-Federal share in 

the fiscal year for which the funds were appropriated.

 

(Authority: Section 19 of the Act; 29 U.S.C. 716)

 

 

Sec. 361.65  Allotment and payment of Federal funds for vocational 

rehabilitation services.

 

    (a) Allotment.

    (1) The allotment of Federal funds for vocational rehabilitation 

services for each State is computed in accordance with the requirements 

of section 110 of the Act, and payments are made to the State on a 

quarterly basis, unless some other period is established by the 

Secretary.

    (2) If the State plan designates one State agency to administer, or 

supervise the administration of, the part of the plan under which 

vocational rehabilitation services are provided for individuals who are 

blind and another State agency to administer the rest of the plan, the 

division of the State's allotment is a matter for State determination.

    (b) Reallotment.

    (1) The Secretary determines not later than 45 days before the end 

of a fiscal year which States, if any, will not use their full 

allotment.

    (2) As soon as possible, but not later than the end of the fiscal 

year, the Secretary reallots these funds to other States that can use 

those additional funds during the current or subsequent fiscal year, 

provided the State can meet the matching requirement by obligating the 

non-Federal share of any reallotted funds in the fiscal year for which 

the funds were appropriated.

    (3) Funds reallotted to another State are considered to be an 

increase in the recipient State's allotment for the fiscal year for 

which the funds were appropriated.

 

(Authority: Sections 110 and 111 of the Act; 29 U.S.C. 730 and 731)

 

Subpart D--[Reserved]

 

Subpart E--Evaluation Standards and Performance Indicators

 

 

Sec. 361.80  Purpose.

 

    The purpose of this subpart is to establish evaluation standards 

and performance indicators for the Program.

 

(Authority: 29 U.S.C. 726(a))

 

Sec. 361.81  Applicable definitions.

 

    In addition to those definitions in Sec. 361.5(b), the following 

definitions apply to this subpart:

    Average hourly earnings means the average per hour earnings in the 

week prior to exiting the vocational rehabilitation (VR) program of an 

eligible individual who has achieved a competitive employment outcome.

    Business Enterprise Program (BEP) means an employment outcome in 

which an individual with a significant disability operates a vending 

facility or other small business under the management and supervision 

of a designated State unit (DSU). This term includes home industry, 

farming, and other enterprises.

    Exit the VR program means that a DSU has closed the individual's 

record of VR services in one of the following categories:

    (1) Ineligible for VR services.

    (2) Received services under an individualized plan for employment 

(IPE) and achieved an employment outcome.

    (3) Received services under an IPE but did not achieve an 

employment outcome.

    (4) Eligible for VR services but did not receive services under an 

IPE.

    General or combined DSU means a DSU that does not serve exclusively 

individuals with visual impairments or blindness.

    Individuals from a minority background means individuals who report 

their race and ethnicity in any of the following categories: American 

Indian or Alaska Native, Asian, Black or African American, Native 

Hawaiian or Other Pacific Islander, or Hispanic or Latino.

    Minimum wage means the higher of the rate specified in section 

6(a)(1) of the Fair Labor Standards Act of 1938, 29 U.S.C. 206(a)(1), 

(i.e., the Federal minimum wage) or applicable State minimum wage law.

    Non-minority individuals means individuals who report themselves 

exclusively as White, non-Hispanic.

    Performance period is the reporting period during which a DSU's 

performance is measured. For Evaluation Standards 1 and 2, performance 

data must be aggregated and reported for each fiscal year beginning 

with fiscal year 1999. However, DSUs that exclusively serve individuals 

with visual impairments or blindness must report each year the 

aggregated data for the 2 previous years for Performance Indicators 1.1 

through 1.6; the second year must coincide with the performance period 

for general or combined DSUs.

    Primary indicators means Performance Indicators 1.3, 1.4, and 1.5, 

which are specifically designed to measure--

    (1) The achievement of competitive, self-, or BEP employment with 

earnings equivalent to the minimum wage or higher, particularly by 

individuals with significant disabilities; and

    (2) The ratio between the average hourly earnings of individuals 

who exit the VR program in competitive, self-, or BEP employment with 

earnings equivalent to the minimum wage or higher and the State's 

average hourly earnings for all employed individuals.

    RSA-911 means the Case Service Report that is submitted annually by 

a DSU as approved by the Office of Management and Budget (OMB).

    Self-employment means an employment outcome in which the individual 

works for profit or fee in his or her own business, farm, shop, or 

office, including sharecroppers.

    Service rate means the result obtained by dividing the number of 

individuals who exit the VR program after receiving one or more 

services under an IPE during any reporting period by the total number 

of individuals who exit the VR program (as defined in this section) 

during that reporting period.

    State's average hourly earnings means the average hourly earnings 

of all persons in the State in which the DSU is located.

 

 

[[Page 4416]]

 

 

(Authority: 29 U.S.C. 726(a))

 

Sec. 361.82  Evaluation standards.

 

    (a) The Secretary establishes two evaluation standards to evaluate 

the performance of each DSU that receives funds under this part. The 

evaluation standards assist the Secretary and each DSU to evaluate a 

DSU's performance in serving individuals with disabilities under the VR 

program.

    (b) A DSU must achieve successful performance on both evaluation 

standards during each performance period.

    (c) The evaluation standards for the VR program are--

    (1) Evaluation Standard 1--Employment outcomes. A DSU must assist 

any eligible individual, including an individual with a significant 

disability, to obtain, maintain, or regain high-quality employment.

    (2) Evaluation Standard 2--Equal access to services. A DSU must 

ensure that individuals from minority backgrounds have equal access to 

VR services. (Approved by the Office of Management and Budget under 

control number 1820-0508.)

 

 

(Authority: 29 U.S.C. 726(a))

 

Sec. 361.84  Performance indicators.

 

    (a) The performance indicators establish what constitutes minimum 

compliance with the evaluation standards.

    (b) The performance indicators require a DSU to provide information 

on a variety of factors to enable the Secretary to measure compliance 

with the evaluation standards.

    (c) The performance indicators are as follows:

    (1) Employment outcomes. 

    (i) Performance Indicator 1.1. The number of individuals exiting 

the VR program who achieved an employment outcome during the current 

performance period compared to the number of individuals who exit the 

VR program after achieving an employment outcome during the previous 

performance period.

    (ii) Performance Indicator 1.2. Of all individuals who exit the VR 

program after receiving services, the percentage who are determined to 

have achieved an employment outcome.

    (iii) Performance Indicator 1.3. Of all individuals determined to 

have achieved an employment outcome, the percentage who exit the VR 

program in competitive, self-, or BEP employment with earnings 

equivalent to at least the minimum wage.

    (iv) Performance Indicator 1.4. Of all individuals who exit the VR 

program in competitive, self-, or BEP employment with earnings 

equivalent to at least the minimum wage, the percentage who are 

individuals with significant disabilities.

    (v) Performance Indicator 1.5. The average hourly earnings of all 

individuals who exit the VR program in competitive, self-, or BEP 

employment with earnings levels equivalent to at least the minimum wage 

as a ratio to the State's average hourly earnings for all individuals 

in the State who are employed (as derived from the Bureau of Labor 

Statistics report ``State Average Annual Pay'' for the most recent 

available year).

    (vi) Performance Indicator 1.6. Of all individuals who exit the VR 

program in competitive, self-, or BEP employment with earnings 

equivalent to at least the minimum wage, the difference between the 

percentage who report their own income as the largest single source of 

economic support at the time they exit the VR program and the 

percentage who report their own income as the largest single source of 

support at the time they apply for VR services.

    (2) Equal access to services.

    (i) Performance Indicator 2.1. The service rate for all individuals 

with disabilities from minority backgrounds as a ratio to the service 

rate for all non-minority individuals with disabilities.

 

(Approved by the Office of Management and Budget under control 

number 1820-0508.)

 

(Authority: 29 U.S.C. 726(a))

 

 

Sec. 361.86  Performance levels.

 

    (a) General.

    (1) Paragraph (b) of this section establishes performance levels 

for--

    (i) General or combined DSUs; and

    (ii) DSUs serving exclusively individuals who are visually impaired 

or blind.

    (2) The Secretary may establish, by regulations, new performance 

levels.

    (b) Performance levels for each performance indicator.

    (1)(i) The performance levels for Performance Indicators 1.1 

through 1.6 are--

 

----------------------------------------------------------------------------------------------------------------

                                                           Performance level by type of DSU

       Performance indicator        ----------------------------------------------------------------------------

                                                     General/Combined                            Blind

----------------------------------------------------------------------------------------------------------------

1.1................................  Equal or exceed previous performance period....  Same.

1.2................................  55.8%..........................................  68.9%.

1.3................................  72.6%..........................................  35.4%.

1.4................................  62.4%..........................................  89.0%.

1.5................................  .52 (Ratio)....................................  .59.

1.6................................  53.0 (Math. Difference)........................  30.4.

----------------------------------------------------------------------------------------------------------------

 

    (ii) To achieve successful performance on Evaluation Standard 1 

(Employment outcomes), a DSU must meet or exceed the performance levels 

established for four of the six performance indicators in the 

evaluation standard, including meeting or exceeding the performance 

levels for two of the three primary indicators (Performance Indicators 

1.3, 1.4, and 1.5).

    (2)(i) The performance level for Performance Indicator 2.1 is--

 

------------------------------------------------------------------------

         Performance indicator                  Performance levels

------------------------------------------------------------------------

2.1....................................  .80 (Ratio).

------------------------------------------------------------------------

 

    (ii) To achieve successful performance on Evaluation Standard 2 

(Equal access), DSUs must meet or exceed the performance level 

established for Performance Indicator 2.1 or meet the performance 

requirement in paragraph (2)(iii) of this section.

    (iii) If a DSU's performance does not meet or exceed the 

performance level required for Performance Indicator 2.1, or if fewer 

than 100 individuals from a minority population have exited the VR 

program during the reporting period, the DSU must describe the policies 

it has adopted or will adopt and the steps it has taken or will take to 

ensure that individuals with disabilities from minority backgrounds 

have equal access to VR services.

 

(Authority: 29 U.S.C. 726(a))

 

 

Sec. 361.88  Reporting requirements.

 

    (a) The Secretary requires that each DSU report within 60 days 

after the end of each fiscal year the extent to which the State is in 

compliance with the

 

[[Page 4417]]

 

evaluation standards and performance indicators and include in this 

report the following RSA-911 data:

    (1) The number of individuals who exited the VR program in each 

closure category as specified in the definition of ``Exit the VR 

program'' under Sec. 361.81.

    (2) The number of individuals who exited the VR program in 

competitive, self-, or BEP employment with earnings at or above the 

minimum wage.

    (3) The number of individuals with significant disabilities who 

exited the VR program in competitive, self-, or BEP employment with 

earnings at or above the minimum wage.

    (4) The weekly earnings and hours worked of individuals who exited 

the VR program in competitive, self-, or BEP employment with earnings 

at or above the minimum wage.

    (5) The number of individuals who exited the VR program in 

competitive, self-, or BEP employment with earnings at or above the 

minimum wage whose primary source of support at the time they applied 

for VR services was ``personal income.''

    (6) The number of individuals who exited the VR program in 

competitive, self-, or BEP employment with earnings at or above the 

minimum wage whose primary source of support at closure was ``personal 

income.''

    (7) The number of individuals exiting the VR program who are 

individuals from a minority background.

    (8) The number of non-minority individuals exiting the VR program.

    (9) The number of individuals from a minority background exiting 

the VR program after receiving services under an IPE.

    (10) The number of non-minority individuals exiting the VR program 

after receiving services under an IPE.

    (b) In lieu of the report required in paragraph (a) of this 

section, a DSU may submit its RSA-911 data on tape, diskette, or any 

alternative electronic format that is compatible with RSA's capability 

to process such an alternative, as long as the tape, diskette, or 

alternative electronic format includes the data that--

    (1) Are required by paragraph (a)(1) through (10) of this section; 

and

    (2) Meet the requirements of paragraph (c) of this section.

    (c) Data reported by a DSU must be valid, accurate, and in a 

consistent format. If a DSU fails to submit data that are valid, 

accurate, and in a consistent format within the 60-day period, the DSU 

must develop a program improvement plan pursuant to Sec. 361.89(a). 

(Approved by the Office of Management and Budget under control number 

1820-0508.)

 

(Authority: 29 U.S.C. 726(b))

 

 

Sec. 361.89  Enforcement procedures.

 

    (a) If a DSU fails to meet the established performance levels on 

both evaluation standards as required by Sec. 361.82(b), the Secretary 

and the DSU must jointly develop a program improvement plan that 

outlines the specific actions to be taken by the DSU to improve program 

performance.

    (b) In developing the program improvement plan, the Secretary 

considers all available data and information related to the DSU's 

performance.

    (c) When a program improvement plan is in effect, review of the 

plan is conducted on a biannual basis. If necessary, the Secretary may 

request that a DSU make further revisions to the plan to improve 

performance. If the Secretary establishes new performance levels under 

Sec. 361.86(a)(2), the Secretary and the DSU must jointly modify the 

program improvement plan based on the new performance levels. The 

Secretary continues reviews and requests revisions until the DSU 

sustains satisfactory performance based on the current performance 

levels over a period of more than 1 year.

    (d) If the Secretary determines that a DSU with less than 

satisfactory performance has failed to enter into a program improvement 

plan or comply substantially with the terms and conditions of the 

program improvement plan, the Secretary, consistent with the procedures 

specified in Sec. 361.11, reduces or makes no further payments to the 

DSU under this program until the DSU has met one of these two 

requirements or raised its subsequent performance to meet the current 

overall minimum satisfactory level on the compliance indicators.

 

(Approved by the Office of Management and Budget under control 

number 1820-0508.)

 

(Authority: 29 U.S.C. 726(b) and (c))

 

Appendix

 

Analysis of Comments and Changes

 

    Note: The following appendix will not appear in the Code of 

Federal Regulations.

 

Section 361.4--Applicable Regulations

 

    Comments: Several commenters requested clarification of proposed 

Sec. 361.4(c) and (d) that made applicable to the VR program the 

regulations implementing the One-Stop system under Title I of the 

WIA. In particular, these commenters requested that the Secretary 

assure in this section that the regulations governing the One-Stop 

system do not conflict with the regulations in part 361 and that the 

One-Stop system requirements would not apply if conflicts between 

regulatory provisions arise.

    Discussion: Proposed Sec. 361.4(c) listed the regulations in 20 

CFR part 662 (Description of One-Stop Service Delivery System under 

Title I of WIA) among the regulations applicable to the VR program. 

Similarly, proposed Sec. 361.4(d) identified the civil rights 

protections under 29 CFR part 37 (Implementation of the 

Nondiscrimination and Equal Opportunity Provisions of WIA) as 

applicable to VR program activities that are conducted as part of 

the One-Stop system. Citing these parts of Federal regulations is 

intended solely as a means of notifying State units of their 

regulatory obligations as One-Stop system partners.

    Moreover, both Title I of WIA and its implementing regulations 

specify that partner programs, such as the VR program, are to 

participate in applicable One-Stop system activities in a manner 

that is consistent with the Federal law authorizing the individual 

partner program (see e.g., section 121(b)(1)(A)(ii) of WIA; 20 CFR 

662.230(d)). We interpret this requirement to mean that the DSU 

administering the VR program in the State must partner with the 

other components of the One-Stop system in accordance with the 

requirements of both Title I of the Rehabilitation Act of 1973 and 

these final regulations. Given that condition on One-Stop system 

participation, and the fact that these regulations generally govern 

State conduct, we do not consider it appropriate to include in the 

regulations the assurances sought by the commenters. However, we 

emphasize that we have worked closely with the U.S. Department of 

Labor to ensure that the One-Stop system regulations do not conflict 

with VR program requirements. Despite these efforts, we urge State 

units and others to inform us of any apparent conflicts between 

regulatory provisions that arise so that we, along with the 

Department of Labor, can address any inconsistencies that might 

remain.

    Changes: None.

 

Section 361.5(b)--Applicable Definitions

 

     General

    Comments: Several commenters asked that additional terms be 

defined in the final regulations. One commenter requested that a 

definition of ``informed choice'' be added to the regulations. Other 

commenters asked that separate definitions of the terms ``qualified 

vocational rehabilitation counselor'' and ``qualified vocational 

rehabilitation counselor employed by the designated State unit'' be 

included among the regulatory definitions. Finally, some commenters 

asked that ``rehabilitation engineering'' be defined in the final 

regulations since that term is used in the definition of 

``rehabilitation technology,'' while others suggested that 

``mediation'' be defined in the final regulations in order to 

clarify the scope of the mediation process.

    Discussion: We do not believe it is necessary to define 

``informed choice'' in the final regulations. Section 361.52 of both 

the proposed and final regulations, which tracks section 102(d) of 

the Act, enumerates the critical aspects of informed choice and 

reflects the statutory emphasis that individuals participating in 

the VR program must be able to exercise informed choice

 

[[Page 4418]]

 

throughout the entire rehabilitation process. That section of the 

regulations also retains additional choice-related provisions from 

the current regulations, including, in Sec. 361.52(c), the types of 

information that must be provided for an individual to exercise 

choice in selecting VR services and service providers. Thus, 

Sec. 361.52, as a whole, contains a comprehensive list of 

requirements intended to ensure that individuals are given 

meaningful choices, and the opportunity to exercise those choices, 

in each aspect of their rehabilitation, as the Act intends.

    For further discussion of our decision to not define ``informed 

choice,'' please see the analysis of comments to Sec. 361.52 in this 

appendix.

    We agree that clarification is needed concerning the distinction 

between a ``qualified vocational rehabilitation counselor'' and a 

``qualified vocational rehabilitation counselor employed by the 

DSU.'' However, we do not believe that defining these terms would 

provide the necessary clarification since States can readily 

determine which counselors they employ. Rather, we think it would be 

more helpful to further explain the differences between the 

functions that must be performed by DSU and non-DSU counselors. That 

discussion can be found in the analysis of comments received under 

Sec. 361.45.

    We agree that retaining the current regulatory definition of 

``rehabilitation engineering'' would be beneficial.

    Finally, the 1998 Amendments introduced mediation as another 

means for individuals and State units to resolve disputes regarding 

the provision of VR services. Although mediation is new to the VR 

program, it has been used for years in other programs as a less 

adversarial process for resolving disputes than formal due process 

hearings or court litigation. The NPRM provided guidance to States 

in developing their systems of mediation by defining the statutory 

term ``qualified and impartial mediator.'' However, we agree that 

defining ``mediation'' in the regulations would provide further 

clarification.

    We believe it is important that the regulations give States 

sufficient flexibility to establish mediation procedures that best 

meet the needs of individuals with disabilities in the State and the 

needs of the State unit. At the same time, for efficiency purposes, 

we feel that the definition of ``mediation'' in the final 

regulations should allow for States to conduct mediations under the 

VR program in a manner that is consistent with those conducted by 

the State under similar programs. We believe that a definition that 

is based on relevant portions of the definition of ``mediation'' in 

the Federal regulations governing the Client Assistance Program 

(CAP) in 34 CFR 370.6(b) serves both of those purposes.

    Changes: We have amended the proposed regulations to include 

definitions of the terms ``mediation'' and ``rehabilitation 

engineering.'' These definitions are located in Sec. 361.5(b)(36) 

and (b)(44), respectively, meaning that other definitions in the 

proposed regulations have been renumbered in the final regulations.

     Administrative costs under the State plan

    Comments: One commenter asked why the listing of costs in the 

proposed definition of ``administrative costs under the State plan'' 

was preceded by the term ``including'' rather than ``including, but 

not limited to,'' as in the current regulations. This same commenter 

also asked what is meant by ``support services'' to other entities, 

which was listed as an administrative cost under 

Sec. 361.5(b)(2)(iv) of the proposed regulations.

    Discussion: The proposed definition of ``administrative costs 

under the State plan,'' which tracks the definition in section 7(1) 

of the Act, does not differ substantively from the previous 

regulatory definition. However, because we interpret the statutory 

definition to allow for ``administrative costs'' other than those 

listed in the Act, we agree with the commenter that the definition 

should specify that the scope of administrative costs is not limited 

to the costs listed in the definition.

    ``Support services to other State agencies, private nonprofit 

organizations, and businesses and industries,'' which is referenced 

in section 7(1)(D) of the Act, as well as in Sec. 361.5(b)(2)(iv), 

can include activities such as training the staff of the One-Stop 

system on disability issues, providing organizations with materials 

and advice on auxiliary aids and services and other accessibility 

issues, reviewing employers' workplace policies and hiring 

practices, and other activities that would facilitate and promote 

the employment of individuals with disabilities. The scope of 

support services that a State unit may provide would differ 

depending upon the circumstances in that State.

    Changes: We have amended the definition of ``administrative 

costs under the State plan'' to clarify that the scope of 

administrative costs under the program includes, but is not limited 

to, the costs listed in the definition.

     Appropriate modes of communication

    Comments: Several commenters requested that we amend the 

proposed definition of ``appropriate modes of communication'' to 

include additional communication modes that are available for 

individuals who are deaf or hard of hearing.

    Discussion: The definition of ``appropriate modes of 

communication'' in the proposed regulations, which was the same as 

the previous regulatory definition, was not intended as a 

comprehensive list of communication modes used by persons with 

disabilities. Accordingly, the definition specified that the scope 

of appropriate modes was not limited to the identified examples and 

allowed for other modes as they are needed.

    Changes: None.

     Assessment for determining eligibility and vocational 

rehabilitation needs

    Comments: One commenter asked that this proposed definition be 

amended to ensure that the information used in assessing 

eligibility, order of selection category, and vocational 

rehabilitation needs of an individual with a disability is provided 

by professionals with expertise in the individual's disabling 

condition or conditions. This commenter also asked that we revise 

the proposed regulations to require that appropriate modes of 

communication are used in the course of conducting assessments.

    Discussion: The points made by the commenter relate to important 

elements of the assessment process. However, we believe those points 

are sufficiently addressed by other requirements in the regulations. 

For example, Sec. 361.42(a) of both the proposed and final 

regulations requires that determinations of eligibility be made by 

qualified personnel. Similarly, Sec. 361.18(e) requires that the 

State unit be able to communicate with applicants, as well as 

eligible individuals, through appropriate modes of communication. 

Because these requirements apply to the State unit as it conducts 

assessments and fulfills its other functions, we do not consider it 

necessary to amend the proposed definition as the commenter 

requested.

    Changes: None.

     Comparable services and benefits

    Comments: One commenter asked that the proposed definition be 

revised to specifically exclude the personal resources of the 

eligible individual from the scope of ``comparable services and 

benefits'' that the State unit must use before expending program 

funds in support of VR services.

    In addition, a number of commenters asked whether a ``ticket'' 

issued to an individual with a disability under the Ticket to Work 

and Work Incentives Improvement Act of 1999, Pub. L. 106-170 

(TWWIIA) constitutes a comparable service or benefit. Several other 

commenters stated that a Plan for Achieving Self-Support (PASS) 

issued by the Social Security Administration (SSA) should not be 

treated as a comparable service or benefit.

    Discussion: The proposed regulatory definition of comparable 

services and benefits--services and benefits that are provided or 

paid for by other Federal, State or local public agencies, by health 

insurance, or by employee benefits--did not include the eligible 

individual's personal resources. Nonetheless, an individual may be 

asked to participate in the costs of certain VR services to the 

extent that the State unit uses a financial needs test that is 

consistent with the requirements in Sec. 361.54 of the regulations.

    Because Social Security recipients with disabilities are issued 

``tickets'' under TWWIIA in order to receive training and 

employment-related services from an employment network as defined in 

that act, we believe that the ticket constitutes a comparable 

service and benefit under the VR program. Thus, to the extent that a 

ticket holder is receiving services from another entity that is 

serving as that individual's employment network, the DSU need not 

expend VR program funds on services that are comparable to the 

services the individual is already receiving. On the other hand, if 

the individual initially chooses the DSU as its employment network 

under TWWIIA, or otherwise transfers his or her ticket to the DSU, 

then the individual would be served solely by the DSU, and the 

ticket would not be considered a comparable service and benefit.

    On a related point, we note that DSUs must accept a ticket as 

sufficient evidence that the

 

[[Page 4419]]

 

ticket holder has a disability, is receiving Social Security 

benefits, and therefore is presumptively eligible under the VR 

program (see Sec. 361.42(a)(3) of the final regulations).

    Finally, we agree with the commenters' assertion that a PASS 

does not constitute a comparable service or benefit. Simply stated, 

a PASS is a mechanism made available to SSDI beneficiaries under the 

Social Security Act that enables its holder to conserve certain 

amounts of his or her own income or resources for purposes of 

supporting himself or herself in the future. Thus, because a PASS is 

not a source of support for VR services, we do not view it as a 

comparable benefit that the DSU can look to as an alternative to 

expending VR program funds.

    Changes: None.

     Competitive employment

    Comments: One commenter questioned the basis for the requirement 

that ``competitive employment'' be limited to employment outcomes in 

integrated settings. A second commenter asked that we broaden the 

definition of ``competitive employment'' in the proposed regulations 

to include employment under the Javits-Wagner-O'Day (JWOD) program 

if that employment is chosen by the eligible individual.

    Discussion: The proposed definition of ``competitive 

employment'' was the same as that found in the previous regulations. 

Although the term is not defined in the Act, section 7(11), the 

statutory definition of ``employment outcome'' does refer to 

competitive employment in the integrated labor market. On that 

basis, and in light of the great emphasis that the Act places on 

maximizing the integration into society of persons with 

disabilities, it has been our longstanding policy to define 

``competitive employment'' to mean employment in an integrated 

setting (at or above minimum wage). For further information on the 

integrated setting (and wage) components of the ``competitive 

employment'' definition, please refer to the relevant discussion in 

the preamble to the previous regulations (62 FR 6310 through 6311).

    Whether an employment outcome meets the regulatory definition of 

``competitive employment'' is to be determined on case-by-case 

basis. If a particular job, including a job secured under the JWOD 

program, is integrated (i.e., the individual with a disability 

interacts with non-disabled persons to the same extent that non-

disabled individuals in comparable positions interact with other 

persons; Sec. 361.5(b)(33)(ii) of the final regulations) and the 

individual is compensated at or above the minimum wage (and not less 

than the customary wage and benefit level paid by the employer for 

the same or similar work performed by individuals who are not 

disabled; Sec. 361.5(b)(11)(ii) of the final regulations), then that 

position would be considered competitive employment. In fact, we 

expect that many jobs secured under JWOD service contracts would 

meet these criteria. On the other hand, employment in a non-

integrated setting such as a sheltered workshop would not qualify as 

competitive employment regardless of whether the position is 

obtained under a JWOD contract or another program or arrangement.

    Changes: None.

     Employment outcome

    Comments: A number of commenters recommended that we expand the 

definition of ``employment outcome'' in the proposed regulations 

(i.e., entering or retaining full- or part-time competitive, 

supported, or other employment) to include ``advancing in'' 

appropriate employment. This change, the commenters believe, would 

encourage DSUs to look beyond entry-level employment options for 

eligible individuals.

    Another commenter asked that we define ``part-time employment'' 

in the final regulations. This commenter expressed concern about 

DSUs expending resources on individuals who might work very few 

hours in the course of a week or a month.

    Discussion: The chief purpose of the VR program is to assist 

eligible individuals with disabilities to achieve high-quality 

employment outcomes consistent with the individual's strengths, 

resources, priorities, concerns, abilities, capabilities, interests, 

and informed choice. Because that standard is reflected in the 

definition of the term ``employment outcome,'' we believe that the 

regulations sufficiently support the commenters' point that 

individuals with disabilities who are currently employed should be 

able to receive VR services in order to advance in their careers.

    Additionally, the availability of VR services for purposes of 

``advancing in'' employment is addressed in other parts of the 

regulations. For example, Sec. 361.46(a)(1)(i)) of the final 

regulations also specifies that the employment outcome identified in 

the individualized plan for employment, i.e., the employment goal 

the individual must pursue with the assistance of the State unit, 

must be consistent with the individual's unique strengths, 

resources, priorities, concerns, abilities, capabilities, career 

interests, and informed choice. That section requires that States 

look beyond options in entry-level employment for VR program 

participants who are capable of more challenging work. Specifically, 

the eligible individual should be assisted in pursuing the job that 

reflects his or her strengths, resources, abilities, and other 

employment factors previously listed. We suggest that you consult 

Rehabilitation Services Administration (RSA) Policy Directive 97-04 

for a more complete discussion of the scope and selection of 

employment outcomes for eligible individuals.

    We have not defined ``part-time employment'' as used in the 

proposed definition of ``employment outcome.'' We note that most 

employers generally consider any job of less than 35 hours per week 

to be part-time. Yet, we do not believe that it would be appropriate 

to require a minimum number of hours for part-time work secured 

through the VR program.

    Although we think that instances in which eligible individuals 

work only a handful of hours per week are limited, we do not want to 

discourage State units from serving potential part-time workers who, 

with the State unit's support, may increase their hours or even 

become employed full-time at a later date.

    Changes: None.

     Fair Hearing Board

    Comments: One commenter suggested modifying the proposed 

regulations to require a State's fair hearing board to include at 

least one individual with a disability.

    Discussion: By defining ``fair hearing board'' in the proposed 

regulations, we intended to clarify past confusion about the scope 

of the fair hearing board exception to the due process requirements 

under section 102(c)(6)(A) of the Act. In particular, the proposed 

regulations specified in Sec. 361.57(j) that for a State's pre-1985 

fair hearing board to qualify under the exception, that board must 

be comprised of a group of persons that acts collectively when 

issuing final decisions to resolve disputes concerning the provision 

of VR services to applicants or eligible individuals.

    These proposed requirements were intended to address instances 

in which some States had misinterpreted the exception as enabling a 

single administrative law judge or other official of a State office 

of hearing examiners to carry out hearings under Sec. 361.57 without 

following the procedural requirements in that section. In response, 

we modeled the proposed definition after the actual State fair 

hearing board that served as the catalyst for the statutory 

exception in the 1986 Amendments to the Rehabilitation Act. Because 

those few States with hearing boards that qualify under the 

exception have long followed this authorized State process for 

resolving individual disputes under the VR program, we do not 

believe it is necessary or prudent to impose special membership 

requirements on those boards through regulations. We do, however, 

encourage the few fair hearing board States to consider qualified 

individuals with disabilities when vacancies on these boards arise.

    Changes: None.

     Maintenance

    Comments: Several commenters objected to the use of examples 

following this definition, stating that the information included in 

the examples should be placed in sub-regulatory guidance. Other 

commenters supported the use of the examples in the proposed 

regulations.

    In addition, one commenter asked that we clarify the types of 

``enrichment activities'' that would fall under the fourth example 

to the proposed definition, while another asked that we eliminate 

that example altogether.

    Discussion: As we have stated in preambles to prior versions of 

the VR program regulations, we believe that the limited use of 

examples following the regulatory definition of ``maintenance'' is 

helpful in understanding the types of services that maintenance may 

include. The examples are purely illustrative and are not meant to 

limit or exclude other types of services that could be considered 

maintenance.

    The fourth example to both the proposed and previous regulatory 

definition stated that maintenance can include the costs of an 

individual's ``participation in enrichment activities'' related to 

the individual's training. This example was added to the previous 

regulations in 1997 in response to the requests of public commenters 

who noted that some DSUs establish limits in

 

[[Page 4420]]

 

maintenance budgets that preclude individuals from participating in 

enrichment activities (e.g., student trips, visits to museums, 

supplemental lectures, etc.) that are often important components of 

a student's training program. The ``enrichment'' example was 

intended to encourage DSUs to factor in these extra costs when 

developing an individualized plan for employment (IPE) for a student 

so that the individual can take advantage of supplemental enrichment 

activities as appropriate.

    Changes: None.

     Personal assistance services

    Comments: One commenter questioned the point at which a State 

unit can provide personal assistance services to an individual with 

a disability.

    Discussion: The proposed definition, which was the same as that 

in the previous regulations, specified that ``personal assistance 

services'' (i.e., services designed to assist persons with 

disabilities in daily living activities) must be necessary to the 

achievement of an employment outcome and may be provided only while 

the individual is receiving other VR services. As long as those 

conditions are met, personal assistance services, as defined in 

Sec. 361.5(b)(39) of the regulations, can be made available at any 

stage in the VR process, including during the assessment for 

determining the individual's eligibility and priority for VR 

services.

    Changes: None.

     Physical and mental restoration services

    Comments: One commenter asked us to require that all services 

listed in the proposed definition of ``physical and mental 

restoration services'' be provided by personnel who are qualified in 

accordance with applicable State licensure laws. Another commenter 

asked that the definition in the final regulations specifically 

refer to ``assistive listening and alerting devices.'' Finally, one 

commenter asked that the regulations prohibit a State unit from 

providing physical or mental restoration services if other resources 

are available.

    Discussion: The proposed regulations followed the scope of 

physical and mental restoration services specified in section 

103(a)(6) of the Act, and we do not believe that it would be 

appropriate to apply, solely through regulations, State licensure 

requirements on the provision of additional restoration services. 

However, a State may, if it has not done so already, choose to 

establish licensure or other qualified personnel requirements for 

providers of physical and mental restoration services. Those States 

would need to address those requirements in its written policies on 

the nature and scope of services developed under Sec. 361.50.

    We do not believe it is necessary to list additional restoration 

services in the final regulatory definition. Additional medical or 

medically related services that an individual needs in order to 

achieve an employment outcome are authorized under 

Sec. 361.5(b)(40)(xvi).

    Similarly, the commenter's concerns about using other resources 

before expending VR funds in support of restoration services is 

fully addressed elsewhere in the regulations. Section 361.48(e) of 

both the proposed and final regulations, under which restoration 

services are authorized, specifies that those services can be made 

available only to the extent that financial support for the services 

is not available from other sources. The application of the more 

general comparable services and benefit requirements in Sec. 361.53 

produces the same result.

    Changes: None.

     Physical or mental impairment

    Comments: Several commenters questioned the proposed revision to 

the previous regulatory definition of ``physical or mental 

impairment'' to mirror the definition used in the regulations 

implementing section 504 of the Act (section 504) (34 CFR 104.3) and 

the Americans with Disabilities Act (ADA). The commenters stated 

that using the ADA or section 504 definition may create confusion, 

conflict with existing definitions in State law, and weaken the 

eligibility criteria of the VR program. Several other commenters 

supported the revised definition, stating that consistency across 

Federal disability laws leads to more effective administration of 

the VR and other programs.

    Discussion: As noted in the preamble discussion of the changes 

to the definition of ``physical or mental impairment'' proposed in 

the NPRM (65 FR 10622), the revised definition does not impact on 

the employment-related eligibility criteria under the VR program. 

The changes to the definition in the previous regulations were 

proposed in an effort to make the VR program regulations more 

consistent with other Federal disability laws that define ``physical 

or mental impairment.'' We agree with those commenters who indicated 

that consistency with the definition used in the ADA and section 504 

regulations increases efficiency and actually lessens confusion by 

eliminating the need to duplicate efforts in assessing whether an 

individual has an impairment. Again, the changes address only 

whether an impairment exists; eligibility for VR services remains 

dependent on whether an individual also satisfies the eligibility 

criteria that are focused on employment (i.e., the impairment 

results in a substantial impediment to employment and the other 

criteria in Sec. 361.42(a)).

    Also, we do not believe that the proposed definition restricted 

the scope of physical or mental impairments that satisfied the 

previous regulatory definition or that the proposed definition 

conflicted with definitions of the same term in State law. If such a 

conflict exists, we ask that the State seek technical assistance 

from RSA in modifying its requirements in order to ensure that the 

State does not employ additional or more restrictive eligibility 

criteria for individuals to receive VR services as compared to the 

criteria specified in these final regulations.

    Changes: None.

     Post-employment services

    Comments: One commenter requested that the proposed regulations 

be modified to eliminate the availability of post-employment 

services for purposes of ``advancing'' in employment.

    Discussion: Although the term ``post-employment services'' is 

not defined in the Act, section 103(a)(18) of the Act specifically 

authorizes post-employment services that are necessary to assist an 

individual with a disability to retain, regain, or advance in 

employment. The proposed definition, which followed the definition 

in the previous regulations, supported the use of post-employment 

services to enable persons to ``advance'' in employment. As in the 

previous regulations, the note that followed the proposed definition 

offered additional guidance regarding the provision of post-

employment services.

    Changes: None.

     Qualified and impartial mediator

    Comments: We received many comments on the proposed definition 

of ``qualified and impartial mediator.'' First, several commenters 

stated that requiring mediators to be ``trained in effective 

mediation techniques consistent with any State-approved or -

recognized certification, licensing, registration, or other 

requirements* * *'' establishes too restrictive a standard for 

mediators. Others sought additional guidance on how to implement 

this requirement if the State has not established applicable 

certification or other requirements. In addition, several commenters 

asked whether the prohibition on public agency employees serving as 

mediators under the proposed definition applies to those from a 

State Office of Dispute Resolution who conduct mediations across 

multiple State programs.

    Aside from those issues, some commenters asked that we clarify 

whether a qualified and impartial mediator could also serve as an 

impartial hearing officer in resolving individual disputes that 

arise under the VR program. Other commenters voiced support for the 

proposed definition and for the emphasis given to mediation in the 

proposed regulations.

    Discussion: In establishing the general guidelines that govern 

mediations, section 102(c)(4) of the Act requires that mediations be 

conducted by a ``qualified and impartial mediator who is trained in 

effective mediation techniques.'' We defined ``qualified and 

impartial mediator'' in the proposed regulations as a means of 

providing guidance to the States in identifying or training 

available mediators.

    As indicated previously, we are aware that many States already 

use mediation to resolve disputes arising under other authorities 

(e.g., the Individuals with Disabilities Education Act (IDEA) or 

family law statutes) and that education, experience, or other 

qualification standards for mediators may vary from State to State. 

Thus, the proposed requirement that mediators under the VR program 

be trained consistent with applicable certification or other 

requirements was intended to ensure that mediators of disputes 

arising under the VR program are sufficiently qualified and that the 

State unit is able to use its State's existing pool of qualified 

mediators.

    We fully agree that mediators in a State Office of Dispute 

Resolution or other similar office should be able to conduct 

mediations under the VR program, and we have modified the proposed 

definition to accommodate that situation. This change is analogous 

to the provision that enables administrative law judges and hearing 

examiners in the State to

 

[[Page 4421]]

 

serve as impartial hearing officers even though those individuals 

are public employees (see the definition of ``impartial hearing 

officer'' in Sec. 361.5(b)(25)).

    In addition, although we believe that it is not generally the 

case, if there are no recognized credentialing or qualification 

standards for mediators in the State, then the Act and these final 

regulations require only that the State unit ensure that its 

mediators are trained in effective mediation techniques and meet the 

other components of the definition in Sec. 361.5(b)(43).

    It is critical that qualified and impartial mediators be neutral 

in facilitating the resolution of disputes regarding the provision 

of services to applicants or eligible individuals under the VR 

program. Therefore, we modeled the impartiality requirements in the 

proposed definition of ``qualified and impartial mediator'' after 

similar requirements in the previous definition of ``impartial 

hearing officer.'' Nevertheless, we realize that many States, 

particularly rural States with relatively small populations, have 

difficulty maintaining an appropriate pool of individuals to serve 

as hearing officers. It is not unusual in these or other States for 

hearing officers also to be trained as mediators, and we interpret 

the Act as allowing individuals to serve as both mediators and 

hearing officers under the VR program, provided they meet the 

applicable qualifications for each position. However, we also 

interpret the statutory requirement that mediators and hearing 

officers be impartial (see section 102(c)(4)(B)(iii) of the Act in 

reference to mediators and sections 7(16) and 102(c)(5) of the Act 

in reference to hearing officers) to preclude the same individual 

from serving as both mediator and hearing officer in the same case.

    Changes: We have revised the definition of ``qualified and 

impartial mediator'' to allow employees of a State office of 

mediators or similar office to serve as qualified and impartial 

mediators under the VR program.

     Substantial impediment to employment

    Comments: One commenter suggested that ``communication'' be 

listed among the attendant factors in the definition that could 

indicate the existence of a ``substantial impediment to 

employment,'' since communication plays a critical role in the 

individual's ability to function in the workplace. Other commenters 

requested that the proposed definition be revised to include 

examples of how the attendant medical factors are applied if medical 

measures are taken and result in mitigating functional limitations.

    Discussion: We agree that communication competence is crucial to 

success in the workplace. Although the proposed and previous 

regulations stated explicitly that a ``substantial impediment to 

employment'' could be measured in terms of ``other factors,'' we 

agree that ``communication'' should be added to the specific factors 

listed in the final regulatory term.

    We suspect that those commenters who suggested that the final 

regulations explain how attendant medical factors indicating the 

existence of a ``substantial impediment to employment'' are assessed 

if medical measures that mitigate functional limitations (also 

referred to as ``mitigating measures'') are taken are questioning 

the application to the VR program of recent Supreme Court case law 

interpreting the ADA. The relevant cases require that any mitigating 

measures (e.g., medication) that an individual is using to lessen 

the effects of that person's impairment be taken into account in 

determining whether the individual has a disability under the ADA 

(i.e., an impairment that substantially limits one or more major 

life activities).

    It is not clear, however, that the Court's decisions apply to 

the VR program eligibility criterion that an individual's impairment 

constitutes a substantial impediment to employment, since that 

provision and ADA language in question are not identical. Moreover, 

the purpose of the ADA, which is a civil rights statute, differs 

from that of the VR program, which provides Federal funding to 

assist individuals with disabilities enter into employment. We are 

not aware of any instances in which States, based on these cases, 

have altered their processes for assessing an individual's 

eligibility for the VR program; nor would we encourage them to do 

so.

    Changes: None.

     Supported employment

    Comments: Some commenters requested clarification of what it 

means to be ``working toward competitive employment'' for purposes 

of meeting the definition of ``supported employment'' in the 

proposed regulations. These commenters also asked whether the fact 

that an individual in supported employment is working toward 

competitive employment affects the 18-month limit on supported 

employment services provided by the State unit.

    Discussion: The 1998 Amendments expanded the prior statutory 

definition of ``supported employment'' (``competitive work in an 

integrated setting with ongoing supports'') to also include 

``employment in integrated settings in which individuals are working 

toward competitive work'' in order to cover persons who are working 

in supported employment settings but are making less than the 

minimum wage. ``Competitive employment,'' which we have long viewed 

as synonymous with the term ``competitive work'' used in the 

supported employment definition, generally refers to employment that 

is performed in an integrated setting for which the individual is 

compensated at or above the minimum wage. Thus, as long as an 

individual receiving ongoing support services while working in an 

integrated setting is also progressing or moving toward the minimum 

wage level, then the individual's job is considered ``supported 

employment.'' We note, however, that an individual in supported 

employment working toward competitive employment would not be 

considered to have achieved a ``competitive employment'' outcome 

until the individual is earning at least the minimum wage consistent 

with the definition of ``competitive employment'' in 

Sec. 361.5(b)(11).

    We also note that the change to the statutory definition of 

``supported employment'' does not affect the 18-month period for 

which the DSU can provide supported employment services. Once that 

18 months has passed (and unless the special circumstances warrant 

an extension), ongoing services, if needed, must be provided by a 

provider of extended services (see Sec. 361.5(b)(20) of the final 

regulations) regardless of whether the individual has yet to receive 

at least the minimum wage.

    Changes: None.

     Transportation

    Comments: Five commenters asked that the examples following the 

proposed definition of ``transportation'' be deleted. Another 

commenter supported specifically the example stating that the 

modification of a vehicle is a rehabilitation technology, rather 

than a transportation, service. Another commenter asked that we 

include in the final regulations specific authority for DSUs to pay 

for the repair and maintenance of vehicles.

    Discussion: We have found that the examples following the 

previous regulatory definition of ``transportation,'' which were 

largely the same as those included in the proposed regulations, were 

helpful to State agency personnel, individuals with disabilities, 

and others in clarifying the scope of transportation services 

authorized under the VR program. As we have always maintained, these 

examples are purely illustrative and are not meant to provide a 

comprehensive set of allowable transportation services.

    Thus, because other authorized ``transportation'' services 

exist, and should be considered in light of the needs of the 

individual, we do not believe it is necessary to specify additional 

transportation costs in the regulations. We do note, however, that 

the second example to the proposed definition identifies the 

``purchase and repair'' of vehicles as an example of an authorized 

transportation expense. We view the vehicle ``repair and 

maintenance'' expense identified by the commenter as covered by that 

example and, therefore, authorized. We would also instruct each DSU 

to include in its written policies governing the nature and scope of 

services under Sec. 361.50(a) any additional transportation expenses 

that the DSU generally provides.

    Changes: None.

 

Section 361.10  Submission, Approval, and Disapproval of the State 

Plan

 

    Comments: Commenters expressed concern that the proposed 

regulations would require the State unit to hold public meetings 

throughout the State prior to adopting any new substantive policy or 

procedure concerning the provision of VR services or substantively 

amending an existing service-related policy or procedure. 

Consequently, many commenters viewed the provision as both 

burdensome and costly. Some of these commenters suggested that the 

State unit be permitted to adopt new policies and procedures (and 

make any amendments to existing policies) initially in accordance 

with applicable State laws and later invite public comment and input 

on those additions or changes during the State's public meetings on 

the State plan. Other commenters sought clarification of what 

constituted a ``substantive'' policy, procedure, or amendment and 

asked who would determine whether a policy is ``substantive.''

 

[[Page 4422]]

 

    Additional comments on this section of the proposed regulations 

reflected concerns about the different dates that govern the 

submission of the VR State plan. These commenters recommended that 

all States be required to submit updates and revisions to their 

State plans by the same date.

    Discussion: Section 101(a)(16)(A) of the Act requires the State 

to hold public meetings prior to adopting policies or procedures 

governing the provision of services under the State plan. This 

requirement is essentially the same as the statutory requirements 

concerning public meetings that preceded the 1998 Amendments. Thus, 

we interpret the requirement in section 101(a)(16)(A) of the Act in 

the same manner as we have historically, i.e., the public is to be 

given the opportunity to comment on the State plan prior to the 

State unit adopting substantive policies and procedures (and any 

amendments thereto) governing the provision of vocational 

rehabilitation services under the plan. Typically, a State unit 

fulfills this requirement by taking comment on new policies during 

public meetings on State plan revisions and updates. Regardless of 

the timing of the State's public meetings, however, section 

101(a)(16)(A) clearly requires that these meetings for receiving 

public input be held prior to States adopting new or revised 

policies affecting the provision of VR services. Implementing new 

policies in advance of the public meetings is not permitted.

    We also note that section 101(a)(16)(B) of the Act and 

Sec. 361.21 of both the previous and the proposed regulations 

required the designated State agency to consult with certain groups 

on matters of general policy arising in the administration of the 

State plan. In addition, a State unit that has a State 

Rehabilitation Council (Council), in accordance with section 

101(a)(21)(A)(ii)(II) of the Act and Sec. 361.16(a) of the 

regulations (again, both previous and proposed), must consult with 

the Council regarding the development, implementation, and revision 

of State policies and procedures of general applicability pertaining 

to the provision of vocational rehabilitation services. Each of the 

public comment or consultation requirements specified in the 

proposed regulations, and the resulting burden, was imposed by the 

Act, and each was intended to ensure that the State unit accounts 

for the diverse needs of its State's disability population before 

modifying its service-provision practices.

    Nonetheless, in an effort to reduce the burden on the States, we 

incorporated into both the proposed and final regulations the term 

``substantive'' to clarify that States need not hold public meetings 

on policy or procedural changes that are merely technical or do not 

affect the provision of VR services in any substantive manner. 

Longstanding RSA guidance (see PD-90-08 and PAC-90-05) provides 

additional information on the scope of this requirement. We note 

that the determination of whether a specific policy or procedure is 

sufficiently ``substantive'' to warrant public input is made by the 

State unit. Yet, we strongly urge State units to consult with their 

Councils in assessing whether proposed policy changes are 

``substantive'' or in developing evaluative criteria for the State 

unit to use in making that assessment.

    Section 101(a)(1)(A) of the Act requires the State to submit its 

State plan for the VR program on the same date that its submits its 

plan under section 112 of WIA. In addition, section 501 of WIA 

authorizes the State to submit a State unified plan in place of both 

a WIA section 112 plan and separate State plans for those WIA 

partner programs, including the VR program. We believe that in order 

to foster collaboration and cooperation between the VR program and 

other components of the One-Stop service delivery system, a State 

plan for the VR program that is not included in the State's unified 

plan should be submitted on the same date as that unified plan. That 

view is reflected in Sec. 361.10(f)(3) of the proposed and the final 

regulations.

    Changes: None

 

Section 361.16  Establishment of an Independent Commission or a 

State Rehabilitation Council

 

    Comments: One commenter expressed concern that the proposed 

regulations failed to require the State unit to provide documents to 

the Council in alternative formats and in a timely manner. As a 

result, this commenter stated that Council members who are blind 

will not have sufficient opportunity to review and respond to 

information provided by the State unit.

    Discussion: This section of the proposed regulations made only 

technical changes to the previous regulations in order to conform to 

statutory changes in the 1998 Amendments to the Act. We do not 

believe that a regulatory change to this provision is warranted 

based on the comment received. Providing information in appropriate 

formats to Council members with disabilities falls under the State 

unit's general responsibility under section 504(a) of the Act to not 

exclude, on the basis of disability, any individual from 

participating in programs or activities receiving Federal financial 

assistance. Moreover, Federal regulations at 34 CFR 104.4(b)(1)(vi) 

specify that a recipient's responsibility under section 504 of the 

Act extends to the participation of individuals with disabilities on 

advisory boards. Thus, as in many other instances in which it 

distributes written materials, the State unit must ensure that 

Council members who are blind or otherwise disabled are able to 

review information that the State unit transmits to the Council, as 

well as participate generally in Council activities.

    Changes: None.

 

Section 361.17  Requirements for a State Rehabilitation Council

 

    Comments: We received several comments regarding the composition 

requirements of the Council. One commenter requested clarification 

as to whether an entity that is a required member of the Council 

could select someone other than a member of that entity as its 

representative to the Council.

    Several commenters suggested that the regulations specify that 

the ``nonvoting'' membership status of Council members who are 

employees of the designated State agency does not apply to the 

representative of the CAP. This change, the commenters assert, is 

necessary since the CAPs in some States are components of the 

designated State agency that administers the VR program. The 

commenters raised questions regarding the required Council 

membership of a representative of the directors of the American 

Indian VR services projects authorized under section 121 of the Act. 

Some of these commenters indicated that the Council should include 

members from each of the section 121 projects and that a single 

representative of all the directors could not adequately represent 

all American Indian VR service projects in the State. Other 

commenters described situations in which a section 121 project is 

``headquartered'' in one State but has a service area that extends 

across State lines into another State and asked whether that project 

must be represented on the Council of each State that it serves.

    One commenter questioned whether a Council member could be 

appointed to the State Workforce Investment Board (SWIB) under 

section 111 of WIA in order to satisfy the requirement in the 

proposed regulations that the Council include a member of the SWIB. 

This commenter stated that otherwise this requirement would be 

difficult to meet given the limited pool of persons interested in 

serving on the Council as evidenced by the difficulty Councils 

experience in filling vacancies as they occur.

    Finally, we received several comments indicating that the 

proposed regulations failed to incorporate the new statutory 

requirement that the majority of members to a Council for a State 

agency for the blind must be individuals who are blind.

    Discussion: Section 105(b) of the Act contains the membership 

requirements for the Council to ensure that various constituencies 

of the VR program have a voice in the conduct of the VR program in 

the State. Section 105(b)(3) requires that the Governor, after 

soliciting recommendations from organizations representing 

individuals with disabilities, appoint members to the Council in 

accordance with the membership criteria in section 105(b)(1) of the 

Act.

    The question as to whether an entity can be represented on the 

Council by someone other than one of its own members or employees 

has been raised in the past. With few exceptions, the Council 

membership requirements in section 105(b)(1) of the Act state that a 

``representative'' of an identified entity must serve on the 

Council. The Act does not require that the ``representative'' be an 

employee or member of the required entity. Thus, we interpret 

section 105(b) of the Act and Sec. 361.17(b) of the regulations to 

allow an entity that is required to be represented on the Council to 

be represented by someone who is not an employee or member of that 

organization. Recommendations of appropriate representatives can be 

made by the organizations themselves, although final appointment 

authority rests with the Governor. Moreover, we would expect that 

such a Council member would be closely affiliated with and 

knowledgeable about the

 

[[Page 4423]]

 

organization or entity whose interests the individual is charged 

with representing.

    We agree that the non-voting status of State agency or State 

unit employees under Sec. 361.17(b)(2) of the proposed regulations 

does not apply to Council members representing the State's CAP 

pursuant to proposed Sec. 361.17(b)(1)(iii).

    Questions regarding Council representation of the section 121 

project directors have been raised frequently since the passage of 

the 1998 Amendments to the Act. Moreover, the commenters' concerns 

as to whether one project director can sufficiently represent the 

interests of several independent projects serving different 

populations of American Indians have generated the most debate. Yet, 

the requirement in proposed Sec. 361.17(b)(1)(ix) enabling one 

person to represent all section 121 project directors in the State 

came directly from section 105(b)(1)(ix) of the Act. This 

requirement appears to reflect an intent of Congress to minimize the 

burden on States and to ensure that the size of the Councils not be 

so large as to become unmanageable. Nevertheless, we urge the 

directors of section 121 projects in the same State to collaborate 

more extensively than they may have in the past and to work to 

ensure that their collective views are represented on the Council. 

We also note that neither the Act nor regulations prohibit the 

Governor from appointing to the Council more than one representative 

of the State's section 121 projects (or other groups) if warranted 

as long as the remaining composition requirements in the Act and 

regulations (e.g., the requirement that a majority of Council 

members be individuals with disabilities) are met. As for section 

121 projects that are ``headquartered'' in one State but serve those 

in another State, it is our understanding that to the extent this 

occurs, affected projects primarily serve American Indians with 

disabilities in the State in which the project is located and serve 

only a relatively small area in a neighboring State. We do not 

believe that the Council must include a representative of a section 

121 project serving American Indians with disabilities in the State 

if that project is primarily located, and serves those, in another 

State. In that instance, Sec. 361.17(b)(1)(ix) of the final 

regulations would apply only to the State in which the project is 

located. The Governor, however, always has the discretion to appoint 

to the Council a representative of an out-of-State project that also 

serves American Indians with disabilities in the Governor's State.

    Since the time that the Council requirements came into effect, 

questions regarding whether the same individual can fulfill more 

than one role on the Council have been raised often. In response, we 

consistently have taken the position that an individual may 

represent only one entity on the Council even though that same 

individual may qualify under more than one of the composition 

requirements. We recognize that some States have difficulty 

maintaining a sufficient pool of qualified individuals to serve on 

statewide Councils and that the 1998 Amendments to the Act added 

three new required members to the Council. Nevertheless, section 

105(b) of the Act establishes a minimum number of members for the 

Council, each of whom represents a specific component of the 

disability community. Because each member represents a different 

interest, sometimes one that is divergent from that of other 

members, we maintain that each organizational requirement must be 

met separately. Thus, a Council member who serves on the SWIB cannot 

represent both the SWIB and another organization on the Council.

    We agree with the commenters who pointed out the discrepancy 

between the Act and the regulations regarding the membership 

requirements that apply to a Council for a separate State agency 

that administers the VR program for individuals who are blind. These 

commenters correctly noted that the proposed regulations did not 

specify, as does the statute, that the majority of members of these 

Councils must be individuals who are blind. This omission was 

inadvertent, and we agree that it needs to be corrected in the final 

regulations.

    Changes: We have revised Sec. 361.17(b)(2) of the proposed 

regulations to clarify that the CAP representative is, in all 

instances, a voting member of the Council. In addition, we have 

modified Sec. 361.17(c) to reflect the requirement in section 

105(b)(4)(B) of the Act that a majority of the members on a Council 

for a separate State agency for the blind must be individuals who 

are blind.

 

Section 361.18(c)  Comprehensive System of Personnel Development--

Personnel Standards

 

    Comments: Some commenters expressed concern with the indication 

in the preamble to the NPRM that statewide ``multi-tiered'' 

personnel standards could be used by the State unit in establishing 

standards for its rehabilitation personnel. Other commenters 

suggested that the proposed regulations be revised to require that 

all rehabilitation counselors obtain a Master's degree consistent 

with the national certification standards for rehabilitation 

counselors.

    In addition, a number of commenters sought waiver or 

``grandfather'' provisions in the final regulations that would 

exempt current rehabilitation counselors and other professionals 

from the State's personnel standards. On a related point, some 

commenters asked whether currently employed rehabilitation 

counselors who do not meet the State unit's personnel standards can 

continue to serve as counselors while training to meet the standard.

    Additionally, several commenters viewed the requirement in the 

proposed regulations that the State unit develop a written plan for 

retraining, recruiting, and hiring staff to meet applicable 

personnel standards as unduly burdensome. Other commenters supported 

this requirement and suggested that the written plan be developed 

with input from the Council.

    Finally, several commenters suggested that RSA define the 

professional and paraprofessional disciplines for which a State unit 

must establish personnel standards, while others asked what 

standards the State unit should apply to professions or 

paraprofessions for which no certification or similar criteria 

exist.

    Discussion: The preamble discussion in the NPRM concerning the 

ability of State units to use the same multi-tiered personnel 

standards as those applied by other State agencies to its 

rehabilitation staff was intended to clarify the level of 

flexibility the proposed regulations give State units in ensuring 

that its personnel are qualified within the meaning of the Act. 

Typically, multi-tiered certification systems require rehabilitation 

counselors to reach a certain academic level depending on the amount 

of experience the individual has had in that field. As we indicated 

in the NPRM (65 FR 10623), because the Act clearly allows State 

units to base their personnel standards on applicable State 

standards, it is permissible for a DSU to apply the multi-tiered 

counselor certification criteria of, for example, the State Workers' 

Compensation program to DSU counselors if the counselors of both 

agencies perform similar functions. The Act gives State units that 

discretion, and that same discretion also prohibits requiring by 

Federal regulations that all State unit counselors obtain a Master's 

degree consistent with the national rehabilitation counselor 

certification standards as sought by some commenters. Nonetheless, 

as we stressed in the preamble to the NPRM, we encourage each State 

unit to ensure that its personnel standards promote quality among 

its counselors and other staff, and we caution State units not to 

employ minimally qualified individuals by routinely substituting 

``equivalent experience'' for higher-level degree criteria.

    The Act does not authorize ``grandfathering'' or the waiving of 

personnel standards for current staff. Rather, section 

101(a)(7)(B)(ii) of the Act compels the State unit, if its current 

personnel does not meet the ``highest requirements in the State'' 

(i.e., the highest entry-level academic degree needed for the 

applicable State or national certification, licensing, or 

registration requirements--see Sec. 361.18(b)(2)(i) of the final 

regulations), to retrain existing staff, as well as recruit new 

employees, to meet the personnel standards applicable to each 

profession.

    The written plan under Sec. 361.18(c)(ii) that describes the 

retraining, recruitment, and other efforts of a State unit whose 

current personnel standards do not conform to the highest 

requirements in the State is based on the requirement in the Act 

that directs the State to provide this information in its State 

plan. More importantly, however, we believe that the limited 

components of the written plan (e.g., retraining, recruiting, and 

hiring steps, timelines for those efforts, procedures for evaluating 

progress, etc.) are essential to ensuring that the State unit 

employs a fully qualified staff that is best able to meet the 

diverse needs of individuals with disabilities. Any burden 

associated with developing the plan, we believe, is caused by the 

intent of the Act. The narrow scope of required plan components is 

expected to provide States with a helpful framework for fulfilling 

their personnel development responsibilities and improving their 

service delivery capacity.

    As we have stated in the past, we recognize the many constraints 

faced by State agencies in securing a fully qualified staff, not the 

least of which is the time that it takes to

 

[[Page 4424]]

 

retrain existing staff. Thus, current counselors who, pursuant to 

the State unit's plan under Sec. 361.18(c)(1)(ii), are working 

toward applicable qualification standards can continue to perform 

their counselor functions. The Act establishes an expectation that 

rehabilitation counselors and other staff will become qualified 

consistent with the highest applicable personnel standards in the 

State. Accordingly, the requirements in the regulations are intended 

to ensure that the State unit can continue to serve persons with 

disabilities while it progresses as rapidly as possible toward the 

point at which all of its staff, both current and new hires, meet 

the highest qualifications that the State applies to their 

professions.

    We also emphasize the importance of the role of the Council in 

the area of personnel development. Section 361.18(a) of the final 

regulations requires that the Council, if it exists, have an 

opportunity to review and comment on the development of all plans, 

policies, and procedures necessary to meet the State unit's 

obligations under the comprehensive system of personnel development 

(CSPD). As with each of the Council's functions, we view the 

Council's input into the development of the State unit's personnel 

policies, procedures, and standards as vital toward ensuring that 

those efforts result in a State unit workforce that is fully capable 

of meeting the training and employment needs of persons with 

disabilities in the State.

    We decline to define the professional and paraprofessional 

disciplines for which a State unit must establish personnel 

standards, as some commenters requested. While a State unit must 

apply to its staff the highest personnel requirements that exist in 

the State and that apply to each profession, determining the types 

of professionals and paraprofessionals needed to effectively 

administer its VR program and establishing the scope of functions 

for each job are the responsibility of the State unit. It is the 

State unit that can best judge its staffing needs and establish 

staffing arrangements that meet the particular needs of that 

agency's service recipients. In the preamble to the NPRM, however, 

we did provide some guidance on the categories of professional and 

paraprofessional disciplines most closely associated with the VR 

program for which the State unit should give priority in developing 

both specific job criteria and appropriate qualification standards. 

Those professions include rehabilitation counselors, vocational 

evaluators, job coaches for individuals in supported employment or 

transitional employment, job development and job placement 

specialists, and personnel who provide medical or psychological 

services to individuals with disabilities.

    As a final matter, we note that if there are no State or 

national licensing, certification, or registration requirements for 

a given profession established by the State unit, then both the Act 

and the final regulations require the State to use other 

``comparable requirements'' (such as State personnel requirements) 

for that profession or discipline. The scope of these ``comparable 

requirements'' (e.g., degree criteria, work experience, etc.) that 

are applied to jobs for which no licensing or similar requirements 

exist is left to the reasonable judgement of the State unit.

    Changes: None.

 

Section 361.22  Coordination With Education Officials

 

    Comments: Some commenters opposed the requirement in the 

proposed regulations that the State unit complete the IPE for 

students eligible for VR services before they leave school. These 

commenters stated, for example, that the proposed requirement would 

be impracticable for State units to fulfill, would lead to rashly 

formulated IPEs, or would exceed applicable statutory requirements. 

Other commenters supported requiring completion of the IPE before 

the student leaves school and viewed the requirement in the proposed 

regulations as essential if transition planning is to prove 

effective.

    In addition, one commenter requested that the proposed 

regulations be revised to require that the formal interagency 

agreement between the State unit and educational agencies specify 

both the manner and the time in which State unit staff will 

participate in transition planning for students with disabilities. 

Another commenter suggested that each agreement include provisions 

for resolving disputes regarding the agencies' financial 

responsibilities in paying for transition services and for enabling 

students to retain assistive technology provided by schools that the 

student needs following transition.

    Discussion: The proposed requirement that State units provide 

for the development and completion of the IPE before students who 

are eligible for VR services leave the school setting was carried 

over from the previous regulations. As we have indicated from the 

time the previous regulations were published in 1997, we believe 

that requiring IPE completion before eligible students with 

disabilities leave school is entirely consistent with the emphasis 

on transition in both the Act and its legislative history (see 

Senate Report 102-357). That emphasis was only heightened by the 

requirement in the 1998 Amendments that State units increase their 

participation in transition planning and related activities. More 

importantly, requiring the IPE to be in place before the student 

exits school is essential toward ensuring a smooth transition 

process, one in which students do not suffer unnecessary delays in 

services and can continue the progress toward employment that they 

began making while in school. In fact, it is in support of that 

effort that we have made two clarifications in these final 

regulations: (1) that designated State agencies should be involved 

in the transition planning process as early as possible; and (2) 

that the IPE must be ``approved'' (i.e., agreed to and signed by the 

individual and the DSU) prior to the student leaving school, as 

opposed to simply ``completed'' as stated in the proposed 

regulations.

    We have determined it necessary to clarify in the final 

regulations steps that the designated State agency must take, at a 

minimum, when conducting the statutorily required outreach to 

students with disabilities. It is essential for the designated State 

agency to inform these students of the purpose of the VR program, 

the application procedures, the eligibility requirements, and the 

potential scope of services that may be available. This information 

should be provided as early as possible during the transition 

planning process in order to enable students with disabilities to 

make an informed choice on whether to apply for VR services while 

still in school.

    We are not aware that State units have had great difficulty in 

completing IPEs for students. As before, the final regulations 

require that if the State is operating under an order of selection, 

only the IPEs of those students that the State unit can serve under 

the order must be developed before the student leaves school. 

Moreover, we believe that State units will be even better prepared 

to fulfill this requirement as they become more active in transition 

planning for special education and other students with disabilities 

(e.g., those students receiving services pursuant to section 504 of 

the Act or the IDEA) and in generally coordinating with school 

officials.

    We believe, as did some commenters, that the extent to which the 

State unit should be involved in transition planning for individual 

students with disabilities should be based on the needs of the 

student. However, we also believe that it is important for the 

designated State agency to participate actively throughout the 

transition planning process, not just when the student is nearing 

graduation. Early involvement by the designated State agency can be 

very beneficial in terms of assisting the student to make the 

transition from school to employment. For this reason, these final 

regulations clarify that the designated State agency should become 

involved in the transition planning process as early as possible. 

The designated State agency and the State education agency should 

negotiate more specific provisions, as part of their interagency 

agreement, to ensure that the students' needs are met in a timely 

manner. Congress clearly envisioned that that approach be followed 

in developing the terms of the State's interagency agreement (see 

e.g., Conference Report 105-659, page 354). Also left to local 

discretion is the scope of components, other than those limited 

components specified in the Act and clarified previously, that 

should be included in the agreement. Some of the additional 

agreement items identified by commenters may be considered in that 

regard.

    However, in response to the commenter's suggestion that each 

agreement should include provisions for resolving disputes in paying 

for transition services, we note that State units are authorized to 

pay for only transition services for students who have been 

determined eligible under the VR program and who have an approved 

IPE. Thus, as long as those criteria have been met, and the IPE 

specifies those transition services necessary for the successful 

implementation of the IPE, we anticipate that disputes of the type 

raised by the commenter will not be prevalent.

    Changes: We have amended Sec. 361.22(a) of the proposed 

regulations to clarify that the

 

[[Page 4425]]

 

IPE for a student determined to be eligible for vocational 

rehabilitation services must be developed and approved before the 

student leaves the school setting and as early as possible during 

the transition planning process. In addition, we have amended 

Sec. 361.22(b)(4) of the proposed regulations to clarify information 

that must be provided by the designated State agency, at a minimum, 

when conducting outreach to students with disabilities, and we have 

clarified that outreach should begin as early as possible during the 

transition planning process.

 

Section 361.23  Requirements Related to the Statewide Workforce 

Investment System

 

    Comments: We received a great many comments on this section of 

the proposed regulations that raise important policy issues and 

questions of interpretation that relate not only to the proposed 

regulations, but also to WIA and the regulations in 20 CFR part 662.

    Most commenters requested more detail in the final regulations 

that elaborates on how the VR program is to fulfill the requirements 

in proposed Sec. 361.23(a). For example, several commenters asked 

that we specify in the final regulations those core services under 

WIA that the VR program is expected to provide in accordance with 

proposed Sec. 361.23(a)(1), while others asked that we explain which 

activities related to ``creating and maintaining'' the One-Stop 

system under Sec. 361.23(a)(2) are allowable under the VR program.

    Some of the commenters on this proposed section also urged us to 

identify in the final regulations certain restrictions in the Act 

(e.g., the order of selection requirements under section 101(a)(5)) 

that may affect the extent to which State units can contribute to 

the cost of One-Stop system services or other One-Stop system 

activities. Of critical importance to the final regulations, most 

commenters stressed, is the need to address the responsibility of 

all WIA partner programs to serve individuals with disabilities.

    Other commenters asked that we add to the One-Stop system 

responsibilities listed in proposed Sec. 361.23(a) other items that 

are necessary for DSUs to effectively participate with other partner 

programs of the One-Stop system, including methods for allocating 

costs between programs, methods for ensuring proportionality between 

the partner's financial participation in the One-Stop system and the 

resulting benefits it receives, and methods for resolving disputes 

regarding funding that may arise between partner programs.

    Several other commenters identified additional components that 

they suggested be included in the required cooperative agreements 

between the designated State agency and those entities administering 

other One-Stop system partner programs. In addition, some commenters 

asked whether the requirement that State units, through the 

cooperative agreements, promote participation by individuals with 

disabilities in the One-Stop system also requires that State units 

pay the cost of reasonable accommodations at the One-Stop system 

center or other locations.

    Discussion: As we discussed at some length in the preamble to 

the NPRM (65 FR 10620, 10621, and 10624), we restated in 

Sec. 361.23(a) of the proposed regulations the responsibilities of 

One-Stop system partners, including the VR program, that are 

described in the regulations implementing Title I of WIA (20 CFR 

part 662). That effort was intended solely to inform State units of 

the One-Stop system responsibilities to which they are subject under 

WIA. We also asked that commenters raise specific interpretive or 

policy questions related to these One-Stop system responsibilities 

so that we may address, through appropriate guidance, those most 

pressing matters that DSUs face as they participate in the One-Stop 

service delivery system. Most of the comments received on this 

section of the proposed regulations focus on those types of 

questions.

    Although we anticipate addressing in future guidance materials, 

and in cooperation with other appropriate Federal agencies, the 

workforce policy questions posed by the commenters, we do note that 

many of the issues raised are impacted by a number of key One-Stop 

system principles embedded in WIA, its implementing regulations, and 

these final regulations.

    First, participation by DSUs in the One-Stop system must be 

performed in a manner that is consistent with the legal requirements 

applicable to the VR program (i.e., the Act and these final 

regulations). Thus, the DSUs' participation in the cost of core 

services or any other One-Stop system activities cannot, for 

example, result in expenditures for services to individuals who do 

not meet the priority for services in the order of selection under 

which a DSU is currently operating (although the DSU can 

participate, as appropriate, in the cost of intake and other 

expenditures that would normally be borne by the DSU prior to 

determining eligibility and the individual's priority category under 

the State's order of selection; see the discussion in the following 

section of this analysis of comments for further information on the 

relationship between order of selection requirements and 

participation in One-Stop system activities.) The fact that DSUs 

must comply with the Act and the VR program regulations in the 

course of participating in the One-Stop system, we believe, was made 

clear in the proposed regulations, as it is in Title I of WIA and 

the regulations implementing that title.

    Compliance with the ADA and section 504 of the Act represents 

another key issue that directly impacts the One-Stop system. In sum, 

those laws obligate One-Stop system centers and their partners to 

make their services accessible to individuals with disabilities. 

Thus, we, along with the Department of Labor and many of the 

commenters, have emphasized that the legal responsibility for 

assisting persons with disabilities does not fall to the DSU alone. 

Consequently, individuals with disabilities are likely to receive 

services through a variety of arrangements (e.g., through the One-

Stop system center, through a combination of core services at the 

One-Stop system center and specialized VR services from the DSU, 

etc.) depending on the configuration and structure of the local One-

Stop system. Nonetheless, because the universal access principles 

reflected in the ADA and section 504 relate to the responsibilities 

of non-DSU entities and because these final regulations establish 

requirements for designated State agencies and designated State 

units administering VR programs, we do not believe this section 

should be revised to address the application of the ADA and section 

504 to the One-Stop system generally. Those responsibilities are 

fully addressed in WIA, particularly in section 188 of that act and 

its implementing regulations, 29 CFR part 37, which establish the 

civil rights protections that must be provided by the State and 

local workforce development systems.

    Many of the commenters also raised important issues related to 

collaboration between the DSU and its One-Stop system partners. In 

response, we note that those issues can, and should, be addressed 

through the development of the memorandum of understanding (MOU) 

governing the operation of the One-Stop system referred to in 

Sec. 361.23(a)(3) or through the cooperative agreements developed 

between these same parties under Sec. 361.23(b). In fact, some of 

the suggested items, including the methods for funding One-Stop 

system costs among partner programs, are addressed in the 

regulations implementing title I of WIA (see MOU requirements in 20 

CFR 662.300). Rather than specifying additional MOU or cooperative 

agreement components in these final regulations, we would urge DSUs 

and their One-Stop system partners to determine which components, 

other than those specified in the MOU requirements in 20 CFR part 

662 and the agreement components in Sec. 361.23(b) of these final 

regulations, would be most appropriate to address given State and 

local circumstances.

    We do believe it is necessary, however, to clarify one technical 

item related to the cooperative agreement under Sec. 361.23(b) that 

some commenters raised. The commenters appeared to interpret 

Sec. 361.23(b)(2)(i)(B) as requiring DSUs to pay for reasonable 

accommodations, auxiliary aids, and other services for persons with 

disabilities participating in the One-Stop system. Yet, that 

proposed section, which comes directly from section 

101(a)(11)(A)(i)(II) of the Act, states only that DSUs, in promoting 

meaningful participation by persons with disabilities in One-Stop 

system and other workforce investment activities through program 

accessibility, may provide training and technical assistance to its 

One-Stop system partners on how to provide reasonable accommodations 

and auxiliary aids and services. Neither the relevant statutory 

provision nor the proposed regulatory section questioned by 

commenters instructs DSUs to pay the costs of providing individuals 

with disabilities access to the One-Stop system. In fact, as 

previously noted, that responsibility falls to the One-Stop system 

pursuant to the ADA and section 504.

    Changes: None.

 

Section 361.31  Cooperative Agreements With Private Nonprofit 

Organizations

 

    Comments: None.

    Discussion: We wish to clarify the relationship between these 

final regulations

 

[[Page 4426]]

 

and potential agreements that DSUs may enter into with employment 

networks authorized under the recently enacted TWWIIA. In 

particular, we note that neither the Act nor the regulations, 

including the requirement in section 101(a)(24)(B) of the Act and 

Sec. 361.31 of the regulations that the DSU enter into cooperative 

agreements under the VR program with private nonprofit VR service 

providers, are intended to limit or prohibit the establishment of a 

fee-for-service or other reimbursement type agreement between DSUs 

and employment networks. Typically, fee-for-service arrangements 

enable private service providers to purchase from the DSU services 

that are needed by an individual with a disability who is not a VR 

program participant.

    On a related note, we also emphasize that nothing in the Act or 

these regulations would affect the ability of a DSU to serve as an 

employment network as authorized under TWWIIA.

    Changes: None.

 

Section 361.36  Ability To Serve All Eligible Individuals; Order of 

Selection for Services

 

    Comments: One commenter suggested that this section of the 

proposed regulations be strengthened to ensure that States preserve 

resources and provide needed services to individuals with 

significant disabilities, particularly as the State unit becomes 

more closely linked to, and participates in, the One-Stop system 

under WIA.

    Discussion: As we discussed in the previous section, we agree 

that the policy behind the order of selection requirements in the 

Act and regulations--to preserve the fiscal and personnel resources 

of the DSU so that those with the most significant disabilities can 

receive the full range of VR services that they need to become 

appropriately employed--must be safeguarded. However, we believe 

those safeguards are in place. As a required partner in the One-Stop 

system, the State unit must participate toward the development and 

maintenance of an effective One-Stop system at the local level. 

Moreover, Title I of WIA and the regulations implementing that title 

clearly condition that participation on compliance with the 

Rehabilitation Act and these regulations. Thus, the order of 

selection requirements in section 101(a)(5) of the Act and these 

regulations, or any other statutory or regulatory requirement 

applicable to the VR program, must be followed in the course of 

participating in One-Stop system activities. If the State is 

operating on an order of selection because it cannot serve all 

eligible individuals given its current level of VR program 

resources, then the State unit can pay only for services (i.e., 

services beyond intake and assessment that are necessary to 

determine whether an individual is eligible under the program and, 

if so, to determine the individual's priority category under the 

order of selection) for the individuals who qualify for services 

under that order, regardless of whether those services are provided 

within or apart from the One-Stop system center. The severity of an 

individual's disability or the cost of the individual's program of 

services can have no bearing on the scope of services the individual 

receives.

    Changes: We have made one clarifying change to Sec. 361.36(c) of 

the proposed regulations that was not based on public comment. This 

proposed section has been revised to clarify that a DSU that has 

developed but not implemented an order of selection must continue to 

provide the full range of services, as appropriate, to all eligible 

individuals.

 

Section 361.42  Assessment for Determining Eligibility and Priority 

for Services

 

    Comments: Several commenters recommended requiring in this 

section of the final regulations a written assessment for 

determining eligibility and priority for services by a qualified VR 

counselor employed by the DSU, as a means of emphasizing the 

importance of the professional opinion of the VR counselor. These 

commenters also proposed that this written assessment be included 

with the information given to the eligible individual during IPE 

development.

    Some commenters opposed the eligibility provisions stated in 

proposed Sec. 361.42(a)(i) and (ii) (i.e., determinations by 

qualified personnel that the applicant has a physical or mental 

impairment and the impairment constitutes or results in a 

substantial impediment to employment) on the basis that neither 

provision required that the applicable determination be made by a 

qualified employee of the DSU. These commenters stated that all 

eligibility-related determinations should be made by the DSU.

    Several commenters opposed Sec. 361.42(a)(3) of the proposed 

regulations, which implemented the statutory requirements regarding 

presumptive VR program eligibility for individuals receiving SSI or 

SSDI under the Social Security Act. These commenters stated that a 

categorical presumption of eligibility for this group of individuals 

could be misconstrued as creating an entitlement to VR services, 

could lead to efforts to extend presumptive eligibility 

inappropriately to other groups with common characteristics, and may 

undermine the individualized nature of the VR program. Some of the 

commenters asserted that a presumption of eligibility should be able 

to be rebutted by a showing that an individual receiving SSI or SSDI 

does not meet one or more of the eligibility criteria. Other 

commenters suggested that presumptive eligibility for these 

individuals should apply to only those Social Security recipients or 

beneficiaries seeking to earn wages as opposed to those intending to 

become homemakers.

    On the other hand, several commenters supported the proposed 

requirements regarding presumptive VR program eligibility for 

individuals receiving SSI or SSDI. Some noted that the relevant 

statutory provision, section 102(a)(3) of the Act, already has been 

effective in reducing the time expended on eligibility 

determinations, thereby allowing counselors and individuals to focus 

on IPE development and initiating needed services.

    Many commenters opposed the manner in which the proposed 

regulations implemented the passage in section 102(a)(3)(ii) of the 

Act that states that Social Security recipients are presumed 

eligible under the VR program ``provided that the individual intends 

to achieve an employment outcome.'' Specifically, these commenters 

believed that completion of the application process, as described in 

the proposed regulations, is insufficient evidence of the 

individual's intent to achieve an employment outcome. They urged 

that the applicable paragraph in the proposed regulations be 

stricken on the basis that DSUs make eligibility-related decisions 

not only at the time of application but throughout the VR process.

    Several commenters opposed authorizing DSUs, under 

Sec. 361.42(b) of the proposed regulations, to make interim 

determinations of eligibility. Most of these commenters questioned 

the statutory authority for the proposed section or viewed the 

provision as unnecessary since all eligibility determinations must 

be completed within 60 days from the time the individual applies for 

VR services. On the other hand, many commenters supported the 

proposed interim eligibility authority and the fact that using it 

rests with the discretion of the DSU.

    Several commenters supported proposed Sec. 361.42(c)(1) that the 

DSU will not impose, as part of the eligibility determination 

process, a duration of residence requirement that excludes from 

services any applicant who is present in the State. Two commenters 

suggested that the proposed language more closely track the Act by 

applying the prohibition not only to applicants but to any 

individual who is present in the State. Other commenters supported 

retaining specific language stating that a requirement for an 

applicant to be present in the State cannot be used to circumvent an 

individual's choice of an out-of-State service provider.

    We received many comments on proposed Sec. 361.42(e), which 

implemented new statutory requirements regarding the use of trial 

work experiences as part of the process for determining eligibility 

for VR services. Several commenters responded to our request in the 

preamble to the NPRM that they identify examples of trial work 

experiences, other than supported employment and on-the-job 

training, that DSUs might employ. Suggestions included contract or 

production work in the individual's own home, internships, unpaid 

work experiences, on-the-job evaluations, job shadowing, structured 

volunteer experiences in real work settings, and community-based 

work assessments with supports, among others.

    Many commenters suggested that the final regulations authorize a 

DSU to consider trial work that the individual performed previously, 

and that is documented, for purposes of meeting the requirement that 

it assess the individual's capacity to perform trial work before the 

individual is determined too severely disabled to achieve an 

employment outcome (and, therefore, ineligible). These commenters 

also recommended that the final regulations clarify that trial work 

experiences need not be used for all individuals with significant 

disabilities or in instances in which an individual's ability to 

achieve an employment outcome is not in question.

    A number of commenters opposed the requirement in proposed 

Sec. 361.42(e)(2)(i) that the DSU develop a written plan to assess 

the individual's capacity to perform in realistic

 

[[Page 4427]]

 

work settings. These commenters noted that the Act does not require 

a written plan and that the proposed provision could have the 

unintended effect of delaying services to the individual. Other 

commenters expressed concern that the trial work assessment for an 

individual appeared open-ended and, therefore, recommended that the 

regulations apply a specific time limit to the use of trial work for 

purposes of determining eligibility.

    One commenter questioned the authority for the proposed 

regulatory requirement that DSUs provide appropriate supports, 

including assistive technology devices and services and personal 

assistance services, to accommodate the rehabilitation needs of an 

individual while performing trial work. In contrast, another 

commenter stated that it is vital for DSUs to provide the supports 

and assistive technology that are needed for an individual during 

the trial work period.

    Several commenters recommended deleting proposed Sec. 361.42(h), 

which authorized the continued use of extended evaluations in 

instances in which trial work experience options have been exhausted 

or cannot be used by the individual. These same commenters suggested 

that the 18-month time limit that applied to extended evaluation 

under the current regulations be applied to trial work experience 

options. Some of the commenters also questioned the authority for 

keeping the extended evaluation option in the regulations, while 

others suggested that since trial work experiences were available to 

most individuals with significant disabilities, the extended 

evaluation authority is no longer necessary or is inconsistent with 

the Act's preference for finding most applicants eligible for the VR 

program. In contrast, a number of commenters supported retaining the 

extended evaluation requirements.

    Discussion: We agree that the professional opinion of the VR 

counselor is critical in assessing an individual's eligibility and 

priority for services. Both the Act and the regulations specify that 

qualified personnel must conduct assessments under the VR program. 

Although we suspect that most States develop written assessments, we 

do not think it is necessary to require by rulemaking that the 

assessment itself be in writing. Thus, State units may continue to 

require written eligibility assessments, or otherwise attest to an 

individual's eligibility and priority of service category under an 

existing order of selection, as they deem appropriate. We do note, 

however, that the DSU is required to document, in some fashion, 

support for determinations of eligibility as part of the record of 

services required under Sec. 361.47 of the regulations. Whether that 

documentation is the assessment itself or some other combination of 

information, again, lies with the discretion of the DSU.

    We believe that proposed Sec. 361.42(a)(1)(i) and (ii) and the 

references to ``qualified personnel'' in each of the provisions are 

consistent with the Act. We interpret the requirements in section 

103(a)(1) of the Act (requiring assessments for determining 

eligibility and rehabilitation to be conducted by ``qualified 

personnel'') and section 102(a)(6) of the Act (requiring eligibility 

determinations to be conducted by the designated State unit) the 

same as we have historically since neither statutory provision 

changed in the 1998 Amendments. Specifically, the Act authorizes 

qualified professionals, both DSU and non-DSU employees, to 

determine the existence of an impairment and to determine whether 

the impairment results in a substantial impediment to employment 

(i.e., whether the first two eligibility criteria have been met.) 

The requirement in section 102(a)(4)(B) of the Act regarding the use 

of determinations made by officials of other agencies also supports 

this position. Assuming the DSU can confirm that a qualified 

professional has determined that the individual has met those 

criteria, the DSU counselor then assesses whether the individual 

requires VR services to obtain and retain work in the individual's 

chosen field that is appropriate to his or her abilities (i.e., the 

third criterion of eligibility.) The individual is presumed to have 

met the fourth criterion--that the individual can benefit from VR 

services under Sec. 361.42(a)(1)(iv). This framework, which we 

believe is required by the Act, is intended to ensure that the DSU 

controls the eligibility process at the same time that it 

facilitates more timely assessments that allow for existing 

information from other sources to be taken into account.

    The 1998 Amendments specify that those who qualify for SSI or 

SSDI are presumed eligible for the VR program. As we discussed 

extensively in the preamble to NPRM (65 FR 10625 and 10626), we 

believe that this change was adopted in the 1998 Amendments to 

streamline eligibility and expedite necessary VR services for those 

Social Security recipients since each category of recipients already 

has met stringent disability criteria under the Social Security Act 

and clearly needs VR services in order to achieve appropriate 

employment. We do not believe that this presumption will be 

misconstrued as changing the nature of the VR program to a program 

under which individuals are entitled to services without pursuing a 

job. In fact, section 102(a)(3)(B) of the Act and Sec. 361.42(a)(5) 

of these final regulations specify that nothing in the presumptive 

eligibility requirement creates an entitlement to VR services, 

meaning that individuals with disabilities are not automatically 

entitled to VR services but, rather, must expect to achieve an 

employment outcome as a result of receiving those services. The 

final regulations implement that expectation by ensuring that all 

applicants, including those receiving SSI or SSDI, are informed of 

the employment-related nature of the VR program during the 

application process.

    We also disagree with the assertion that a categorical 

presumption of eligibility for individuals receiving SSI or SSDI 

will lead to categorical eligibility for other groups and undermine 

the individualized nature of the VR program. Prior to the 1998 

Amendments, disabled SSI recipients were statutorily presumed to 

have a physical or mental impairment that constituted a substantial 

impediment to employment (i.e., were presumed to have met the first 

two eligibility criteria in Sec. 361.42(a)(1) of the regulations), 

as well as a severe disability. Section 102(a)(3) of the 1998 

reauthorized Act expanded this presumption by giving presumptive VR 

program eligibility (i.e. a presumption that individuals meet all of 

the eligibility criteria under the VR program) to this same 

population. The presumption applies only to these persons and is not 

written to broadly cover other groups that do not qualify under the 

stringent disability-related criteria applied by the Social Security 

Administration. Also, the individualized nature of the VR program 

(i.e., that services are provided under an IPE to meet an 

individual's rehabilitation needs and assist an individual to 

achieve an employment outcome) is unaffected by this requirement 

that only addresses eligibility for services.

    As section 102(a)(3)(A)(ii) of the Act makes clear, a DSU can 

rebut the presumption that an SSI or SSDI recipient is eligible 

under the VR program if it can demonstrate by clear and convincing 

evidence that the individual is incapable of benefiting in terms of 

an employment outcome from VR services due to the severity of the 

individual's disability. In response to the commenter's contentions, 

we maintain that a presumption of eligibility can be rebutted only 

on this basis.

    We also do not believe that presumptive eligibility for SSI or 

SSDI recipients should be restricted to those seeking certain types 

of employment outcomes. As we have long required, eligibility 

requirements are not to be applied with regard to the type of 

expected employment outcome that the applicant seeks (see 

Sec. 361.42(c)(2)(ii)(B) of these final regulations). Thus, whether 

an individual seeks a self-employment, another wage-earning 

employment, a homemaker, or other outcome cannot be used as a factor 

in determining the individual's eligibility for VR services or 

affect the presumptive eligibility of an individual receiving SSI or 

SSDI.

    We believe that completion of the application process after the 

DSU has informed the individual that he or she must seek an 

employment outcome to receive VR services is sufficient evidence 

that any individual, including SSI and SSDI recipients, ``intends to 

achieve an employment outcome,'' as section 102(a)(3)(ii) specifies. 

While we understand that some commenters are concerned that disabled 

Social Security recipients in particular will seek VR services 

without intending to work, we find that concern unfounded. We 

referred in the preamble to the NPRM to an obvious fact--that all 

applicants for VR services, not only those who qualify for SSI or 

SSDI, must intend to work to receive VR services. Thus, ensuring 

that the DSU explains the employment-related nature of the VR 

program as part of the application process ensures that applicants 

understand what is expected of them before participating in the 

program. Thus, the proposed regulatory method of ensuring an 

individual's intent to work fulfills an expectation that applies to 

all applicants for VR services and streamlines, rather than hinders, 

the eligibility process for SSI and SSDI recipients, as the Act 

intends.

    Additionally, we disagree with the contention that an 

individual's intent to

 

[[Page 4428]]

 

achieve an employment outcome constitutes an additional eligibility-

related criterion that must be applied throughout the VR process. 

Eligibility is assessed at the outset of the rehabilitation process, 

at a point when the final regulations require that the DSU apprise 

individuals of the nature of the program. As always, if an 

individual becomes too severely disabled to achieve an employment 

outcome (as supported by clear and convincing evidence) or, for 

whatever reason, stops participating in the VR program, then the DSU 

need not continue serving that individual. That approach applies no 

less to SSI recipients or SSDI beneficiaries than it does to any 

other participant in the VR program. Yet, as long as the individual 

continues to participate in the program, there exists a presumption 

that the individual intends to work.

    We agree with those commenters who supported proposed 

Sec. 361.42(b) that would allow DSUs to make interim determinations 

of eligibility for individuals who the DSU reasonably believes will 

be eligible for VR services at the end of the statutory 60-day 

period for making eligibility decisions. We emphasize that this 

provision is an option for DSUs to expedite further the delivery of 

services to individuals while the DSU awaits information to permit a 

final eligibility determination. DSUs are not required to implement 

provisions for interim determinations of eligibility.

    We also agree with the commenters who stressed the importance of 

language in section 101(a)(12) of the Act that prohibits a State 

from establishing any residence requirement that excludes from 

services any individual who is present in the State. However, we 

believe that the proposed regulatory language sufficiently tracks 

the statutory requirement that was not changed by the 1998 

Amendments. Again, we believe it is important to clarify, as 

explained in the Senate Committee Report on the Rehabilitation Act 

Amendments of 1998, that the requirement for an individual to be 

present in the State in order to be eligible to receive services 

should not be interpreted in any way to circumvent an individual's 

choice of an out-of-State provider (Senate Report 105-166, p. 13). 

The committee further stated that, with regard to out-of-State 

placements, the requirement that an individual be present in the 

State must be imposed at the time of the eligibility determination 

and may not be used as a means of denying the continuation of 

services that are being provided in an out-of-State setting.

    As we explained more fully in the preamble to the NPRM (65 FR 

10626 and 10627), the Act specifies that DSUs must explore an 

individual's abilities, capabilities, and capacity to perform in 

work settings through the use of trial work experiences before it 

can demonstrate that an individual is too severely disabled to 

benefit from VR services in terms of an employment outcome and, 

consequently, is ineligible under the program. We believe that this 

requirement establishes the fairest standard for assessing whether 

an individual with a significant disability is in fact capable of 

achieving employment. We also appreciate the trial work examples 

that commenters shared and note that these types of work options 

(e.g., supported employment, on-the-job training, internships, job 

shadowing, structured volunteer experiences in real work settings, 

and community-based work assessments with appropriate supports) 

should be considered by others as they seek to expand the scope of 

trial work experiences available to applicants with significant 

disabilities. Nevertheless, we believe that Sec. 361.42(e)(2)(ii) of 

the regulations is sufficiently broad to encompass each of these 

examples and that a change to that provision is not necessary.

    In addition, we interpret the Act to clearly require DSUs to 

give individuals trial work experiences before deciding that an 

individual is ineligible under the VR program due to the severity of 

the individual's disability. Accordingly, a DSU cannot meet the 

requirement that it use trial work to assess eligibility by simply 

securing documentation that addresses the individual's success in 

performing work previously. Using documentation in that regard runs 

the risk of violating the scope of the mandate in section 

102(a)(2)(B) of the Act, specifically that trial work options be 

sufficiently varied and take place over a sufficient period of time 

for the DSU to either conclude that the individual is eligible for 

VR services or (based on clear and convincing evidence) that the 

individual is incapable of benefiting from the provision of VR 

services in terms of an employment outcome. Given the State units' 

expertise in conducting assessments, and without knowing the 

validity of the documentation that exists or the circumstances that 

might have changed since the time the individual previously worked, 

we believe that it is appropriate to require that, before 

determining that an individual cannot benefit from VR services, the 

DSU give the individual a variety of trial work options regardless 

of the individual's past work history or assessments.

    We do not believe that the written plan for providing trial work 

experiences as required in Sec. 361.42(e)(2)(i) of the regulations 

is inconsistent with the Act or will cause delays in service 

delivery. On the contrary, we believe that requiring a written plan 

to assess an individual's abilities, capabilities, and capacities to 

perform in realistic work settings is a logical means of fulfilling 

the requirements in section 102(a)(2)(B) of the Act. The written 

plan will ensure that the assessment process is conducted in a 

deliberate and well-formulated manner, thus giving an individual a 

full opportunity to demonstrate his or her capabilities and enabling 

the DSU to accurately gauge whether the individual can achieve 

employment. Also, we feel that any burden or minor delay associated 

with developing the written plan is clearly justified given that the 

individual risks being found ineligible, and precluded from 

receiving services altogether, if trial work options are not well-

planned and prove unsuccessful.

    We recognize the concerns of those commenters who requested that 

time limits be included in the regulations to ensure that trial work 

opportunities do not extend beyond a reasonable length. Yet, we 

believe the timeframes that are the most reasonable and appropriate 

already were built into the proposed regulations. Specifically, 

Sec. 361.42(e)(2)(iii) of the regulations requires that the DSU 

assess the individual's capacity to work in realistic work settings 

through the use of trial work experiences that are provided over a 

sufficient period of time for the DSU to determine either that the 

individual is eligible for VR services or that there exists clear 

and convincing evidence that the individual cannot benefit from VR 

services in terms of an employment outcome due to the severity of 

the individual's disability. Because trial work is intended to 

result in either a determination of eligibility or a determination 

of ineligibility that is sufficiently supported, trial work 

opportunities must be provided until the point that the DSU can 

reach one of these two conclusions. Thus, specific time periods that 

would serve to discontinue trial work requirements before the DSU 

has reached either result would serve to undermine the purpose 

behind those very same requirements.

    We do not believe that the requirement in Sec. 361.42(e)(2)(iv) 

of the regulations that the DSU provide individuals with appropriate 

support services, such as assistive technology devices and services 

and personal assistance services, during trial work falls beyond the 

scope of the Act. Section 102(a)(2)(B) of the Act states explicitly 

that trial work experiences are to be afforded ``with appropriate 

supports provided by the designated State unit.'' Clearly, assistive 

technology devices and services and personal assistance services are 

authorized services available to individuals pursuing employment, 

including supported employment, through the VR program (see e.g., 

section 102(b)(3)(B)(i)(I) of the Act). Accordingly, we believe it 

is entirely appropriate to interpret the DSU's responsibility to 

provide ``necessary supports'' during the trial work period to cover 

these same services.

    We also disagree that the authority concerning extended 

evaluations should be deleted in the final regulations. Although the 

Act clearly places a priority on using trial work experiences in the 

course of assessments, Congress recognized the need to allow for 

extended evaluations in those limited instances in which a real work 

test is impossible or the State unit has exhausted its trial work 

options without reaching a determination of eligibility. That point 

is reflected in the legislative history to the trial work provisions 

in the Act, specifically in Senate Report 105-166, pages 9 and 10.

    Changes: None.

 

Section 361.45  Development of the Individualized Plan for 

Employment

 

    Comments: Several commenters recommended that the final 

regulations clarify that the DSU is not required to pay for the 

costs of technical assistance in IPE development that is provided by 

sources other than DSU personnel. On the other hand, other 

commenters suggested that the DSU be required to pay for the costs 

of the technical assistance provided by non-DSU sources, asserting 

that such a requirement

 

[[Page 4429]]

 

would be consistent with the individual's opportunity to exercise 

informed choice in selecting DSU or non-DSU assistance for purposes 

of developing the individual's IPE.

    Many commenters sought more explanatory information in the final 

regulations that details the role of the qualified VR counselor 

employed by the DSU in developing and approving the IPE and IPE 

amendments and in reviewing the IPE annually. These commenters 

indicated that the ``diminished role for the DSU counselor'' in the 

proposed regulations was inconsistent with the Act and other 

regulatory requirements. The commenters also stated that a DSU-

employed counselor must conduct the required annual review of the 

IPE and assess the individual's progress toward achieving the 

identified employment outcome since the DSU is responsible for the 

proper delivery of services and the outcome of the individual's 

participation in the program. Other commenters suggested that we 

distinguish between the roles of the ``qualified vocational 

rehabilitation counselor'' and the ``qualified vocational 

rehabilitation counselor employed by the designated State unit'' by 

defining each term in the final regulations.

    Some commenters suggested that this section of the proposed 

regulations be revised to prohibit VR counselors employed, or 

previously employed, by an agency or organization that may provide 

services under an individual's IPE from assisting the individual in 

developing the IPE. These commenters urged that a prohibition of 

this type be implemented in order to guard against conflicts of 

interest on the part of the counselor that could otherwise 

jeopardize the individual's ability to exercise informed choice in 

selecting services and service providers included in the IPE.

    In addition, a number of commenters opposed Sec. 361.45(e) of 

the proposed regulations, which required the DSU to establish and 

implement standards, including timelines, for the prompt development 

of IPEs. These commenters viewed this proposed section as beyond the 

scope of the Act. Other commenters recommended either requiring by 

regulations a specific time period governing IPE development and 

implementation (e.g., 30 days from the date eligibility is 

determined) or defining the term ``timely'' as it applies to IPE 

development.

    Discussion: Pursuant to section 102(b) of the Act and 

Sec. 361.45(c) of the final regulations, the DSU must inform 

eligible individuals of the range of available options in obtaining 

assistance for purposes of developing the IPE (e.g., developing the 

IPE with DSU assistance, with non-DSU assistance, or on one's own). 

Since IPE development assistance from non-DSU sources is authorized, 

the regulations do not prohibit the DSU from supporting the costs of 

that assistance. At the same time, however, we agree that the DSU 

need not pay the costs of assistance provided by non-DSU sources if 

it so chooses. Thus, it falls within the discretion of the DSU to 

determine whether, and under what circumstances, it will pay for 

technical assistance in IPE development from sources other than the 

DSU.

    We believe that the proposed regulations accurately reflected 

the scope of functions that the Act reserves to the DSU, as well as 

the broad authority for non-DSU counselors to assist in the 

development and review of IPEs at the individual's discretion. As 

some commenters pointed out, a qualified VR counselor who is 

employed by the DSU must approve and sign the IPE and any amendments 

to the IPE (see section 102(b)(2)(C)(ii) and (b)(2)(E) of the Act). 

The proposed regulations followed the framework established by the 

Act, i.e., by enabling individuals to receive assistance in IPE 

development from whichever source (if any) that they choose and 

ensuring that the DSU maintains final IPE approval authority as the 

Act requires. We do not believe that additional regulatory 

provisions in this area, including definitions, are needed.

    While we note, as we did in the preamble to the NPRM, that the 

DSU also is responsible for ensuring that the individual's IPE is 

reviewed annually, we do not agree that that review must necessarily 

be conducted by a DSU counselor. As discussed in greater detail in 

the NPRM preamble (65 FR 10626 and 10627), Congress intended to 

distinguish between IPE functions that must be performed by a 

qualified VR counselor employed by the DSU and related functions 

that may be performed by a qualified VR counselor or other person 

who is not employed by the State unit. Thus, in addition to enabling 

individuals to secure assistance from outside the DSU in developing 

the IPE and IPE amendments, the DSU can meet its responsibility to 

ensure that the IPE is reviewed at least annually with the 

individual by conducting the review itself or, at the individual's 

discretion, by approving the results of a review appropriately 

conducted by a qualified VR counselor from outside the DSU.

    At the same time, however, we do appreciate the commenters 

concerns regarding the potential conflicts of interest, including 

potential limits on the exercise of informed choice, that may arise 

if the counselor or other person assisting the individual in 

developing (or amending) the IPE is employed or otherwise affiliated 

with an organization that may provide services to the individual 

under that IPE. However, without information indicating whether that 

problem exists or the resulting effects that an existing problem has 

on participants in the program, we are not inclined to restrict, 

through these final regulations, the individual's choice of 

assistants in developing the IPE. Nonetheless, we emphasize that 

DSUs must ensure that individuals are given full opportunities to 

exercise informed choice in the selection of services and service 

providers consistent with the requirements of section 102(d) of the 

Act and Sec. 361.52 of these final regulations. Accordingly, we 

would expect DSUs to address any situation, if it arises, in which 

it believes that a counselor employed by a service provider is 

unduly influencing an individual during IPE development to obtain 

services through that counselor's employer without providing the 

individual with sufficient choices.

    We maintain that requirements in Sec. 361.45(e) regarding DSU 

standards, including timelines, for the prompt development of IPEs 

are entirely consistent with the Act. In particular, section 

101(a)(9) of the Act requires that the individual's IPE be developed 

and implemented ``in a timely manner'' subsequent to the 

determination of eligibility. In fact, both this regulatory 

requirement and the statutory provision on which it is based precede 

the 1998 Amendments. We continue to believe that the regulatory 

standards and timelines called for under Sec. 361.45(e) of the 

regulations are necessary to guard against delays in service 

delivery that are, in turn, caused by delays in the IPE development 

process. We emphasize that DSUs need not meet this requirement by 

establishing an arbitrary time limit to apply to the development of 

all IPEs. Instead, State units are expected to develop general 

standards to guide the timely development of IPEs and, as part of 

those standards, flexible timelines that take into account the 

specific needs of the individual.

    Changes: None.

 

Section 361.47  Record of Services

 

    Comments: Some commenters generally supported the modifications 

to record of services requirements that we proposed in the NPRM. One 

commenter supported the new flexibility given to DSUs in determining 

the sources of documentation it will use to meet the required 

components of the record of services, but asked that RSA identify 

minimum documentation types in the final regulations. Several 

commenters opposed the expansion of the service record requirements 

beyond those in the previous regulations.

    Several other commenters asked that we clarify the scope of 

Sec. 361.47(a)(7) of the proposed regulations, which required 

documentation in the service record describing the extent to which 

the applicant or eligible individual exercised informed choice 

regarding assessment services and regarding the employment outcome, 

VR services, and other components of the IPE. Some commenters 

suggested that this proposed requirement be replaced by a provision 

requiring simply that the DSU document that the individual was 

provided an opportunity to exercise informed choice. Other 

commenters stated that it would be difficult to meet the proposed 

requirement in instances in which the DSU is not directly involved 

in the development of the IPE.

    Many commenters opposed the newly proposed Sec. 361.47(b), which 

would require that the DSU consult with the State Rehabilitation 

Council in determining the type of documentation that it will 

maintain for each applicant and eligible individual. These 

commenters believed that the proposed provision would expand the 

functions of the Council beyond those functions required by the Act. 

Due to the voluntary nature of the Council, the commenters asserted, 

it would be inappropriate to expect members of the Council to be 

involved in the DSU's day-to-day operations, including the setting 

of documentation requirements. Other commenters supported requiring 

the Council to be involved in establishing the DSU's documentation 

requirements.

    Discussion: We revised Sec. 361.47(a) of the previous 

regulations to identify minimum

 

[[Page 4430]]

 

documentation standards that will enable DSUs to demonstrate that 

certain service delivery requirements, as they apply to applicants 

and eligible individuals participating in the VR program, have been 

met. While we identified in this proposed section those critical 

service delivery requirements that must be documented, we sought to 

provide greater flexibility to DSUs in determining the manner in 

which they would comply (i.e., determining the types of 

documentation each would use to comply) with the stated 

requirements. We believe that the proposed regulations provided that 

flexibility, while identifying only those requirements of the 

rehabilitation process that are most necessary to address in the 

record of services. Those proposed requirements that were not drawn 

from the previous regulations represented important aspects of the 

1998 Amendments that we believe the DSU, and we, must monitor to 

ensure the proper implementation of the program.

    In addition, we believe that Sec. 361.47(a)(7) of the proposed 

regulations established an appropriate standard for DSUs to meet in 

documenting compliance with a most critical aspect of the VR 

program--giving individuals the opportunity to exercise informed 

choice throughout the rehabilitation process. Accordingly, we do not 

believe that a simple statement that the applicant or eligible 

individual was provided an opportunity to exercise informed choice 

reflects either the scope or the importance of the choice-related 

requirements in the Act. Among those requirements, section 102(d) of 

the Act and Sec. 361.52 of the final regulations specify that 

applicants and eligible individuals must be given opportunities to 

exercise informed choice in selecting assessment services and in 

selecting an employment outcome, the VR services needed to achieve 

that outcome, the entities providing services, and the methods used 

to secure the services. Thus, given the emphasis accorded choice 

under the Act, we believe it is appropriate and prudent to require 

documentation describing the extent to which the applicant or 

eligible individual exercised informed choice in accordance with the 

Act's requirements. As for those instances in which an individual 

elects to develop an IPE without the DSU's assistance, we would 

expect the DSU to inform individuals about the availability and 

opportunities to exercise informed choice (as it is required to do 

under section 102(d)(1) of the Act), obtain information from the 

individual on the extent to which he or she exercised choice during 

IPE development, and supplement that information with additional 

information available to the DSU in order to meet the documentation 

requirement in Sec. 361.47(a)(7).

    As we stated in the preamble to the NPRM, we think it is 

necessary that the DSU consult with the Council, if it has a 

Council, in determining the type of documentation that the DSU will 

maintain in the record of services for each applicant and eligible 

individual. Section 101(a)(16)(B)(v) of the Act requires the State 

unit to take into account, in connection with matters of general 

policy arising in the administration of the State plan, the views of 

the Council and other specified groups. The document types that will 

comprise the records of services maintained by the DSU relate 

directly to the DSU's ability to demonstrate its compliance with 

important service provision requirements in the law, as well as its 

ability to justify its decisions (e.g., eligibility determinations) 

regarding the individual's participation under the VR program. We 

maintain, therefore, that the DSU's documentation standards for 

fulfilling the record of services requirements in this section of 

the regulations constitute a policy of general applicability on 

which the Council's input is required. Moreover, we do not believe 

that the consultation required under this section of the regulations 

expands the Council's functions beyond the scope of the statute, 

particularly the broad scope of review, analysis, and advisory 

functions carried out by the Council under section 105(c)(1) of the 

Act.

    Changes: None.

 

Section 361.48  Scope of Vocational Rehabilitation Services for 

Individuals With Disabilities

 

    Comments: Several commenters requested that we revise 

Sec. 361.48(j) of the proposed regulations to more clearly describe 

the type of interpreter and other communication access services that 

are authorized under the program. Other commenters requested 

clarification regarding the scope of assistance for eligible 

individuals seeking self-employment, telecommuting, or business 

ownership outcomes that is authorized under proposed Sec. 361.48(s). 

One of these commenters requested guidance on how these services 

relate to the entrepreneurial services available through the State 

workforce investment system.

    Discussion: We agree with the suggestion that the scope of 

authorized interpreter services under proposed Sec. 361.48(j) needs 

to be clarified in the final regulations. In particular, we believe 

that we need to clarify that sign language interpreter and oral 

interpreter services are authorized under that section.

    Regarding Sec. 361.48(s), we have received several inquiries, in 

addition to the noted comments, asking us to clarify the scope of 

resources that are authorized to be provided through the statewide 

workforce investment system in order to clarify the extent of the 

State unit's obligation under proposed Sec. 361.48(s). This 

provision restates section 103(a)(13) of the Act.

    Section 112 of Title I of WIA requires that each participating 

State submit to the Department of Labor a State plan that describes 

its statewide workforce investment system and the employment and 

training activities that it will support with WIA Title I funds. The 

specific employment and training activities included in the plan are 

determined individually by each State, depending on the needs and 

economic conditions in that State. Therefore, the scope of resources 

authorized under the VR program for self-employed persons, 

telecommuters, and small business owners will depend on the extent 

to which the State's workforce development system, as described in 

the State plan under section 112 of WIA, provides support to 

individuals pursuing that type of work. Given the variances in 

workforce investment systems across the States, we do not believe 

that it is practical to revise the language in proposed 

Sec. 361.48(s) that aligned the resources authorized under the VR 

program with those that the State makes available under WIA.

    Finally, we believe it is important to note that the list of 

authorized services in this section of the regulations is not 

exhaustive and that Sec. 361.48(t) specifically authorizes ``other 

goods and services'' that the DSU and individual determine to be 

necessary for the individual to achieve an employment outcome.

    Changes: We have revised Sec. 361.48(j) of the proposed 

regulations by referring specifically to sign language interpreter 

and oral interpreter services as included within the scope of 

authorized services for individuals who are deaf or hard of hearing.

 

Section 361.50  Written Policies Governing the Provision of 

Services for Individuals With Disabilities

 

    Comments: One commenter requested changes to Sec. 361.50(b)(1) 

of the proposed regulations, which authorized States to establish 

preferences for in-State services under certain conditions. The 

commenter contends that this provision, which was included in the 

previous regulations, has been subject to misuse and 

misinterpretation. In response, the commenter suggests restricting 

DSU preferences for in-State services to instances in which the in-

State service is equivalent to and likely to have the same results 

as an out-of-State service.

    Discussion: Section 361.50(b)(1) authorizes a DSU to establish a 

preference for in-State services in instances in which necessary 

services are available both within and outside the State. The 

preference (i.e., the State not taking responsibility for the costs 

of an out-of-State service that exceeds the costs of the same 

service provided in-State) is dependent on the in-State service 

meeting the individual's rehabilitation needs. For that reason, we 

believe that the provision establishes an appropriate standard, one 

that has the same effect as that of requiring equivalency between 

in-State and out-of-State services.

    Changes: None.

 

Section 361.51  Standards for Facilities and Providers of Services

 

    Comments: Many commenters expressed concern about the omission 

in the proposed regulations of the designated State unit's current 

regulatory responsibility to issue minimum standards for facilities 

and service providers. The commenters believed that omitting these 

requirements from the final regulations will have the effect of 

holding community providers and facilities to a lower standard than 

that which must be met by the State agency administering the VR 

program. The concern was that VR program participants receiving 

services from private providers would be adversely affected. These 

commenters encouraged us to maintain the current regulatory 

standards in the final regulations.

    The commenters on this section were concerned mostly about the 

proposed

 

[[Page 4431]]

 

removal of the previous regulatory provisions requiring providers of 

vocational rehabilitation services to use qualified personnel. For 

example, one party stated that financial constraints on community 

facilities may reduce a facility's capacity to maintain the same 

qualified personnel standards that section 101(a)(7) of the Act 

imposes on State agencies; nevertheless, this commenter believed 

that regulatory requirements should be developed to ensure a 

reasonable level of professional qualifications at provider 

facilities. Other commenters stated that individuals who are blind 

or visually impaired in particular, and all individuals with 

disabilities generally, must be assured that private facilities and 

providers of services under the VR program have proper 

qualifications beyond native language skills and the ability to use 

appropriate modes of communication (two current standards that were 

retained in the proposed regulations). In addition, many of the 

commenters expressed concern that the proposed regulations, unlike 

the previous regulations, did not require VR service providers to 

have adequate and appropriate policies and procedures to prevent 

fraud, waste, and abuse.

    Discussion: We had proposed to remove the regulatory 

requirements governing personnel and other standards for providers 

of VR services on the basis that the explicit statutory authority 

supporting those requirements was removed by the 1998 Amendments. 

Specifically, the 1998 Amendments removed provisions previously 

contained in section 12(e) of the Act that had required the 

Secretary to promulgate regulations pertaining to the selection of 

VR services and VR service providers. In accordance with the prior 

Act, Sec. 361.51 of the previous regulations included procedures to 

prevent fraud, waste, and abuse among service providers and 

procedures to ensure that service providers complied with applicable 

standards, such as those related to qualified personnel. The 

requirements in Sec. 361.51 of the proposed regulations that were 

retained from the previous regulations relating to the accessibility 

of facilities, affirmative action for qualified individuals with 

disabilities, and special communication needs personnel also were 

retained in the 1998 Amendments.

    We have interpreted Congress' removal of standards governing 

personnel and fraud, waste, and abuse from the Act as intended to 

give States greater discretion in determining how best to ensure 

that service providers used by the DSU are capable of providing 

necessary VR services and meeting the needs of VR program 

participants. In other words, Congress determined that States could 

ensure the quality of personnel and administrative efficiency among 

the service providers it uses by following applicable State rules. 

We want to emphasize that removing this particular requirement from 

the final regulations does not absolve State units from ensuring 

that entities providing services under the VR program meet 

applicable State laws that impose personnel standards and other 

safeguards on parties providing services under State-administered 

programs. We believe that this responsibility of the DSU, as well as 

the DSU's general responsibilities under OMB Circular A-87 and the 

Education Department General Administrative Regulations (EDGAR) to 

administer the VR program and the expenditure of VR program funds 

efficiently and effectively, ensures that the removal of previous 

regulatory standards for service providers will not have an adverse 

impact on the program.

    Changes: None.

 

Section 361.52  Informed Choice

 

    Comments: As with proposed Sec. 361.5(b) discussed previously, a 

number of commenters requested that we define the term ``informed 

choice'' in this section of the final regulations.

    Another commenter suggested that this section of the proposed 

regulations be revised to ensure that participants in the VR program 

are able to exercise informed choice in selecting their vocational 

rehabilitation counselor. Specifically, the commenter suggested that 

participants, prior to selecting a counselor, be given a list of 

counselors in the local office of the State unit, a statement of the 

counselors' qualifications, and the opportunity to interview a 

number of counselors.

    Other commenters suggested that DSUs make available to 

individuals information concerning the outcomes that individuals 

achieve in working with specific service providers. The commenters 

asked that this information be included in the scope of information 

that DSUs must provide individuals under Sec. 361.52(c). Other 

commenters proposed revisions to Sec. 361.52(d), which identifies 

sample methods or sources of information that the DSU may use to 

make available required information on services and service 

providers. Specifically, one commenter requested that DSUs make 

available to individuals information on nationwide services and 

service providers, as well as service-related information issued by 

national consumer groups.

    Discussion: We have long been asked to define the term 

``informed choice'' in regulations and have refrained on the basis 

that the current regulations establish appropriate guidelines 

governing the informed choice process, while leaving some discretion 

to DSUs, in conjunction with their Councils, if they have Councils, 

to determine how best to secure information and make that 

information available to participants so that they may exercise 

choice. The 1998 Amendments give even greater emphasis to informed 

choice, specifically in section 102(d), which identifies each of the 

stages at which choices must be given (essentially all stages of the 

rehabilitation process), requires the DSU to inform individuals 

about the availability of and the opportunity to exercise informed 

choice, and requires that the DSU assist individuals as is necessary 

so that they may make informed choices. We believe that this 

proposed section of the regulations sufficiently reflected the 

significant scope of the choice provisions in the Act and retained a 

number of key portions from the previous regulations that serve to 

guide DSUs in developing their choice-related policies. We again 

emphasize the crucial role that the Council must play in that 

regard.

    Although we maintain that, at this point, defining ``informed 

choice'' in the regulations would not be appropriate, we have 

established additional guidance materials designed to facilitate the 

choice process, most notably as part of the RSA Monitoring Guide for 

FY 2000. We intend to develop additional policy directives that will 

also assist in that effort.

    Section 361.45 of the regulations, which implements section 

102(b)(1) of the Act, specifies the range of options available to 

individuals in securing assistance in developing their IPEs, 

including assistance provided by DSU or non-DSU counselors or from 

other sources. However, neither that provision nor the broad choice 

requirements in section 102(d) of the Act establish a basis for 

requiring DSUs to provide individuals with their choice of VR 

counselors. At the same time, we note that the Act and the final 

regulations do not prevent a State from giving individuals the 

opportunity to exercise informed choice in selecting counselors. RSA 

guidance to the States (Program Assistance Circular 88-03, dated 

June 7, 1988) underscores the importance of an effective counseling 

relationship between the applicant or eligible individual and the 

DSU counselor. Thus, we would urge DSUs, taking into account 

caseload levels and other staffing considerations, to assign 

counselors to individuals in a manner that they believe will result 

in a most effective match. Given the obvious effect that that match 

has on the successful rehabilitation of the individual, we also 

indicate in the guidance that, if an individual requests a change in 

counselor and the request is denied, the individual can appeal the 

determination through the DSU's due process procedures.

    Section 361.52(c) of the proposed regulations listed the minimum 

scope of information that State units were required to provide to 

individuals, or assist the individual in acquiring, to enable the 

individual to make informed choices about the services, service 

providers, and outcome identified in the IPE. We agree with the 

commenter that the minimum information related to services and 

service providers specified in this section (e.g., cost, consumer 

satisfaction, qualifications, degree of integration, etc.) also 

should mention the types of outcomes that individuals have achieved 

in working with certain providers.

    Section 361.52(d) identifies specific methods and sources of 

information that the DSU may use to provide individuals with 

sufficient information about services and service providers. Since 

this provision is not a comprehensive listing of methods and 

sources, we note that DSUs and individuals may use any other methods 

and sources of information that are available to enable the 

individual to exercise choice. We agree that participants and State 

units may benefit greatly by securing information from national 

consumer groups or other national organizations with specialized 

expertise in particular disabilities, rehabilitation methods, and 

services. In addition, methods involving experiences that 

participants may use to gain information about types of employment 

outcomes, services, and service providers may prove helpful. We 

encourage

 

[[Page 4432]]

 

DSUs to assist individuals in obtaining useful information from many 

other appropriate sources.

    Changes: We have revised Sec. 361.52(c) of the proposed 

regulations to clarify that information and assistance provided 

under that section also must assist individuals in exercising 

informed choice among assessment services. In addition, we have 

included service provider outcomes in the scope of information 

relating to the selection of vocational rehabilitation services and 

service providers. We have deleted the terms ``local'' and ``state 

and regional'' from Sec. 361.52(d) and have added references to 

methods involving visiting or experiencing various settings to the 

list of potential methods or sources of obtaining information.

 

Section 361.53  Comparable Services and Benefits

 

    Comments: One commenter expressed concern that the requirement 

in the proposed regulations that DSUs provide services to an 

individual while waiting for identified comparable services and 

benefits to become available may serve as a disincentive for 

individuals to pursue the alternative benefits or services at the 

appropriate time. The commenter recommended that DSUs be able to 

discontinue services if an individual refuses to pursue the 

comparable benefits or services.

    Another commenter noted that the proposed regulations did not 

include the statutory exemption in section 101(a)(8)(A)(ii) of the 

Act that states that awards and scholarships based on merit are not 

considered comparable services and benefits under the program.

    Discussion: Both section 102(b)(3)(E)(ii) of the Act and 

Sec. 361.46(a)(6)(ii)(C)) of the regulations require that the IPE 

identify the individual's responsibilities with regard to applying 

for and securing comparable services and benefits. Thus, the law 

anticipates that State units and individuals will work out the 

extent of those responsibilities through the IPE development 

process. For that reason, we do not believe that Sec. 361.53(c)(2), 

which is unchanged from the previous regulations, would create the 

disincentive envisioned by the commenter as long as the individual 

is fully apprised of, and is assisted in fulfilling, his or her 

responsibilities in securing other services once they become 

available.

    We recognize that this section of the proposed regulations did 

not refer to the statutory exception to comparable services and 

benefits for scholarships and awards based on merit. However, this 

exemption is addressed in the definition of the term ``comparable 

services and benefits'' in Sec. 361.5(b)(10). We think the exception 

is best addressed in the definition itself since it is the 

definition that specifies the scope of comparable services and 

benefits under the program.

    Changes: None.

 

Section 361.54  Participation of Individuals in Cost of Services 

Based on Financial Need

 

    Comments: Many commenters supported the proposed expansion of 

those services that would be exempt from State financial needs 

tests, meaning that individuals could not be required to contribute 

to the cost of those services. One commenter suggested that the 

proposed exemption of interpreter services, reader services, and 

personal assistance services from financial needs tests be limited 

to the provision of those services during the assessment phase of 

the VR process. Another commenter supporting the proposal asked that 

we also emphasize that the DSU still must seek and use comparable 

services and benefits to pay for exempted services.

    In addition, in response to our request for comments on the 

appropriate scope of services that should be exempted from financial 

needs tests, a number of commenters requested that the proposed 

listing be expanded to specifically include assistive communication 

devices, rehabilitation engineering services, and other access-type 

services.

    Other commenters strongly opposed the proposed expansion of the 

list of services exempted from financial needs tests under the prior 

regulations. Some of these commenters stated that the proposed 

expansion would undermine the DSU's longstanding option of 

considering the financial need of program participants and would 

weaken the DSU's ability to conserve VR program funds.

    In addition, many commenters supported the proposed prohibition 

in the NPRM on applying financial needs tests to eligible 

individuals receiving SSI or SSDI. Other commenters supported 

prohibiting the application of financial needs tests only to 

individuals receiving SSI since SSI eligibility is based on the 

individual's financial need as opposed to SSDI beneficiaries who may 

have assets that they could contribute to the cost of vocational 

rehabilitation services.

    A significant number of commenters opposed the proposed 

exemption of SSI recipients and SSDI beneficiaries from the DSU's 

financial needs assessments on the basis that DSUs often consider 

the resources of the individual's entire household, as opposed to 

those of the individual only, in determining the level of resources 

the individual must contribute to the program of VR services. While 

these commenters agreed that DSUs could disregard an individual's 

actual SSI or SSDI cash payment, the commenters recommended that 

DSUs be able to consider the overall financial status of the 

individual and the individual's household when assessing the 

individual's financial need under the VR program.

    Discussion: In the NPRM, we proposed to expand the scope of 

services exempt from State financial needs tests under the prior 

regulations to include certain services (i.e., interpreter, reader, 

and personal assistance services) needed to participate in the VR 

program, as well as any service needed by a recipient of SSI or 

SSDI.

    The purpose of the proposal to exempt from State financial needs 

tests interpreter, reader, and personal assistance services was to 

ensure access to the VR program. As we discussed in the preamble to 

the NPRM (65 FR 10629), the additional services that we proposed 

excluding from State financial needs tests enable individuals to 

participate in training or employment-related services that they are 

seeking through the VR program. Typically, individuals do not apply, 

nor are they determined eligible, under the VR program solely to 

receive these access-type services. Rather, these services are 

provided in conjunction with employment and training services sought 

by the individual participating in the VR program. In fact, the 

distinguishing feature of these access services is that 

participation in the VR program is not possible without these 

services being afforded. Thus, placing an additional burden on the 

individual to participate in the cost of accessing the VR program, 

in our view, is inappropriate and contrary to both the purpose of 

the VR program and the principles in section of 504 of the Act and 

the ADA, which safeguard participation by persons with disabilities 

in federally funded (under section 504) or public (under the ADA) 

programs.

    As many of the commenters pointed out, we realize that access-

type services other than the three additional services that the NPRM 

would have exempted from financial needs tests (i.e., interpreter, 

reader, and personal assistance services) clearly exist and that 

individuals might need those services in order to participate in the 

VR program. In light of the extensive public comment we received on 

that point, and the fact that the limited scope of exempted services 

in the proposed regulations would not ensure that persons with 

certain disabilities are able to participate in the VR program, we 

have modified the proposed regulations to more clearly reflect the 

DSU's responsibility to ensure that all persons with disabilities do 

not incur the disability-related costs of accessing the VR program. 

Specifically, the final regulations prohibit the application of 

State financial needs tests to the provision of any auxiliary aid or 

service that would be necessary under section 504 of the Act or the 

ADA in order for an individual with a disability to participate in 

the VR program. Thus, the final regulations, in effect, ensure that 

individuals are able to receive, at no additional cost to 

themselves, aids and services to which they are already entitled 

under section 504 or the ADA.

    We note that interpreter and reader services--two services 

proposed to be exempt from financial needs tests in the NPRM--

generally would be covered under the section 504- and ADA-based 

standard in the final regulations if those services are needed in 

order for the individual to access other VR services. In addition, 

the final regulations, like the NPRM, identify personal assistance 

services as a separate category of services exempt from financial 

needs tests. While personal assistance services, as defined in the 

VR program regulations, might not necessarily be provided by public 

programs under section 504 or the ADA, those services are often 

critical for individuals with significant disabilities to be able to 

access employment and training under the VR program. As we indicated 

in the preamble to the NPRM, we believe it is important to exempt 

these services from financial needs tests as well. We also believe 

that retaining from the NPRM the exemption for personal assistance 

services will remove a significant disincentive toward pursuing

 

[[Page 4433]]

 

employment for those with the most significant disabilities.

    We also note, however, that the final regulations do not alter 

the State unit's responsibility to seek comparable services and 

benefits that can meet the individual's interpreter, reader, 

personal assistant, or other access needs. Nor does it affect 

entities outside of the DSU from meeting their responsibilities 

under section 504 of the Act, the ADA, or other laws. In fact, we 

expect that some of those entities are likely to be public agencies 

with which the State unit is required to enter into an interagency 

agreement in order for both parties to fulfill their 

responsibilities toward individuals with disabilities (see 

Sec. 361.53(d) of the final regulations).

    With regard to the proposed prohibition on applying financial 

needs tests to individuals who receive SSI or SSDI, we continue to 

believe that it is appropriate to exempt those persons from DSU 

financial needs tests given the Act's emphasis on streamlining 

access to VR services for disabled Social Security recipients. 

Moreover, as we discussed in the preamble to the NPRM (65 FR 10629), 

this change to the prior regulations facilitates the primary goal 

behind referring SSI recipients and SSDI beneficiaries to the VR 

program--supporting their efforts (and reducing disincentives) to 

pursue gainful employment and no longer require Social Security 

support.

    Our rationale for exempting individuals receiving SSI benefits, 

or a combination of SSI and SSDI benefits, from State-imposed 

financial needs tests is further supported by the fact that these 

persons already have gone through a rigorous, federally mandated 

financial needs test that is typically more restrictive than those 

tests employed at the State level. To qualify for SSI, individual 

recipients must have very limited, if any, monthly income--

individual or household--or other assets. These individuals 

generally live at or below the federally established poverty level. 

Consequently, SSI recipients clearly have a limited ability to 

contribute to the costs of VR services. Requiring these same persons 

to undergo an additional financial needs test at the State level 

would serve only to unnecessarily delay the provision of VR 

services.

    On the other hand, the rationale behind exempting from DSU 

financial needs tests individuals receiving SSDI benefits alone is 

based on three critical points. First, SSA, as a matter of policy, 

has deemed it necessary to award SSDI beneficiaries monthly cash 

assistance due to their inability to work. While it is true that 

SSDI benefits are awarded on the basis of earnings and years worked 

as opposed to extreme financial need, SSA has determined that these 

individuals can no longer work due to their disabilities and, 

therefore, cannot earn income to support themselves or their 

families. SSDI payments are intended to cover a person's living 

expenses. Once a person achieves an employment outcome earning 

sufficient wages, as determined by SSA, the individual would be 

removed from the SSDI rolls.

    Second, many State and Federal agencies currently are working to 

remove as many disincentives as possible for individuals with 

disabilities, including individuals with significant disabilities 

receiving Social Security benefits, to return to work. For example, 

Congress has adopted changes to Social Security laws not to penalize 

persons (i.e., not to eliminate or reduce Social Security benefits, 

including health care coverage) for working since individual's wages 

are often insufficient to cover costly medical and other living 

expenses. Previously, many individuals with disabilities chose to 

remain on SSDI, at Federal expense, rather than risk losing health 

care coverage. Imposing a financial needs test on this same 

population that is seeking VR services in order to achieve an 

employment outcome, in effect, creates an additional disincentive to 

work and could adversely affect the results sought through the 

revised Social Security laws and other reforms.

    Third, it is important to note that SSA reimburses State VR 

agencies for the costs incurred in serving an SSI or SSDI recipient 

when that individual achieves an employment outcome (i.e., 

substantial gainful activity under Social Security laws) for a 

specified period of time. Thus, as far as those SSI and SSDI 

recipients who successfully achieve employment outcomes under the VR 

program are concerned, there is ultimately little financial burden 

on the DSU in serving these persons to justify transferring that 

burden to individuals.

    Changes: We have amended the proposed regulations to exempt from 

DSU financial needs tests any service that constitutes an auxiliary 

aid or service afforded the individual under section 504 of the Act 

or the ADA in order for the individual to participate in the VR 

program.

 

Section 361.56  Requirements for Closing the Record of Services of 

an Individual Who Has Achieved an Employment Outcome

 

    Comments: Several commenters expressed concern about proposed 

Sec. 361.56(a), which required, as a condition of closing the 

individual's record of services, that the employment outcome 

achieved by the individual be the same as that described in the 

individual's IPE. These commenters viewed the provision as 

inappropriate since amending the IPE to specify a new employment 

outcome is not always possible, for example when the individual is 

unavailable to sign an amended IPE.

    Other commenters questioned Sec. 361.56(c) of the proposed 

regulations, which required an agreement between the individual and 

the DSU counselor that the employment outcome is satisfactory and 

that the individual is performing well in the employment before the 

DSU can close the individual's record of services. These commenters 

suggested that the proposed provision might lead to differences of 

opinion between the counselor and the individual as to whether the 

outcome is ``satisfactory'' and thus preclude the State unit from 

appropriately closing the service record.

    Discussion: We agree that in very limited instances it may be 

impractical for the DSU and the individual, together, to amend the 

individual's IPE to reflect the ultimate employment outcome that the 

individual obtains while participating in the VR program. Yet, we 

believe that in most instances necessary amendments to the IPE can 

be accomplished since the DSU and the individual need not approve 

and sign the amended IPE simultaneously. Moreover, the required 

consistency between the IPE and the individual's outcome, in our 

view, is warranted in order to preserve the usefulness of the IPE 

development process.

    With respect to the comments on proposed Sec. 361.56(c), we note 

that this provision in the NPRM was substantially the same as the 

previous regulatory provision. In addition, we are not aware of any 

reported problems regarding the implementation of this provision 

through RSA monitoring activities, referrals to the Client 

Assistance Program, or due process hearings. More importantly, given 

that employee and counselor satisfaction is a critical factor toward 

assessing the stability of the individual's job, we believe that the 

provision should be retained in the final regulations.

    Changes: None

 

Section 361.57  Review of Determinations Made by Designated State 

Unit Personnel

 

    Comments: One commenter suggested revising Sec. 361.57(a) of the 

proposed regulations to require the State unit to provide in writing 

all agency decisions that result in a suspension, termination, or 

denial of services. This commenter explained that requiring written 

notification of service denials would be consistent with procedural 

safeguards in other Federal programs.

    We received several comments regarding proposed Sec. 361.57(b), 

the general requirements governing State due process procedures. 

Specifically, commenters expressed dissatisfaction with proposed 

Sec. 361.57(b)(3)(ii) regarding representation during mediation 

sessions and formal due process hearings. One commenter suggested 

revising that paragraph to exclude the use of attorneys during 

mediation and to require the use of attorneys during the formal 

hearing process. The commenter expressed concern that the use of 

attorneys during mediation would alter the informal nature of that 

process. Conversely, the commenter explained, individuals who are 

not represented by attorneys during the formal hearing are at a 

distinct disadvantage since the State unit, in general, is 

represented in hearings by an attorney.

    At least one commenter questioned whether mediation should be 

voluntary on the part of the State unit. The commenter suggested 

revising proposed Sec. 361.57(d)(2)(i) to require the State unit to 

participate in good faith in the mediation process whenever 

mediation is requested by the individual.

    Commenters suggested that Sec. 361.57(d)(2)(ii) of the proposed 

regulations be modified to allow the mediator, in addition to the 

parties to the mediation, to terminate the mediation process. The 

commenters stated that it is common practice to give mediators that 

authority.

    A few commenters raised concerns about proposed 

Sec. 361.57(d)(2)(iii), which governs the manner in which mediators 

are assigned to a particular case and lists of qualified and

 

[[Page 4434]]

 

impartial mediators are maintained. One commenter described the 

meticulous and thoughtful steps used in one State to assign the 

mediator who is most appropriate to each case. Another commenter 

suggested that the regulations require that the State unit and the 

Council agree to the list of mediators as they do for impartial 

hearing officers.

    The final set of comments regarding the proposed mediation 

procedures pertain to the requirements governing mediation 

agreements under proposed Sec. 361.57(d)(4). One commenter stated 

that mediators do not ``issue'' mediation agreements as that 

provision suggests. Several commenters urged us to make mediation 

agreements binding on all parties in order to create greater 

incentive to pursue mediation.

    We received many comments regarding the requirement in proposed 

Sec. 361.57(e)(1) that hearings generally be conducted within 45 

days of an individual's request for review of a State unit decision 

that affects the provision of services to the individual. With one 

exception, all commenters indicated that it is overly burdensome to 

require the State unit to conduct informal reviews, mediation, and 

the formal hearing within the same 45-day period. Some suggested 

that the 45-day clock not begin until after an informal review and, 

if applicable, the mediation process are completed. Others suggested 

that the time period be extended by a certain number of days (e.g., 

10 days) to allow for mediation to occur. Still others suggested 

that the regulations allow separate time periods for each phase of 

dispute resolution and that the time periods run consecutively.

    Several commenters suggested that Sec. 361.57(g)(3)(iii) of the 

proposed regulations be modified to eliminate the 30-day deadline by 

which a reviewing official must render a decision.

    Finally, we received several comments asking that the final 

regulations include a time limit (e.g., 30 days) for the filing of 

civil actions under Sec. 361.57(i) of the proposed regulations.

    Discussion: The issue concerning requiring that all agency 

decisions that result in a suspension, termination, or denial of 

services be provided in writing has been brought to our attention 

many times since the adoption of the 1998 Amendments. Section 

361.57(a) conforms to the statutory requirements in section 102(c) 

of the Act. The Act does not require a written decision in order for 

an individual to initiate an appeal under this section. An 

individual may appeal ``any determination.'' Therefore, we do not 

require designated State unit personnel to issue decisions 

pertaining to the provision of services in writing, but we encourage 

the use of written decisions whenever practicable.

    With respect to the comments pertaining to legal representation, 

we share the concern that individuals sometimes are at a 

disadvantage if they are not represented by an attorney during the 

formal hearing process, especially if the designated State unit is 

represented by an attorney. However, we do not share the concern 

that attorneys used during the mediation process necessarily change 

the nature of mediation. Nonetheless, the proposed requirements 

regarding representation during the mediation and hearing stages 

reflect the broad authority in section 102(c)(3)(B) of the Act for 

individuals to select the representative of their choice.

    The 1998 Amendments to the Act added mediation as a new method 

of resolving disputes between individuals and the State unit. Thus, 

it is not surprising that many commenters sought further 

clarification of the requirements in the proposed regulations that 

impact the States' implementation of mediation procedures.

    Section 361.57(d)(2)(i) conforms to the statutory language of 

section 102(c)(4)(B)(i) of the Act, which requires that the DSU's 

mediation procedures ensure that the mediation process ``is 

voluntary on the part of the parties. . . . '' (emphasis added). 

Therefore, Congress intended the mediation process to be voluntary 

on the part of both parties rather than giving only the individual 

the discretion to participate in mediation as one commenter 

suggested. We also believe that allowing mediation to be voluntary 

on the part of both parties is necessary since mediation is 

successful only if both parties participate willingly in an effort 

to resolve their dispute. We do note, however, that the State unit's 

decision to agree to pursue mediation should be made on a case-by-

case basis. It is neither appropriate nor consistent with the intent 

of the Act for a DSU to follow a general policy of never 

participating in mediation.

    Our intent behind Sec. 361.57(d)(2)(ii) of the proposed 

regulations was to ensure that either party may change its mind 

about participating in mediation, even after the mediation process 

has begun, and at that point pursue a due process hearing. We sought 

to ensure that individuals in particular are never locked into a 

less formal dispute resolution process that they believe to be 

futile. Consistent with this approach, we also agree with the 

suggestion that mediators should be allowed to terminate the 

mediation process and that amending the regulations to reflect that 

point would not alter the intended effect of this proposed section.

    We proposed a process in Sec. 361.57(d)(2)(iii) of the proposed 

regulations that is similar to that which the Act applies to the 

selection of impartial hearing officers. In particular, we sought to 

ensure the same neutrality on the part of the mediators that exists 

for hearing officers. However, we believe that States with 

established processes for assigning mediators to a case should be 

allowed to continue appointing mediators in that fashion, provided 

that the process used ensures neutrality.

    In response to the comments on proposed Sec. 361.57(d)(2)(iii) 

and the development of the State's list of available mediators, we 

note that section 102(c)(4)(C) of the Act does not require the State 

to develop the list of mediators through the joint efforts of the 

State unit and the Council. Many States have developed an ``Office 

of Dispute Resolution'' or similar office to handle all mediations 

across multiple State agencies. These offices typically employ 

mediators or contract with private mediators to conduct mediations 

involving State-administered programs. The proposed regulations were 

intended to give States as much flexibility as possible in 

establishing mediation policies and using existing mediation 

processes.

    Many individuals representing CAPs and DSUs have urged us to 

interpret section 102(c)(4) of the Act to require that a mediation 

agreement be binding on all parties. We believe that, if the outcome 

of mediation (i.e., a mediation agreement) were binding, then 

conceivably neither party could pursue a formal hearing afterward. 

That type of restriction would be contrary to the scope of due 

process procedures that are available under the Act.

    In light of the overwhelming support for extending the 45-day 

period for holding due process hearings under proposed 

Sec. 361.57(e)(1), we agree that the period should be extended to 60 

days in the final regulations. We do not believe that the time 

period should be extended any longer since section 102(c) of the Act 

clearly envisions a due process system that is timely, quick, and 

equitable.

    We believe that the 30-day period for an appropriate official to 

review a hearing officer's decision under proposed 

Sec. 361.57(g)(3)(iii) is reasonable. This is the same time period 

that applied to the review of hearing decisions by the State unit 

director under the previous regulations. Although State-level review 

of hearing decisions, if established by the State, now must be 

conducted by an official of an entity overseeing the DSU, we see no 

reason for modifying the current time period.

    We consider it inappropriate for us to establish a time limit 

for the filing of civil actions in disputes arising under the VR 

program. The State's Rules of Civil Procedure or the Federal Rules 

of Civil Procedure, depending on the appropriate forum, dictate the 

applicable deadline for filing an action in civil court.

    Changes: We have made the following modifications to proposed 

Sec. 361.57(d): authorizing mediators to terminate mediations 

(Sec. 361.57(d)(2)(ii)); authorizing States with an established 

method of assigning mediators to use that process in assigning 

mediators for the VR program provided the process ensures neutrality 

on the part of mediators (Sec. 361.57(d)(2)(iii)); and, in adopting 

a technical but important revision suggested by some commenters, 

clarifying that mediators assist in developing rather than ``issue'' 

mediation agreements (Sec. 361.57(d)(4)). We also have modified 

proposed Sec. 361.57(e)(1) to require that hearings be conducted 

within 60, rather than 45, days from the individual's request for 

review of a DSU decision.

 

Section 361.60  Matching Requirements

 

    Comments: One commenter wrote in support of the proposed change 

in Sec. 361.60(b)(3)(ii) that would authorize a State to use funds 

that are earmarked for a particular geographic area within the State 

as part of its non-Federal share without obtaining a waiver of 

statewideness if the State determines and informs the RSA 

Commissioner that it cannot provide the full amount of its non-

Federal share without using the earmarked funds. This commenter 

indicated that the provision was needed

 

[[Page 4435]]

 

since many State legislatures appropriate most, but not all, of the 

funds needed to match the full amount of Federal funds available 

under the program.

    Discussion: Although section 101(a)(4)(B) of the Act is intended 

to assist some States in meeting their matching obligations, we wish 

to reemphasize that statewideness requirements still apply to the 

Federal VR program funds that the State receives in return for 

contributing geographically limited earmarked funds to its non-

Federal share. For further discussion of the effect of this change 

from the previous regulations, please refer to the preamble to the 

NPRM (65 FR 10630).

    Changes: None.

 

Sections 361.80-361.89  Evaluation Standards and Performance 

Indicators

 

    Comments: None.

    Discussion: The Evaluation Standards and Performance Indicators 

for the VR program were published in the Federal Register on June 5, 

2000 (65 FR 35792) and became effective on July 5, 2000. Because 

these performance measures are part of the regulations implementing 

the VR program (34 CFR 361), we have added the measures and their 

corresponding requirements to the final regulations in this 

publication. The Evaluation Standards and Performance Indicators are 

located in Secs. 361.80 through 361.89 of Subpart E. For guidance in 

implementing the performance measures, we suggest you consult the 

preamble to the prior Federal Register publication of the measures 

(65 FR 35792).

    Changes: We have amended the proposed regulations to include 

Subpart E, ``Evaluation Standards and Performance Indicators,'' and 

the corresponding provisions in Secs. 361.80 through 361.89 that 

were previously published. The requirements in these sections are 

the same as those published in the Federal Register on June 5, 2000.

[FR Doc. 01-512 Filed 1-16-01; 8:45 am]

BILLING CODE 4000-01-U

 

 


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