Part 20.
TEXAS WORKFORCE COMMISSION
Chapter 800.
GENERAL ADMINISTRATION
The Texas Workforce Commission (Commission) adopts new §§800.81-800.86,
amendment to the title of Subchapter C of Chapter 800 and the repeal of §800.60
relating to the Reallocation of Funds, with changes to the text as published
in the April 28 issue of the
Texas Register
(25 TexReg 3731).
Background and Purpose: The Commission's allocation rules provide a single
set of rules to allocate funds that are subject to Local Workforce Development
Board (Board) planning and management. The funds are provided to Local Workforce
Development Areas (workforce areas) for the purpose of meeting the workforce
training and services needs of eligible populations and for meeting or exceeding
statewide performance measures as set forth in the General Appropriations
Act. Deobligation and reallocation of funds from one workforce area to another
has occurred as necessary at varying points of time, but not pursuant to an
established schedule.
The adopted reallocation rules describe an approach that builds upon existing
policy and provide a schedule for the reallocation process. The rules enhancements
are to: promote effective service delivery and financial planning and management,
ensure full utilization of funding, discourage over-expenditure, ensure performance
in association with expenditures, announce clear timetables and benchmarks,
reallocate funds to populations in need, and promote conditions that avoid
the need for reallocation.
Section 800.81 sets forth the purpose, intent, notice and scope provisions.
The Commission intends that the level of funding allocated to individual workforce
areas be sufficient to ensure full utilization of funding, to ensure compliance
with state and federal requirements applicable to the State, to meet the State's
federal participation rates, to respond to caseload changes, and to respond
to unforeseen demographic or economic changes. For example, this provision
would allow the Commission to consider the relationships among different categories
of funding in making deobligation and reallocation decisions. Section 800.81(d)
clarifies that the rules contained in this subchapter will be effective beginning
on September 1, 2000.
Section 800.82 sets forth definitions of the following terms to provide
clarity and consistency in how the different categories of funding are managed
by the Boards: expenditures, Funds Utilization and Service Level Plan, monthly
expenditure report, obligation, program year, and service level report.
Section 800.83 sets forth the provisions relating to the Funds Utilization
and Service Level Plan and reports to provide a method of tracking Board expenditures
and performance under the Board's Funds Utilization and Service Level Plan.
Section 800.84 sets forth required expenditure, local match, and obligation
levels. The Commission anticipates that Boards will expend funds throughout
the year consistent with the Boards' Funds Utilization and Service Level Plans.
The Commission also expects that each Board shall leverage and secure local
funds for workforce training and services and in particular child care to
access unmatched federal funds that are contingent upon Boards securing local
donations, transfers, and certifications as required by the provisions of
the General Appropriations Act.
The levels of reported expenditures by the end of the program year vary
by category of funding based on (1) federal statutory requirements, (2) spending
cycles, and (3) reasonable operating carryover budgets, based on general business
practices to ensure no overspending occurs and no disruptions to client services
will result at the end of a program year.
Section 800.85 sets forth provisions relating to deobligation of funds,
including the methods for deobligating and the requests to voluntarily deobligate
from the workforce areas. Regarding deobligation of Child Care funds, the
Commission believes that the number of child care units of service represents
the best indicator of performance for purposes of managing funding, because
the number of child care units of service directly (1) reflects the amount
of funding used for direct child care services and (2) is more accurate for
purposes of deobligation than a count of the total number of children served
without reference to the frequency of the services provided for the children.
Section 800.86 sets forth the criteria for workforce areas to be eligible
for reallocated funds based on the management by the Boards and the method
of reallocating for each category of funding.
The Agency provided copies of a draft reallocation policy during the rule
development and appreciates the Boards' input throughout the rulemaking process
and the Boards' participation in the conference call held to provide representatives
of the Boards with an opportunity to respond to the draft policy.
Comments were received from the following Boards: Alamo, Deep East Texas,
Gulf Coast, Panhandle, Permian Basin, and West Central; and the City of San
Antonio.
Comment: Regarding §800.82(4), one commenter asked if the term obligation
as used in the proposed rule encompassed Individual Training Accounts (ITAs).
If it did not, the commenter recommended inclusion of the term Individual
Training Account in the definition to ensure that local areas consistently
reported this item.
Response: The Commission agrees with the commenter and will amend the rule
to include ITAs in the definition for obligation. To clarify further, Boards
are encouraged to plan and manage funds, including ITAs, to ensure the effective
and full utilization of funds and delivery of services. For example, a Board
may fund an ITA for an individual who plans to attend college for two years.
However, the individual may decide, after completing the first year or a portion
of the first year, to withdraw due to an unforeseen problem. Rather than maintain
the ITA until the individual is able to return to college at a later date,
Boards may elect to reassign the remaining ITA funds to another individual,
and fund the original ITA at a later date. In this way, funds are fully utilized
and the greatest number of individuals may be served within a specific time
period.
Comment: Regarding §800.83(a)(2), one commenter requested clarification
on the term "categories of funding" as it applied to Child Care because the
proposed rules alluded to Child Care, other than TDPRS funded child care services,
as one category of funding.
Response: The Commission set out the categories of funding in §800.81(c)(1)
and (3). Child Care is considered one funding category and TDPRS funded child
care services are not.
Comment: Regarding §800.83(b)(1)(A)-(B), the commenter requested reconsideration
of the due date for monthly expenditure and service level reports. The commenter
recommended changing the due date to "on or before the 28th calendar day of
the following month" to allow time for invoices from vendors to be processed
and entered into the Child Care Budget and Payment System to better reflect
the actual service level and expenditures for the previous month. The commenter
requested further clarification on requirements and due dates of final or
close-out reports if applicable.
Response: The Commission's intent is to consolidate the required reporting
schedule for all categories of funding in the rule. To avoid confusion, the
Commission will retain the proposed reporting schedule. Additionally, §800.83(b)(1)(C)
of the rule provides for the eventualities the commenter describes by allowing
Boards an additional 25 days to make any necessary revisions to their expenditure
and service level reports. With regard to the request for clarification on
close-out reports, the Commission declines to comment because a close-out
report is not cited in the rule. Any close-out requirement for a grant is
delineated in the Board Master Contract.
Coment: Regarding §800.84(a), a commenter asked if, under Child Care,
non-direct child care items such as expenditures for administration, operations,
and quality improvement activities are included in the required monthly expenditure
levels. The commenter further asserted that these types of expenditures are
not uniformly expensed throughout the year in the same manner as direct child
care.
Response: The Commission requires that all Child Care funds, including
non-direct child care expenditures, must be included in the required expenditure
levels and according to the time periods cited in §800.84. Boards are
encouraged to plan, based on the experience they have gained, for the various
types of expenses they will encounter throughout a program year through their
annual Funds Utilization and Service Level Plan. Boards are also afforded
the opportunity to amend their Funds Utilization and Service Level Plans if
unforeseen events would significantly impact the Plan, and to revise the required
monthly expenditure and service level reports. Boards are given the flexibility
and authority to determine how and when they will expend funds according to
their own local needs and to report to the Commission.
Comment: Regarding §800.84(a)(3)(A), a commenter suggested that the
96% to 98% Child Care fund expenditure required in the proposed rule was reasonable
if the Commission provided a hold harmless provision in the same percentage.
The commenter asserted that carryover funding of less than 5% may jeopardize
a Board's ability to maintain children in care should its workforce area's
allocation for the next year be reduced by a greater percentage. The commenter
recommended consideration of an expenditure scale that accounted for future
year allocation levels such that Boards would be required to expend 95% of
funds if the next year allocation is equal to or greater than the current
year allocation. However, if the following year's allocation is lower, the
Board's expenditure requirement would also be lowered to ensure continuity
of service. A second commenter asserted that because administrative and operational
costs are largely fixed, a 98% expenditure requirement would put pressure
on Boards to expend funds for quality enhancements that may be rushed and
inadequately prepared to avoid disallowed costs. The second commenter recommended
amending the rule to provide for a 90% expenditure requirement by the end
of the program year, with a 100% expenditure requirement by the end of the
second quarter of the succeeding program year. A third commenter recommended
lowering the 98% expenditure level for Child Care to 97% and allowing Boards
to carry forward up to 3% of their previous year's funding. The third commenter
stated that the Boards need flexibility, and a Board should be able to estimate
an amount it wishes to carry forward to the next fiscal year in order to provide
more continuous service to customers, especially in light of maximum rate
increases and substantial increases in enrollment due to a one-time reallocation
of funds that affects the amount of funding available to customers the next
year. Another commenter agreed with the intent that allocated funds be fully
utilized, but expressed concern about the requirement that Boards meet a 98%
expenditure level for child care (unless the workforce area has an allocation
of less than $5,000,000). The second commenter believed that a 2% margin of
error was too small given the number of uncontrollable variables in child
care.
Response: Federal and State funding sources assume a 100% expenditure level
for Child Care. Further, it is vitally important that Boards demonstrate aggressive
expenditures to meet the demand for child care as represented by the number
of children on the waiting lists. However, the Commission acknowledges the
need for management flexibility at the local level and agrees to reduce the
required expenditure levels for Child Care to 97%, unless the workforce area
has an allocation less than $5,000,000. If a workforce area has a Child Care
allocation of less than $5,000,000, the Board shall expend at least 95% of
the funds for Child Care. The corresponding language regarding carryover is
modified accordingly.
Comment: Regarding §800.84(a)(3), one commenter questioned why there
were different expenditure levels for Child Care, Choices, and Food Stamps
Employment and Training (FS E&T). The commenter suggested 95% for all
programs. Another commenter offered the same recommendation for the Choices
expenditure level as offered for the Child Care expenditure level.
Response: The required expenditure levels vary by category of funding based
on (1) federal statutory requirements, (2) spending cycles, and (3) reasonable
operating carryover budgets that are based on general business practices to
ensure no overspending occurs and that no disruptions to client services will
result at the end of a program year. Federal and State funding sources assume
100% expenditure rates for these funding categories. However, the Commission
is encouraging sound financial planning and management that discourages overspending
as well as underspending. Therefore, to provide reasonable flexibility to
Boards to allow for the variables that influence expenditures, the Commission
is requiring a 95% rather than a 100% expenditure rate by the twelfth month
for Choices funds. The Commission further amends the proposed rule regarding
Child Care expenditures to allow 97% for Child Care, unless the workforce
area has an allocation less than $5,000,000, in which case the Board shall
expend at least 95% for Child Care, rather than the respective 98% or 96%
expenditure level for Child Care. The required twelfth month expenditure level
for the total allocation for the Choices category of funding is 95%, with
the ability to spend the remaining five percent within the first four months
of the subsequent program year. The Commission encourages Boards to expend
100% of the allocations to provide as much service as possible during any
fiscal year. The percentages listed in the rule are minimums.
Regarding FSE&T funds, the Commission only has appropriation authority
for FSE&T funds to access an amount of federal funds that the Legislature
determines can be reasonably expended within a single fiscal year. Therefore,
the Commission has determined that a 100% expenditure rate in the twelfth
month for FSE&T funds is reasonable given the limited appropriation and
one-year expenditure requirement.
Comment: Regarding §800.84(a)(3), one commenter requested clarification
on whether the required expenditure level for Child Care funds, excluding
unmatched federal Child Care funds, included obligations. The commenter is
concerned that, given the 45-day policy for billing, known expenditure levels
at the end of the twelfth month will not represent total expenditures for
the year. The commenter further requested clarification on whether expenditure
levels for the twelfth month must be "at the end" or "as of" that month.
Response: The Commission wishes to clarify that all expenditures occurring
by the end of the twelfth month are inclusive of expenditures not billed until
45 days following the end of the program year.
Comment: Regarding §800.84(a)(3)(B), a commenter questioned whether
Boards would be given specific allocations for certain fund codes as a result
of the language in this subsection.
Response: The intent of the question is unclear. However, if the commenter
is requesting fund category detail beyond that provided in the contract fund
summary, this could be considered during the Board Master Contract development
process.
Comment: Regarding §§800.84(a)(3)(A) and 800.84(b), one commenter
asked if the expenditure requirement for Child Care also applied to Texas
Department of Protective and Regulatory Services (TDPRS) and FSE&T child
care funds. The commenter also requested clarification on whether TDPRS and
FSE&T child care dollars are included in the amount of unexpended funds
from one program year that may be expended by the fourth month of the following
program year.
Response: Child care services under contract with TDPRS are excluded from
all of the provisions of the proposed rules. See §800.81(c)(2)(B). FSE&T
funds that are included in the Child Care allocation are subject to the rule
provisions governing the FSE&T category of funding that require Boards
to meet a 100% expenditure level by the end of the twelfth month following
the beginning of the program year.
Comment: A commenter found the expenditure requirements in §800.84(b)
and the schedule for pledges and completed donations in §800.84(c) to
be reasonable expectations.
Response: The Commission appreciates the support expressed in this comment
and agrees with the commenter that both rule sections are fair and reasonable.
Comment: Regarding §800.85(a)(2), two commenters recommended consideration
by the Commission of a Board's projected service levels, in addition to current
service levels as required by the proposed rule, in determining the degree
of funds deobligation. One of the two commenters asserted that this would
allow greater flexibility for both the Commission and Boards in determining
appropriate deobligation amounts.
Response: The Commission's primary consideration in making deobligation
decisions is actual expenditure levels as they compare to a Board's planned
expenditure levels. But the Commission may consider service level information
(both current and projected) as a method to determine whether a variance in
expenditures has been addressed through service level adjustments. Therefore,
the Commission will amend the rule to include consideration of projected service
levels when making deobligation decisions.
Comment: Regarding §800.85(a)(1), a commenter asserted an inconsistency
between this section that refers to a "required" expenditure level and §800.84(a)(1)-(2)
that refers to a "planned" expenditure level.
Response: The Commission does not find the inconsistency to which the commenter
is referring. The required expenditure level referred to in §800.85(a)(1)
corresponds to the 90% and 95% expenditure levels set out in §800.84(a)(1)
and (2).
Comment: Regarding §800.86(b)(1), a commenter recommended streamlining
the eligibility guidelines for reallocated funds by reducing the criteria
Boards must meet to the following four elements. Boards must: (1) be within
90% of planned expenditure and service levels, (2) be current in all reporting,
(3) have demonstrated the need and ability to use additional funds, and (4)
not be under preventive maintenance and sanctions.
Response: There are several issues raised by the commenter in the recommendation
for streamlining workforce area reallocation eligibility requirements.
The first issue dealt with reducing required expenditure levels for each
category of funding to 90%. Under the proposed rule, a workforce area could
receive reallocated funds for Child Care, Choices, and FSE&T if the Board
meets the required 90% of the Board's planned expenditure levels in the first
four months of the program year. The Commission believes that Boards would
have the ability to manage additional funds with only a 90% expenditure rate
by the fourth month. The expenditure levels are increased in the eighth and
twelfth months to ensure full utilization of funding that meets federal and
State expectations. A Board failing to meet required expenditure levels at
those periods of time would unlikely be able to manage additional funds received
through a reallocation.
The second issue centered on the commenter's recommendation that Boards
be within 90% of their planned service level. In making deobligation decisions,
the primary consideration by the Commission is on current expenditure levels
as they compare to the expenditure levels planned by a Board. But the Commission
will consider service level information (both current and projected) as a
method to determine whether a variance in expenditures has been addressed
through service level adjustments, and will modify the rule to include projected
service levels.
The Commission believes that (1) demonstrating that expenditures conform
to cost category limits for funding and (2) being current with all single
audit requirements are key elements in sound financial management. Boards
not demonstrating sound financial management should not be eligible for reallocated
funds.
Comment: One commenter questioned the policy disparity between the proposed
rule that requires Boards to secure funds to match federal resources and the
Commission's Financial Manual for Grants and Contracts (FMGC) which disallows
fund-raising. The commenter further stated that the term "leveraging local
resources" may not be substituted as it is used by the Commission synonymously
with "fund-raising". The commenter also asserted that the fund-raising requirement
is difficult on small Boards and competing for State monies creates a staffing
issue for all Boards.
Response: The Commission agrees that the Office of Management and Budget
(OMB) Circulars and the Agency's Financial Manual prohibit "fund-raising,"
and would clarify that the securing of local matching funds is not a prohibited
activity that would fall under the definition of "fund-raising." Specifically,
in terms of child care, the federal statute at 42 U.S.C.A. §618(a)(2)(C)
provides for payment to eligible States of an amount based on the federal
medical assistance percentage (FMAP) based on the State's expenditures for
child care. The federal regulations at 45 CFR §98.53 provide that "an
expenditure in the State may be used to secure matching funds if it consists
of (1) public funds that are transferred from another public agency to the
[Texas Workforce Commission]; (2) public funds that are certified by the contributing
public agency as representing expenditures eligible for federal match; or
(3) donated funds from private sources." Collecting donations of private funds
to secure local matching funds is also recognized in 45 CFR §98.53(f),
which provides that "donated funds need not be transferred to or under the
administrative control of the Agency in order to qualify as an expenditure
eligible to receive federal matching funds. They may be given to the entity
designated by the State to receive donated funds pursuant to §98.16(c)(2)."
The provision referenced by the commenter is a prohibition against paying
with federal funds the costs of "organized fund-raising, including financial
campaigns, endowment drives, solicitation of gifts and bequests, and similar
expenses incurred solely to raise capital or obtain contributions." Fund-raising
as prohibited is typically associated with political activity or other activities
beyond securing local matching funds as authorized under the Child Care and
Development Fund statute and regulations. The broad prohibition against paying
with federal funds the costs of "organized fund-raising, including financial
campaigns, endowment drives, solicitation of gifts and bequests, and similar
expenses incurred solely to raise capital or obtain contributions" does not
appear to apply to the incidental costs required to secure local matching
funds. The reasoning contained in this response is also applicable to match
fund development in the Welfare-toWork program.
The Commission agrees, however, to clarify the language contained in the
rule. The term "fund-raising" is being replaced with the phrase "securing
local matching funds," which is consistent with federal statute and regulations
and is not a prohibited activity. The Commission also notes that Boards may
use State funds, program income such as parent fees, and donated funds to
secure match funds.
Comment: Regarding §800.86(b), two commenters requested clarification
on the definition of "timely" in reference to receiving reallocated funds.
Response: The Commission will notify Boards of eligible workforce areas
in writing with a clearly defined time frame for submitting reallocation requests.
Comment: Regarding §800.86(b)(3)(c)(1)(D), a commenter requested a
definition for the term "other related factors."
Response: In determining the amount to be reallocated, the Commission may
consider, among other things, "related factors as necessary to ensure that
funds are fully utilized." The Commission retains the right to consider anything
it deems necessary in determining the amount to be reallocated. Examples of
related factors that the Commission may consider are caseload changes, unforeseen
demographic or economic changes, or the relationships among different categories
of funding.
Comment: Regarding §800.86(b)(1)(H), a commenter asked if the reallocation
eligibility requirement that a Board not be under preventive maintenance or
sanctions applied to all workforce development programs or just to child care.
Response: The reallocation eligibility requirement that a Board not be
under preventive maintenance or sanctions applies to all funds provided to
a workforce area under a contract between the Board and the Agency that are
listed under §800.81(c)(1) of the proposed rule. However, the rule does
not require that a Board under preventive maintenance or sanctions for one
category of funding be ineligible to receive funds reallocated for another
category of funding. For example, a workforce area with a Board under preventive
maintenance or sanctions for Choices is ineligible only for reallocated Choices
dollars, but could be eligible for other categories of funding such as Child
Care.
Comment: Regarding §800.86(1)(B), the commenter requested clarification
on the difference between the 110% expenditure limit on planned funds utilization
versus the 100% limit on the workforce area's allocation.
Response: The 110% refers not to the total annual allocation for a workforce
area received by a Board but, rather, to the expenditure limit for one of
the three applicable time periods set out in §800.84. While the Commission
discourages overspending and underspending, it recognizes that, within a given
period of time, Boards may need to expend more than 100% of their planned
expenditures. However, the Commission expects that Boards will manage their
funds such that, by the end of the program year, total annual expenditures
will not exceed 100%. The Commission intends to provide as much local flexibility
as possible while at the same time discouraging over- or under-utilization
of funds.
Subchapter B. ALLOCATIONS AND FUNDING
40 TAC §800.60
The repeal is adopted under Texas Labor Code §§301.061
and 302.002, which provide the Texas Workforce Commission with the authority
to adopt, amend, or repeal such rules as it deems necessary for the effective
administration of Commission services and activities.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on July 14, 2000.
TRD-200004893
J. Randel (Jerry) Hill
General Counsel
Texas Workforce Commission
Effective date: September 1, 2000
Proposal publication date: April 28, 2000
For further information, please call: (512) 463-8812
40 TAC §§800.81 - 800.86
The new sections are adopted under Texas Labor Code §§301.061
and 302.002, which provide the Texas Workforce Commission with the authority
to adopt, amend, or repeal such rules as it deems necessary for the effective
administration of Commission services and activities.
§800.81.General Provisions.
(a)
Purpose. The purpose of this rule is to promote effective
service delivery and financial planning and management, to ensure full utilization
of funding, and to reallocate funds to populations in need.
(b)
Intent. Notwithstanding any other provision of the rules
contained in 40 TAC, Part 20, relating to the Texas Workforce Commission,
except for funding for Welfare-to-Work, WIA Adult, WIA Youth and WIA Dislocated
Worker, the level of funding allocated to a workforce area may be modified
or reallocated by the Commission for one or more of the following reasons:
(1)
to ensure full utilization of the funding;
(2)
to ensure compliance with State and federal requirements
applicable to the State;
(3)
to meet the State's federal participation rates;
(4)
to respond to caseload changes; or
(5)
to respond to unforeseen demographic or economic changes.
(c)
Scope.
(1)
Subchapter C of this chapter shall apply to funds provided
to workforce areas under a contract between the Board and the Commission for
the following categories of funding:
(A)
Child Care;
(B)
Choices;
(C)
Food Stamp Employment and Training;
(D)
WIA Adult;
(E)
WIA Dislocated Worker; and
(F)
WIA Youth.
(2)
Subchapter C does not apply to funds provided to workforce
areas under a contract between the Board and the Commission for the following
unless otherwise indicated:
(A)
WIA Rapid Response for Dislocated Workers;
(B)
Child Care services funded under contract with the Texas
Department of Protective and Regulatory Services; and
(C)
Employment services, 29 U.S.C.A. §49
et seq.
.
(3)
Sections 800.81, 800.82, and 800.83 of Subchapter C of
this chapter shall apply to funds provided to workforce areas under a contract
between the Board and the Commission for Welfare-to-Work, 42 U.S.C.A. §603
(d)
Effective Date. Subchapter C shall be effective on September
1, 2000, and applicable to any funds allocated to workforce areas or not yet
expended by the Boards on or after September 1, 2000.
§800.82.Definitions.
In addition to the definitions in §800.2, the following terms,
when used in this subchapter, shall have the following meanings unless the
context clearly indicates otherwise:
(1)
Expenditures -- Costs incurred for goods and services that
cause decreases in net financial resources.
(2)
Funds Utilization and Service Level Plan -- A Board plan
that includes:
(A)
a funds utilization schedule for accrued expenditures that
demonstrates that each allocation shall be fully utilized within the Funds
Utilization Plan period established by the Commission, and
(B)
a service level schedule that lists the number of enrollments
or other activities as may be determined by the Commission, to be completed
during a specified period, and that demonstrates achievement of performance
benchmarks consistent with the Board's contract performance goals and integrated
workforce training and services plan.
(3)
Monthly expenditure report -- A report submitted by a Board
that contains information regarding services for each category of funding
allocated by the Commission, and in which the Board lists expenditures by
category of funding, as referenced in §800.83(b) of this subchapter,
relating to Funds Utilization and Service Level Plan and Reports, for each
month of the reporting period.
(4)
Obligation -- A debt, including Individual Training Accounts
as described in the Workforce Investment Act, established by a legally binding
contract, letter of agreement, sub-grant award, or purchase order, which has
been executed prior to the end of a program year, and which will be performed
within the program year or within 90 calendar days after the end of a program
year. Any obligation periods extending beyond 90 days after the program year
shall be prorated using the straight-line method or other acceptable proration
method that accurately matches benefits received with dollars included as
obligations.
(5)
Program year -- The twelve-month period applicable to the
funding as referenced in §800.83(b) of this subchapter, relating to Funds
Utilization and Service Level Plan. The program years are as follows:
(A)
Child Care: September 1 - August 31;
(B)
Choices: September 1 - August 31;
(C)
Welfare-to-Work: September 1 - August 31;
(D)
Food Stamp Employment and Training: September 1 - August
31;
(E)
WIA Adult: July 1 - June 30;
(F)
WIA Dislocated Worker: July 1 - June 30; and
(G)
WIA Youth: July 1 - June 30.
(6)
Service level report -- A Board report that is submitted
periodically to the Commission, with information in a format determined by
the Commission, on the number of:
(A)
Child Care units of service, as well as pledged and completed
local funds as specified in 40 TAC §809.20;
(B)
Choices individuals participating in Temporary Assistance
for Needy Families component activities, and the number of Choices participants
meeting minimum work requirements who are included in calculating federal
work participation rates;
(C)
Welfare-to-Work participants served;
(D)
Food Stamp Employment and Training mandatory work registrants
served and Able Bodied Adults Without Dependents (ABAWDs) served;
(E)
WIA Adult participants who received a WIA service;
(F)
WIA Dislocated Worker participants who received a WIA service;
and
(G)
WIA Youth participants who received a WIA service.
§800.83.Funds Utilization and Service Level Plan and Reports.
(a)
Planning.
(1)
A Board shall annually on a schedule as determined by the
Commission submit for approval a Funds Utilization and Service Level Plan
that contains information regarding each category of funding as specified
by the Commission, including the categories listed in §800.81(c)(1) and
(3). A Board shall include the Funds Utilization and Service Level Plan as
part of the Board's integrated workforce training and services plan, as well
as part of the Board's annual plan modifications.
(2)
A Board shall ensure that the plan describes the funds
utilization and service levels for each of the categories of funding specified
by the Commission for each corresponding program year.
(3)
A Board of a workforce area which has been subject to deobligation
of funds or a Board of a workforce area receiving reallocated funds shall
submit to the Commission for approval a revised Funds Utilization and Service
Level Plan within 45 days of notification of the Commission's action to deobligate
or reallocate. A Board may also amend its Funds Utilization and Service Level
Plan if an unforeseen event would significantly impact a Board's plan.
(b)
Reporting.
(1)
A Board shall submit reports that list information as required
by the Commission for the reporting period as follows:
(A)
a monthly expenditure report on or before the 20th calendar
day of the following month;
(B)
a monthly service level report on or before the 20th calendar
day of the following month; and
(C)
any necessary revision to the monthly expenditure report
and service level report pursuant to this section §800.83 within 25 calendar
days after the original due date of the report.
(2)
The Commission may require that a Board amend expenditure
reports and service level reports as the result of Commission monitoring reviews
or audits. Amended reports may be the basis for deobligation.
§800.84.Required Expenditure, Local Match, and Obligation Levels.
(a)
For Child Care (excluding unmatched federal Child Care
funds that are contingent upon a Board securing local funds), Choices, and
Food Stamp Employment and Training funds provided by the Commission, a Board
shall meet the following expenditure levels:
(1)
by the end of the fourth month following the beginning
of the program year, reported expenditure of at least 90% of the planned expenditure
level in the Funds Utilization and Service Level Plan;
(2)
by the end of the eighth month following the beginning
of the program year, reported expenditure of at least 95% of the planned expenditure
level in the Funds Utilization and Service Level Plan; and
(3)
by the end of the twelfth month following the beginning
of the program year, reported expenditure levels of the total annual allocation
of:
(A)
at least 97% for Child Care, unless the workforce area
has an allocation of less than $5,000,000, in which case the Board shall expend
at least 95% for Child Care;
(B)
at least 95% for Choices; and
(C)
100% for Food Stamp Employment and Training.
(b)
For Child Care funds (excluding unmatched federal Child
Care funds that are contingent upon a Board securing local funds) which do
not exceed 3% of the total contracted amount or 5% for workforce areas with
allocations of less than $5,000,000, and Choices funds which do not exceed
5% of the total contracted amount, that are unexpended by the close of the
twelve-month program year, a Board shall expend funds by the end of the fourth
month of the next program year. The Commission may deobligate and reallocate,
as provided in §§800.85 and 800.86 of this subchapter, relating
to Deobligation of Funds and Reallocation of Funds, unexpended balances not
expended in accordance with this subsection.
(c)
For unmatched federal Child Care funds that are contingent
upon a Board securing local match funds, a Board shall meet the following
performance requirements:
(1)
by the end of the fourth month following the beginning
of the program year, pledged donations, transfers and certifications totaling
at least 100% of the amount the Board needs to secure in order to access all
of the unmatched federal Child Care funds available to the workforce area;
(2)
by the end of the eighth month following the beginning
of the program year, completed donations, transfers and certifications totaling
at least 60% of the amount the Board needs to secure in order to access all
of the unmatched federal Child Care funds available to the workforce area;
and
(3)
by the end of the twelfth month following the beginning
of the program year, completed donations, transfers and certifications totaling
at least 100% of the amount the Board needs to secure in order to access all
of the unmatched federal Child Care funds available to the workforce area.
(d)
For WIA Adult, WIA Dislocated Worker, and WIA Youth funds,
a Board shall meet the following reported levels for each of these categories
of funding:
(1)
by the end of the twelfth month following the beginning
of a program year, obligation of at least 80% of the allocation for each category
of funding less any amount reserved up to 10% for costs of administration;
and
(2)
by the end of the 24th month following the beginning of
a program year, expenditure of 100% of the allocation for each category of
funding.
(e)
If a Board fails to achieve required expenditure, local
match, or obligation levels as indicated in this section, the Commission may
deobligate funds from the workforce area.
§800.85.Deobligation of Funds.
(a)
For deobligation of Child Care (excluding unmatched federal
Child Care funds that are contingent upon a Board securing local funds), Choices,
and Food Stamp Employment and Training funds, the Commission may, for the
category of funding:
(1)
deobligate all or part of the difference between a Board's
actual expenditure level and the required expenditure level described in §800.84(a)
and (b) of this subchapter, relating to Required Expenditure, Performance
and Obligation Levels, as applicable for each category of funding for that
period; and
(2)
consider a Board's current and projected service levels
in determining to what degree to deobligate funds.
(b)
For deobligation of unmatched federal Child Care funds
that are contingent upon a Board securing local funds, the Commission may
deobligate all or part of the difference between a Board's actual level of
secured match and the required level of secured match to be met by the Board
described in §800.84(c) of this subchapter, relating to Required Expenditure,
Local Match, and Obligation Levels.
(c)
For deobligation of WIA Adult, WIA Dislocated Worker, and
WIA Youth funds, the Commission shall deobligate funds from each of these
categories of funding as follows:
(1)
after the end of the twelfth month following the beginning
of a program year, any unobligated funds which exceed 20% of the allocation
for WIA Adult, WIA Dislocated Worker, or WIA Youth for that program year,
less any amount reserved up to 10% for costs of administration; and
(2)
after the end of the 24th month following the beginning
of a program year, any unexpended funds of the program year allocation for
WIA Adult, WIA Dislocated Worker or WIA Youth.
(d)
For voluntary deobligation, a Board may submit a written
request that the Commission deobligate a portion of the workforce area's allocation
for one or more categories of funding. The Commission shall determine whether
to approve requests for deobligation.
§800.86.Reallocation of Funds.
(a)
Combining Funds. The Commission shall combine the funds
deobligated from workforce areas by categories of funding for each obligation
period and may reallocate funds to an eligible workforce area.
(b)
Eligibility. For a workforce area to be eligible for reallocation
of funds relating to a category of funding, a Board shall meet the additional
criteria set forth in this section that is applicable to the category of funding
and shall submit a timely written request to receive reallocated funds listing
the maximum amount of reallocated funds which the Board intends to utilize.
(1)
For a workforce area to be eligible for a reallocation
of Child Care (excluding unmatched federal funds that are contingent upon
a Board securing local funds), Choices, and Food Stamp Employment and Training
funds, a workforce area's Board shall:
(A)
have met expenditure levels as required by §800.84(a)
and (b), as applicable, for that period;
(B)
have expended at the levels outlined in Section 800.84,
but not more than 110% of the planned funds utilization level for funding
for the applicable expenditure period and program year, and not more than
100% of the workforce area's allocation for the category of funding;
(C)
be within 90% of the planned service level;
(D)
have demonstrated that expenditures conform to cost category
limits for funding;
(E)
have demonstrated the need for and ability to use additional
funds;
(F)
be current on expenditure and service level reporting;
(G)
be current with all single audit requirements; and
(H)
not be under preventive maintenance or sanctions.
(2)
For a workforce area to be eligible for a reallocation
of the unmatched federal Child Care funds that are contingent upon a Board
securing local funds, the workforce area's Board shall have met the level
for securing local match requirements set out in §800.84(c) of this subchapter,
relating to Required Expenditure, Local Match, and Obligation Levels, for
the program year from which funds were deobligated.
(3)
For a workforce area to be eligible for a reallocation
of WIA Adult, WIA Dislocated Worker and WIA Youth funds, to be eligible for
a reallocation, the workforce area's Board shall have met the obligation or
expenditure requirement set out in §800.84(d) of this subchapter, relating
to Required Expenditure, Local Match, and Obligation Levels, for the category
of funding for the program year from which funds were deobligated.
(c)
Reallocation.
(1)
For reallocation of Child Care, including unmatched federal
funds that are contingent upon a Board securing local funds, Choices, and
Food Stamp and Employment and Training funds, the Commission may reallocate
funds to an eligible workforce area based on the applicable allocation method
set forth in Subchapter B of this chapter relating to Allocation and Funding.
In determining the amount to be reallocated, the Commission may also consider:
(A)
the amount specified in the Board's timely written request
for additional funds;
(B)
the ability of the Board to expend funds to address the
need for services in the workforce area;
(C)
the financial and service of the Board performance during
the prior program year; and
(D)
related factors as necessary to ensure that funds are fully
utilized.
(2)
For WIA Adult, WIA Dislocated Worker and WIA Youth funds,
the Commission shall reallocate funds as provided in WIA §§128 and
133.
This agency hereby certifies that the adoption has been
reviewed by legal counsel and found to be a valid exercise of the agency's
legal authority.
Filed
with the Office of the Secretary of State on July 14, 2000.
TRD-200004892
J. Randel (Jerry) Hill
General Counsel
Texas Workforce Commission
Effective date: September 1, 2000
Proposal publication date: April 28, 2000
For further information, please call: (512) 463-8812
The Texas Workforce Commission (Commission) adopts new §809.20
relating to Leveraging Local Resources, and the repeal of §809.20 relating
to Local Donations, with changes to the text as published in the May 5, 2000,
issue of the
Texas Register
(25 TexReg 3938).
Section 809.20 sets forth a local workforce development board's (Board)
responsibility to leverage local resources by securing local matching funds
and obtaining certifications from public entities that reflect expenditures
that are consistent with the purposes of the Child Care and Development Fund.
The purpose of the proposed rule is to clarify the role of the Boards in
securing local matching funds to improve the affordability, accessibility,
and quality of child care. The Commission encourages the Boards to aggressively
solicit and manage the securing of local funds to the fullest extent possible
to ensure that local public and private funds are leveraged to meet the child
care needs of the residents of Texas. The proposed rule clarifies that the
Boards are able to fully manage pledges of funds, transfers, and certifications.
The clarification is intended to enable Boards to avail themselves of matching
federal funds available to the local workforce development area (workforce
area) if the Boards secure local funds, and to enable Boards to realize the
long-term benefits to the future workforce through any additional local funds
invested today in affordable, accessible, quality child care. The Commission's
intent is not to over-commit federal matching funds available through the
Commission, but to encourage the Boards to secure additional local matching
funds beyond the minimum required to access federal matching funds, and to
multiply the benefits of each investment in child care for low income working
families, local employers, and others in the workforce area. By supporting
Boards that forge public-private partnerships to invest in child care, the
Commission intends to support the goals of state and federal child care statutes
and regulations.
Goals: Child care services are provided to low-income families to create
and promote long-term self-sufficiency by enabling parents to work or attend
educational or training activities. Such services should offer child care
that promotes the physical, social, emotional, and intellectual development
and safety of children. Recognizing that parents best understand the needs
of their children, these services empower parents to make informed choices
regarding child care that best suits the family's needs. The Commission also
advocates improvements in the availability, affordability, and quality of
child care while supporting health, safety, and regulatory standards for child
care providers. The goals are to coordinate workforce services, to leverage
private and public funds at the local level, and to fully integrate child
care for low-income families with the network of workforce training and services
under the administration of the Boards.
The Child Care and Development rule contained in 40 TAC §809.20 applies
to Boards securing local matching funds to access available federal matching
funds and the additional federal matching funds that may subsequently be accessed
by the Boards. For example, a Board shall ensure that the local matching funds
and the corresponding federal matching funds are spent on authorized child
care activities as specified in the Board's integrated strategic and operational
plan, including child care services for eligible families and quality improvement
activities. Similarly, a Board is charged with ensuring that the resulting
federal matching funds are expended only up to the amount that corresponds
to the donations, transfers, and certifications that are completed within
the program year. A Board shall also report and monitor the activities to
secure and leverage funds and corresponding expenditures consistent with the
Board's Funds Utilization and Service Level Plan and reporting requirements
described in 40 TAC §§800.82 and 800.83.
Comments were received from the following Boards: Alamo, Deep East, Panhandle,
and South Plains. Some of the commenters supported the rule, and others suggested
changes and requested clarification to the language contained in the proposed
rule. The summary of comments and the responses are set forth as follows.
Comment: One commenter stated that in §809.20(a)(1), which refers
to Boards raising local public and private funds, and in §809.20(b)(1),
which refers to Boards managing the fund-raising of local resources, the language
was confusing and seemingly contradictory with the Texas Workforce Commission's
financial manual, which prohibits fund-raising. The commenter wanted to know
how the Board is to fund-raise or manage fund-raising without violating the
Office of Management and Budget's (OMB) prohibition against fund-raising.
Response: The Commission agrees that the OMB Circulars and the Texas Workforce
Commission's financial manual prohibit "fund-raising," and clarifies that
the securing of local matching funds is not a prohibited activity that would
fall under the definition of "fund-raising." Specifically, the federal child
care statute at 42 U.S.C.A. §618(a)(2)(C) provides for payment to eligible
States of an amount based on the Federal medical assistance percentage (FMAP)
based on the State's expenditures for child care. The federal regulations
at 45 CFR §98.53 provide that "an expenditure in the State may be used
to secure matching funds if it consists of (1) public funds that are transferred
from another public agency to the Lead Agency; (2) public funds that are certified
by the contributing public agency as representing expenditures eligible for
Federal match; or (3) donated funds from private sources." Collecting donations
of private funds to secure local matching funds is also recognized in 45 CFR §98.53(f),
which provides that "Donated funds need not be transferred to or under the
administrative control of the Lead Agency in order to qualify as an expenditure
eligible to receive Federal matching funds. They may be given to the entity
designated by the State to receive donated funds pursuant to §98.16(c)(2)."
The provision referenced by the commenter is a prohibition against using federal
funds to pay the costs of "organized fund-raising, including financial campaigns,
endowment drives, solicitation of gifts and bequests, and similar expenses
incurred solely to raise capital or obtain contributions." Fund-raising, as
prohibited, is typically associated with political activity or other activities
beyond securing local matching funds as authorized under the Child Care and
Development Fund statute and regulations. The broad prohibition against using
federal funds to pay the costs of "organized fund-raising, including financial
campaigns, endowment drives, solicitation of gifts and bequests, and similar
expenses incurred solely to raise capital or obtain contributions" does not
apply to the incidental costs required to secure local matching funds.
The Commission agrees, however, to clarify the language contained in the
rule. The term "fund-raising" is being replaced with "securing local matching
funds," which is consistent with federal statute and regulations and is not
a prohibited activity. The Commission also notes that Boards may use state
funds, program income such as parent fees, and donated funds that are used
for local match to secure matching funds.
Comment: One commenter stated that the requirement to secure local matching
funds is difficult for small Boards and that the requirement for Boards to
compete for monies from the State has become a staffing issue for the Boards.
Response: The Commission recognizes that Boards have differing levels of
local resources. However, the Commission also recognizes the leadership role
of Board members within their individual communities to identify needs and
resources to address those needs, and secure local resources to enhance funds
available within the workforce area.
Comment: One commenter raised the following two questions about the incentive
awards: "what is the amount of the award?" and "what can the incentive funds
be used for?"
Response: At the present time child care is included in the incentive awards
process because the general incentive awards are based in part on performance
related to child care measures. Specific amounts and uses of any such awards
are determined by the general incentive rules (40 TAC Chapter 800, Subchapter
D Incentive Award Rules).
Comment: One commenter suggested that the language of the rule may be unclear
regarding "in an amount equal to."
Response: The Commission agrees and revises the language accordingly to
make clear that Boards may secure more local funds than merely those required
to obtain federal matching funds.
Comment: One commenter agreed with the overall intent of the rule, but
was concerned with §809.20(b)(2). The commenter felt that the wording
of that section suggests that a Board should raise more funds than it will
be allowed to submit for federal match, and that some donors do not want to
donate unless they can get a "return on their investment." The commenter stated
that not receiving federal matching funds severely hinders a Board's efforts
to secure local donations. The commenter suggested that the wording be changed
to read: "In order for a Board to receive federal matching funds, a Board
must raise local funds in the amount necessary to draw down the federal match
dollars." A second commenter stated that the language of this paragraph appears
to require Boards to raise more local matching funds than are actually needed
for the federal match, and that this would seriously damage credibility with
local partners. The second commenter stated that the language should be clarified
if the intent is actually to raise local funds sufficient to match available
federal funds.
Response: The Commission believes it is important to encourage the Boards
to obtain more local matching funds than that required to draw down each Board's
allocated amount of federal funds. One reason for securing more local matching
funds than merely the amount needed to draw down the corresponding federal
matching funds is that unforeseen circumstances beyond the Board's control
may arise that make the pledged donation, transfer, or certificate difficult
or not feasible to complete by the anticipated completion date. Another reason
for securing more local matching funds than merely the amount needed to draw
down the corresponding federal matching funds is that those unmatched funds
add to the amount available in the workforce area for child care services
and demonstrate the Board's capability to utilize reallocated additional federal
matching funds should they become available.
Subchapter B. GENERAL MANAGEMENT REQUIREMENTS
Subchapter C. REALLOCATION OF FUNDS
Chapter 809.
CHILD CARE AND DEVELOPMENT