[Federal Register: May 14, 1996 (Volume 61, Number 94)]
[Rules and Regulations]
[Page 24389-24403]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[[Page 24389]]
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Part III
Department of Education
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34 CFR Part 361
The State Vocational Rehabilitation Services Program; Final Rule
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DEPARTMENT OF EDUCATION
34 CFR Part 361
RIN 1820-AB13
The State Vocational Rehabilitation Services Program
AGENCY: Department of Education.
ACTION: Final regulations.
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SUMMARY: The Secretary amends the regulations governing The State
Vocational Rehabilitation Services Program. These regulations are
needed to implement section 12(d) of the Rehabilitation Act of 1973
(Act), as amended by the Rehabilitation Act Amendments of 1992 (1992
Amendments) and the Rehabilitation Act Amendments of 1993. Section
12(d) of the Act requires that the Secretary promulgate regulations
establishing requirements for the implementation of an order of
selection for the receipt of vocational rehabilitation services. An
order of selection is required under section 101(a)(5)(A) of the Act if
a designated State unit (DSU) determines that it is unable to provide
services to all eligible individuals who apply for services. If a DSU
establishes an order of selection, it must first provide services to
individuals with the most severe disabilities before serving other
eligible individuals. The regulations are necessary to ensure the
proper administration of the order of selection requirements by DSUs.
EFFECTIVE DATE: These regulations take effect on June 13, 1996.
FOR FURTHER INFORMATION CONTACT: Suzanne Tillman, U.S. Department of
Education, 600 Independence Avenue, S.W., Room 3220, Mary E. Switzer
Building, Washington, D.C. 20202-2735. Telephone: (202) 205-8303.
Individuals who use a telecommunications device for the deaf (TDD) may
call the Federal Information Relay Service (FIRS) at 1-800-877-8339
between 8 a.m. and 8 p.m., Eastern time, Monday through Friday.
SUPPLEMENTARY INFORMATION: The State Vocational Rehabilitation Services
Program is a State-administered program that provides individualized
vocational rehabilitation (VR) services to eligible individuals with
disabilities. The purpose of the program is to assist States in
operating a comprehensive, coordinated, effective, efficient, and
accountable program for vocational rehabilitation designed to assess,
plan, develop, and provide VR services for individuals with
disabilities so that they may prepare for and engage in gainful
employment.
The program supports the National Education Goal that, by the year
2000, 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.
On July 16, 1993, the Secretary published a notice of proposed
rulemaking (NPRM) in the Federal Register (58 FR 38482) to implement
section 12(d) of the Act, as amended by the 1992 Amendments (Pub. L.
102-569) and the Rehabilitation Act Amendments of 1993 (Pub. L. 103-
73), which requires that the Secretary issue regulations on the
requirements for implementing an order of selection by a DSU.
Analysis of Comments and Changes
In response to the Secretary's invitation in the NPRM, 45 parties
submitted comments on the proposed regulations. An analysis of the
comments and of the changes in the regulations since publication of the
NPRM follows.
Major issues are grouped according to subject under appropriate
sections of the regulations. Technical and other minor changes--and
suggested changes the Secretary is not legally authorized to make under
the applicable statutory authority--are not addressed. The Secretary
also has not addressed comments that relate to issues that are more
appropriately dealt with in other program regulations being developed
to implement the 1992 Amendments.
In addition, the proposed regulations have been reviewed and
revised in accordance with the Department's principles for regulating,
which were developed as part of the Administration's regulatory
reinvention initiative under the National Performance Review II. The
principles are designed to ensure that the Department regulates in the
most flexible, most equitable, and least burdensome way possible. As a
result of that review, several non-statutory paperwork requirements in
the proposed regulations have been eliminated or modified. These
changes are discussed in the following paragraphs and in the section-
by-section summary.
Section 101(a)(5)(A) of the Act requires a DSU to explain how it
will provide VR services to all eligible individuals or, if it cannot
provide services to all these individuals, to describe and justify the
order of selection the DSU will follow in serving eligible individuals,
with first priority being given to individuals with the most severe
disabilities. Accordingly, Sec. 361.36(a)(1) of the final regulations
requires DSUs that do not establish an order of selection to explain
how, on the basis of its projected fiscal and personnel resources and
its assessment of the rehabilitation needs of individuals with severe
disabilities within the State, the DSU will continue to serve all
individuals currently receiving services, provide assessment services
to all applicants and VR services to all individuals determined to be
eligible in the next fiscal year, and meet all other program
requirements.
The proposed regulations would have required each DSU that does not
establish an order of selection to provide detailed information to
support that decision, including its projected number of applicants,
eligible individuals, and qualified personnel, projected costs of
services and administration, and projected revenues. The Secretary
believes that requiring all DSUs to submit these projections is overly
burdensome and unnecessary for those States that have not experienced
problems in serving all eligible individuals in recent years. Thus, the
requirements in the final regulations are more narrowly tailored to
address the underlying problem of ensuring that DSUs do not improperly
avoid establishing an order of selection.
The final regulations establish two different information
requirements for DSUs that do not plan to establish an order of
selection: one for DSUs that have demonstrated the ability to serve all
eligible individuals and meet all program requirements and one for DSUs
that have not demonstrated this ability. The first information
requirement (Sec. 361.36(a)(2)) applies to DSUs whose past practice
demonstrates their ability to serve all eligible individuals without an
order of selection. DSUs will be subject to this requirement if they
have provided assessment services to all applicants, provided the full
range of services to all eligible individuals, made referral forms
widely available, conducted outreach efforts to identify and serve
those underserved in the past, and have not delayed the development of
individualized written rehabilitation programs (IWRPs) or the provision
of services for eligible individuals. This provision permits these DSUs
to submit a narrative explanation of their ability in the next year to
continue to serve everyone and meet all program requirements.
The second information requirement (Sec. 361.36(a)(3)) applies to
DSUs that have not demonstrated their ability to serve all eligible
individuals and meet all program requirements without an
[[Page 24391]]
order of selection. This more detailed information requirement would
apply to DSUs that--(1) Said in their State plans for the current or
past year that they could serve everyone, but, in fact, did not do so;
(2) Served all eligible individuals in the current or past year by not
meeting the requirements in Sec. 361.36(a)(2); or (3) Provided services
under an order of selection in the current or preceding fiscal year,
but believe that they can serve all eligible individuals in the next
fiscal year. These DSUs will be required to provide information,
including projections, similar to the information that would have been
required of all DSUs under the NPRM. Specifically, these DSUs must
describe the changed circumstances that will enable them to serve all
eligible individuals in the forthcoming fiscal year and must submit the
projections required under Sec. 361.36(a)(3) to support this
determination, including projected numbers of applicants, eligible
individuals, and qualified personnel, projected costs of services and
administration, and projected revenues. In addition, Sec. 361.36(a)(3)
requires these DSUs to provide, as relevant, comparable data for the
current or preceding fiscal year, or both years, of these projected
costs and resources.
These changes in the final regulations are intended to reduce
paperwork burdens on DSUs that have a demonstrated capacity to serve
all eligible individuals and, at the same time, to ensure that if a DSU
decides not to implement an order of selection, even though it has not
been able to serve all eligible persons in the past, that the decision
is supported in the State plan by sufficient data showing the DSU's
projected costs and resources.
Section 361.36(a)--General Provisions
Assurance of ability to serve all eligible individuals.
--Range of Services
Comments: Several commenters on Sec. 361.36(a)(1)(i) of the
proposed regulations requested that this provision specify that a DSU
is able to provide the full range of services listed in section 103(a)
of the Act. These commenters were concerned that a DSU could interpret
the wording ``able to provide services'' to mean that it may avoid
establishing an order of selection if it is able to provide some, but
not all, of the services listed in section 103(a) of the Act.
Discussion: The Secretary agrees with these commenters. A DSU that
assures that it is able to provide services to all eligible individuals
must be able to provide all of the services listed in section 103(a) of
the Act.
Changes: The Secretary has revised Sec. 361.36(a)(1)(i) to provide
that the State plan must contain an assurance that the DSU is able to
provide the full range of services listed in section 103(a) of the Act,
as appropriate, to all eligible individuals.
--Monitoring and review of assurances
Comments: Several commenters were concerned that the Secretary
would not adequately monitor compliance with the assurances provided by
a DSU. Several commenters recommended that the Secretary thoroughly
examine a DSU's decision not to implement an order of selection and
approve or disapprove that decision, as appropriate.
One commenter feared that, in order to avoid implementing an order
of selection, DSUs may expand counselor caseload sizes beyond the
capacity of counselors to serve eligible individuals in a meaningful
way. Caseload sizes could continue to grow but might not trigger an
order of selection.
One commenter suggested adding factors to measure a DSU's
compliance with these regulations. This commenter also suggested that
if a DSU is found in substantial noncompliance and fails to take
corrective action, it should be subject to financial sanctions.
Several commenters stated that a DSU should be required to evaluate
the impact of its order of selection to determine if there are any
unintended consequences or exclusions of specific groups of individuals
with disabilities.
Discussion: The Secretary ensures that a DSU is complying with its
assurances through annual reviews and periodic on-site monitoring of
State vocational rehabilitation programs required by sections
107(a)(3)(A) and 107(a)(4)(B) of the Act. Section 107(a)(3)(A) of the
Act requires the Secretary, as part of the monitoring process, to
conduct on-site visits, including on-site reviews of records, to verify
that a DSU is following requirements regarding order of selection.
Section 107(a)(4)(B) requires the Secretary to examine, in conducting
the review and monitoring, a DSU's provision of services, including, if
applicable, order of selection requirements.
Section 101(a)(7) of the Act requires a DSU to ensure, as part of
its comprehensive system of personnel development, that it has an
adequate supply of qualified personnel to provide vocational
rehabilitation services. The regulations require DSUs that do not
establish an order of selection to satisfy all VR program requirements,
including those relating to the comprehensive system of personnel
development. The Secretary also reviews and monitors compliance with
section 101(a)(7) of the Act.
The Secretary does not believe it is necessary to add factors to
measure a DSU's compliance with the order of selection requirements of
the State plan. A DSU's compliance with the order of selection
requirements will be monitored like any other State plan requirement,
and a DSU's noncompliance with these requirements will be dealt with
like any other finding of noncompliance with the State plan
requirements.
The Secretary believes that a DSU (along with the State
Rehabilitation Advisory Council (Council), if the DSU has a Council),
should evaluate the impact of its order of selection as part of its
administration of the program and would expect a discussion of this
impact in its annual evaluation of the program.
Changes: None.
Explanation of how a DSU will serve all eligible
individuals.
--Detailed nature of explanation
Comments: Several commenters opposed the proposed requirement that
a DSU provide a detailed explanation of the methods by which it will
provide services to all eligible individuals because they believe it is
overly burdensome. One commenter believed that the required projections
in Sec. 361.36(a)(1)(ii) of the proposed regulations might prevent
closer cooperation between consumer groups and DSUs because consumer
groups might believe that the incidence and prevalence of their
disability is greater than indicated in the statistical data used by
the DSU.
Several commenters believed that there is no practical way for a
DSU to make the required projections because of the uncertainty of
future funding levels and of the effect of the revised eligibility
requirements under the Act.
One commenter stated that if projections are required, the
Secretary should keep documentation to a minimum. This commenter
requested that a DSU be able to use existing data, e.g., Federal census
and population data, to make its projections.
Discussion: The legislative history accompanying the 1992
Amendments to the order of selection requirement indicates an
expectation on the part of the Congress that the Secretary will
promulgate regulations that will obligate States wishing to avoid
establishing an order of selection to prove that they are indeed able
to serve all eligible individuals. Nevertheless, the data
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projections required in the proposed regulations have been
significantly reduced in accordance with the Department's principles
for regulating. Application of the remaining documentation requirements
is limited to--(1) Those DSUs that were unable to serve all eligible
individuals (including DSUs that established an order of selection) in
the current or preceding fiscal year, but contend they will be able to
do so in the next fiscal year; and (2) Those DSUs that were able to
serve all eligible individuals in the current or preceding fiscal year
only by not meeting the requirements in Sec. 361.36(a)(2). The
Secretary believes that the documentation requirements remaining in the
regulations to support a DSU's conclusion that it is able to serve all
eligible individuals, even though it has been unable to serve all
eligible persons in the past, is fully consistent with congressional
intent.
The Secretary believes that the required explanation will not
impose any additional data collection burdens on a DSU. The Secretary
believes that existing information in a DSU's required statewide
studies and annual evaluations, comprehensive statewide assessments of
the rehabilitation needs of individuals with severe disabilities,
comprehensive system of personnel development, and budget data would
enable a DSU to provide the required explanation without any need for
additional data collection.
The Secretary believes that a DSU should be able to predict funding
levels for the program during the upcoming fiscal year through use of
State and Federal budget data.
The Secretary believes that Federal census and population data
alone are not sufficient for a DSU to make the required projections.
These data are not updated often enough for a DSU to rely solely on
these sources in making its projections, but may be useful in
conjunction with information from a DSU's statewide studies,
comprehensive statewide assessments, comprehensive system of personnel
development, and budget data.
Changes: The Secretary has revised Sec. 361.36(a)(1)(ii) of the
proposed regulations to reduce the data projections that a DSU must
provide as part of its explanation of how it is able to serve all
eligible individuals. This provision has been relocated to
Sec. 361.36(a)(3) of the final regulations and applies only to--(1)
DSUs that were unable to serve all eligible individuals during the
current or preceding fiscal year; and (2) DSUs that contend that they
served all eligible individuals in the preceding and current fiscal
years, but cannot attest to meeting the program requirements listed in
Sec. 361.36(a)(2) for both those years.
--Projections for serving all eligible individuals with disabilities
Comments: Several commenters suggested that the Secretary require a
DSU to provide separate projections for serving individuals with non-
severe, severe, and the most severe disabilities in providing the data
in Sec. 361.36(a)(1)(ii) (A) and (B) of the proposed regulations. These
commenters believed that the approach taken in the proposed regulations
would allow a DSU to average the costs of serving all populations, and
the commenters recommended that a DSU be required to break out the
costs of serving individuals with severe and the most severe
disabilities. Commenters contended that the average projected cost of
serving all individuals is substantially less than the cost of serving
the subgroup of individuals with the most severe disabilities because
of the variety of services and supports that individuals in this
category require. One of these commenters also believed that providing
specific data on each of these populations would help to determine the
extent to which a DSU has engaged in aggressive outreach efforts to
serve a greater number of individuals with the most severe
disabilities.
One commenter requested that, in making its projections, a DSU be
required to take into consideration the likelihood that more
individuals will be applying for services as a result of the revised
eligibility requirements established under the 1992 Amendments and that
more of these individuals will be individuals with the most severe
disabilities because of the expanded requirements to provide personal
assistance and rehabilitation technology services.
Discussion: As discussed previously, the Secretary has
significantly revised the proposed regulations to require DSUs to
submit projections as part of their State plan only in limited
circumstances. Specifically, Sec. 361.36(a)(3) requires DSUs that were
unable to serve all eligible individuals during the current or previous
fiscal year, but believe that they do not need to establish an order of
selection in the next fiscal year, to include in their State plans the
projected numbers of eligible individuals, the projected costs of
serving those individuals, the projected revenues, and the projected
number of qualified personnel. (These State plan requirements also
apply to DSUs that do not establish an order of selection but cannot
provide the assurances in Sec. 361.36(a)(2).) However, any DSU that
does not establish an order of selection must still consider the
rehabilitation needs of individuals with severe disabilities as part of
its explanation under Sec. 361.36(a)(1)(i), even though the final
regulations do not require separate projections for individuals with
non-severe, severe, and most severe disabilities under
Sec. 361.36(a)(3).
The Secretary agrees that averaging the costs of serving all
eligible individuals would not provide an accurate estimate of the
costs of serving individuals with severe and the most severe
disabilities if a State relied solely on cost data for years prior to
the enactment of the 1992 Amendments in making its projections. The
Secretary believes that in making projections with respect to the cost
of serving all eligible individuals, a DSU must consider the costs of
serving individuals with severe disabilities.
The Secretary agrees that more individuals with severe disabilities
and individuals with the most severe disabilities have become eligible
to receive services under the revised eligibility requirements in the
1992 Amendments. However, the Secretary believes that any significant
expansion in the number of eligible individuals that is attributable to
the revised eligibility criteria has already taken place. Consequently,
the Secretary believes there is no need to require DSUs under
Sec. 361.36(a)(3) to provide separate projections for serving
individuals with non-severe, severe, and most severe disabilities as
long as the projected number of all eligible individuals and the
projected costs of serving those individuals is provided.
Changes: The Secretary has revised Sec. 361.36(a)(1)(ii) of the
proposed regulations to reduce the amount of data and related
explanations that must be submitted as part of the State plan. In
addition, the regulations require that this data be included as part of
the State plan only if--(1) The DSU was unable to serve all eligible
individuals in the current or preceding fiscal year; or (2) The DSUs
did not meet the requirements in Sec. 361.36(a)(2) in serving all
eligible individuals in the current and preceding fiscal years. This
provision has been relocated to Sec. 361.36(a)(3) in the final
regulations.
--Cost-containment
Comments: Several commenters suggested that a DSU be required to
control costs before implementing an order of selection. One commenter
suggested adding a new requirement to the regulations that a DSU, prior
to
[[Page 24393]]
implementing an order of selection, implement methods to control costs,
including, but not limited to, rigorous administrative controls and
oversight, aggressively pursuing comparable services and benefits,
paying vendors based on performance outcomes, developing equitable
financial need policies, and establishing collaborative program funding
through interagency agreements that will enable the DSU to provide
services to all eligible persons.
Another commenter requested that a DSU that is unable to secure its
full Federal allotment for the program due to insufficient State match
be required to demonstrate efforts to obtain the full match in order to
be able to implement an order of selection. This commenter also
requested that the Secretary question or not approve a DSU's decision
to implement an order of selection if it is unable to fill vacant
counselor positions due to a statewide freeze on hiring, since
counselor salaries are primarily funded by Federal funds.
On the other hand, several commenters requested that a DSU be
prohibited from establishing inappropriate, arbitrary, or groundless
policy restrictions on the provision of services that are intended to
avoid implementation of an order of selection. Some of these commenters
recommended that the Secretary establish an appeal process to the
Rehabilitation Services Administration (RSA) Regional Offices so that
parties may challenge these types of restrictions.
Discussion: The Secretary agrees that a DSU should undertake all
efforts to control costs before it opts to establish an order of
selection. Some of the means suggested by commenters for controlling
costs are already Federal requirements (e.g., program costs must be
reasonable and necessary and DSUs must pursue comparable services and
benefits before providing most services), while others are State
options (e.g., paying vendors based on performance outcomes, developing
equitable financial need policies, and establishing collaborative
program funding through interagency agreements). The Secretary
encourages DSUs to use these State options whenever possible to contain
costs.
In conjunction with a DSU's determination of whether it needs to
establish an order of selection, a DSU should consider whether the
adoption of certain cost containment measures would enable the DSU to
serve all eligible individuals. Adoption of cost containment measures,
therefore, should be considered both at the time the DSU develops its
State plan submission on order of selection prior to the beginning of
the fiscal year and whenever changed circumstances during the fiscal
year warrant reevaluation of the need to establish an order of
selection in accordance with Sec. 361.36(b). If a DSU undertakes cost
containment strategies and is still unable to serve all eligible
individuals, it is required to establish an order of selection for
services.
The Secretary does not believe there is authority to establish a
link between a DSU's ability to meet its full matching requirement--and
therefore earn its entire allotment--and its right to implement an
order of selection. In fact, the inability of a DSU to obtain its full
matching contribution may be a factor in its need to establish an order
of selection, since a DSU would have fewer program funds available
because of insufficient State dollars and the loss of some Federal
funds.
As previously noted, the Secretary agrees that DSUs need to proceed
carefully in establishing an order of selection. Therefore, the
Secretary requires, under Sec. 361.36(e)(1), that a DSU consult with
and seriously consider the advice of the Council regarding the need to
establish an order of selection. The Secretary does not believe it is
necessary or advisable to establish an appeal process that is
specifically for order of selection compliance issues. Section 107(c)
of the Act provides a general appeals process for substantial
noncompliance with any State plan requirement under this program.
Changes: None.
--Assessment of rehabilitation needs of individuals with severe
disabilities
Comments: One commenter requested that the provision in
Sec. 361.36(a)(1)(ii)(B)(1) of the proposed regulations requiring a DSU
to assess the rehabilitation needs of ``individuals with severe
disabilities'' within the State be changed to require a DSU to assess
the needs of ``individuals with the most severe disabilities.'' The
commenter believed that this change would be consistent with section
101(a)(5)(A) of the Act.
Discussion: Section 101(a)(5)(A) of the Act provides that the State
plan shall contain the plans, policies, and methods to be followed in
carrying out the State plan and in its administration and supervision,
including the results of a comprehensive, statewide assessment of the
rehabilitation needs of ``individuals with severe disabilities''
residing within the State. Therefore, Sec. 361.36(a)(1)(i) of the final
regulations correctly tracks the language in section 101(a)(5)(A) of
the Act. The Secretary notes, however, that the broad category of
``individuals with severe disabilities'' would include as a subcategory
``individuals with the most severe disabilities.''
Changes: None.
--Interagency cooperative agreements
Comments: One commenter requested that the provision in
Sec. 361.36(a)(1)(ii)(B)(4) of the proposed regulations, which
highlighted or emphasized the consideration of cooperative agreements
serving certain groups of individuals with disabilities, be changed to
read ``including individuals served by the Individuals with
Disabilities Education Act, * * * and any other cooperative
agreements'' in order to ensure that equal weight is given to all
cooperative arrangements.
One commenter recommended that the Secretary require a DSU to
include in its projections estimates of the number of individuals with
severe disabilities that will be provided services under the
interagency cooperative arrangement with programs that rely on Javits-
Wagner-O'Day Act (JWOD Act) set-asides.
Discussion: The Secretary believes that requiring in the State plan
separate estimates of the number of individuals with disabilities to be
served under interagency cooperative arrangements is overly burdensome.
As long as the DSU considers these agreements when ascertaining the
projected numbers of eligible individuals and the projected costs of
administering its program, there is no need to provide a separate
breakdown of the number of applicants or eligible individuals receiving
services under each type of agreement.
Changes: In accordance with the Department's principles for
regulating, the Secretary has revised the proposed regulations to
eliminate the requirement that the DSU include estimates of the number
of individuals to be served under interagency cooperative agreements as
part of its projected costs of administering the program.
--Development of order of selection as a contingency plan
Comments: Several commenters requested that a DSU be required to
develop an order of selection regardless of whether it needs to be
implemented in the current fiscal year. These commenters believed it is
important for each DSU to have an order of selection available as a
contingency measure.
Discussion: There is no statutory authority to require a DSU to
develop an order of selection if a DSU determines it is presently able
to serve all eligible individuals and will be able to do so throughout
the fiscal year. Section 101(a)(5)(A) of the Act requires a DSU
[[Page 24394]]
to establish an order of selection only if it is unable to serve all
eligible individuals.
A DSU could, however, choose to develop the priority categories in
an order of selection in anticipation of possible future need, but
would still be required at the time of implementation of the order of
selection to meet the public participation requirements of section
101(a)(23) of the Act, including consultation with the Council.
Changes: None.
Order of selection.
--Applicability of order of selection to funds not included in State
match or Federal allotment
Comments: One commenter requested that the order of selection
requirement not apply to service funds that are not included in the
State match or Federal allotment.
Discussion: The order of selection requirement applies to all
expenditures under the State plan, including expenditures made with
Federal funds and DSU expenditures made with non-Federal funds that are
necessary to meet a DSU's matching and maintenance-of-effort
requirements.
Changes: None.
--Outcome and service goals
Comments: One commenter suggested adding a paragraph to
Sec. 361.36(a)(2) of the proposed regulations requiring a DSU to show
the outcome and service goals and the time in which they may be
achieved for individuals. The commenter believed that this reporting
requirement should be added to ensure that the Secretary will know with
specificity the types of services and service outcomes being provided,
either if a DSU elects to establish and implement an order of selection
or if a DSU assures that it is able to serve all eligible individuals.
According to the commenter, if a DSU establishes an order of selection
for services, it will be very important for evaluation purposes to
define the mix of services, goals, and timelines for providing services
to individuals with the most severe disabilities.
Discussion: The Secretary agrees with the change suggested by the
commenter. Section 101(a)(5)(A) of the Act requires a DSU to show the
outcomes and service goals, and the time within which they may be
achieved, for individuals provided services under an order of selection
established by a DSU. Section 101(a)(10)(A) of the Act requires a DSU
to include in its State plan the outcomes, service goals, and service
costs for individuals under each priority category in a DSU's order of
selection.
Changes: The Secretary has revised Sec. 361.36(a)(2) of the
proposed regulations to provide that a DSU's order of selection must
include the order to be followed in selecting eligible individuals to
be provided services, a justification of that order of selection, and a
description of the outcome and service goals and service costs for
individuals with disabilities in each priority category within the
order and the time within which these goals may be achieved. This
provision has been relocated to Sec. 361.36(a)(1)(ii) of the final
regulations.
Section 361.36(b)--Time for Determining Need for and Implementation of
an Order of Selection
--Implementation of an order of selection and opening and closing of
priority categories during the fiscal year
Comments: One commenter recommended requiring a DSU to periodically
review whether it needs to establish an order of selection. This
commenter also recommended requiring a DSU to periodically update its
projections under Sec. 361.36(a)(1) of the proposed regulations so that
the DSU, with advice and input from the Council (if the DSU has a
Council), can make decisions with current information.
One commenter recommended that the regulations require a DSU to
reevaluate its decision not to establish an order of selection at some
regular interval identified in the regulations, rather than permit the
DSU to determine the timing of its reevaluation. Otherwise, the
commenter feared that many DSUs would delay reevaluation and likely be
forced to implement an order of selection on an emergency basis.
One commenter suggested that a DSU submit reports to the Secretary
and to the Council comparing the actual costs and numbers of
individuals served with its projections under Sec. 361.36(a)(1) of the
proposed regulations and any adjustments to the projections.
Other commenters suggested that a DSU be required, no later than 45
days after the end of each quarter, to submit a report on how service
and expenditure levels for that quarter and cumulatively for the fiscal
year compare to the projections made by the DSU under Sec. 361.36(a)(1)
of the proposed regulations. These commenters believed that this type
of reporting would allow the Secretary to track the accuracy of a DSU's
projections. Other commenters recommended requiring a DSU to submit
quarterly reports to the Secretary on the accuracy of a DSU's
projections and the need to establish an order of selection.
One commenter inquired whether a DSU may implement an order of
selection during the fiscal year, rather than at the beginning of the
fiscal year. This commenter believed that requiring a DSU to establish
an order of selection at the beginning of each fiscal year might cause
a DSU to be overly conservative and to close more priority categories
than is necessary.
One commenter inquired whether a DSU may adjust, during the fiscal
year, which priority categories are open and closed.
Discussion: The Secretary considers DSU reevaluation of the need to
establish an order of selection necessary to the proper management of
the program. However, the Secretary does not believe that requiring
reevaluation at regular intervals during the course of each fiscal year
is necessary. A requirement of this type would be overly burdensome and
would apply an inflexible standard to determinations that are best
governed by a DSU's individual circumstances. The regulations,
therefore, require a DSU to reevaluate its decision not to implement an
order of selection for services, in consultation with the Council,
whenever changed circumstances, such as a decrease in its fiscal or
personnel resources or an increase in program costs, indicate that it
may no longer be able to provide the full range of services to all
eligible individuals. In addition, documentation related to
reevaluations is to be provided to the Council, as well as to the
Department during RSA's monitoring and review of the order of selection
requirement under sections 107(a)(3)(A) and 107(a)(4)(B) of the Act.
A DSU is required to determine the need for an order of selection
prior to the beginning of the fiscal year and to reevaluate that need
during the year under Sec. 361.36(b) if circumstances change after the
beginning of the fiscal year. If changed circumstances warrant
establishing an order of selection during the fiscal year, a DSU may
implement an order of selection at that time. The Secretary prefers,
however, for a DSU to implement an order of selection at the beginning
of the fiscal year if it foresees any circumstances that may affect its
ability to serve all eligible individuals throughout the year. The
preparations needed to establish and implement an order of selection
take time. During this time, resources may be further strained. Thus,
the Secretary believes that a conservative approach toward implementing
an order of selection and opening priority categories is preferable so
that sufficient resources are available
[[Page 24395]]
throughout the year to serve all individuals with severe disabilities,
including individuals with the most severe disabilities.
If a DSU implements an order of selection during the fiscal year,
rather than at the outset, and thereafter cannot serve all individuals
with severe and the most severe disabilities, it would be out of
compliance with the order of selection requirement.
The Secretary believes that a DSU may use its discretion as to the
timing for opening and closing priority categories as long as the order
of categories is maintained. When considering whether to open a
category, a DSU should evaluate not only current resources but also the
impact that continuing to serve these eligible individuals under this
category will have on resources expected to be available in the next
fiscal year, or possibly beyond.
Changes: The Secretary has revised Sec. 361.36(e)(1) to provide
that the DSU shall consult with and seriously consider the advice of
the Council regarding the need to establish an order of selection,
including any reevaluation of the need to establish an order of
selection under Sec. 361.36(b)(2).
Section 361.36(c)--Establishing an Order of Selection.
--Further guidance on factors to be considered in establishing an order
of selection
Comments: Several commenters recommended that the Secretary provide
further guidance on what factors a DSU should use in establishing an
order of selection. One of these commenters suggested adding five
factors that a DSU should consider in establishing an order of
selection: Lower levels of educational achievement; longer lengths of
unemployment, under-employment, or lower level jobs; lower levels of
self-esteem and self-worth; need for two or more services; and need for
services for a longer length of time.
One commenter requested that a statement be added to Sec. 361.36(c)
indicating that the criteria for determining which individuals are
individuals with the most severe disabilities must be equally
applicable to, and not lead to the exclusion of, transitioning
students. This commenter was concerned that a DSU may define an
``individual with the most severe disability'' by using factors, such
as an employment history of repeated failures, that may exclude youth
with severe disabilities.
Discussion: In establishing an order of selection a DSU can only
consider severity of disability. The Secretary believes that an order
of selection must be based on the factors or criteria contained in the
definition of an ``individual with a severe disability'' in section
7(15)(A) of the Act. An ``individual with a severe disability'' is
defined as an individual with a disability (1) 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 employment outcome; (2) whose vocational rehabilitation can
be expected to require multiple vocational rehabilitation services over
an extended period of time; and (3) who has one or more physical or
mental disabilities, as identified in section 7(15)(A) of the Act, or
any other disability or disabilities that cause comparable substantial
functional limitation.
In determining which individuals with severe disabilities are
individuals with the most severe disabilities, for purposes of
providing them with the highest priority in an order of selection, a
DSU cannot merely apply the criteria in this definition. Because
individuals with the most severe disabilities are a subgroup of
individuals with severe disabilities, the Secretary believes that a DSU
must refine these criteria to identify this subgroup.
A DSU may refine these factors, for example, by basing its order of
selection on the number and degree of functional limitations, the
amount of time vocational rehabilitation services would be needed, and
the number of vocational rehabilitation services needed. When refining
these factors, a DSU may choose to refine one factor or a combination
of factors. The purpose of refining these factors is to link the nature
and depth of the individual's functional limitations with the need for
multiple and complex services that require an extended period of time
for completion.
A DSU could refine the first criterion by requiring that an
individual demonstrate limitations in three or more functional
capacities, such as mobility, communication, self-care, self-direction,
interpersonal skills, work tolerance, or work skills. Alternatively, a
DSU could specify the degree of functional limitations within one or
more functional capacities by requiring that an individual demonstrate
a minimum number of specific functional limitations, such as five
specific functional limitations, within one or more functional
capacities.
Possible examples of specific functional limitations within the
functional capacity of self-direction include--(1) Purposeless shifting
from one activity to another; (2) Inability to follow through with and
complete assignments; (3) Problems related to time management; (4)
Making decisions impulsively without consideration for previous plans
or experience; (5) Limitations in gathering, organizing, and analyzing
information; (6) Difficulties in adapting to changing work
requirements; and (7) Inability to monitor work performance and to
adjust behaviors and activities if the current performance is not
adequate.
A DSU could refine the second criterion by specifying the minimum
number of vocational rehabilitation services required by the individual
or by specifying the extended period of time required for the provision
of services. For example, in order to link the complexity or
substantiality of the services provided to the severity of functional
limitations, a DSU could establish a criterion that an individual
require 2 or more major services that will be at least 12 months in
duration. Major services could be defined as those services described
in section 103(a) of the Act, excluding diagnostic services; supportive
services, such as maintenance and transportation, that complement the
provision of major services; and the counseling, guidance, and service
coordination provided to every eligible individual.
A DSU could base the minimum time period required for the provision
of multiple vocational rehabilitation services on a DSU's experience
with the length of time necessary for individuals with severe
disabilities to achieve an employment outcome. This extended period of
time could be defined as the period of time at the upper end of the
range required for individuals with severe disabilities to achieve an
employment outcome, after eliminating any exceptional cases.
Socioeconomic factors, such as levels of educational achievement or
length of unemployment or underemployment, and personal traits, such as
levels of self-esteem, however, cannot be used in establishing an order
of selection because these factors are not measures of severity of
disability or even measures of disability. For example, using a factor
such as low level of educational achievement would tend to include
individuals whose disabilities were acquired at birth or during the
developmental years while excluding individuals whose disabilities were
acquired after having completed high levels of education, even though
both groups of individuals might demonstrate equal substantial
[[Page 24396]]
functional limitations and have an equal need for multiple services
over an extended period of time. Using a factor such as an employment
history of repeated failures would have the effect of excluding youth
who may have little or no employment history.
Changes: The Secretary has revised Sec. 361.36(c) by adding a new
paragraph (1) that states that an order of selection must be based on a
refinement of the three criteria in the definition of ``individual with
a severe disability'' in section 7(15)(A) of the Act.
Priority for individuals with the most severe
disabilities.
--Federal criteria for defining individuals with the most severe
disabilities
Comments: Several commenters expressed concern about the potential
for an individual to be denied services if the individual moves to a
State in which the DSU uses different criteria for determining which
individuals have the most severe disabilities. One commenter inquired
as to whether there will be a consistent procedure for determining
severity of disability, and other commenters requested that the
regulations include appropriate criteria for defining ``most severe.''
Discussion: There is no statutory authority for the Secretary to
establish Federal criteria to determine which individuals are
individuals with the most severe disabilities. Section 101(a)(5) of the
Act mandates that each DSU has the responsibility to develop its own
criteria in this regard.
Changes: None.
--Functional limitations
Comments: One commenter requested that the Secretary clarify that a
DSU may base an order of selection on limitations of functional
capacities in addition to those listed in the statutory definition of
``individual with a severe disability'' in section 7(15)(A)(i) of the
Act.
Another commenter suggested that the Secretary encourage DSUs to
determine which individuals are the most severely disabled based on the
types of functional limitations specified in the definition of
``developmental disability'' in section 6001(5) of the Developmental
Disabilities and Bill of Rights Act (DD Act). ``Developmental
disability'' is defined, in part, as a severe, chronic disability that
results in substantial functional limitations in three or more of the
following areas of major life activity: (1) Self-care. (2) Receptive
and expressive language. (3) Learning. (4) Mobility. (5) Self-
direction. (6) Capacity for independent living. (7) Economic self-
sufficiency.
Discussion: A DSU may base an order of selection on limitations of
functional capacities in addition to those functional capacities listed
in section 7(15)(A)(i) of the Act. This listing is not all-inclusive
because it is preceded by the words ``such as.'' However, functional
limitations under this program must affect the achievement of an
employment outcome. The DD Act definition specifies functional
limitations that affect major life activities. Under The State
Vocational Rehabilitation Services Program, some of the functional
areas specified in the DD Act, such as economic self-sufficiency and
capacity for independent living, would not necessarily be considered a
functional limitation that impedes the achievement of an employment
outcome, but rather would be considered a potential outcome or benefit
of the VR program. Therefore, they could not be used as a factor in
determining severity of disability under the VR program. As part of a
review of a DSU's criteria for identifying individuals with the most
severe disabilities, the Secretary would assess the appropriateness of
using particular different functional capacities.
Changes: None.
Factors that cannot be used in determining order of
selection of eligible individuals.
--Applying eligibility restrictions to order of selection decisions
Comments: Several commenters opposed applying eligibility
restrictions to order of selection decisions. These commenters stated
that the eligibility and order of selection requirements are intended
to stand alone under the Act.
Discussion: The Secretary agrees that the eligibility requirements
and the order of selection requirements are separate requirements.
Eligibility determinations can be based only on the statutory
eligibility criteria in section 102(a)(1) of the Act. Determinations of
the order of serving eligible individuals can be based only on severity
of disability in accordance with section 101(a)(5)(A) of the Act.
Neither determination can be based on any of the factors in
Sec. 361.36(c)(2).
Changes: None.
--Residency prohibition
Comments: One commenter believed that the residency prohibition
needed to be clarified because, as worded in the NPRM, it would
encourage individuals who live in one State to apply for services in
another State.
Discussion: The Secretary's intention was to prohibit an order of
selection from being based on any particular durational residency
requirement as long as the individual is present in the State and can
complete a program of services. The Secretary did not intend to address
the issue of the ability of residents of one State to receive VR
services in another State.
Changes: The Secretary has revised Sec. 361.36(c)(1)(i) of the
proposed regulations to prohibit an order of selection from being based
on any duration of residency requirement, provided the individual is
present in the State. This provision has been relocated to
Sec. 361.36(c)(2)(i) of the final regulations.
--Type of disability prohibition
--Individuals who are blind or visually-impaired
Comments: One commenter urged the Secretary to ensure that State
rehabilitation agencies that serve only individuals who are blind or
visually impaired be permitted to continue to serve these individuals
if those agencies are operating under an order of selection. In
addition, this commenter recommended that State rehabilitation agencies
that serve all individuals with disabilities be required to recognize
blindness as a severe disability for purposes of order of selection.
Discussion: If a DSU that serves only individuals who are blind or
visually impaired is unable to serve all eligible individuals, it must
prioritize according to severity of disability.
An individual who is blind or visually impaired must be assessed
like all other eligible individuals with disabilities according to the
three criteria in the definition of an ``individual with a severe
disability'' in section 7(15)(A) of the Act. A DSU may not determine
that an individual who is blind or visually impaired automatically
meets this definition, i.e., that every individual who is blind or
visually impaired is an individual with a severe disability or an
individual with a most severe disability. An individual who is blind,
however, would automatically satisfy the third element in the
definition because ``blindness'' is included among the listing of
physical or mental disabilities that the Act recognizes as causing
substantial functional limitation.
In addition, if an individual is determined blind pursuant to Title
II or Title XVI of the Social Security Act, section 102(a)(2) of the
Rehabilitation Act considers that individual to have a severe physical
or mental impairment that seriously limits one or more functional
capacities in terms of an employment outcome, thus satisfying the first
criterion in the definition of an
[[Page 24397]]
``individual with a severe disability.'' There is no basis in the Act,
however, for automatically determining that an individual who is blind
or visually impaired would require multiple vocational rehabilitation
services over an extended period of time.
Changes: None.
--Individuals with disabilities of alcoholism and other drug abuse
Comments: One commenter was concerned that individuals with
disabilities of alcoholism and other drug abuse would not receive fair
consideration under an order of selection. In order to ensure fair
consideration for these individuals, the commenter requested that
criteria be added that require a DSU to include among individuals with
the most severe disabilities those individuals with chronic relapsing
conditions.
Discussion: Section 105(a)(5)(A) requires a DSU, not the Secretary,
to establish criteria for determining which individuals with severe
disabilities are individuals with the most severe disabilities. Any
criteria established by a DSU for identifying individuals with the most
severe disabilities should apply equally to individuals with chronic
and individuals with acute disabling conditions. Many individuals with
chronic relapsing conditions, such as alcohol or drug abuse, may
experience substantial functional limitations and require multiple
vocational rehabilitation services over an extended period of time.
However, an assessment of whether a particular individual with a
disability meets these criteria, including an assessment of an
individual who is disabled because of alcohol or drug abuse, must be
done on a case-by-case basis.
Changes: None.
--Source of referral prohibition
Comments: One commenter inquired whether the emphasis on
interagency cooperative arrangements in the Act allows a DSU to
establish a priority under an order of selection for eligible
individuals referred by school systems under the Individuals with
Disabilities Education Act (IDEA) or the Carl D. Perkins Vocational and
Applied Education Act (Perkins Act).
Discussion: A DSU may not establish a priority under an order of
selection for eligible individuals referred by school systems under
IDEA or the Perkins Act because the source of referral is not
necessarily an indicator of severity of disability. While some of these
individuals might be individuals with severe or the most severe
disabilities, all individuals referred by schools under these programs
may not necessarily meet these criteria. This determination must be
made on an individual basis.
Changes: None.
--Prohibition against using type of expected employment outcome
Comments: Several commenters opposed this prohibition. Several
commenters contended that the purpose of the Title I program is to
assist individuals with disabilities to enter into gainful employment,
and, therefore, the type of expected employment outcome should be used
as a factor in establishing an order of selection. One commenter
contended that one of the evaluation standards for the program to be
developed by the Secretary under section 106(a)(2) of the Act may
relate to the achievement of competitive employment outcomes and an
increase in post-placement earnings. The commenter believed it is
unfair to evaluate a DSU on the level of earnings of the individuals it
places in employment if it cannot use type of employment and amount of
earnings as a factor in establishing an order of selection.
Finally, one commenter inquired whether, given the increased
emphasis in the Act on supported employment, a DSU should be permitted
to establish a priority in its order of selection for eligible
individuals whose employment outcome is in a supported employment
setting.
Discussion: Individuals with multiple functional limitations and a
need for multiple services over an extended period of time will have
varying expected employment outcomes, including competitive employment,
supported employment, and other types of employment. Thus, type of
expected employment outcome and level of post-placement earnings are
not indicative of severity of disability and cannot be used as criteria
for determining the level of severity of disability.
Although an individual whose employment outcome is in a supported
employment setting would be included in the group of individuals with
the most severe disabilities because supported employment services
under the Act can only be provided to individuals with the most severe
disabilities, a DSU cannot give individuals whose employment outcome is
in a supported employment setting priority over other individuals with
the most severe disabilities who have different employment outcome
goals.
Changes: None.
--Prohibition against considering the particular service needs of an
individual or anticipated cost of services required by an individual
Comments: Several commenters opposed these prohibitions. Several
commenters questioned the logic of prohibiting consideration of service
needs when establishing an order of selection because the need for
multiple services is part of the definition of ``individual with a
severe disability.'' One commenter also pointed out that this
restriction is contrary to previous RSA sub-regulatory guidance that
has allowed DSUs to use service needs and costs in establishing
priority categories for individuals with non-severe disabilities.
Finally, one commenter inquired whether it is consistent with the Act
for a DSU to establish a priority in its order of selection for
eligible individuals who require rehabilitation technology devices and
services.
Several commenters believed that the Secretary should revise the
regulations to allow a DSU to develop an IWRP for only non-purchased
services if resources are not available to also provide purchased
services. These commenters requested that a DSU that has established an
order of selection for services be allowed to provide a priority to
persons who do not have a severe or most severe disability and who need
only non-purchased services as long as adequate resources are available
to serve first those individuals who are the most severely disabled.
Discussion: The Secretary agrees that clarification is needed. This
provision is intended to prohibit a DSU from giving priority to an
individual who has one or more specific service needs over another
individual who has different service needs. For example, a DSU is
prohibited from giving priority to individuals who require physical
restoration services over individuals who require vocational training.
A DSU is also prohibited from giving priority to individuals who
require rehabilitation technology devices and services, as raised by
one commenter, over any other individual who requires a different
service.
One of the examples provided in the preamble to the proposed
regulations to illustrate this provision may have caused confusion. The
example stated that a DSU is prohibited from establishing an order of
selection that gives priority to individuals who require short-term
services over individuals who require long-term services. Since a DSU
is required to consider, in establishing its order of selection, an
individual's need for vocational rehabilitation services over an
extended period of time under the second factor of the definition of
``individual with a
[[Page 24398]]
severe disability,'' the use of the words ``short-term'' and ``long-
term'' was inappropriate. The example was intended to illustrate the
principle that the cost of services cannot be a factor in an order of
selection and that DSUs cannot give priority to individuals who need
short-term, less costly services over individuals who need longer term
and more costly services.
The Secretary believes that there is no basis under the Act for
exempting from the order of selection requirement the provision of non-
purchased services. The Act does not draw any distinction between the
provision of purchased and non-purchased vocational rehabilitation
services with respect to a DSU's determination of the order in which it
will provide services to eligible individuals if it cannot serve all
eligible individuals. The order must be predicated, as section
101(a)(5)(A) requires, on severity of disability: Individuals with the
most severe disabilities must be served first.
This means, for example, that if a DSU has established three
service categories for serving eligible individuals (i.e., individuals
with the most severe disabilities, individuals with severe
disabilities, and individuals with non-severe disabilities), then it
must be able to provide all needed services, whether purchased or not,
to all individuals with the most severe disabilities before serving any
individuals with severe disabilities. In addition, it must be able to
provide all needed services to all individuals with severe disabilities
before serving any individuals in the last category who have less than
severe disabilities. An individual's need for only non-purchased
services cannot override this order.
Thus, the Secretary believes that a DSU cannot establish a priority
category anywhere in its order of selection that provides solely for
the provision of non-purchased services, even among individuals with
non-severe disabilities. This interpretation represents a policy
reversal by RSA of its position in subregulatory guidance (RSA-MT-92-
17, March 20, 1992), which permitted a DSU to give a service priority
to non-severely disabled individuals whose rehabilitation needs do not
require the expenditure of case service funds (i.e., individuals who
need only counseling, guidance, and placement services that can be
provided by DSU staff) over other non-severely disabled individuals.
To address the concern of some DSUs on this issue, the Secretary
has proposed regulations for this program in 34 CFR 361.37(c) that were
published in the Federal Register on December 15, 1995 (60 FR 64476)
and that would provide a limited exception to this prohibition. These
proposed regulations would authorize any DSU that has implemented an
order of selection to establish an expanded information and referral
program that includes the provision of job referral services to
eligible individuals who are not being served under a DSU's order of
selection, provided that certain State plan requirements are met. These
requirements include a description in the State plan of the level of
commitment of staff and other resources for this purpose and an
assurance that funds to carry out this program will supplement and not
supplant funds available for providing VR services to eligible
individuals who are able to be served under the DSU's order of
selection.
Changes: The Secretary has clarified Sec. 361.36(c)(1)(vi) of the
proposed regulations by providing that the need for specific services
by an individual cannot be the basis for an order of selection. This
provision has been relocated to Sec. 361.36(c)(2)(vi) of the final
regulations.
--Income level of the individual or the individual's family
Comments: Several commenters recommended that a DSU be permitted to
give priority to persons on public assistance in its order of selection
because these individuals have a greater need for services than those
who have larger incomes.
Discussion: A DSU may not give priority to persons on public
assistance under its order of selection because use of public
assistance is a socioeconomic factor that may not necessarily be
related to the presence of a disability or to the severity of that
disability. Individuals who are on public assistance and who are
included in a priority category currently being served by a DSU can
receive services. As noted in the preamble to the NPRM, however, the
income level of an individual or the individual's family can be a
factor only in determining whether an individual is required by a DSU
to pay part of the cost of a service. This is a State option permitted
under current regulations in 34 CFR 361.47(a).
Changes: None.
--Transitioning students
Comments: One commenter believed the intent of section
101(a)(24)(A) (i), (ii), and (iii) of the Act is to ensure that all
eligible students receive services in a timely manner and to ensure
that there is no gap in services between the school system and the
vocational rehabilitation system.
One commenter inquired how a DSU will handle transitioning special
education students if an order of selection is implemented.
Specifically, the commenter inquired whether a student who is receiving
vocational rehabilitation services would continue to receive services
if the student falls outside of the priority categories being served
under an order of selection established by a DSU.
Another commenter was concerned that transitioning students would
be placed on waiting lists for services. This commenter recommended
requiring a DSU operating under an order of selection to include in its
State plan the plans, policies, and procedures to identify how the DSU
will work with education officials and others to meet the needs of
transitioning youth and to otherwise fulfill their obligations under
the Act concerning the provision of transition services.
Discussion: Even though section 101(a)(24)(A) (i), (ii), and (iii)
of the Act strengthen the provisions for transition services to
students with disabilities, a student who is determined eligible for
services after a DSU implements an order of selection will be served
only if the student is among those individuals included in a priority
category that is currently being served under the DSU's order of
selection.
Section 361.36(d)(3), however, provides that a DSU must ensure that
it will continue to provide all needed services under an IWRP to any
eligible individual who has begun to receive services prior to the
effective date of the order of selection, irrespective of the severity
of the individual's disability. Thus, for example, if a transitioning
student with severe disabilities is receiving vocational rehabilitation
services under an IWRP prior to the effective date of the order of
selection, the student will continue to receive all needed services
even if the DSU is able under its order of selection to initiate
services only to individuals with the most severe disabilities.
Transitioning students who are not included in a priority category
that is currently being served under a DSU's order of selection will be
placed on a waiting list unless services were begun prior to the
implementation of the order of selection.
Changes: None.
--Individuals with less severe disabilities
Comments: One commenter inquired whether individuals with less
severe disabilities will be systematically left out of the process in
those DSUs that implement an order of selection. This
[[Page 24399]]
commenter feared that the proposed regulations permit a DSU to refuse
services to an individual because his or her disability is not severe
enough.
One commenter inquired whether a DSU may limit the number of
individuals with non-severe disabilities who may be served under an
order of selection so that there will be funds available to serve
individuals with a severe disability who may apply for services.
Discussion: The order of selection requirement mandates that
services be provided first to individuals with the most severe
disabilities before serving other eligible individuals. This means that
individuals with the most severe disabilities are served before
individuals with severe disabilities and individuals with non-severe
disabilities. A DSU that implements an order of selection may be unable
to serve eligible individuals with non-severe disabilities.
The Secretary urges DSUs operating under an order of selection to
be conservative in assessing their ability to serve individuals other
than those with the most severe disabilities before opening additional
priority categories. This approach is needed to ensure that sufficient
resources are available throughout the year to serve individuals under
higher priority categories (i.e., individuals with most severe
disabilities and individuals with severe disabilities) who apply for
services and become eligible after the beginning of the fiscal year. As
stated previously, the Secretary prefers this conservative approach
since a potential increase in the number of applicants with severe
disabilities might affect the DSU's ability to comply with the order of
selection requirements throughout the year.
Changes: None.
Section 361.36(d)--Administrative Requirements
--Identify the order of selection as a State-imposed requirement
Comments: One commenter recommended deleting this requirement. The
commenter stated that the only legally permissible reason for
implementing an order of selection policy is resource limitations.
Since funding for the program is a shared responsibility of State and
Federal governments, the commenter believed there was no reason to
attribute resource shortfalls exclusively to a State.
Discussion: The Secretary believes that the commenter
misinterpreted this provision of the proposed regulations. The intent
of the provision was for a DSU to identify its particular order of
selection policy as a State-imposed requirement (not the order of
selection requirement itself, which is a Federal requirement) since
this policy is a State rule or policy relating to the administration or
operation of the program under section 17 of the Act. Nevertheless, the
Secretary believes that there is no reason to particularly highlight
this one State-imposed requirement in the regulations over other State-
imposed requirements, such as a State's financial needs test. The
Secretary intends to address State-imposed requirements in general in
other regulations for this program.
Changes: The Secretary has deleted the requirement in
Sec. 361.36(d)(2) of the proposed regulations that a DSU identify its
order of selection policy as a State-imposed requirement.
--Written policies
Comments: Several commenters suggested that written policies for an
order of selection include requirements that the policies must provide
that affected individuals are notified of the State's particular order
of selection, the priority category to which they have been assigned,
and their right to appeal assignment to a particular priority category.
One commenter suggested revising Sec. 361.36(d)(3) of the proposed
regulations to provide that a DSU must establish written policies
related to the development, establishment, and administration of the
order of selection that should include, but not be limited to, the
following: (1) Consultation with the Council. (2) Staff orientation and
training. (3) Notification to individuals applying for services, or in
an appropriate case, the parent, family member, guardian, advocate, or
authorized representative of such an individual. (4) Monitoring
procedures. (5) Caseload management. (6) Evaluation of effectiveness of
the order of selection. The commenter believed that these policies
should be required since they include important accountability
elements.
Discussion: The Secretary agrees that a DSU must ensure that each
eligible individual is informed of the priority categories that have
been established in a DSU's order of selection, of the particular
priority category to which he or she has been assigned, and of his or
her right to appeal assignment to a particular priority category under
the State's procedures for reviewing rehabilitation counselor or
coordinator determinations. The Secretary believes these are basic
procedural rights that eligible individuals have under this program.
These notification requirements are specified in Sec. 361.36(d)(2).
In accordance with the Department's principles for regulating,
however, the Secretary has eliminated the requirement in the proposed
regulations that DSUs establish written policies related to the
development, establishment, and administration of its order of
selection. The Secretary believes that requiring DSUs to establish
written policies covering all aspects of the implementation of an order
of selection is overly burdensome. Nevertheless, the Secretary
encourages a DSU to develop policies, as needed, to ensure proper
administration of its order of selection, including policies in areas
such as staff orientation and training, monitoring procedures, caseload
management, and evaluation and management of the order of selection.
Changes: The Secretary has revised Sec. 361.36(d)(3) of the
proposed regulations to require a DSU to notify all eligible
individuals of the priority categories in a DSU's order of selection,
their assignment to a particular category, and their right to appeal
assignment to a particular priority category. This provision has been
relocated to Sec. 361.36(d)(2) of the final regulations.
--Continuity of services
Comments: One commenter requested clarification of this provision.
The commenter noted that a person could have a completed and signed
IWRP, but not yet have begun to receive services under the IWRP. This
commenter requested that the regulations be revised to provide that
anyone with a completed and signed IWRP must continue to receive
services in accordance with their approved IWRP, irrespective of the
severity of their disability. Another commenter inquired whether the
continuity of services requirement entitles an individual who is
receiving services under one DSU's order of selection to receive
services from a DSU in another State if that individual moves and falls
outside of the priority categories being served by the DSU in the
second State.
Discussion: The continuity of services requirement ensures that an
eligible individual who has begun to receive services under an IWRP
prior to the effective date of a DSU's order of selection will continue
to receive all needed services, including services that may be
necessary because of amendments to the IWRP, irrespective of the
severity of that individual's disability.
An eligible individual who has a completed IWRP, but who has not
begun to receive services under that
[[Page 24400]]
IWRP, would not be covered by this requirement. This means that the
continuity of services requirement does not apply to any services
provided in developing an eligible individual's IWRP. This requirement
takes effect at the point in the rehabilitation process when services
leading to an employment outcome have been initiated under an IWRP.
Finally, the continuity of services requirement is DSU-specific and
does not entitle an individual who is receiving services under one
DSU's order of selection to receive services under another DSU's order
of selection if the individual is not included among the individuals
being served under the second DSU's order of selection.
Changes: The Secretary has revised Sec. 361.36(d)(4) of the
proposed regulations to ensure that a DSU continues to provide all
services needed by any eligible individual who has begun to receive
services ``under an IWRP'' prior to the effective date of the order of
selection, irrespective of the severity of the individual's disability.
This change is necessary to clarify that it is the receipt of services
under an IWRP that triggers the continuity of services requirement.
This provision has been relocated to Sec. 361.36(d)(3) of the final
regulations.
--Third-party funding arrangements
Comments: One commenter recommended that the Secretary permit
third-party funding arrangements that conflict with a DSU's order of
selection if these arrangements reflect priorities in national or State
policy. Another commenter feared that requiring DSUs to renegotiate
third-party arrangements will result in a considerable reduction in
resources to serve individuals with disabilities.
One commenter recommended that the Secretary provide a further
explanation of how a DSU can ensure that its third-party arrangements
are ``consistent'' with its order of selection for services. This
commenter also requested that the Secretary take into consideration the
practical difficulties for a provider of renegotiating a contract
midstream. Another commenter inquired whether cooperative arrangements,
like third-party arrangements, must be consistent with a DSU's order of
selection.
One commenter questioned whether a DSU may select a category of
individuals for priority under its order of selection because that
category is funded by targeted funds from another agency.
Discussion: The Secretary believes that a DSU's funding
arrangements for providing services, such as third-party arrangements
and cooperative arrangements, cannot override its order of selection if
those funds are used under the State plan. For example, a DSU that
receives third-party funding to serve individuals with mental illness
may not serve individuals with mental illness who fall outside of the
priority categories being served under the order of selection. This is
necessary to ensure that an order of selection is applied fairly and
evenly to all individuals regardless of whether funding arrangements
are in place to serve individuals from particular disability groups. If
a funding arrangement is inconsistent with a DSU's order of selection,
a DSU must renegotiate these arrangements so that individuals are
served in a manner consistent with the DSU's order of selection.
Changes: The phrase ``under the State plan'' has been added to
Sec. 361.36(d)(4) to clarify that any funding arrangements that are
used by a DSU to provide services under the State plan must be
consistent with a DSU's order of selection.
--Other requirements
Comments: Several commenters were concerned that there is an
inadequate number of counselors qualified to properly evaluate severity
of disability. These commenters suggested that the Secretary ensure
that qualified counselors are available to evaluate individuals to
determine whether they will receive services under an order of
selection.
Discussion: Section 101(a)(7) of the Act requires a DSU to develop
a comprehensive system of personnel development to ensure that an
adequate supply of qualified State rehabilitation professional and
paraprofessionals is available in the State. The Secretary believes
that this provision mandates that staff in sufficient numbers be
qualified to properly evaluate functional limitations for purposes of
determining severity of disability. The Secretary believes that all
DSUs operating under an order of selection must provide staff with
appropriate training to be able to make these determinations.
Changes: None.
Section 361.36(e)--State Rehabilitation Advisory Council
Comments: One commenter recommended that the Secretary highlight
the responsibility of the DSU to seek and seriously consider the advice
of the Council on DSU criteria for determining which individuals are
individuals with the most severe disabilities.
Several commenters suggested that a DSU that has implemented an
order of selection be required to consult other advisory boards,
service providers, advocacy organizations, consumers, family members,
and rehabilitation vendors, in addition to the Council, regarding the
content of the order of selection. One of these commenters stated that
this consultation is necessary because the composition of the Council
may not ensure sufficient or equal representation by persons of
different disabilities, such as persons with mental illness.
Several commenters recommended that the Secretary add a new
Sec. 361.36(f) stating that the client assistance program and other
parties must be consulted, under section 101(a)(23)(C) of the Act,
before revisions are made to a DSU's order of selection.
Discussion: The Secretary does not believe that it is necessary to
further highlight the responsibility of a DSU to seek and seriously
consider the advice of the Council when developing the criteria for
determining which individuals are the most severely disabled. The
Secretary believes that Sec. 361.36(e)(3) sufficiently highlights this
responsibility.
The Secretary agrees with the commenters who suggest that advisory
boards, other than the Council, service providers, advocacy
organizations, consumers, family members, rehabilitation vendors, and
the director of the client assistance program (CAP) are valuable
sources of information and should be consulted by a DSU in determining
the content of its order of selection. The Secretary believes that
consultation with these and other groups as to the content of the DSU's
order of selection is sufficiently addressed under sections 101(a)(18),
101(a)(23), and 105(b)(1) of the Act. These statutory provisions
provide for broad public participation in the development of the State
plan and of policies governing the provision of vocational
rehabilitation services under the plan.
Changes: None.
Additional comment
--Development of IWRP
Comments: Several commenters requested that a DSU not be required
to develop an IWRP for all individuals eligible for vocational
rehabilitation services under the Act if the DSU cannot serve all
eligible individuals and is providing services under an order of
selection. These commenters stated that requiring a DSU that has
implemented an order of selection to develop IWRPs for all eligible
individuals, regardless of
[[Page 24401]]
whether the individual could currently be served, would result in
unnecessary work for vocational rehabilitation counselors and would
give false hope to individuals who fall outside of the categories being
served.
Discussion: The Secretary understands the concern expressed by
these commenters and is addressing this issue in other vocational
rehabilitation program regulations. The proposed regulations concerning
development of an IWRP for this program published in the Federal
Register on December 15, 1995 (60 FR 64476, proposed Sec. 361.45(a))
would require a DSU that has implemented an order of selection to
develop an IWRP only for each eligible individual that it is able to
serve.
Changes: None.
Executive Order 12866
Assessment of Costs and Benefits
These final regulations have been reviewed in accordance with
Executive Order 12866. Under the terms of the order the Secretary has
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 determined by the
Secretary to be necessary for administering this program effectively
and efficiently.
In assessing the potential costs and benefits--both quantitative
and qualitative--of these regulations, the Secretary has determined
that the benefits of the regulations justify the costs.
The Secretary has also 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 Benefits Relative to Potential Costs of the
Regulatory Provisions Discussed Previously in This Preamble
The Secretary believes that the final regulations represent the
least burdensome way to implement the statutory requirement that a DSU
explain the methods by which it will serve all eligible individuals for
VR services or, in the alternative, establish and justify the order of
selection it shall follow in serving first those individuals with the
most severe disabilities. In addition, the Secretary believes that the
regulations present the most effective means of ensuring that DSUs do
not improperly avoid establishing an order of selection (i.e., failing
to establish an order of selection even though the DSU cannot serve all
eligible individuals). Reduction of burden on DSUs and other benefits
resulting from the final regulations are discussed in the following
paragraphs of this section and throughout the analysis of comments and
changes section of the preamble.
Reduction of Paperwork Burden on Grantees
As stated previously in this preamble, review of the final
regulations in accordance with the Department's principles for
regulating resulted in two major, burden-reducing changes from the
proposed regulations. First, under the final regulations, DSUs that
have successfully served all eligible individuals in the past are not
required to include detailed projections (e.g., projected number of
eligible individuals, projected program costs and revenues) as part of
their explanation of how they will continue to serve everyone and meet
all other program requirements in the next year. As long as a DSU can
provide the assurances required in the regulations to confirm its past
ability to serve all eligible individuals, the DSU's explanation under
Sec. 361.36(a)(1) is not subject to minimum content requirements.
Second, the regulations reduce the number of data projections and
related demonstrations that must be included as part of the explanation
for DSUs that have been unable to serve all eligible individuals in the
past. The remaining projections are needed to indicate whether a DSU
that has been unable to serve all eligible individuals previously can
serve everyone in the next year.
Evaluation of Need to Establish an Order of Selection
Once a DSU decides, prior to the beginning of the fiscal year, that
it does not need to establish an order of selection, the final
regulations require the DSU to reevaluate this decision whenever
changed circumstances indicate that it may no longer be able to serve
all eligible individuals. DSUs, therefore, are responsible for
determining whether they need to implement an order of selection after
the start of the year. The Secretary prefers this flexible approach
rather than imposing in the regulations a specific time when all DSUs
must reevaluate the need to establish an order of selection, as some
commenters on the proposed regulations suggested.
Instructions for Establishing an Order of Selection
Section 361.36(c) provides, for DSUs unable to serve all eligible
individuals, clear directives on how to establish an order of selection
for providing services. In addition, this section includes specific
factors that cannot be used in developing an order of selection. Many
commenters on the proposed regulations had requested clarification as
to whether these factors could be considered in formulating specific
priority categories under an order of selection.
Additional Benefits
The final regulations include provisions intended to enhance the
protection of individuals with disabilities by DSUs operating under an
order of selection. For example, the regulations require DSUs to notify
all eligible individuals of the priority categories in the State's
order of selection, as well as their assignment to a particular
category. Additionally, the regulations require DSUs to continue to
serve any eligible individual who has begun to receive services under
an IWRP prior to the effective date of the order of selection,
irrespective of the severity of the individual's disability.
Paperwork Reduction Act of 1995
Under the Paperwork Reduction Act of 1995, no persons are required
to respond to a collection of information unless it displays a valid
OMB control number. The valid OMB control number assigned to the
collection of information in these final regulations is displayed at
the end of the affected section of the regulations.
Intergovernmental Review
This program is subject to the requirements of Executive Order
12372 and the regulations in 34 CFR Part 79. The objective of the
Executive order is to foster an intergovernmental partnership and a
strengthened federalism by relying on processes developed by State and
local governments for coordination and review of proposed Federal
financial assistance.
In accordance with the order, this document is intended to provide
early notification of the Secretary's specific plans and actions for
this program.
Assessment of Educational Impact
In the notice of proposed rulemaking, the Secretary requested
comments on whether the proposed regulations would require transmission
of information that is being gathered by or is available from any other
agency or authority of the United States.
Based on the response to the proposed regulations and on its own
review, the Department has determined that the
[[Page 24402]]
regulations in this document do not require transmission of information
that is being gathered by or is available from any other agency or
authority of the United States.
List of Subjects in 34 CFR Part 361
Administrative practice and procedures, Grant programs--education,
Grant programs--social programs, Reporting and recordkeeping
requirements, Vocational rehabilitation.
(Catalog of Federal Domestic Assistance Number 84.126--The State
Vocational Rehabilitation Services Program)
Dated: March 4, 1996.
Richard W. Riley,
Secretary of Education.
The Secretary amends Part 361 of Title 34 of the Code of Federal
Regulations as follows:
PART 361--THE STATE VOCATIONAL REHABILITATION SERVICES PROGRAM
1. The authority citation for Part 361 continues to read as
follows:
Authority: 29 U.S.C. 711(c), unless otherwise noted.
2. Section 361.36 is revised to read as follows:
Sec. 361.36 Ability to serve all eligible individuals; order of
selection for services.
(a) General provisions.
(1) The State plan must contain--
(i) An assurance that the designated State unit is able to provide
the full range of services listed in section 103(a) of the Act, as
appropriate, to all eligible individuals. The assurance must be
supported by an explanation that satisfies the requirements of
paragraph (a)(2) or (a)(3) of this section and describes how, on the
basis of the designated State unit's projected fiscal and personnel
resources and its assessment of the rehabilitation needs of individuals
with severe disabilities within the State, it will--
(A) Continue to provide services to all individuals currently
receiving services;
(B) Provide assessment services to all individuals expected to
apply for services in the next fiscal year;
(C) Provide services to all individuals who are expected to be
determined eligible in the next fiscal year; and
(D) Meet all program requirements; or
(ii) The order to be followed in selecting eligible individuals to
be provided services, a justification of that order of selection, and a
description of the outcome and service goals and service costs to be
achieved for individuals with disabilities in each category within the
order and the time within which these goals may be achieved.
(2) For those designated State units that provided assurances in
their State plans for the current fiscal year and the preceding fiscal
year that they are able to provide the full range of services, as
appropriate, to all eligible individuals, the explanation required by
paragraph (a)(1)(i) of this section must include a statement that,
during the current fiscal year and the preceding fiscal year, the DSU
has 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
written rehabilitation programs (IWRPs) for individuals determined
eligible, or the provision of services for eligible individuals for
whom IWRPs have been developed.
(3) For those designated State units unable to provide the full
range of services to all eligible individuals during the current or
preceding fiscal year, or unable to provide the statement required in
paragraph (a)(2) of this section, the explanation required by paragraph
(a)(1)(i) of this section must include--
(i) A description of the circumstances that have changed that will
allow the DSU to meet the requirements of paragraph (a)(1)(i) of this
section in the next fiscal year, including a description of--
(A) The estimated number of and projected costs of serving, in the
next fiscal year, individuals with existing IWRPs;
(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
(a)(3)(i) (A) through (C) of this section and the resources identified
in paragraph (a)(3)(i)(D) of this section and an explanation of any
projected increases or decreases in these costs and resources; and
(iii) A demonstration 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 (a)(3)(i) (A)
through (C) of this section so as to ensure the provision of the full
range of services, as appropriate, to all eligible individuals.
(b) Time for determining need for an order of selection.
(1) The designated State unit shall 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 shall 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.
(c) 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 severe disability'' in section 7(15)(A) of the Act.
(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, creed, 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.
(3) Priority for individuals with the most severe disabilities. The
State plan must assure that those individuals with the most severe
disabilities are selected for service before other individuals with
disabilities. The designated State unit shall establish criteria for
determining which individuals are individuals with the most severe
disabilities. The criteria must be consistent with the definition of
[[Page 24403]]
``individual with a severe disability'' in section 7(15)(A) of the Act
and the requirements in paragraphs (c)(1) and (2) of this section.
(d) Administrative requirements. In administering the order of
selection, the designated State unit shall--
(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 IWRP prior to the
effective date of the order of selection, irrespective of the severity
of the individual's disability;
(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 shall renegotiate these funding
arrangements so that they are consistent with the order of selection.
(e) State Rehabilitation Advisory Council. The designated State
unit shall consult with and seriously consider the advice of the State
Rehabilitation Advisory Council regarding the--
(1) Need to establish an order of selection, including any
reevaluation of the need under paragraph (b)(2) of this section;
(2) Priority categories of the particular order of selection;
(3) Criteria for determining individuals with the most severe
disabilities; and
(4) Administration of the order of selection.
(Approved by the Office of Management and Budget under control
number 1820-0500.)
(Authority: Secs. 7(15)(A); 12(d); 17; 101(a)(4); 101(a)(5)(A);
101(a)(7); 101(a)(11)(A); 101(a)(15)(D); 101(a)(24); 101(a)(30);
101(a)(36)(A)(ii); 107(a)(4)(B); and 504(a) of the Act; 29 U.S.C.
706(15)(A), 711(d), 716, 721(a)(4), 721(a)(5)(A), 721(a)(7),
721(a)(11)(A), 721(a)(15)(D), 721(a)(24), 721(a)(30),
721(a)(36)(A)(ii), 727(a)(4)(B), and 794(a))
[FR Doc. 96-11808 Filed 5-13-96; 8:45 am]
BILLING CODE 4000-01-P