The U.S. Department of Labor (USDOL), Office of Inspector General, conducted an audit of the Workforce Investment Board of Southeast Los Angeles County's (SELACO) H-1B technical skills training grant for the period November 15, 2000 through December 31, 2001. The overall audit objective was to evaluate if SELACO was meeting the intent of the H-1B Technical Skills Training Program and the requirements of its grant. The subobjectives were to determine if:

• The project had been implemented as stated in the grant.

• Program outcomes were measured, achieved, and reported.

• Reported outlays were reasonable, allocable, and allowable in accordance with applicable Federal regulations, and Office of Management and Budget (OMB) Circular A-122, Cost Principles for Non-Profit Organizations.

The H-1B Technical Skills Training Program was designed to help U.S. workers acquire the technical skills for occupations that are in demand and being filled by foreign workers holding H-1B visas. USDOL awarded SELACO $2,800,000 to operate an H-1B Technical Skills Training Program for the period November 15, 2000 to November 14, 2002. The training program was designed to provide high-tech machinist/CNC (computer numerical control) training in four modes: Conventional Classroom Instruction, PC-Web Hybrid, Web-Based, and PC-Based Application.

AUDIT RESULTS

As of December 31, 2001, SELACO recruited and referred targeted participants to training at local community colleges with established curricula. Participants paid for their own training. Thus, sustainability is not an issue with regard to Conventional Classroom Instruction. Additionally, SELACO reported outlays in accordance with applicable Federal regulations and cost principles. However, SELACO did not implement other modes of training, measure and report all outcomes, or report matching funds.

• PC-Web Hybrid, Web-Based, and PC-Based Application training modes, which were the unique aspects of the grant, were not fully developed and offered at participant worksites, as originally envisioned in the grant. As of April 11, 2002,⁽¹⁾ only 58 of the 180 modules proposed in the grant to be used in these modes of training were developed.

• SELACO did not fully accomplish, measure, or report proposed program outcomes. As of December 31, 2001, 1,106 participants were being trained, working towards certification or associate degrees. This exceeds the training enrollment goal of 500. However, training completions, placements, and employment upgrades were not known, as SELACO did not track this data.

• The grant established a matching requirement of 25 percent of Federal outlays. However, the third party in-kind contribution had not been reported as of December 31, 2001.

SELACO's RESPONSE TO DRAFT REPORT

On September 13, 2002, the Executive Director of SELACO responded to the draft report. He stated that (1) 3 modes of training curriculum were developed and 175 training modules were completed over the summer of 2002, (2) reporting measures would be implemented in the Fall of 2002, and (3) a revision was made to the June 30, 2002, Financial Status Report (FSR) to include the match contribution.

OIG COMMENTS

SELACO's response indicates that it has made additional progress towards implementing its program in accordance with the grant requirements. ETA needs to follow up with SELACO to verify the progress reported since the end of our audit fieldwork.

RECOMMENDATIONS

We recommend the Assistant Secretary for Employment and Training ensures that SELACO:

• completes the remaining modules to be used for training and continues to implement the three remaining modes of training curriculum (PC-Web Hybrid, Web-Based, PC-Based Application);

• achieves, measures, and properly reports training completions, placements, and upgrades; and

• continues to obtain and report the required matching funds.

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