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WIATL 39 (House Bill 372 Incumbent Worker Training Program)
Workforce Investment Act Transmittal Letter No. 39
July 31, 2008
TO: WIA Local Workforce Investment Boards (WIBs), Fiscal Agents, Administrative Entities, One-Stop Operators, and Ohio Department of Development
FROM: Helen E. Jones-Kelley, Director
SUBJECT: House Bill 372 Incumbent Worker Training Program


To establish joint procedures and operational parameters for implementation of the Incumbent Worker Training Program (IWTP) administered by the Ohio Dept of Development (ODOD), Workforce and Talent Division.

II.Effective Date

March 1, 2008


The Incumbent Worker Training Program (IWTP) is a new addition to the array of business services offered through ODOD. With this initiative, Ohio's businesses will have access to a wide array of services offered through both ODOD and local WIBs through collaborative partnerships established throughout the state. The IWTP is authorized under House Bill 372 effective March 1, 2008 through June 30, 2009.

IV.Guidance Statements

A.Program Overview

Working together, ODOD Regional Workforce Directors and local WIB Directors (or their designees) will develop strategies that foster a streamlined approach to serving the business community within the region. As both ODOD and local WIBs offer services for businesses, it is essential that representatives from both entities have a common understanding and awareness of the availability of all services in order to ensure that business and industry customers have access to the best service package.

ODOD Regional Workforce Directors and WIB Directors or designees will work collaboratively to identify businesses that may be in need of training assistance for their workforce. Regardless of how the initial contact is made with a business, ODOD will be responsible to assess the business needs and determine the best strategy to assist the business, in partnership with the local WIB. Business services may include IWTP, Ohio Investment Training Program (OITP), or other types of assistance offered through ODOD and/or the local WIB's array of services.

If the determination is made that the business will be served through the IWTP, ODOD will submit (or assist the business in submitting) an approved training plan for funding through the Ohio Department of Job and Family Services (ODJFS). Local WIBs will acknowledge the approved training plan through sign-off. Local WIBs will then receive an allocation letter and a copy of the approved training plan for the project and will enter into a training contract utilizing the required template (provided by ODJFS) with the business based on the approved training plan. ODOD's Regional Workforce Director will then serve as a liaison between the business and the local WIB, providing general oversight of the project and assisting as needed.

Successful implementation of the IWTP occurs when the business has received services made available through the partnership between ODOD and the local WIB, workers have increased skills that enable them to advance earnings over time and obtain industry or employer recognized credentials, the business regains financial stability and viability within the regional economy, or the business becomes engaged in the workforce investment system within the regional area.

B.Incumbent Worker Training - General Guidelines

IWTP will provide worker training assistance to businesses that are at risk of closing, downsizing, to expand capacity, or are in need of increased skill levels of the workforce. Training is developed with a business to upgrade the skills of a particular workforce and is conducted at the workplace or offsite. Training is designed to increase worker skills and competencies, and/or retrain workers with new technology-related skills that will improve their productivity.

An IWT that prevents a layoff or averts a business closure should be given priority consideration. Businesses that provide additional sources of funding to support the IWT make strong candidates for this program.

Participation in the IWTP is mutually beneficial to both the business and incumbent worker. Businesses participating in IWTP will benefit by having a more highly skilled workforce, which will result in increased financial viability, stability, competitiveness, and productivity. Workers receiving training under this initiative will receive needed skills that lead to job retention, increased earnings, promotions, and/or credentials/certificates and skills that are transferable and marketable in the regional economy.

High wages, high costs for recruitment, and or positions that remain unfilled for long periods of time may indicate a shortage of skills within the workforce. This program should target occupations in industries that have documented skill shortages. The program should also provide training that leads to credentials that are portable, transferable, and or recognized by the business community. The training should develop the skills of the workforce and lead to enhanced career pathways for individual employees.

For the purposes of this program and OMB Circular A-133, an approved business is not a vendor or subrecipient. These businesses are determined to be beneficiaries of this federal program. From this point forward, approved businesses will be referred to as "beneficiaries."

All beneficiaries receiving assistance through the IWTP must ensure that workers trained under this program are authorized to work in the United States and are willing to provide documentation to verify this status upon request. Documentation could include copies of I-9's for trainees.

Beneficiaries participating in the IWTP must pay for at least 50 percent of the cost of training. Trainee wages are not included in the cost of training.

No IWTP funds may be used, or proposed for use, to encourage or induce the relocation of a business or part of a business if such relocation would result in a loss of employment for any employee of such business at the original location and the original location is within the United States.

No IWTP funds may be used for customized training, skill training, or on-the-job training for any business or part of a business that has relocated, until the date that is 120 days after the date on which such business begins operations at the new location, if the relocation of the business or part of a business results in a loss of employment for any employee of the business at the original location and the original location is within the United States.

The maximum award payable to a beneficiary is 50 percent of the training program's cost, or $200,000, whichever is less. All awards will be paid to a beneficiary on a reimbursement basis. Beneficiaries are required to pay 100 percent of the total training program costs of which 50 percent will be reimbursed, up to the total award amount.

Beneficiaries shall be reimbursed for 50 percent of the actual training program costs, up to $1,000 for each employee, subject to the limitations of the total award. Training program costs shall not be averaged for each employee when determining training plan approvals or reimbursement amounts. Curriculum development costs are limited to 10 percent of the total training program costs.

Workers receiving training under IWTP must be permanent full-time employees of the beneficiary.

ODOD shall ensure that not less than 25 percent of beneficiaries served statewide in the IWTP initiative will be in non-manufacturing industries and have less than 500 employees.

C.Eligibility for Participating Beneficiaries

Whether the initial point of contact with the beneficiary is made by the ODOD Regional Workforce Directors or a local WIB Director or designee, it is important to gather sufficient information to determine the appropriate mix of services to meet the beneficiary's needs. The IWTP initiative is one of many business services offered and based upon a thorough assessment, it may be determined that a business could be better served through a program not funded under this initiative.

There are also businesses that should not participate in this initiative due to past or current violations of local, state, or federal law; unfair labor practices; and other conditions identified through the up front assessment process.

The ODOD Regional Workforce Directors and the local WIBs will ensure that the assurances and considerations listed below have been reviewed prior to the approval of a training plan.

  • Businesses must be current on their local, state and federal tax obligations and compliant with all environmental requirements. Only businesses that are not presently debarred, suspended, proposed for disbarment, declared ineligible, or voluntarily excluded from participation in transactions by USDOL or any other federal department or agency shall be considered for IWT.
  • Businesses must ensure that they are not on the most recent list established by the Ohio Secretary of State that would identify them as having more than one (1) unfair labor practice contempt of court finding.
  • Businesses must have all of the approvals, licenses, or other qualifications needed to conduct business in Ohio and all are current. Should this status change during the course of the IWTP activities and the business is disqualified from conducting business in Ohio, all training under the IWTP must cease.
  • Governmental entities, including the city, county and state, may not participate in IWTP. Health care providers that are operating as not-for-profit governmental entities are the only allowable exceptions to this prohibition.
  • Businesses that have relocated to Ohio and have laid-off workers at their former location in the United States may not be considered for this program until they have been in operation at the new location for 120 days.
  • Businesses that have employees in a lay-off status should not be considered for an IWT unless the IWT will avert additional lay-offs.
  • Businesses must adhere to all other assurances and certifications as listed in the training contract provided by ODJFS.

D.Training Provider Considerations

Community colleges, state universities, vocational schools, technical schools, licensed private institutions, and training providers on Ohio's statewide WIA Eligible Training Provider (ETP) list should be used whenever possible. Professional trainers from the business community, including staff from the business applying for funds, are acceptable alternatives.

Training providers without satisfactory past performance, accreditation, curricula that lead to credentials, relevant training experience, accredited instructors, high job placement rates, and or high training completion rates, should be avoided.

The training facility should provide an environment that supports learning and be within reasonable proximity to the trainees so the cost and time required for travel is minimized.

E.Application for Funds and Contracting

Once a beneficiary is determined to be eligible for IWTP, an approved training plan that has been acknowledged by the local WIB through signature, will be submitted to ODJFS. This training plan may be completed by a local ODOD Regional Workforce Director or by the beneficiary, assisted by ODOD staff.

Once the approved local training plan has been received by ODJFS, the appropriate local WIB Administrative Entity and the Fiscal Agent will be notified and an allocation letter will be issued by ODJFS to the area that includes an additional 3 percent of the cost of training to offset the administrative costs associated with this initiative. A copy of the approved training plan will accompany the allocation letter.

Upon receiving the allocation letter for the approved training plan, the local WIB will develop a training contract with the beneficiary that identifies all costs associated with IWTP, utilizing the required contract template provided by ODJFS. The contract will include only those costs identified in the approved training plan.

Funds for IWTP will be passed from ODJFS to the local WIB, and from the local WIB to the beneficiary, on a reimbursement basis. A beneficiary that has been approved to participate in IWTP will be reimbursed by the local WIB for actual costs paid, up to 50 percent. These beneficiaries may purchase training from any approved training provider subject to section IV., subsection D., of this transmittal as well as the limitations of their approved training plan. Beneficiaries will submit the documentation required by the local WIB for reimbursement of training costs.

All costs associated with the training must be allowable, allocable, reasonable, and necessary, following all state and federal guidelines.

Allowable Costs for IWTP may include but are not limited to:

  • Instructor / trainer salaries*,
  • Curriculum development, textbooks, manuals, training software, materials and non-consumables,
  • Other necessary and reasonable costs directly related to training.

* This includes in-house trainers if utilized to provide training to the incumbent workers.

Unallowable Costs for IWTP may include but are not limited to:

  • Trainee wages,
  • Foreign travel,
  • The purchase or lease of capital equipment.

F.Grant Award Structure

ODJFS will allocate funds for approved IWTP training plans to local WIBs only. WIBs will maintain all responsibility for audits and audit resolutions.

The primary audit responsibility will remain with the fiscal agent for all fiscal related functions, including financial reporting, budget tracking, and fiscal audits as with any program activity, and should be incorporated into local area monitoring practices. Local WIBs will determine documentation requirements for reimbursement of training costs. Approved IWTP activities will also be monitored by ODJFS. Program monitoring activities may include, but are not limited to, site visits; examination of program operations; review of beneficiary and trainee eligibility; and, review of outcomes and of quality of training provided (refer to the USDOL handbook for more information on monitoring procedures).

G.Fiscal Reporting

The local area fiscal agent will reimburse the approved beneficiaries for IWTP up to 50 percent of the actual costs of the approved training contract. Allocation letters will be issued for the project via the normal ODJFS process in conjunction with the annual local area grant agreement. The allocation will be based on 50 percent of the approved training amount plus an additional 3 percent administrative cost.

The fiscal agents will follow the Ohio Administrative Code for specifics on the cash draws, fiscal reporting, and other related accounting functions.

Expenditures reported against the incumbent worker training program will be monitored by ODJFS as part of the regularly scheduled visit. Therefore, local areas should report expenditures in a timely manner.

H.Data Elements, Documentation and Program Reporting

Local WIBs are required to report IWTP beneficiaries and workers via the mini-incumbent worker registration in the Sharing Career Opportunities and Training Information (SCOTI) WIA system. Outcomes are also required.

Both HB 372 IWTP and local incumbent worker programs utilize the mini-incumbent worker registration in SCOTI. However, the reporting requirements are not always the same. In order to distinguish between the HB 372 IWTP and the local IWT program, WIBs are required to follow the instructions below when entering activities tied to this initiative.

Data Element: Contract ID

This is a local use field that can be utilized at the local level to track specific data unique to the area. This 5-character field may be alpha or numeric (or a combination of the two). For all HB 372 activities, the first two characters in this field must be entered as "HB."

Data Element: Type of IWT Program

Each project must be categorized as either Layoff Aversion or Workforce Talent Development as identified in the training plan when recorded in SCOTI. The category definitions are as follows:

Layoff Aversion IWT - a category of incumbent worker training allowable under this IWTP initiative that identifies the beneficiary as having a workforce in need of training due to the potential for workforce downsizing or closure.

Workforce Talent Development (WTD) IWT - a category of incumbent worker training allowable under this IWTP initiative that identifies the beneficiary as in need of training for its workers in order to expand capacity, increase skills and competencies, remain viable and competitive, and/or retrain with new technologies.

Data Element: Training Types

All training under the IWTP must be entered as "skills upgrade." (This is unlike the reporting requirements for local areas conducting incumbent worker training programs under waiver authority with up to 20 percent of local funds. With the local program, the type of training must be reported under the appropriate category of OJT, ITA, Customized Training, or Skills Upgrade.)

Additional Data Elements

The following additional data elements are included in the SCOTI mini-incumbent worker screen for reporting:

WIB NumberCountyBusiness Name
NAICS CodeWorker NameDate of Birth
Worker SSN (optional)Training Start DatePlanned End Date
Planned Training HoursActual End DateActual Training Hours

Worker outcomes must be reported and selected from the following list (multiple selections may be made):

Completed training programDid not complete training program
Received vocational skill certificateReceived other credential
Worker remained employed with same business after exitWorker is employed by a different business after exit
Worker received wage increaseWorker received promotion
Worker received other positive outcome 

V.Technical Assistance

For questions regarding this policy, contact ODOD Talent and Workforce Division at WORKFORCE@odod.state.oh.us or ODJFS Office of Workforce Development at WIAQNA@JFS.OHIO.GOV.


Amended Substitute House Bill 372, 127th G.A., Section 3

Workforce Investment Act of 1998, Public Law 105-220

Workforce Investment Act Final Rules, 20 CFR Part 652

OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations

OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments

Incumbent Worker Reporting Requirements Memo, issued January 2, 2008 Ohio Dept. of Job and Family Services, Office of Workforce Development, John B. Weber