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entitled 'Workforce Investment Act: Substantial Funds Are Used for 
Training, but Little Is Known Nationally about Training Outcomes' which 
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Report to Congressional Requesters: 

United States Government Accountability Office: 

GAO: 

June 2005: 

Workforce Investment Act: 

Substantial Funds Are Used for Training, but Little Is Known Nationally 
about Training Outcomes: 

GAO-05-650: 

GAO Highlights: 

Highlights of GAO-05-650, a report to Congressional Requesters: 

Why GAO Did This Study: 

The Congress passed the Workforce Investment Act (WIA) in 1998 seeking 
to create a system connecting employment, education, and training 
services to better match job seekers to labor market needs. However, 
questions have been raised about how WIA funds are being used and, in 
particular, how much is being spent on training. Contributing to the 
concern about the use of WIA funds is the lack of accurate information 
about the extent to which WIA participants are enrolled in training 
activities. GAO was asked to determine (1) the extent to which WIA 
funds are used for training, (2) how local workforce boards manage the 
use of Individual Training Accounts (ITA) and what challenges they have 
encountered, and (3) what is known at the national level about outcomes 
of those being trained. 

In its comments, the Department of Labor (Labor) noted that some of our 
estimates on training conflicts with their estimates. Labor’s estimate 
of the number of adults trained comes from their database and includes 
only those who had exited from the program. GAO’s estimates represent a 
more complete and accurate picture than Labor’s because they are based 
on information obtained directly from the local workforce areas, 
include all funds spent or obligated for training, and count all adults 
who received training in program year 2003, not just those who exited 
the program. 

What GAO Found: 

Local workforce boards used an estimated 40 percent of the WIA funds 
they had available in program year 2003 to obtain training services for 
WIA participants. Nationally, local boards had approximately $2.4 
billion in WIA funds that were available to serve adults and dislocated 
workers during program year 2003 and used about $929 million for 
training activities (see fig.) The remaining funds paid for other 
program costs as well as administrative costs. We estimate that 416,000 
WIA participants received training during the year. However, because 
some individuals may have received more than one type of training, this 
count may include some individuals more than once. Most of the 
participants received occupational classroom training purchased with 
ITAs, which are established on behalf of an eligible participant to 
finance training services. 

Most local workforce boards have developed policies to manage the use 
of ITAs, but many boards have encountered challenges in trying to 
implement their use. Local boards often require participants to 
complete specified tasks prior to entering training, such as gathering 
additional information on their desired occupation. In addition, they 
generally limit the amount of money participants can spend on training 
using ITAs and how long the training can last. Among the challenges 
encountered by local boards was the lack of good performance data on 
training providers making it difficult to determine which providers 
were most effective. Local boards in rural areas faced a different 
challenge—lack of nearby training providers. 

Little is known on a national level about the outcomes of those being 
trained. Certain aspects of Labor’s national participant database have 
been found to be incomplete and unverified. Additionally, data 
generally cannot be compared across states or local areas because of 
variations in data definitions. Labor is taking some steps to address 
these concerns, but the findings from this study reaffirm the need for 
a continued focus on resolving reported data quality issues. 

WIA Funds Available and Used for Training in Program Year 2003: 

[See PDF for image] --graphic text: 

Bar graph with ten items.

Dollars in millions. 

WIA adult; 
Funds available: $989; 
Funds used for training: $419. 

WIA dislocated worker; 
Funds available: $889; 
Funds used for training: $332.

National Emergency grants; 
Funds available: $204; 
Funds used for training: $77.

State set-asides; 
Funds available: $295; 
Funds used for training: $101.

Total; 
Funds available: $2,377; 
Funds used for training: $929.

Source: GAO analysis. 

Note: Funds used for training include funds spent or obligated for 
training in program year 2003. 

[End of figure]

www.gao.gov/cgi-bin/getrpt?GAO-05-650. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Sigurd Nilsen at (202) 
512-7215 or nilsens@gao.gov. 

[End of section]

Contents: 

Letter: 

Results in Brief: 

Background: 

Local Boards Used an Estimated 40 Percent of Available WIA Funds to 
Train Program Participants: 

Local Boards Manage ITAs but Have Faced Challenges in Implementing 
Them: 

Little Is Known about Outcomes of Those Being Trained because of 
Weaknesses in Data Collected: 

Concluding Observations: 

Agency Comments: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Summary of Adult and Dislocated Worker Formula Funds for 
Program Year 2003: 

Appendix III: Comments from the Department of Labor: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Related GAO Products: 

Tables: 

Table 1: WIA Adult and Dislocated Worker Outcome Performance Measures: 

Table 2: Estimated Total Number of Instances in Which WIA Participants 
Were Trained during Program Year 2003, by Category and Funding Source: 

Table 3: Challenges Encountered by Local Boards: 

Table 4: 95 Percent Confidence Intervals for Numeric Estimates with 
Margins of Error Exceeding 15 Percent of the Value of Those Estimates: 

Table 5: Locations Selected for Site Visits: 

Figures: 

Figure 1: WIA Funding Streams for Youth, Adults, and Dislocated 
Workers: 

Figure 2: Distribution of Local Workforce Investment Areas in Program 
Year 2003: 

Figure 3: Estimated Total WIA Funds Available for Local Areas in 
Program Year 2003: 

Figure 4: Estimated Total WIA Funds Used for Training in Program Year 
2003: 

Figure 5: Estimated Percentage of WIA Funds Used for Training, by 
Funding Source: 

Figure 6: Estimated WIA-Funded Training in Program Year 2003, by 
Category: 

Figure 7: Estimated Percentage of Local Boards Requiring Completion of 
Specified Activities for Adults and Dislocated Workers Seeking 
Training: 

Figure 8: Estimated Percentage of Local Boards with Various Dollar Caps 
on ITAs: 

Figure 9: Estimated Percentage of Local Boards Requiring Participants 
to Use ITA Funds for Costs Other than Tuition: 

Abbreviations: 

EMILE: ETA Management Information and Longitudinal Evaluation: 

ETA: Employment and Training Administration: 

ETPL: eligible training provider list: 

ITA: Individual Training Account: 

NAWB: National Association of Workforce Boards: 

OIG: Office of Inspector General: 

TAA: Trade Adjustment Assistance: 

TANF: Temporary Assistance for Needy Families: 

WIA: Workforce Investment Act: 

WIASRD: Workforce Investment Act Standardized Record Data: 

United States Government Accountability Office: 

Washington, DC 20548: 

June 29, 2005: 

The Honorable Michael B. Enzi: 
Chairman: 
The Honorable Edward M. Kennedy:
Ranking Minority Member: 
Committee on Health, Education, Labor, and Pensions: 
United States Senate: 

The Honorable Patty Murray: 
Ranking Minority Member: 
Subcommittee on Employment and Workplace Safety: 
Committee on Health, Education, Labor, and Pensions:
United States Senate: 

The Congress passed the Workforce Investment Act (WIA) in 1998, seeking 
to create a system connecting employment, education, and training 
services to better match job seekers to labor market needs. However, 
questions have been raised about how WIA funds are being used and, in 
particular, how much is being spent on training. Contributing to the 
concern about the use of WIA funds is the lack of accurate information 
about the extent to which WIA participants are enrolled in training 
activities. In program year 2003,[Footnote 1] the Congress appropriated 
approximately $2.3 billion for the Department of Labor (Labor) to 
provide employment and training services to adults (those individuals 
aged 18 and older) and dislocated workers (in general, those 
individuals who have been laid off and are unlikely to return to their 
previous employment). Because not everyone needs or wants additional 
training, WIA authorizes local workforce boards to oversee a variety of 
services provided through one-stop career centers to meet the needs of 
individual job seekers as well as the needs of the businesses in their 
area. Such services include providing information on job openings, 
comprehensive assessments, individual counseling, supportive services-
-such as transportation and child care--and job training. Job training 
includes occupational skills training, which is typically purchased by 
WIA participants using Individual Training Accounts (ITA). ITAs are 
established on behalf of an eligible participant to finance training 
services, and payments from these accounts can be made in a variety of 
ways, including the electronic transfer of funds or the use of 
vouchers. 

The primary vehicle for collecting and reporting information about the 
extent to which WIA participants are enrolled in training activities, 
including training funded through ITAs, is Labor's national participant 
database, the Workforce Investment Act Standardized Record Data 
(WIASRD). However, both we and Labor's Office of Inspector General have 
raised concerns about the completeness and accuracy of data contained 
in WIASRD. Because of your interest in how WIA funds are being spent at 
the local level, you asked us to determine (1) the extent to which WIA 
funds are used for training, (2) how local workforce boards manage the 
use of ITAs and what challenges they have encountered, and (3) what is 
known at the national level about outcomes of those being trained. 

To determine the extent to which program year 2003 WIA funds were used 
for training,[Footnote 2] how local workforce boards manage ITAs, and 
what challenges they have encountered in implementing ITAs, we 
conducted a Web-based survey of the 590 local workforce investment 
boards that were in existence in program year 2003 and located in the 
50 states, District of Columbia, and Puerto Rico. We received responses 
from 428 (73 percent). We used the 428 responses to make estimates 
about the entire population of local workforce investment boards. 
[Footnote 3] We gathered information for four sources of WIA funds: 
adult formula funds, dislocated worker formula funds, national 
emergency grant funds, and state set-aside funds for statewide 
activities and rapid response activities. We collected information for 
program year 2003 (July 1, 2003, through June 30, 2004) because it was 
the most recent year for which complete data were available. We 
included questions in the survey to assess the reliability of the 
financial and participant data. We also selected four states to visit-
-California, Georgia, Iowa, and Maryland--that varied in funding size 
and geographic location. Within each state, we visited two local 
workforce investment boards, selected to provide a mix of urban and 
rural areas. At each location visited, we obtained additional 
information on training policies implemented, challenges encountered, 
and reliability of data systems. To assess what is known on a national 
level about outcomes of those being trained, we obtained program year 
2003 WIASRD data and performed tests to assess its completeness. We 
also reviewed our prior reports about the reliability of the WIASRD 
data and a report by Labor's Office of the Inspector General on WIA 
performance outcomes. Appendix I contains a more detailed discussion of 
our scope and methodology. We performed our work between June 2004 and 
May 2005 in accordance with generally accepted government auditing 
standards. 

Results in Brief: 

Local boards used an estimated 40 percent of the WIA funds they had 
available in program year 2003 to obtain training services for WIA 
participants. Nationally, local boards had a combined total of 
approximately $2.4 billion in WIA funds that were available to serve 
adults and dislocated workers during program year 2003 and used about 
$929 million for training activities, primarily occupational classroom 
training. The remaining funds pay for other program costs, including 
job search assistance, case management, and supportive services, as 
well as administrative costs. We estimate that 416,000 participants 
received training during the year. However, because some individuals 
may have received more than one type of training, this count may 
include some individuals more than once. Of those trained in program 
year 2003, about 323,000 participants received occupational classroom 
training. Approximately 85 percent of the occupational classroom 
training provided during that year was purchased through ITAs. At the 
eight sites we visited, participants used ITAs to prepare them for a 
wide variety of occupations, including nursing, information technology, 
and truck driving. Local boards also used the flexibility provided 
under WIA to offer a broad range of training-related activities, such 
as work experience, internships, and skills workshops, aimed at 
increasing employability but are not included in WIA's definition of 
training and not paid for with training dollars. For example, about one-
half of local boards used WIA funds to offer their customers computer 
lab workshops in software applications, basic keyboarding, and other 
computer skills, although this learning is not defined as training 
under WIA. 

Most local workforce boards have developed policies to manage the use 
of ITAs, but many boards have encountered challenges in trying to 
implement their use. An estimated 85 percent of the local workforce 
boards limited the amount of money participants can spend on training 
using ITAs, and about two-thirds limited the length of time 
participants can be enrolled in training. For example, the majority of 
boards limited the amount participants can spend on training using ITAs 
to between $3,000 and $7,000 and the length of time they can spend in 
training to 2 years. In addition, more than 80 percent of the local 
boards placed additional restrictions on adults and dislocated workers 
seeking to use ITAs by requiring them to complete specified skill 
assessments, and about 70 percent of the local boards require adults 
and dislocated workers to gather additional information about the 
occupation for which they desire training. For example, one board 
required participants seeking ITAs to write an essay about why they 
wanted a particular training. Although the vast majority of local 
boards use ITAs, most have faced challenges in managing their use. For 
example, nearly two-thirds of the local boards encountered lack of 
performance data on providers as a challenge. Local boards we visited 
stated that not having performance information on training providers 
hindered their ability to determine which providers served participants 
most effectively. In addition, local boards located in rural areas may 
face other challenges because of the lack of nearby training providers. 

Little is known on a national level about the outcomes of those being 
trained because of weaknesses in the WIASRD database. Certain aspects 
of WIASRD have been found to be incomplete, unverified, and not 
comparable across local areas and states. Labor's Office of the 
Inspector General has said there is little assurance that the states' 
performance data for WIA programs are either accurate or complete 
because of inadequate oversight of data collection and management. 
Additionally, data generally cannot be compared across states or local 
areas because Labor allows local areas some flexibility to decide how 
to collect and report certain data on participant outcomes. For 
example, outcome data are entered in WIASRD once a participant has left 
the WIA program, but we found that local areas use different 
definitions to determine when a person has officially exited from the 
program. As a result, wage and employment outcomes being reported could 
vary greatly, making it difficult to compare outcome data across local 
areas. Labor is taking some steps to address these concerns, improve 
the data collected at the national level, and assess the impact of the 
program. For example, Labor has implemented a new project to validate 
the performance information collected and reported under WIA. This 
initiative requires states to examine the accuracy of both reports 
submitted to Labor and individual data elements. However, because this 
initiative is relatively new, it is too soon to tell if it will 
satisfactorily resolve all data quality problems. Labor is also in the 
initial stages of developing a single, streamlined reporting and record-
keeping system that would replace several databases, including WIASRD, 
and could address some data issues. However, it is unclear when this 
system will be implemented. Labor plans to conduct impact studies to 
assess the effectiveness of the WIA program, but Labor will not begin 
this process until after WIA reauthorization, thereby missing WIA's 
requirement to conduct at least one study by 2005. 

In its comments, Labor noted that some of our information on training 
expenditures and training outcomes conflicts with its estimates. Labor 
also identified additional steps being taken to address data quality. 
Labor's estimate of the number of adults enrolled in training includes 
only those adults reported in WIASRD who exited the program. We believe 
our estimates of the amount of funds used for training and the number 
of adults trained represent a more complete and accurate picture than 
Labor's estimates because our estimates come directly from the local 
workforce areas, include all funds spent or obligated for training, and 
count all adults who received training in program year 2003, not just 
those who exited the program. 

Background: 

WIA specifies a different funding source for each of the act's main 
client groups--youth, adults, and dislocated workers.[Footnote 4] Our 
report focuses on adults and dislocated workers. Once the Congress 
appropriates WIA funds, the amount of money that flows to states and 
local areas depends on a specific formula that takes into account 
unemployment for the adult and dislocated worker funding streams, the 
number of low-income individuals for the adult funding stream, and the 
number of long-term unemployed for the dislocated worker funding 
stream.[Footnote 5] Labor allots 100 percent of the adult funds and 80 
percent of the dislocated worker funds to states. The Secretary of 
Labor retains 20 percent of the dislocated worker funds in a national 
reserve account to be used for National Emergency Grants,[Footnote 6] 
demonstrations, and technical assistance and allots the remaining funds 
to each of the 50 states, the District of Columbia, and Puerto Rico. In 
program year 2003, Labor allotted approximately $2 billion to states 
for adults and dislocated workers (see app. II for a listing of program 
year 2003 allotments by state). Upon receiving its allotments, each 
state can set aside no more than 15 percent to support statewide 
activities. These may include a variety of activities that benefit 
adults, youths, and dislocated workers statewide, such as providing 
assistance in the establishment and operation of one-stop centers, 
developing or operating state or local management information systems, 
and disseminating lists of organizations that can provide training. In 
addition, each state can set aside no more than 25 percent of its 
dislocated worker funds to provide rapid response services to workers 
affected by layoffs and plant closings. The funds set aside by the 
states to provide rapid response services are intended to help 
dislocated workers transition quickly to new employment. After states 
set aside funds for rapid response and for other statewide activities, 
they allocate the remainder of the funds--at least 60 percent--to their 
local workforce areas[Footnote 7] (see fig. 1). 

Figure 1: WIA Funding Streams for Youth, Adults, and Dislocated 
Workers: 

[See PDF for image] --graphic text: 

Stacked bar chart with three groups: two with two items and one with 
four items.

Separate funding streams for programs serving youth, adults, and 
dislocated workers: 

Youth; 
100% distributed to states by formula; 
Sub-state funds distributed to local areas by formula: 85%; 
Statewide activities: 15%. 

Adults; 
100% distributed to states by formula; 
Sub-state funds distributed to local areas by formula: 85%; 
Statewide activities: 15%. 

Dislocated workers; 
20% secretary's reserve; 
National emergency grants, demonstrations and technical assistance. 

Dislocated workers; 
80% distributed to states by formula; 
Sub-state funds distributed to local areas by formula: 60%; 
Statewide activities: 15%; 
State rapid response: 25%. 

Source: Employment and Training Administration, and P.L. 105-220. 

[End of figure]

Approximately 600 local workforce areas exist throughout the nation 
(see fig. 2). Each local area has a local workforce board that 
administers WIA activities within the local area, including selecting 
one-stop center operators, identifying eligible training providers, 
developing links with employers, and overseeing the use of funds for 
employment and training activities. 

Figure 2: Distribution of Local Workforce Investment Areas in Program 
Year 2003: 

[See PDF for image]

[End of figure]

WIA was intended to meet both the needs of businesses for skilled 
workers and the training, education, and employment needs of 
individuals. The act allows training and employment programs to be 
designed and managed at the local level to meet the unique needs of 
local businesses and individuals. Another aspect of the act was to 
provide customers with easy access to the information and services they 
needed and empower those who need training to obtain the training they 
find most appropriate. One cornerstone of WIA was the one-stop concept 
where information about and access to a wide array of services would be 
available at a single location. At the one-stop center, customers can 
get information about job openings; receive job search and placement 
assistance; receive an assessment of their skill levels, aptitudes, and 
abilities; and obtain information on a full array of employment-related 
services, including information on local education and training 
providers. Through the one-stop centers, employers also have a single 
point of contact to provide information about current and future skills 
needed by their workers and to list job openings. 

The services typically available at one-stop centers fall into the 
following categories: 

* Core services. These include job search and placement assistance, the 
provision of labor market information, and preliminary assessment of 
skills and needs. Core services are available to all adults who come to 
a one-stop center, with no eligibility requirements imposed. 

* Intensive services. These include comprehensive assessments, case 
management, short-term prevocational services,[Footnote 8] work 
experience, and internships. Intensive services are available to 
qualified adults and dislocated workers who are unable to obtain or 
retain a job that leads to self-sufficiency. 

* Training services. These include occupational skills training, on- 
the-job training, customized training,[Footnote 9] and skill upgrading 
and retraining. Training services are available to qualified adults and 
dislocated workers who are unable to obtain or retain employment after 
receiving at least one intensive service.[Footnote 10]

* Supportive services. These include services--such as transportation, 
child care, and housing--that are necessary to enable WIA participants 
to take part in WIA activities. 

WIA requires the use of ITAs, which allow qualified individuals to 
purchase the training they determine best for themselves. Adults and 
dislocated workers use ITAs to purchase training services from eligible 
providers they select in consultation with case managers. Payments from 
ITAs may be made in a variety of ways, including the electronic 
transfer of funds through financial institutions, vouchers, or other 
appropriate methods. Payments may also be made incrementally. WIA 
requires that ITAs can only be used to purchase training from programs 
listed on an eligible training provider list (ETPL). Local boards, in 
partnership with the state, compile this list by identifying training 
providers and programs whose performance qualifies them to receive WIA 
funds to train adults and dislocated workers. Good information allows 
participants to make informed training choices. In this regard, WIA 
requires that local boards ensure that participants have access to 
performance information on training providers, including the percentage 
of individuals completing their training program, the percentage of 
individuals in the program who obtained jobs, and the wages earned by 
these individuals. 

Under certain situations, however, local boards have the option of 
purchasing training without using ITAs. The three exceptions to using 
ITAs are: 

* if the activity is on-the-job training or customized training,

* if a local board determines an insufficient number of eligible 
providers exist in the area (such as in a rural area), or: 

* if a training provider has a demonstrated effectiveness in serving a 
special population that face multiple barriers to employment. 

To assess whether it is accomplishing its goals, WIA established a 
performance measurement system for the programs directly funded by WIA-
-one that emphasized results in areas of job placement, retention, 
earnings, and skill attainment[Footnote 11] (see table 1). WIA requires 
states to use Unemployment Insurance wage records to track employment- 
related outcomes. States submit this information to Labor in annual 
reports submitted each December. States also submit quarterly 
performance reports, which are due 45 days after the end of each 
quarter. In addition to the performance reports, states submit their 
updates for WIASRD every January. WIA also requires Labor to conduct at 
least one multisite study to determine program results by the end of 
fiscal year 2005. 

Table 1: WIA Adult and Dislocated Worker Outcome Performance Measures: 

Adult: 1. Entered employment rate; Dislocated worker: 1. Entered 
employment rate. 

Adult: 2. Employment retention rate at 6 months; 
Dislocated worker: 2. Employment retention rate at 6 months. 

Adult: 3. Average earnings change in 6 months; 
Dislocated worker: 3. Earnings replacement rate in 6 months. 

Adult: 4. Entered employment and credential rate; 
Dislocated worker: 4. Entered employment and credential rate. 

Source: U.S. Department of Labor Employment and Training Administration 
(ETA), Training and Employment Guidance Letter, No. 7-99 (Mar. 3, 
2001). 

[End of table]

Local Boards Used an Estimated 40 Percent of Available WIA Funds to 
Train Program Participants: 

Local boards used an estimated 40 percent of the WIA funds they had 
available in program year 2003 to obtain training services for WIA 
participants. Nationally, local boards had approximately $2.4 billion 
in WIA funds that were available to serve adult participants during 
program year 2003 and used about $929 million for training activities, 
primarily occupational classroom training. The remaining funds pay for 
other program costs, including job search assistance, case management, 
and supportive services, as well as administrative costs. We estimate 
that 416,000 WIA participants received training during the year. 
However, because some individuals may have received more than one type 
of training, this count may include some individuals more than once. Of 
those trained in program year 2003, about 323,000 participants received 
occupational classroom training, of which about 85 percent was 
purchased through ITAs. Local boards also used the flexibility provided 
under WIA to offer a broad range of training-related activities aimed 
at increasing employability but not included in WIA's definition of 
training. 

An Estimated 40 Percent of Available WIA Funds Were Used for Training: 

Local boards nationwide used an estimated 40 percent of their WIA funds 
for training in program year 2003. During that year, local boards had 
about $2.4 billion in WIA funds available to serve adults and 
dislocated workers. Almost all local boards had funds from the WIA 
adult and dislocated worker funding streams; in addition, many boards 
had National Emergency Grants or funds from two state set-asides, the 
15 percent set-aside for statewide activities and the 25 percent set- 
aside for rapid response. WIA permits local boards up to 2 years to 
spend each program's funding. Accordingly, to get a national picture of 
available WIA funds at the local level, we defined available funds as 
the combined amount of program year 2003 funds and funds carried over 
from program year 2002. Of the approximate $2.4 billion in combined WIA 
funds that local boards had available, about $1.8 billion (75 percent) 
came from the program year 2003 allocation, while the rest consisted of 
funds carried over from 2002 (see fig. 3). Allocations from the WIA 
adult and WIA dislocated worker funding streams together constituted 
about 80 percent of the funds local boards could use. 

Figure 3: Estimated Total WIA Funds Available for Local Areas in 
Program Year 2003: 

[See PDF for image] --graphic text: 

Stacked bar graph with five groups of two items each.

Dollars in millions. 

WIA adult; 
Program year 2003 funds: $782; 
Carryover funds: $207. 

WIA dislocated worker; 
Program year 2003 funds: $681; 
Carryover funds: $208. 

National Emergency Grants; 
Program year 2003 funds: $124; 
Carryover funds: $80. 

State set-asides; 
Program year 2003 funds: $208; 
Carryover funds: $87. 

Total; 
Program year 2003 funds: $1,795; 
Carryover funds: $582. 

Source: GAO analysis. 

Note: All estimates less than or equal to $87 million in figure 3 have 
margins of error exceeding plus or minus 15 percent of the value of 
those estimates. See appendix I for the 95 percent confidence intervals 
associated with these estimates. 

[End of figure]

Of the $2.4 billion available, local boards used approximately $929 
million in program year 2003 to fund training activities, representing 
about 40 percent of the WIA funds that were available to serve adult 
participants in the program. The remaining funds pay for other program 
costs, including job search assistance, case management, and supportive 
services, as well as administrative costs. We found that local boards 
spent an estimated $724 million on training and obligated another $205 
million.[Footnote 12] Obligations are funds local boards commit to pay 
for training, but for which services have not yet been provided and 
costs not yet incurred (see fig. 4). 

Figure 4: Estimated Total WIA Funds Used for Training in Program Year 
2003: 

[See PDF for image] --graphic text: 

Dollars in millions. 

WIA adult; 
Obligated funds: $91; 
Expended funds: $328. 

WIA dislocated worker; 
Obligated funds: $83; 
Expended funds: $249. 

National Emergency Grants; 
Obligated funds: $14; 
Expended funds: $63. 

State set-asides; 
Obligated funds: $17; 
Expended funds: $84. 

Total WIA funds used; 
Obligated funds: $205; 
Expended funds: $724. 

Source: GAO analysis. 

Note: All estimates less than or equal to $83 million in figure 4 have 
margins of error exceeding plus or minus 15 percent of the value of 
those estimates. See appendix I for the 95 percent confidence intervals 
associated with these estimates. 

[End of figure]

Local boards used a slightly higher percentage of their WIA adult funds 
(43 percent) for training than their dislocated worker and state set- 
aside funds, both of which had 37 percent used for training (see fig. 
5). 

Figure 5: Estimated Percentage of WIA Funds Used for Training, by 
Funding Source: 

[See PDF for image] --graphic text: 

Bar graph with five items. 

WIA adult: 43%; 
WIA dislocated worker: 37%; 
National Emergency Grants: 39%; 
State set-asides: 37%; 
Total: 40%. 

Source: GAO analysis. 

[End of figure]

Of the WIA dollars local boards spent on training, an estimated 79 
percent was for occupational classroom training. Boards used the 
remainder of the funds to pay for on-the-job training, customized 
training, and other types of training, including adult basic education 
and skill upgrading. 

In addition to using WIA funding, many local boards also leveraged 
other sources of funding to help pay the costs of training for WIA 
participants.[Footnote 13] Some of these funding sources were federal 
programs, including Trade Adjustment Assistance (TAA),[Footnote 14] the 
H-1B skill grant program,[Footnote 15] and Temporary Assistance for 
Needy Families (TANF). For example, in program year 2003, one board we 
visited in Maryland enrolled 49 WIA participants in training funded by 
TAA. Other sources of funding came from state and local governments or 
private entities. For example, at one site we visited in Georgia, the 
local public school system paid for high school equivalency classes for 
WIA participants, including teacher salaries, testing, and books and 
materials. In addition, the local housing authority provided training 
on a variety of soft skills for 600 of its clients at the one-stop 
center.[Footnote 16]

WIA Participants Were Most Likely to Receive Occupational Classroom 
Training: 

Overall, we estimate that 416,000 WIA participants were enrolled in 
training during program year 2003 and that about 323,000 participants 
received occupational classroom training.[Footnote 17] In our survey, 
local boards reported the number of people enrolled in each category of 
training rather than the total receiving training. As a result, it is 
possible that the 416,000 includes some duplication of individuals who 
received more than one kind of training during that year (see table 2). 

Table 2: Estimated Total Number of Instances in Which WIA Participants 
Were Trained during Program Year 2003, by Category and Funding Source: 

Occupational classroom training; 
WIA adult: 135,901; 
WIA dislocated worker: 123,139; 
National Emergency Grants: 32,558; 
State set-asides: 31,204; 
Total: 322,802. 

On-the-job training; 
WIA adult: 14,671; 
WIA dislocated worker: 7,863; 
National Emergency Grants: 656; 
State set-asides: 2,217; 
Total: 25,407. 

Customized training; 
WIA adult: 13,424; 
WIA dislocated worker: 2,193; 
National Emergency Grants: 174; 
State set-asides: 10,883; 
Total: 26,674. 

Other training; 
WIA adult: 20,771; 
WIA dislocated worker: 11,526; 
National Emergency Grants: 2,193; 
State set-asides: 6,144; 
Total: 40,634. 

Total; 
WIA adult: 184,767; 
WIA dislocated worker: 144,721; 
National Emergency Grants: 35,581; 
State set-asides: 50,448; 
Total: 415,517. 

Source: GAO analysis. 

Note: All customized training estimates, all other training estimates, 
and some on-the-job training estimates in table 2 have margins of error 
exceeding plus or minus 15 percent of the value of those estimates. See 
appendix I for the 95 confidence intervals associated with those 
estimates. 

[End of table]

We estimate that more than three-quarters of the training that 
participants received (78 percent) was occupational classroom training 
(see fig. 6). On-the-job training and customized training each 
accounted for an additional 6 percent of the total training that 
occurred in program year 2003, while 10 percent of training included 
other activities, such as adult education, literacy classes, 
entrepreneurial training, and skill upgrading. 

Figure 6: Estimated WIA-Funded Training in Program Year 2003, by 
Category: 

[See PDF for image] --graphic text: 

Pie chart with four items.

Participants in occupational classroom training: 78%; 
Participants in other training: 10%; 
Participants in on-the-job training: 6%; 
Participants in customized training: 6%. 

Source: GAO analysis. 

[End of figure]

Approximately 85 percent of the occupational classroom training 
provided during program year 2003 was purchased by participants through 
ITAs. At some local boards, however, specific kinds of occupational 
classroom training were obtained without the use of ITAs. For example, 
one local board we visited in Iowa used WIA funds to pay for classes in 
typing skills at the local community college, but ITAs were not used to 
pay for this training because it was short-term training that did not 
result in a credential. 

At the eight sites we visited, participants used ITAs to pay for 
training in a wide variety of occupations. WIA regulations require that 
participants select a training program directly linked to employment 
opportunities. Each of these local boards told us that nursing and 
other health care professions were in high demand locally, and 
accordingly, participants in all eight areas sought training in health 
care occupations. Other high-demand occupations at some of the local 
boards we visited included information technology, truck driving, 
manufacturing, and teaching. As local labor markets have changed, some 
boards have developed specially tailored programs designed to mirror 
shifts in labor demand. For example, one local area in California faced 
massive layoffs in the high-tech industry but had a dearth of qualified 
teachers in the local schools. As a result, the local board created a 
program to train dislocated high-tech workers to become teachers. 

Local Boards Fund Training-Related Activities and Services: 

In addition to providing training activities, local boards used the 
flexibility provided under WIA to offer a broad range of intensive 
services, some of which are aimed at increasing job skills. These 
training-related activities, including work experience, internships, 
and computer skills training, are not captured in WIA's definition of 
training and, therefore, not paid for with training dollars. 
Accordingly, neither the amount of funding spent on these activities 
nor the number of participants who benefit from them are identified in 
our statistics on training. Nevertheless, these activities can play a 
significant role in preparing WIA participants for successful 
employment. 

Although many WIA participants do not need extensive training to obtain 
a job, some still need help improving a variety of skills that will 
further their chances of successfully searching for and retaining a 
job. Much like training, these activities are intended to increase 
employability. Many are short-term activities, such as computer lab 
training and other intensive skills workshops. For example, 
approximately one-half of local boards use WIA funds to offer 
participants computer lab training in software applications, basic 
keyboarding, and other computer skills. One board we visited in Georgia 
offers another type of short-term, intensive skills workshop through 
its Basic Industrial Maintenance program. During this 4-week training 
course, participants learn a variety of skills including the basics of 
construction, plumbing, and carpentry. Other training-related 
activities that are intended to increase skills but are not included in 
WIA training are internships and work experience opportunities. For 
example, one local board we visited in Iowa spent about $79,000 in 
program year 2003 to provide internships and work experience 
opportunities to 41 WIA participants. 

Moreover, some boards we visited used WIA funds to pay for supportive 
services, such as child care and transportation, that enable 
participants to attend training. Like funding spent on training-related 
activities, the cost of these supportive services is not reflected in 
the amount of WIA funding that local boards spend on training. However, 
these services can represent a large investment of WIA dollars. Local 
boards have flexibility in whether and how they use WIA funds for 
services that support training.[Footnote 18] For example, one local 
board we visited in rural Iowa spent over $160,000 in program year 2003 
on a wide array of supportive services for people in training, 
including child care, transportation, eye exams, and glasses. Because 
the area contains several correctional facilities, the board also used 
a portion of these WIA funds to purchase bicycles for ex-offenders who 
were attempting to reenter the workforce but had lost their driving 
privileges. Another local area we visited in California spent $87,000 
in supportive services during program year 2003; in addition to paying 
for child care and transportation, these WIA funds paid for items 
including books, uniforms, and tools, as well as services such as 
fingerprinting and tuberculosis testing, which some training programs 
require. Not all boards provided WIA-funded supportive services to 
people in training, however. One local area we visited in Maryland did 
not use WIA funding to provide supportive services to its adult 
participants, although it referred those in need to other agencies for 
assistance. 

Local Boards Manage ITAs but Have Faced Challenges in Implementing 
Them: 

Most local workforce boards have developed policies to manage the use 
of ITAs, but many boards have encountered challenges in trying to 
implement their use. Local boards often require participants to 
complete various skill assessments prior to entering training and 
gather additional information on the occupation for which they desire 
training. In addition, they generally limit the amount of money 
participants can spend on training using ITAs and how long participants 
can spend in training. Although the vast majority of local boards use 
ITAs, most also said they have faced challenges in managing their use. 
The challenge most frequently identified was lack of good performance 
data on training providers. Local boards in rural areas face a 
different challenge--lack of nearby training providers. Some boards 
have identified initiatives to mitigate the challenges they face. 

Most Local Boards Have Policies to Manage ITAs: 

We estimate that most local boards established procedures to ensure 
that any training purchased using ITAs is warranted and placed spending 
limits on individual ITAs to control costs. WIA regulations require 
that participants must receive at least one intensive service, such as 
individual counseling and career planning, before enrolling in 
training. Many local boards also require participants in the adult and 
dislocated worker programs who want training to first complete 
specified activities to demonstrate their need for training. For 
example, local boards may require participants to complete skill 
assessments or attend specific workshops. 

In addition, they may require participants to gather information on the 
occupation for which they want training or document their inability to 
find employment (see fig. 7). 

Figure 7: Estimated Percentage of Local Boards Requiring Completion of 
Specified Activities for Adults and Dislocated Workers Seeking 
Training: 

[See PDF for image] --graphic text: 

Pie chart with eight items. 

Undergo skill assessments; 
Adult: 86%; 
Dislocated worker: 86%.

Complete workshops; 
Adult: 34%; 
Dislocated worker: 33%.

Gather additional information; 
Adult: 70%; 
Dislocated worker: 69%.

Document inability to find job; 
Adult: 47%; 
Dislocated worker: 50%.

Source: GAO analysis.

[End of figure]

More than 80 percent of the local boards require adults and dislocated 
workers to complete specified skill assessments or tests before being 
allowed to purchase training with ITAs. For example, three local boards 
in Georgia, Kansas, and Mississippi commented that participants are 
required to complete career assessments or occupational interest 
inventories prior to training. A local board in New York mentioned that 
staff are required to interview participants and determine whether they 
are in need of training and have the skills and qualifications to 
successfully participate in the training program. A local board we 
visited in Georgia required participants to demonstrate an aptitude and 
interest in an area before enrolling in training. Depending on how 
proactive the participant is, the process can take up to 6 months 
before the participant is enrolled in a training program. 

Approximately 70 percent of the local boards require adults and 
dislocated workers to gather additional information about the 
occupation for which they want training. For example, a local board in 
Arizona noted that participants must interview three people working in 
their desired field; another board, in Washington, commented that 
participants are required to conduct informational interviews with 
employers in the occupation they wish to pursue. Similarly, three of 
the local boards that we visited required participants to perform 
specific tasks prior to entering training. For example, one local board 
we visited in Georgia required participants to gather specific 
information on training providers and then compose an essay explaining 
why they chose a particular course and provider. Another board we 
visited, in California, asks participants to research and disclose 
information on the training they want to pursue, including the 
occupation's starting wage, whether this wage is sufficient to support 
them and their family, working conditions, available job openings, and 
education and skill requirements. Also, a local board we visited in 
Maryland requires participants seeking certain types of training, such 
as on the operation of a tractor-trailer, to obtain prehire letters 
that guarantee employment once training is completed. 

About one-third of local boards required adults and dislocated workers 
to complete workshops prior to enrolling in training. For example, a 
West Virginia board noted that participants must demonstrate their soft 
skills or complete a soft skills program before entering occupational 
training. One of the local boards we visited in California requires 
that participants attend an orientation and a soft skills workshop 
prior to entering training. They also offer additional voluntary 
workshops, including those in which participants explore different 
vocations, complete applications, practice interviews, and perform self-
assessments. Similarly, a local board we visited in Georgia requires 
participants to take a general orientation and résumé writing workshop 
before being eligible for ITAs. 

Approximately 85 percent of local workforce boards limit the amount of 
money participants can spend on training using ITAs. An estimated 31 
percent of the local boards limited ITAs to between $3,000 and $5,000 
(see fig. 8). At local boards limiting ITAs, the amount of the caps 
ranged from $350 at one local board to $15,000 at three local boards. 
One of the local boards we visited in Maryland said that its ITA cap 
had changed four times since program year 2000. The cap started at 
$4,000, was then increased to $4500 because of inflation, and later 
rose to $5,500 because of the increased demand for, and cost of, 
information technology training. However, because of reduced WIA 
funding, the board later lowered the cap to $3,000. 

Figure 8: Estimated Percentage of Local Boards with Various Dollar Caps 
on ITAs: 

[See PDF for image] --graphic text: 

Bar graph with six items. 

Amount of dollar cap on ITAs: Less than $3,000; 
Percentage of boards with ITA cap: 8%.

Amount of dollar cap on ITAs: $3,000-$4,999; 
Percentage of boards with ITA cap: 31%.

Amount of dollar cap on ITAs: $5,000-%6,999; 
Percentage of boards with ITA cap: 27%.

Amount of dollar cap on ITAs: $7,000-$8,999; 
Percentage of boards with ITA cap: 12%.

Amount of dollar cap on ITAs: $9,000 or more; 
Percentage of boards with ITA cap: 8%.

Amount of dollar cap on ITAs: No ITA cap; 
Percentage of boards with ITA cap: 15%.

Source: GAO analysis. 

Note: Percentages do not add to 100 because of rounding. 

[End of figure]

Rather than having a single dollar limit on ITAs, two local boards 
reported having ITA caps that could vary by training program. 
Specifically, a local board in Hawaii limits an ITA for any particular 
training program to the cost of the least expensive provider among 
those who offer equivalent programs, while a local board we visited in 
Iowa limits an ITA for a particular training program to the highest 
cost of obtaining that training at a state public institution. 

Most of the boards that impose dollar caps on ITAs expect the amount of 
the ITA to also cover the costs of books, tools, and uniforms. A number 
of local boards also expect the amount of the ITA to cover the costs 
for supportive services and other items, such as fees for licenses, 
certifications, tests, and physical exams (see fig. 9). 

Figure 9: Estimated Percentage of Local Boards Requiring Participants 
to Use ITA Funds for Costs Other than Tuition: 

[See PDF for image] --graphic text: 

Bar graph with five items. 

Type of cost: Books/supplies: 86%; 
Type of cost: Tools/equipment: 65%; 
Type of cost: Uniforms: 58%; 
Type of cost: Supportive services: 18%; 
Type of cost: Other: 22%.

Source: GAO analysis. 

Note: Other includes fees for licenses, certifications, tests, and 
physical exams. 

[End of figure]

In addition to limiting the amount of money participants can spend on 
training, an estimated two-thirds of the local boards also limit how 
long participants can spend in training. The most frequent limit on 
training was 2 years. Many of these local boards, however, indicated 
that time limits could be waived depending on an individual's 
circumstances. One of the local boards we visited in Iowa had no time 
limit for training using ITAs, but encouraged shorter-term training 
lasting one or two semesters, especially for dislocated workers, 
because of the limited period for collecting unemployment insurance. 

The use of particular training providers varied among the local boards 
we visited. For example, in program year 2003, one local board we 
visited in California used 48 private schools as training providers for 
305 participants and 3 community colleges for 42 participants. This 
local board also used 15 4-year colleges for 202 participants. The 
majority of these participants were former high-tech workers being 
trained to become teachers. A local board we visited in Georgia relied 
heavily on private, proprietary schools, using them for about 1,000 
participants each year. The board believes these schools are more 
flexible than other training providers and offer a wide array of 
training courses. On the other hand, a local board we visited in Iowa 
used community colleges for 90 percent of the 246 ITAs issued in 
program year 2003.[Footnote 19] Local boards responding to our survey 
reported that 37 percent of the ITAs issued in program year 2003 were 
used at proprietary schools and 35 percent were used at community 
colleges. The remainder were used at various providers, including 4- 
year colleges, public vocational and technical schools, and community 
based-organizations. 

In December 2004, Mathematica Policy Research issued an interim report 
concluding that the way ITAs are administered influences the likelihood 
of participants requesting counseling or receiving ITAs.[Footnote 20] 
The study also found that different approaches to administering ITAs 
appeared to have a limited effect on participants' training choices. 
Labor funded the 3-year study to assess how different approaches to 
administering ITAs affect training choices, employment and earnings 
outcomes, returns on investment, and customer satisfaction. Eight sites 
were included in the study. These sites were located in or around 
Atlanta, Georgia; Bridgeport, Connecticut; Charlotte, North Carolina; 
North Cook County, Illinois; Jacksonville, Florida; and Phoenix, 
Arizona.[Footnote 21] Mathematica's study results are not generalizable 
beyond these eight sites. A later report by Mathematica will present an 
analysis of how the ITA approaches affect additional outcomes, 
including training completion, customer satisfaction, and employment 
and earnings after training, as well as an analysis of the return on 
the investment in training. 

Local Boards Face Challenges in Implementing ITAs: 

Most local boards faced some challenges in their efforts to implement 
ITAs, and local boards in rural areas face a unique challenge. The 
majority of local boards encountered as challenges the lack of 
performance data on training providers, the timing of training being 
offered, being able to get new training providers on the eligible 
training provider list (ETPL), and the ability to link the ITAs with 
economic development strategies (see table 3). A few local boards have 
found ways to mitigate some of these challenges. 

Table 3: Challenges Encountered by Local Boards: 

Challenge: Lack of quality data on provider performance; 
Estimated percentage of local boards encountering challenge[A]: 65%. 

Challenge: Timing of training; 
Estimated percentage of local boards encountering challenge[A]: 60%. 

Challenge: Getting new providers on ETPL; 
Estimated percentage of local boards encountering challenge[A]: 54%. 

Challenge: Linking ITA system with local economic and business 
strategies; 
Estimated percentage of local boards encountering challenge[A]: 52%. 

Challenge: Lack of providers on ETPL offering training in high demand 
occupations; 
Estimated percentage of local boards encountering challenge[A]: 44%. 

Challenge: Communication with training providers to monitor participant 
progress; 
Estimated percentage of local boards encountering challenge[A]: 42%. 

Challenge: Clients choosing training in low demand or low wage 
occupations; 
Estimated percentage of local boards encountering challenge[A]: 42%. 

Challenge: Management and tracking of obligations and expenditures for 
training; 
Estimated percentage of local boards encountering challenge[A]: 32%. 

Challenge: Lack of qualified providers; 
Estimated percentage of local boards encountering challenge[A]: 32%. 

Challenge: Lack of local control over participant's selection of 
training provider; 
Estimated percentage of local boards encountering challenge[A]: 27. 

Challenge: Federal monitoring and reporting of local and state 
spending; 
Estimated percentage of local boards encountering challenge[A]: 27%. 

Challenge: Getting providers off the ETPL; 
Estimated percentage of local boards encountering challenge[A]: 24%. 

Challenge: Formulating ITA policies at the local level; 
Estimated percentage of local boards encountering challenge[A]: 22%. 

Challenge: Not enough guidance from Labor on implementing ITAs; 
Estimated percentage of local boards encountering challenge[A]: 21%. 

Source: GAO analysis. 

[A] We classified challenges as circumstances that local boards 
reported encountering to a moderate, great, or very great extent. 

[End of table]

Nearly two-thirds of the local workforce boards encountered the lack of 
performance data on training providers as a challenge. For example, a 
local board in Wisconsin commented that the lack of consistent data on 
training providers reduces the value of the ETPL to local boards. A 
local board in Missouri noted that one of the greatest challenges lies 
in not having reliable information regarding the quality and relevance 
of the training being offered by training providers. The board further 
stated that the state's report card containing performance information 
on training providers in Missouri was incomplete or unavailable. Local 
boards we visited in California and Iowa said that a statewide report 
card on training provider performance did not exist. In lieu of a 
statewide report card, the California boards tracked training provider 
performance themselves, while the Iowa boards relied upon informal 
feedback about provider performance. 

Approximately 60 percent of the local boards encountered the timing of 
the training offered by providers as a challenge. For example, two 
local boards we visited in Georgia and Iowa said that some participants 
are unable to attend training programs that are offered only during a 
regular academic schedule. The Iowa board explained that some 
participants who have to wait too long for a training program to begin 
may have their unemployment insurance benefits run out before the 
training can be completed. On the other hand, some local boards have 
found solutions to deal with this issue. For example, a local board in 
Washington commented that it purchased classroom group training to 
offer more flexibility as to when training will be offered and to 
satisfy the demand for particular training. Similarly, a local board in 
Massachusetts noted it persuaded local technical high schools to offer 
programs at night, thereby resulting in greater availability of 
training in trade-related fields that are in high labor demand. A local 
board we visited in Maryland developed close relationships with area 
community colleges that now schedule occupational training outside the 
regular academic calendar. 

More than half the boards faced getting new providers on the ETPL as a 
challenge. This has been a long-standing concern. We reported in 2001 
that according to training providers, the data collection burden 
resulting from participation in WIA can be significant and may 
discourage willingness to participate under WIA as training 
providers.[Footnote 22] Labor has heard these concerns from training 
providers and has approved waivers for 30 states. These waivers, in 
effect, give states additional time to address data collection 
challenges. However, getting training providers, particularly community 
colleges, to participate in the ETPL remains a concern for some local 
boards. For example, local boards in California, Indiana, 
Massachusetts, and Michigan noted that some providers, community 
colleges in particular, are reluctant to participate in the ETPL. A 
local board that we visited in California elaborated on this point, 
stating that community colleges in its area are operating at full 
capacity and do not need WIA dollars or participants and, therefore, 
are not interested in getting on the ETPL. Some local boards are 
finding ways to encourage providers to participate. For example, one 
local board in Massachusetts has been working collaboratively with 
other boards throughout the state to meet with key figures in the 
community college system to provide information, consultation, and 
feedback. Two local boards we visited in Iowa and Maryland have 
developed strong relationships with the 16 community colleges in their 
areas, each of which is on state lists. Another local board we visited 
in California conducts regional ETPL workshops with training providers 
and shares ideas with other local boards in the surrounding areas. 

More than half of the local boards found linking ITAs with local 
economic and business development strategies to be a challenge. Several 
local boards provided different examples of why they found it difficult 
to provide participants with training in high-demand occupations in 
their area. The area around one local board we visited in California 
faced a nursing shortage, but nearby training for nurses was difficult 
to obtain. Some area community colleges were opting not to provide 
nursing training because they could not recoup the costs of operating 
them. A local board we visited in Georgia also said that keeping up 
with businesses' needs is a challenge and noted that some information 
technology sector-based training courses are not always available. 
Other local boards identified some initiatives they are pursuing to 
strengthen links with economic development. For example: 

* A local board in Michigan partners with a local technical training 
center to develop intensive, short-term certificate programs in high- 
skill, high-wage, and high-demand fields. The technical center is 
operated by a local community college but offers non-credit certificate 
programs responsive to business and community needs. 

* A local board in Ohio works closely with the local Chambers of 
Commerce and economic development partners to formulate training 
programs that are based on employer demands. Specifically, if the board 
hears that a group of employers have a skill need, then the board will 
develop the appropriate training program with a service provider. 

* A local board in Texas uses an industry cluster analysis report to 
focus attention on specific industries and then targets funds for 
training in these sectors. Training institutions must prepare industry- 
approved training curriculums in order to have programs approved by the 
local board and to have ITAs issued to participants for training. 

* A local board in Washington partnered with representatives from local 
education, economic development, and government to develop a shared 
blueprint for economic development and training around eight high- 
demand industry clusters. 

A number of local boards representing rural locations mentioned that 
the requirement to use ITAs to purchase training from providers on the 
ETPL presented a different problem for them from their counterparts in 
urban areas. Local boards in Arizona, Colorado, Kansas, Montana, North 
Carolina, and Utah all mentioned that participants in rural areas have 
few nearby training providers from which to choose. Additionally, local 
boards in Kansas and Montana noted that being located in a rural area 
with limited providers makes dealing with ITAs burdensome. A local 
board that we visited in rural California applied for and received a 
waiver from using ITAs. The board directly contracts with a community 
college for a 2-year program to train participants to become registered 
nurses and an 18-month program to train participants to become licensed 
vocational nurses. Through April 2004, 73 participants have completed 
the nursing programs, and according to the board, all were employed in 
their respective fields. 

Little Is Known about Outcomes of Those Being Trained because of 
Weaknesses in Data Collected: 

Little is known on a national level about the outcomes of those being 
trained. Certain aspects of WIASRD have been found to be incomplete and 
unverified. Additionally, data generally cannot be compared across 
states or local areas because of differences in data definitions. Labor 
is taking some steps that may address these concerns and plans to 
complete an evaluation that will measure the overall impact of the WIA 
program. 

Concerns Remain That Data Collected Are Unreliable: 

Our analysis of program year 2003 WIASRD has shown that the database 
does not contain information for a large number of data elements. It is 
unclear if these values are missing because Unemployment Insurance wage 
records are not available or because they simply were not entered into 
the database by officials. This finding reaffirms issues that have been 
raised previously about the quality of data that Labor uses to assess 
program performance. Our 2004 report found that performance data 
submitted by states in quarterly and annual reports were not 
sufficiently reliable to determine outcomes for the WIA programs. 
[Footnote 23] Labor's Office of Inspector General (OIG) raised the same 
concerns in 2002 by noting that because of inadequate oversight of data 
collection and management, little assurance exists that the states' 
performance data for all WIA programs are either accurate or 
complete.[Footnote 24] OIG's report found that of the 12 local areas 
examined, none had adequately documented procedures for validating 
participant performance data. Similarly, none of the four states 
examined had sufficient procedures to ensure the accuracy of their 
reported performance data. At the time, OIG recommended that states use 
a statistical sampling method for validating reported data. 

Because of questions about the comparability of data elements, states' 
performance data are of limited value for national comparisons, or even 
comparisons within a single state. Labor allows local areas to exercise 
some flexibility in determining how to collect and report certain 
performance data on participants. For example, while local areas 
collect data on a participant who leaves the program, they use 
different methods to determine when a person has officially exited from 
the program. WIASRD guidelines define participants as having exited the 
program on the last date they received WIA services. Labor allows two 
ways to define exit: (1) at the point of case closure or (2) when the 
participant has not received any services or training for more than 90 
days and is not scheduled for future services. We found that local area 
definitions differ from this and from each other. For example, one 
local board we visited defines exit as occurring when participants are 
finished with their WIA services; another board defines exit when 
participants have found a new job and the wages for their new job are 
considered acceptable (regardless of the number of days that have 
passed since their last service). Wage and employment outcomes under 
these different circumstances would vary greatly, making it difficult 
to compare outcome data across local areas. In a prior report, we also 
noted the data are not comparable on what constitutes a credential-- 
whether it is the attainment of a certified skill or of a degree. 
[Footnote 25] Labor allows states and local areas to determine what 
constitutes a credential. 

Labor Is Taking Actions to Improve Data and Assess Impact of Program: 

Labor is taking some steps to address data quality concerns and improve 
the data used at the national level. This includes implementing a new 
project to validate the performance information collected and reported 
under WIA. The data validation initiative covers both the accuracy of 
reports submitted to Labor on program activity and performance outcomes 
and the accuracy of individual data elements. The report validation 
checks the accuracy of states' software used to calculate the 
performance reports submitted to Labor. For example, if a state 
reports, for a particular time frame, that 100 adults found employment 
after they received services, the validation software searches through 
the state's electronic records to ensure that 100 records are found 
that match these criteria. Data element validation, on the other hand, 
evaluates the accuracy of the participant data used to generate reports 
submitted to Labor. The process compares selected information from a 
sample of participant exit records with the original paperwork that 
contained this information. Data element validation results in an 
estimate of the error rate for each data element that has been selected 
for validation. 

While Labor provides guidelines for the data validation, states are 
responsible for executing the initiative. Program year 2003 is the 
first year states have completed the process, and Labor plans to review 
state results and start setting acceptable standards for error rates. 
Eventually, Labor plans to hold states accountable for meeting accuracy 
standards. Once these accuracy standards are in place, states failing 
to meet the standards may lose eligibility for incentive awards or, in 
cases with significant deviations from the standards, may be 
sanctioned. Because this initiative is relatively new, it is too soon 
to tell if it will satisfactorily resolve all data quality problems 
associated with WIASRD outcome measures--but it is a step toward 
addressing these concerns. 

Labor is also in the initial stages of developing a single, streamlined 
reporting and record-keeping system that will replace a series of 
databases, including WIASRD, and may address some concerns about data 
quality. The system, formally called the ETA Management Information and 
Longitudinal Evaluation (EMILE), would replace the current data 
collection and reporting requirements for 12 employment and training 
programs. The goal of the new system is to allow for consistent, 
comparable analysis across Labor's employment and training programs, 
using the same definitions for specific measures. These definitions, 
known as common measures, are to be implemented July 1, 2005, well 
before EMILE is implemented. [Footnote 26] A feasibility analysis on 
the EMILE proposal, which will provide information on next steps, is in 
the planning stages and should be completed by December 2005, but it is 
unclear how soon EMILE will be implemented. 

Labor has plans to meet the requirement that it conduct at least one 
multisite study to determine the general effectiveness of the WIA 
program and the specific impacts of WIA services on the community and 
participants involved. WIA requires Labor to conduct at least one 
multisite evaluation using a control group by the end of fiscal year 
2005. However, as noted in a prior report, Labor will not meet this 
deadline. [Footnote 27] Labor is waiting for WIA reauthorization to 
begin the evaluation, and will likely wait until the second year after 
reauthorization to commission the study. Labor anticipates it will take 
at least 5 years to complete the first evaluation. 

Concluding Observations: 

WIA represented a fundamental shift for workforce development because 
it attempted to significantly change how employment and training 
services were provided and because it provided considerable latitude to 
those implementing WIA at the state and local levels, yet little is 
known about the impacts of these changes. In program year 2003, local 
workforce boards used a substantial amount of WIA funds to train a 
large number of individuals. During these times of increasingly tight 
federal budgets, it is important to know what types of training are the 
most successful and how the outcomes from training compare with 
outcomes from other services. We previously recommended that Labor take 
actions to improve data quality and to conduct an impact evaluation of 
WIA services.[Footnote 28] While Labor is taking steps to address the 
accuracy of data contained in WIASRD, reliable information is not yet 
available on a national level as to the outcomes of those being 
trained. In addition, Labor will likely wait until 2007 to conduct the 
multisite impact evaluation required by WIA. Our findings reaffirm the 
need for a continued focus on resolving reported data quality issues 
and determining what services are the most successful. 

Agency Comments: 

We provided a draft of this report to Labor for review and comment. In 
its comments, Labor acknowledged that the WIA reporting system 
currently has limited information on training expenditures and training 
outcomes, but noted that some of our information conflicts with their 
estimates of these activities. In particular, Labor states the 
Administration's estimate of the amount of WIA funds spent on training 
is lower than the 40 percent that we estimate was used for training in 
program year 2003. In addition, Labor estimates adult training 
enrollments to be roughly 200,000. We agree with Labor that the WIA 
reporting system has limited reliable information. As a result, we went 
directly to the local workforce boards to obtain as complete a picture 
as possible on the extent to which WIA funds were used for training and 
how many adults were trained in program year 2003. Our information 
differs from Labor's estimates in two ways. First, our report indicates 
that 40 percent of WIA funds were used for training in program year 
2003. We define funds used for training to include funds spent as well 
as funds obligated. As shown in the report, of the approximately $929 
million used for training in program year 2003, about $724 million was 
actually spent and another $205 million was obligated. Second, Labor's 
estimate of 200,000 adults enrolled in training includes only those 
adults reported in WIASRD who exited from the program. Our estimate of 
416,000 comes directly from the local workforce areas that provided the 
training and includes the total number of adults who received training 
in program year 2003, including those who had not exited from the 
program. We believe our estimates of the amount of WIA funds used for 
training and the number of adults trained represent a more complete and 
accurate picture than Labor's estimates because we included all funds 
used for training in program year 2003, whether they were spent or 
obligated, and counted all adults who received training in program year 
2003, not just those who exited the program. 

Regarding our discussion on data quality, Labor stated that it 
appreciates that we recognize the steps taken to improve data quality 
through data validation and noted that it has provided states with the 
software, handbooks, user guides, and technical assistance necessary to 
develop reports and document validation. Labor commented that it plans 
to continue supporting data validation during the transition to common 
measures and is currently revising the software and related materials 
to match the new reporting requirements. In addition, Labor stated that 
in the coming months it will be publishing proposed revisions to the 
WIASRD in the Federal Register. Labor also has issued guidance 
standardizing the definition of "exit" for purposes of assessing 
program performance across all programs implementing common measures. 
Labor said that states will begin implementing the change on July 1, 
2005, and believes that this will improve the comparability of WIA 
outcome data. We commend Labor's efforts to improve data quality and 
acknowledge that these actions are a step in the right direction to 
having a reporting system that contains complete and accurate 
information. 

Labor also provided technical comments that we incorporated where 
appropriate. Labor's entire comments are reproduced in appendix III. 

We will send copies of this report to the Secretary of Labor, relevant 
congressional committees, and other interested parties and will make 
copies available to others upon request. In addition, the report will 
be available at no charge on GAO's Web site at http://www.gao.gov. 

A list of related GAO products is included at the end of this report. 
If you or your staffs have any questions about this report, please 
contact me at (202) 512-7215 or at nilsens@gao.gov. Contact points for 
our Offices of: 

Congressional Relations and Public Affairs may be found on the last 
page of this report. Other contacts and staff acknowledgments are 
listed in appendix IV. 

Signed by: 

Sigurd R. Nilsen, Director: 
Education, Workforce, and Income Security Issues: 

[End of section]

Appendix I: Objectives, Scope, and Methodology: 

We were asked to determine (1) to what extent Workforce Investment Act 
(WIA) funds have been used for training, (2) how local workforce 
investment boards have managed the use of Individual Training Accounts 
(ITA) and what challenges they have encountered, and (3) what is known 
at the national level about the outcomes of those receiving training. 
To address these issues, we conducted a Web-based survey of all local 
workforce investment boards in the 50 states, the District of Columbia, 
and Puerto Rico, and visited eight local boards located in 4 states. We 
conducted our work from June 2004 to May 2005 in accordance with 
generally accepted government auditing standards. 

Web-Based Survey: 

To determine the extent to which program year 2003 WIA funds were used 
for training, how local workforce boards manage ITAs, and what 
challenges they have encountered, we conducted a Web-based survey of 
the local workforce investment boards for the 590 local workforce 
investment areas in existence in program year 2003. Program year 2003 
was the most recent year for which complete data were available. The 
basis for our list of local workforce investment boards was the 
directory from the National Association of Workforce Boards (NAWB). To 
view the survey, go to www.gao.gov/cgi-bin/getrpt?GAO-05-807SP. 

Prior to administering the survey, we pretested the content and format 
of the questionnaire with a number of local workforce investment boards 
to determine whether (1) the survey questions were clear, (2) the terms 
used were precise, (3) respondents were able to provide the financial 
and client data we were seeking, and (4) the questions were unbiased. 
We made changes to the content and format of the final questionnaire 
based on pretest results. 

The surveys were conducted using self-administered electronic 
questionnaires posted on the Web. We received completed surveys from 
428 boards (a 73 percent response rate). 

We attempted to assess the reliability of the responses to survey 
questions that asked for quantitative data relating to WIA funds used 
for training and numbers of clients served. We included questions in 
the survey that asked whether or not the local board carried out 
certain practices or procedures to ensure that databases or data 
systems used to produce the financial and client information we asked 
for were in fact reliable. These questions asked (1) if there were 
written procedures that defined data elements or specified how data 
were collected; (2) if routine internal reviews of data were conducted 
to check for errors in completeness, accuracy, or reasonableness; (3) 
if periodic monitoring or audits of the data were conducted to check 
for errors in completeness, accuracy, or reasonableness; and (4) 
whether or not routine quality control procedures were in place such as 
data verification to source documents or computer edit checks. We asked 
these four questions separately for both the financial data and the 
client data obtained in the survey. If the local area responded that it 
had used at least two of the four practices or procedures to monitor 
the quality of the financial and participant data provided in their 
survey, we either accepted the responses or called for clarification, 
depending on which procedures were used.[Footnote 29] If the local 
board responded that three or four of these practices or procedures 
were not used for either financial or client data, we did not use those 
data. In cases where the local board responded that it was not sure 
whether these practices or procedures had been carried out or did not 
answer three or more of the four questions, we telephoned the board to 
try to determine whether or not it had actually carried out these 
practices or procedures. In cases where we determined that the data 
actually did meet our data reliability criteria, based on these 
telephone calls, we accepted the responses. On the basis of the 
criteria, we accepted the financial data for all 428 of the completed 
surveys and we accepted the participant data for 425 of the completed 
surveys. In the three cases where we did not accept the participant 
data, we did retain and use responses from other sections of the 
survey. In addition to including the questions on data reliability in 
the survey, we also checked the consistency of responses on a number of 
survey questions that asked for numeric data. On the basis of these 
consistency checks, some responses were dropped from our analysis. 

We generated estimates to the population of 590 boards by treating the 
428 responding boards as a simple random sample. We chose to treat the 
428 responding boards as a simple random sample from the population of 
590 based on an analysis of the differences between the responding 
boards and the nonresponding boards. 

To determine if there were any significant differences between the 
responding boards and the nonresponding boards, we contacted officials 
in the 50 states, the District of Columbia, and Puerto Rico to obtain 
the number of unemployed individuals for each local area. We obtained 
this number for all 590 boards in the population. We used this 
information to determine whether sample-based estimates of this 
characteristic generated from the responding boards compared favorably 
with the known population values. The known population value of the 
number of unemployed individuals fell within the 95 percent confidence 
interval surrounding the sample-based estimate. On the basis of these 
results, and our assessment that the number of unemployed individuals 
is correlated with key items we were estimating, we concluded that 
treating the 428 responding boards as a simple random sample is not 
likely to introduce significant bias into estimates. Some of the 428 
responding boards did not provide responses to all of the items in the 
survey. To improve our estimates, we employed a nearest neighbor hot 
deck imputation methodology to account for nonresponse of numerical 
items. 

Because we decided to treat the respondents as a simple random sample 
of boards, our results are estimates of the population of 590 boards 
and thus are subject to sampling errors that are associated with 
samples of this size and type. Our confidence in the precision of the 
results from this sample is expressed in 95 percent confidence 
intervals, which are expected to include the actual results in 95 
percent of samples of this type. We calculated confidence intervals 
based on methods that are appropriate for a simple random sample. All 
percentage estimates have margins of error of plus or minus 5 
percentage points or less. All numerical estimates other than 
percentages have relative margins of error of plus or minus 15 percent 
or less, except for those shown in table 4. For example, an estimate of 
$1,000,000 with a relative margin of error of plus or minus 15 percent 
would have a 95 percent confidence interval of $850,000 to $1,150,000. 

Table 4: 95 Percent Confidence Intervals for Numeric Estimates with 
Margins of Error Exceeding 15 Percent of the Value of Those Estimates: 

Question: National Emergency Grant (NEG) Carryover program funds; 
Estimate: $80,000,000; 
Lower bound: $58,000,000; 
Upper bound: $103,000,000. 

Question: State set-asides carryover funds; 
Estimate: $87,000,000; 
Lower bound: $66,000,000; 
Upper bound: $108,000,000. 

Question: Dislocated Worker funds obligated for training; 
Estimate: $83,000,000; 
Lower bound: $70,000,000; 
Upper bound: $96,000,000. 

Question: NEG funds obligated for training; 
Estimate: $14,000,000; 
Lower bound: $10,000,000; 
Upper bound: $18,000,000. 

Question: NEG funds expended on training; 
Estimate: $63,000,000; 
Lower bound: $51,000,000; 
Upper bound: $74,000,000. 

Question: State set-asides funds obligated for training; 
Estimate: $17,000,000; 
Lower bound: $14,000,000; 
Upper bound: $21,000,000. 

Question: NEG participants in on-the-job training; 
Estimate: $656; 
Lower bound: $441; 
Upper bound: $871. 

Question: State set-asides participants in on-the-job training; 
Estimate: $2,217; 
Lower bound: $1,744; 
Upper bound: $2,690. 

Question: Adult participants in customized training; 
Estimate: $13,424; 
Lower bound: $9,584; 
Upper bound: $17,264. 

Question: Dislocated Worker participants in customized training; 
Estimate: $2,193; 
Lower bound: $976; 
Upper bound: $3,410. 

Question: NEG participants in customized training; 
Estimate: $174; 
Lower bound: $71; 
Upper bound: $277. 

Question: State set-asides participants in customized training; 
Estimate: $10,883; 
Lower bound: $8,329; 
Upper bound: $13,437. 

Question: Total participants in customized training; 
Estimate: $26,674; 
Lower bound: $21,432; 
Upper bound: $31,916. 

Question: Adult participants in other training; 
Estimate: $20,771; 
Lower bound: $10,371; 
Upper bound: $31,172. 

Question: Dislocated Worker participants in other training; 
Estimate: $11,526; 
Lower bound: $4,973; 
Upper bound: $18,078. 

Question: NEG participants in other training; 
Estimate: $2,193; 
Lower bound: $895; 
Upper bound: $3,492. 

Question: State set-asides participants in other training; 
Estimate: $6,144; 
Lower bound: $3,956; 
Upper bound: $8,332. 

Question: Total participants in other training; 
Estimate: $40,634; 
Lower bound: $23,542; 
Upper bound: $57,726. 

Source: GAO analysis. 

Note: All dollar amounts are rounded to millions. 

[End of table]

The practical difficulties of conducting any survey may introduce other 
kinds of errors, commonly referred to as nonsampling errors. For 
example, difficulties in how a particular question is interpreted, in 
the sources of information that are available to respondents, or in how 
the data are entered into a database or were analyzed can introduce 
unwanted variability into the survey results. We took steps in the 
development of the questionnaire, the data collection, and the data 
analysis to minimize these nonsampling errors. For example, social 
science survey specialists designed the questionnaire in collaboration 
with GAO staff with subject matter expertise. Then, the draft 
questionnaire was pretested with a number of local boards to ensure 
that the questions were relevant, clearly stated, and easy to 
comprehend. As mentioned above, we included additional questions to 
determine whether certain practices or procedures had been carried out 
on the financial and client data. When the data were analyzed, a 
second, independent analyst checked all computer programs. Since this 
was a Web-based survey, respondents entered their answers directly into 
the electronic questionnaire. This eliminated the need to have the data 
keyed into a database, thus removing an additional source of error. 

Site Visits: 

We used two criteria in selecting site visit locations. First, we 
stratified the 48 continental states and the District of Columbia into 
four categories according to amount of program year 2003 adult and 
dislocated worker formula funds to reflect states with varying funding 
sizes. The four categories were less than $10 million, $10 million to 
$25 million, over $25 million to $50 million, and over $50 million. We 
selected one from each category. Second, we chose geographically 
dispersed states to help illuminate regional differences in 
implementing ITAs. From within each state, we judgmentally selected two 
local boards to provide a mix of urban and rural areas (see table 5). 

Table 5: Locations Selected for Site Visits: 

Local workforce area: Merced County; 
Type: Rural; 
City: Merced; 
State: California. 

Local workforce area: North Valley Job Training Consortium (NOVA); 
Type: Urban; 
City: Sunnyvale; 
State: California. 

Local workforce area: Atlanta Regional Workforce Board (ARWB); 
Type: Mixed; 
City: Atlanta; 
State: Georgia. 

Local workforce area: City of Atlanta Workforce Development Agency; 
Type: Urban; 
City: Atlanta; 
State: Georgia. 

Local workforce area: Region 16; 
Type: Rural; 
City: Burlington; 
State: Iowa. 

Local workforce area: Region 9; 
Type: Urban; 
City: Davenport; 
State: Iowa. 

Local workforce area: Baltimore County; 
Type: Urban; 
City: Towson; 
State: Maryland. 

Local workforce area: Western Maryland; 
Type: Rural; 
City: Hagerstown; 
State: Maryland. 

Source: GAO analysis. 

[End of table]

At each location visited, we obtained general information about the 
local workforce area and additional information on WIA funding, local 
training policies implemented, challenges encountered, innovative 
practices, and reliability of data systems. To increase our confidence 
in the reliability of the data we gathered from our survey, we 
interviewed each local board we visited about data monitoring and 
quality control procedures and policies with respect to their financial 
and participant databases. We also asked the local boards we visited to 
show us samples of records in their databases and to trace them to 
source documents. We generally found their data quality processes and 
procedures to be sufficiently reliable for the purposes of our report. 

Assessment of WIASRD: 

To determine whether the Workforce Investment Act Standardized Record 
Data (WIASRD) might be a viable source of data for outcomes of training 
participants, we reviewed our prior reports about the reliability of 
the WIASRD data and a report by Labor's Office of the Inspector General 
on WIA performance outcomes. We also performed electronic tests of the 
program year 2003 WIASRD data to check for missing values. The 
variables analyzed included employment after first, third, and fifth 
quarters after exit quarter, and type of credential attained. Missing 
data due to unemployment insurance wage data lags were taken under 
consideration. On the basis of our analysis, we determined that the 
WIASRD data elements pertinent to this report were not sufficiently 
reliable for our purposes. We have discussed the data reliability 
issues throughout the body of the report. 

[End of section]

Appendix II: Summary of Adult and Dislocated Worker Formula Funds for 
Program Year 2003: 

State: Alabama; 
Adult allotment: $15,735,991; 
Dislocated worker allotment: $19,648,431; 
Total: $35,384,422. 

State: Alaska; 
Adult allotment: $3,074,377; 
Dislocated worker allotment: $3,532,589; 
Total: $6,606,966. 

State: Arizona; 
Adult allotment: $16,031,216; 
Dislocated worker allotment: $19,236,076; 
Total: $35,267,292. 

State: Arkansas; 
Adult allotment: $8,471,046; 
Dislocated worker allotment: $8,381,623; 
Total: $16,852,669. 

State: California; 
Adult allotment: $127,752,492; 
Dislocated worker allotment: $181,115,296; 
Total: $308,867,788. 

State: Colorado; 
Adult allotment: $6,355,326; 
Dislocated worker allotment: $12,644,518; 
Total: $18,999,844. 

State: Connecticut; 
Adult allotment: $5,139,126; 
Dislocated worker allotment: $6,545,965; 
Total: $11,685,091. 

State: Delaware; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $1,619,829; 
Total: $3,850,681. 

State: District of Columbia; 
Adult allotment: $3,029,095; 
Dislocated worker allotment: $3,412,007; 
Total: $6,441,102. 

State: Florida; 
Adult allotment: $42,307,802; 
Dislocated worker allotment: $56,526,693; 
Total: $98,834,495. 

State: Georgia; 
Adult allotment: $16,339,645; 
Dislocated worker allotment: $19,872,747; 
Total: $36,212,392. 

State: Hawaii; 
Adult allotment: $4,153,045; 
Dislocated worker allotment: $3,507,793; 
Total: $7,660,838. 

State: Idaho; 
Adult allotment: $3,478,699; 
Dislocated worker allotment: $4,600,066; 
Total: $8,078,765. 

State: Illinois; 
Adult allotment: $43,313,151; 
Dislocated worker allotment: $63,671,542; 
Total: $106,984,693. 

State: Indiana; 
Adult allotment: $11,927,202; 
Dislocated worker allotment: $18,667,803; 
Total: $30,595,005. 

State: Iowa; 
Adult allotment: $3,463,590; 
Dislocated worker allotment: $4,733,474; 
Total: $8,197,064. 

State: Kansas; 
Adult allotment: $5,201,245; 
Dislocated worker allotment: $5,859,682; 
Total: $11,060,927. 

State: Kentucky; 
Adult allotment: $14,994,952; 
Dislocated worker allotment: $15,324,618; 
Total: $30,319,570. 

State: Louisiana; 
Adult allotment: $20,489,917; 
Dislocated worker allotment: $22,106,456; 
Total: $42,596,373. 

State: Maine; 
Adult allotment: $2,518,154; 
Dislocated worker allotment: $2,406,018; 
Total: $4,924,172. 

State: Maryland; 
Adult allotment: $11,088,755; 
Dislocated worker allotment: $13,818,649; 
Total: $24,907,404. 

State: Massachusetts; 
Adult allotment: $9,103,791; 
Dislocated worker allotment: $16,275,735; 
Total: $25,379,526. 

State: Michigan; 
Adult allotment: $37,251,688; 
Dislocated worker allotment: $49,051,997; 
Total: $86,303,685. 

State: Minnesota; 
Adult allotment: $8,412,429; 
Dislocated worker allotment: $10,814,167; 
Total: $19,226,596. 

State: Mississippi; 
Adult allotment: $12,275,609; 
Dislocated worker allotment: $14,986,889; 
Total: $27,262,498. 

State: Missouri; 
Adult allotment: $15,184,213; 
Dislocated worker allotment: $17,356,406; 
Total: $32,540,619. 

State: Montana; 
Adult allotment: $3,180,736; 
Dislocated worker allotment: $2,068,283; 
Total: $5,249,019. 

State: Nebraska; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $2,876,482; 
Total: $5,107,334. 

State: Nevada; 
Adult allotment: $5,454,619; 
Dislocated worker allotment: $9,336,077; 
Total: $14,790,696. 

State: New Hampshire; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $2,491,345; 
Total: $4,722,197. 

State: New Jersey; 
Adult allotment: $20,367,136; 
Dislocated worker allotment: $29,967,785; 
Total: $50,334,921. 

State: New Mexico; 
Adult allotment: $7,517,971; 
Dislocated worker allotment: $7,051,503; 
Total: $14,569,474. 

State: New York; 
Adult allotment: $64,530,126; 
Dislocated worker allotment: $85,269,181; 
Total: $149,799,307. 

State: North Carolina; 
Adult allotment: $25,708,051; 
Dislocated worker allotment: $43,355,653; 
Total: $69,063,704. 

State: North Dakota; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $946,647; 
Total: $3,177,499. 

State: Ohio; 
Adult allotment: $37,225,801; 
Dislocated worker allotment: $39,094,488; 
Total: $76,320,289. 

State: Oklahoma; 
Adult allotment: $7,232,422; 
Dislocated worker allotment: $6,326,289; 
Total: $13,558,711. 

State: Oregon; 
Adult allotment: $14,830,033; 
Dislocated worker allotment: $25,631,266; 
Total: $40,461,299. 

State: Pennsylvania; 
Adult allotment: $31,676,565; 
Dislocated worker allotment: $44,790,835; 
Total: $76,467,400. 

State: Puerto Rico; 
Adult allotment: $41,665,749; 
Dislocated worker allotment: $36,808,705; 
Total: $78,474,454. 

State: Rhode Island; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $2,571,482; 
Total: $4,802,334. 

State: South Carolina; 
Adult allotment: $13,557,999; 
Dislocated worker allotment: $17,614,232; 
Total: $31,172,231. 

State: South Dakota; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $1,272,804; 
Total: $3,503,656. 

State: Tennessee; 
Adult allotment: $17,271,017; 
Dislocated worker allotment: $17,675,156; 
Total: $34,946,173. 

State: Texas; 
Adult allotment: $74,133,194; 
Dislocated worker allotment: $91,170,377; 
Total: $165,303,571. 

State: Utah; 
Adult allotment: $3,515,501; 
Dislocated worker allotment: $6,438,510; 
Total: $9,954,011. 

State: Vermont; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $1,293,147; 
Total: $3,523,999. 

State: Virginia; 
Adult allotment: $13,242,958; 
Dislocated worker allotment: $13,971,928; 
Total: $27,214,886. 

State: Washington; 
Adult allotment: $25,736,856; 
Dislocated worker allotment: $39,224,868; 
Total: $64,961,724. 

State: West Virginia; 
Adult allotment: $8,053,562; 
Dislocated worker allotment: $6,914,091; 
Total: $14,967,653. 

State: Wisconsin; 
Adult allotment: $12,501,089; 
Dislocated worker allotment: $19,319,871; 
Total: $31,820,960. 

State: Wyoming; 
Adult allotment: $2,230,852; 
Dislocated worker allotment: $951,173; 
Total: $3,182,025. 

Total; 
Adult allotment: $892,340,757; 
Dislocated worker allotment: $1,150,149,247; 
Total: $2,042,490,004. 

Source: Department of Labor, Employment and Training Administration. 

Note: Amounts identified reflect the adult and dislocated worker 
program year 2003 funds after the 0.59 percent rescission. Totals 
exclude the seven outlying areas (American Samoa, Guam, Marshall 
Islands, Micronesia, Northern Mariana, Palau, and Virgin Islands). 

[End of table]

[End of section]

Appendix III: Comments from the Department of Labor: 

U.S. Department of Labor:
Assistant Secretary for Employment and Training: 
Washington, D.C. 20210: 

JUN 22 2005: 

Mr. Sigurd R. Nilsen: 
Director:
Education, Workforce, and Income Security Issues: 
U.S. Government Accountability Office:
441 G. Street, N.W.: 
Washington, D.C. 20548: 

Dear Mr. Nilsen: 

Thank you for the opportunity to respond to the draft Government 
Accountability Office (GAO) report entitled, "Workforce Investment Act: 
Substantial Funds are Used for Training, but Little is Known Nationally 
About Training Outcomes" (GAO-05-650). We understand that it was 
necessary for GAO to make some assumptions in evaluating information 
for this report because the WIA reporting system currently has limited 
official information on training expenditures and training outcomes. 
Some of those assumptions, however, conflict with our own evaluation of 
these activities, and we do have several comments about certain 
recommendations in the report. 

The report estimates that approximately 40 percent of WIA funds are 
spent on training. According to Administration estimates, the 
percentage is lower. In fact, we believe that the percentage of funds 
expended on training, and the number of training enrollments, should be 
significantly higher. Both can be greatly increased through program 
innovation and efficiencies. We estimated training enrollments when 
developing proposals for the WIA reauthorization and found that roughly 
200,000 adults received training services in Program Year 2003 through 
the WIA and Wagner-Peyser formula dollars. The President, in fact, has 
challenged the workforce investment system to double the number of 
individuals trained, from 200,000 to 400,000. This effort can be 
accomplished by delivering training opportunities through new Community-
Based Job Training Grants, which would generate an estimated 100,000 
enrollments, and through reforms of the workforce investment system, 
which will generate funding for another 100,000 training enrollments. 

Of the roughly $4 billion currently expended on the WIA Adult, WIA 
Dislocated Worker, WIA Youth and Wagner-Peyser Employment Service 
programs, $1.5 billion is spent on "infrastructure" as reported by the 
states. Of this infrastructure spending, $527 million is reported as 
being spent on "other" uses which do not include Rapid Response 
services, local administration, or statewide projects. The 
Administration believes that at least $300 million of the $527 million 
in "other" infrastructure funding can and should be used for training 
additional workers for high growth jobs. 

Regarding the discussion on data quality and validation, we appreciate 
that GAO recognizes that ETA is taking steps to improve data quality 
through data validation. TEGL 3-03 Change 1, Data Validation Policy for 
Employment and Training Program, informs states that they are required 
to validate WIASRD elements 332 to 337, which relate to Individual 
Training Accounts (ITAs) and the provision of training. ETA has 
provided the states with the software, handbooks, user guides and the 
technical assistance necessary to develop reports and document 
validation. States are encouraged to use the materials provided by ETA 
as the basis for creating state specific policies for local areas. Some 
states are already doing an excellent job customizing data validation 
materials to meet local case management needs, and we expect better 
data quality in the future as a result. 

ETA plans to continue supporting data validation during the transition 
to common measures and is currently revising the software and related 
materials to match the new reporting requirements. ETA will also 
continue to provide training and technical assistance to help states 
improve data collection and source document retention procedures. In 
the coming months, ETA will be publishing proposed revisions to the 
WIASRD in the Federal Register for a 60-day public comment, and we 
would welcome further specific comments from GAO on ways to strengthen 
this reporting system during that time. 

In addition, in Training and Employment Guidance Letter (TEGL) 28-04, 
Common Measures Policy, ETA standardized the definition of "exit" for 
purposes of assessing program performance across all programs 
implementing common measures. States will begin implementing the noted 
change on July l, 2005, and we believe that this will improve the 
comparability of WIA outcome data at both the state and local levels. 

The report also indicates that some local workforce boards impose 
limits on ITAs, such as capping the total amount available for ITAs and 
limiting the total time for training. This effort is generally related 
to attempts to maximize the number of people that can access some level 
of training at the local level; however, ETA believes that strategic 
investments in training for occupations in high-growth, high-demand 
industries in the 2 IS' century economy will require a different set of 
strategies. The skill level for many jobs is increasing significantly 
as a result of technology and innovation. In some cases, the effort to 
prepare workers for high-demand occupations will require longer periods 
of training and in other cases we will need strategies that offer 
workers the ability to gain their skills incrementally over time. As 
part of its job training reform efforts, the Administration has 
proposed creating Innovation Training Accounts. These accounts would 
allow individuals to bundle training resources from a variety of 
sources, including WIA funds, into a single, self-managed account that 
would provide individuals with opportunities to acquire the skills that 
businesses need and access to good jobs and career pathways. What is 
most important is a better understanding by the state and local WIA 
system of employer skill demands, successful economic development 
strategies, and outcome-based and high-growth training opportunities. 

Enclosed are ETA's technical comments on the draft report. If you would 
like additional information, please do not hesitate to call me at (202) 
693-2700. 

Sincerely,

Signed by: 

Emily Stover DeRocco: 

Enclosure: 

[End of section]

Appendix IV: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Sigurd R Nilsen (202) 512-7215: 

Staff Acknowledgments: 

Joan Mahagan, Assistant Director, and Wayne Sylvia, Analyst-in-Charge, 
managed all aspects of the assignment. Rebecca Woiwode made significant 
contributions to this report in all aspects of the work. In addition, 
Amanda Mackison and Matthew Saradjian assisted in the survey design, 
data collection, and report writing; Stuart Kaufman and Shana Wallace 
assisted in the design of the national survey and the assessment of the 
survey's data reliability; James Ashley and Sidney Schwartz assisted in 
data projections of the national survey; Grant Mallie and Stefanie 
Bdzusek assisted in analyzing the national survey responses; Joan Vogel 
assisted in assessing the data reliability of the WIASRD data; Jessica 
Botsford and Richard Burkard provided legal support; and Corinna 
Nicolaou provided writing assistance. 

[End of section]

Related GAO Products: 

Workforce Investment Act: Labor Should Consider Alternative Approaches 
to Implement New Performance and Reporting Requirements. GAO-05- 
539.Washington, D.C.: May 27, 2005. 

Workforce Investment Act: Employers Are Aware of, Using, and Satisfied 
with One-Stop Services, but More Data Could Help Labor Better Address 
Employers' Needs. GAO-05-259. Washington, D.C.: Feb. 18, 2005. 

Public Community Colleges And Technical Schools: Most Schools Use Both 
Credit and Noncredit Programs for Workforce Development. GAO-05-04. 
Washington, D.C.: Oct. 18, 2004. 

Trade Adjustment Assistance: Reforms Have Accelerated Training 
Enrollment, but Implementation Challenges Remain. GAO-04-1012. 
Washington, D.C.: Sept. 22, 2004. 

Workforce Investment Act: States and Local Areas Have Developed 
Strategies to Assess Performance, but Labor Could Do More to Help. GAO- 
04-657. Washington, D.C.: June 1, 2004. 

National Emergency Grants: Labor Is Instituting Changes to Improve 
Award Process, but Further Actions Are Required to Expedite Grant 
Awards and Improve Data. GAO-04-496. Washington, D.C.: April 16, 2004. 

Workforce Investment Act: Labor Actions Can Help States Improve Quality 
of Performance Outcome Data and Delivery of Youth Services. GAO-04-308. 
Washington, D.C.: Feb. 23, 2004. 

National Emergency Grants: Services to Dislocated Workers Hampered by 
Delays in Grant Awards, but Labor Is Initiating Actions to Improve 
Grant Award Process. GAO-04-222. Washington, D.C.: Nov. 14, 2003. 

Workforce Investment Act: Exemplary One-Stops Devised Strategies to 
Strengthen Services, but Challenges Remain for Reauthorization. GAO-03- 
884T. Washington, D.C.: June 18, 2003. 

Workforce Investment Act: One-Stop Centers Implemented Strategies to 
Strengthen Services and Partnerships, but More Research and Information 
Sharing Is Needed. GAO-03-725. Washington, D.C.: June 18, 2003. 

Workforce Investment Act: Issues Related to Allocation Formulas for 
Youth, Adults, and Dislocated Workers. GAO-03-636. Washington, D.C.: 
April 25, 2003. 

Workforce Investment Act: Interim Report on Status of Spending and 
States' Available Funds. GAO-02-1074. Washington, D.C.: Sept. 5, 2002. 

Workforce Investment Act: Better Guidance and Revised Funding Formula 
Would Enhance Dislocated Worker Program. GAO-02-274. Washington, D.C.: 
Feb. 11, 2002. 

Workforce Investment Act: Better Guidance Needed to Address Concerns 
over New Requirements. GAO-02-72. Washington, D.C.: Oct. 4, 2001. 

FOOTNOTES

[1] A program year begins on July 1 of a year and ends on June 30 of 
the following year. A program year is designated by the year in which 
it begins. Thus, program year 2003 began on July 1, 2003, and ended on 
June 30, 2004. 

[2] For purposes of this report, we are defining "used" to mean funds 
that are either spent or obligated. 

[3] We chose to make these estimates based on an analysis of the 
differences between the responding boards and the nonresponding boards. 
All percentage estimates have margins of error of plus or minus 5 
percentage points or less. All numerical estimates other than 
percentages have margins of error of plus or minus 15 percent or less 
of the value of those estimates, unless otherwise noted. 

[4] A dislocated worker is an individual who (1) has been terminated or 
laid off, or who has received a notice of termination or layoff, from 
employment; is eligible for, or has exhausted entitlement to, 
unemployment insurance or is not eligible but has been employed for a 
sufficient duration to demonstrate attachment to the workforce; and is 
unlikely to return to previous industry or occupation; (2) has been 
terminated or laid off, or has received a notice of termination or 
layoff, from employment as a result of any permanent plant closure of, 
or substantial layoff at, a plant, facility, or enterprise; (3) was 
self employed but is unemployed as a result of general economic 
conditions in the community in which the individual resides or because 
of natural disasters; or (4) is a displaced homemaker. 

[5] See GAO, Workforce Investment Act: Issues Related to Allocation 
Formulas for Youth, Adults, and Dislocated Workers, GAO-03-636 
(Washington, D.C.: Apr. 25, 2003). 

[6] For additional information on National Emergency Grants, see GAO, 
National Emergency Grants: Labor Is Instituting Changes to Improve 
Award Process, but Further Actions Are Required to Expedite Grant 
Awards and Improve Data, GAO-04-496 (Washington, D.C.: Apr. 16, 2004). 

[7] Under WIA, the chief elected official in a local area or his or her 
designee serves as the local recipient of WIA funds. The local 
recipient must disburse the funds at the direction of the local board. 

[8] Short-term prevocational services prepare individuals for 
employment or training and include development of learning skills, 
communication skills, interviewing skills, punctuality, personal 
maintenance, and professional conduct. 

[9] Customized training is designed to meet the special requirements of 
an employer and is conducted with a commitment by the employer to hire 
the individual upon successful completion of the training, for which 
the employer pays no less than 50 percent of the cost. 

[10] The determination of whether training services may be made 
available to adults or dislocated workers under WIA is generally made 
by WIA adult or dislocated worker staff. 

[11] Several prior reports have cited disincentives in the performance 
measures to serve certain workers using WIA funds. See related GAO 
products at the back of this report. 

[12] WIA regulations require expenditures to be reported on an accrual 
basis. This means states should report all cash outlays and all 
accruals as expenditures on their reports. Accruals are amounts owed 
for goods and services that have been received but for which cash has 
not yet been disbursed. 

[13] WIA funding for training is limited to participants who are unable 
to obtain grant assistance from other sources to pay the costs of their 
training, or who require assistance beyond that available under grant 
assistance from other sources. 

[14] To participate in the TAA program, laid-off workers must be 
certified as eligible by the Department of Labor. For more information, 
GAO, Trade Adjustment Assistance: Reforms Have Accelerated Training 
Enrollment, but Implementation Challenges Remain, GAO-04-1012 
(Washington, D.C.: Sept. 22, 2004). 

[15] For more information on the H-1B skill grant program, see GAO, 
High Skill Training: Grants from H-1B Visa Fees Meet Specific Workforce 
Needs, but at Varying Skill Levels, GAO-02-881 (Washington, D.C.: Sept. 
20, 2002). 

[16] Soft skills are the nontechnical skills, abilities, and traits 
that workers need to function in a job. These include four sets of 
workplace competencies: problem-solving and other cognitive skills, 
oral communication skills, personal qualities and work ethic, and 
interpersonal and teamwork skills. 

[17] These figures include any participant who received training in 
program year 2003, regardless of when they were enrolled in, or exited 
from, the program. 

[18] Under WIA, supportive services may only be provided to individuals 
who are participating in core, intensive, or training services and who 
are unable to obtain these services through other programs. 

[19] For more information about workforce development programs offered 
by community colleges and technical schools, see GAO, Public Community 
Colleges and Technical Schools: Most Schools Use Both Credit and 
Noncredit Programs for Workforce Development, GAO-05-04 (Washington, 
D.C.: Oct. 18, 2004). 

[20] See Mathematica Policy Research, The Effects of Customer Choice: 
First Findings from the Individual Training Account Experiments, Final 
Interim Report (Washington, D.C.: December 2004). 

[21] In Atlanta and Phoenix, the study was implemented by a consortium 
of two local workforce investment areas. 

[22] See GAO, Workforce Investment Act: Better Guidance Needed to 
Address Concerns over New Requirements, GAO-02-72 (Washington, D.C.: 
Oct. 4, 2001). 

[23] GAO, Workforce Investment Act: Labor Actions Can Help States 
Improve Quality of Performance Outcome Data and Delivery of Youth 
Services, GAO-04-308 (Washington, D.C.: Feb. 23, 2004). 

[24] U.S. Department of Labor, Office of Inspector General, Workforce 
Investment Act Performance Outcomes Reporting Oversight , 06-02-006-03- 
390 (Washington, D.C.: Sept. 30, 2002). 

[25] GAO, Workforce Investment Act: Improvements Needed in Performance 
Measures to Provide a More Accurate Picture of WIA's Effectiveness, GAO-
02-275 (Washington, D.C.: Feb. 1, 2002). 

[26] For additional information on EMILE and common measures, see GAO, 
Workforce Investment Act: Labor Should Consider Alternative Approaches 
to Implement New Performance and Reporting Requirements, GAO-05-539 
(Washington, D.C.: May 27, 2005). 

[27] GAO, Workforce Investment Act: States and Local Areas Have 
Developed Strategies to Assess Performance, but Labor Could Do More to 
Help, GAO-04-657 (Washington, D.C.: June 1, 2004). 

[28] See GAO-05-539, p. 36-37; GAO-04-496, p. 29; GAO-04-657, p. 41; 
and GAO-04-308, p. 31. 

[29] Because we believe that having written procedures was less 
important to define quality than the other three measures, we only 
accepted responses without clarification if the board reported using 
two of the three remaining procedures. 

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