FR Doc 2010-6787
[Federal Register: March 26, 2010 (Volume 75, Number 58)]
[Page 14582-14585]
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Office of Special Education and Rehabilitative Services--Special 
Demonstration Programs--Model Demonstration Projects To Improve 
Outcomes for Individuals Receiving Social Security Disability Insurance 
(SSDI) Served by State Vocational Rehabilitation (VR) Agencies

AGENCY: Office of Special Education and Rehabilitative Services, 
Department of Education.

ACTION: Notice of proposed priority.


Catalog of Federal Domestic Assistance (CFDA) Number: 84.235L.

SUMMARY: The Assistant Secretary for Special Education and 
Rehabilitative Services proposes a priority under the Special 
Demonstration Programs to fund a project to identify, develop, and 
implement model demonstration projects to improve outcomes for 
individuals receiving Social Security Disability Insurance (SSDI) 
served by State Vocational Rehabilitation (VR) agencies. The Assistant 
Secretary may use this priority for competitions in fiscal year (FY) 
2010 and later years. We take this action to improve employment 
outcomes for SSDI beneficiaries receiving services from State VR 

DATES: We must receive your comments on or before April 26, 2010.

ADDRESSES: Address all comments about this notice to Thomas Finch, U.S. 
Department of Education, 400 Maryland Avenue, SW., room 5147, Potomac 
Center Plaza (PCP), Washington, DC 20202-2800.
    If you prefer to send your comments by e-mail, use the following 
address: You must include the term ``SSDI 
Demonstration'' in the subject line of your electronic message.

FOR FURTHER INFORMATION CONTACT: Thomas Finch. Telephone: (202) 245-
7343 or by e-mail:
    If you use a telecommunications device for the deaf (TDD), call the 
Federal Relay Service (FRS), toll free, at 1-800-877-8339.


[[Page 14583]]

    Invitation To Comment: We invite you to submit comments regarding 
this notice.
    We invite you to assist us in complying with the specific 
requirements of Executive Order 12866 and its overall requirement of 
reducing regulatory burden that might result from this proposed 
priority. Please let us know of any further ways we could reduce 
potential costs or increase potential benefits while preserving the 
effective and efficient administration of the program.
    During and after the comment period, you may inspect all public 
comments about this notice in room 5052, Potomac Center Plaza (PCP), 
550 12th Street, SW., Washington DC, between the hours of 8:30 a.m. and 
4:00 p.m., Washington, DC time, Monday through Friday of each week 
except Federal holidays.
    Assistance to Individuals With Disabilities in Reviewing the 
Rulemaking Record: On request we will provide an appropriate 
accommodation or auxiliary aid to an individual with a disability who 
needs assistance to review the comments or other documents in the 
public rulemaking record for this notice. If you want to schedule an 
appointment for this type of accommodation or auxiliary aid, please 
contact the person listed under FOR FURTHER INFORMATION CONTACT.
    Purpose of Program: The purpose of this program is to expand and 
improve the provision of rehabilitation and other services authorized 
under the Rehabilitation Act of 1973, as amended (the Rehabilitation 
Act), or to support activities that increase the provision, extent, 
availability, scope, and quality of rehabilitation services provided 
under the Rehabilitation Act.

    Program Authority: 29 U.S.C. 773(b).

    Applicable Program Regulations: 34 CFR part 373.

Proposed Priority

    This notice contains one proposed priority.

Model Demonstration Projects To Improve Outcomes for Individuals 
Receiving Social Security Disability Insurance (SSDI) Served by State 
Vocational Rehabilitation (VR) Agencies


    The Rehabilitation Act of 1973, as amended (the Rehabilitation 
Act), authorizes the establishment of VR agencies in each State to 
administer the State's Vocational Rehabilitation Services program. 
These State VR agencies provide VR services to eligible individuals 
with disabilities to assist them to prepare for, obtain, or retain 
employment, preferably competitive employment. Under the VR program, 
competitive employment means employment in the competitive labor market 
that is performed in an integrated setting and for which the individual 
is paid at or above the minimum wage but not less than the customary 
wage and level of benefits paid by the employer for the same work to 
individuals who are not disabled (see generally 34 CFR 361.5(b)(11)). 
In this context, an integrated setting means employment in jobs that 
are typically found in the community and in which individuals with 
disabilities have the same opportunity to interact with others in the 
course of their work that is available to any other person employed in 
a comparable position (see generally 34 CFR 361.5(b)(33)(ii)).
    The Social Security Administration (SSA) provides income support to 
more than 10 million working age people with disabilities through its 
Social Security Disability Insurance (SSDI) and Supplemental Security 
Income (SSI) programs. Under the SSDI program, SSA provides benefits to 
eligible individuals with a work history who have paid Social Security 
taxes on their earnings and who cannot work because they have a medical 
condition that is expected to last at least one year or result in 
death. The SSI program is an income supplement program that provides 
cash assistance for basic needs, such as food, clothing, and shelter, 
to individuals who are 65 years of age or older or who are disabled and 
who have little or no income. Individuals with disabilities may receive 
assistance under both the SSDI and SSI programs. The Federal 
government's cost of providing these benefits was almost $101 billion 
in 2005 and the number of beneficiaries and cost of these programs are 
expected to increase (GAO-07-332, March 30, 2007).
    State VR agencies serve a significant number of SSA beneficiaries. 
In FY 2008, approximately 28 percent of all individuals whose service 
records were closed were SSA beneficiaries at the time that they 
applied for VR services, over half of whom were SSDI beneficiaries. 
Similarly, SSA beneficiaries represented nearly a quarter of those 
individuals exiting the State VR program with an employment outcome in 
FY 2008, over half of whom were SSDI beneficiaries (RSA-911 data). 
Accordingly, SSA has a significant and ongoing interest in State VR 
agencies' success in helping individuals with disabilities secure 
    The Rehabilitation Act Amendments of 1992 increased the role of VR 
agencies in assisting SSA beneficiaries by requiring that individuals 
with disabilities who receive SSDI or SSI benefits be considered 
individuals with significant disabilities and be presumed to be 
eligible for VR services under the State VR Services program (see 
section 102(a)(3) of the Rehabilitation Act). State VR agencies' role 
has increased even more since the passage of the Ticket to Work and 
Work Incentives Improvement Act of 1998 (42 U.S.C. 1320b-19). Under the 
Ticket to Work program, most SSDI beneficiaries and SSI recipients 
between the ages of 18 and 64 are offered a ``ticket'' which they may 
use to obtain VR services, employment services, and other support 
services from an SSA employment network services provider. State VR 
agencies can participate in the Ticket to Work program as an employment 
network services provider or through a cost reimbursement program. As 
of March 1, 2010, about 229,224 ticket-holders are working with a State 
VR agency under the traditional cost reimbursement arrangement. In 
addition, about 34 percent of the 40,328 tickets that have been 
assigned have been assigned to State VR agencies as an employment 
network and about 66 percent have been assigned to other employment 
networks. The Web site 
provides more details on the coordination effort 
between State VR agencies and the Ticket to Work program. There are 
also new opportunities for State VR agencies to partner with other VR 
providers under options that became available under the new Ticket to 
Work regulations that became effective July 21, 2008 (20 CFR part 411).
    Notwithstanding collaboration between SSA and the VR program, 
recent studies have criticized the return to work efforts for SSA 
beneficiaries. A GAO study found that while individuals increased their 
earnings after receiving VR services, only a small proportion of that 
group of individuals earned a sufficient amount that would enable them 
to leave the SSA beneficiary rolls (Vocational Rehabilitation: Earnings 
Increased for Many SSA Beneficiaries after Completing VR Services, but 
Few Earned Enough to Leave SSA's Disability Rolls, GAO-07-332 March 30, 
2007). The most recent GAO study (Vocational Rehabilitation: Improved 
Information and Practices May Enhance State Agency Earnings Outcomes 
for SSA Beneficiaries, GAO-07-521, May 23, 2007) reported that State 
agency outcomes for SSA beneficiaries completing VR programs varied 

[[Page 14584]]

across different outcome measures. For example, according to SSA 
earning records, there is wide variation among State VR agencies in the 
amount of money that individuals with disabilities who achieved 
employment outcomes earned during the first year after closure of the 
VR service record.
    This most recent study also found that some of the variance in 
outcomes could be explained by factors such as State economic 
conditions and the characteristics of the individuals receiving agency 
services. However, GAO did find that a few State VR agency practices 
appeared to yield positive earnings results and made the following 

    To improve the effectiveness of Education's program evaluation 
efforts and ultimately the management of vocational rehabilitation 
programs, the Secretary of Education should further promote agency 
practices that show promise for helping more SSA disability 
beneficiaries participate in the work force. Such a model should 
seek to increase: (1) The percentage of VR staff who meet State 
standards and certifications established under the Comprehensive 
System of Personnel Development (CSPD), (2) partnership or 
involvement with area business communities, and (3) collaboration 
with other agencies that provide complementary services (Vocational 
Rehabilitation: Improved Information and Practices May Enhance State 
Agency Earnings Outcomes for SSA Beneficiaries, GAO-07-521, May 23, 

We propose to address GAO's recommendation that the Department promote 
promising practices by examining practices in State VR agencies and 
other factors affecting the employment outcomes of SSDI beneficiaries. 
The focus of this proposed priority is limited to individuals with 
disabilities receiving SSDI benefits at the time of application to the 
VR program, including those individuals receiving both SSDI and SSI, 
because differences in program eligibility and other characteristics of 
the SSDI and SSI programs and their recipients (work history, amount of 
disability payment, work-related incentives/disincentives), would make 
it difficult to analyze, interpret, and generalize the results.
    There are a number of practices and other factors that may affect 
the outcomes of SSDI beneficiaries that need to be examined at the 
State or local level, for example, looking at the effect of partnering 
with business or collaborating with other agencies that provide 
complementary services, as suggested by GAO. Likewise, State VR 
agencies commit varying levels of resources towards rehabilitation of 
SSA beneficiaries, and these individual State decisions could also 
explain differences in State VR agency performance. Finally, the 
existence within States of different levels of extended services and 
supports available from other agencies to assist individuals with 
disabilities to maintain employment following the completion of the VR 
program and case closure may also have a direct impact on job retention 
and earnings levels.
    One way to study these individual State differences is to identify 
State VR agencies that are particularly successful in achieving 
employment outcomes for SSDI beneficiaries at comparatively higher 
wages and hours worked and to conduct in-depth case studies of those 
agencies to identify practices that are associated with more and better 
employment outcomes and can be replicated by other State VR agencies.
    One source of data that may be used for this analysis is the RSA-
911. The RSA-911 is the primary individual service record level 
database on which State VR agencies report information about individual 
characteristics of, services provided to, and the employment outcomes 
obtained by individuals served by the VR program. Examination of RSA-
911 information for FY 2008 shows that, as GAO reported, State VR 
agencies differ considerably in both the number of SSDI beneficiaries 
served and in the number and quality of the employment outcomes 
obtained by SSDI beneficiaries. There are differences in relative 
success rates (called employment outcome rates or rehabilitation rates 
in VR nomenclature) and relative differences in emphasis on full- or 
part-time work (as indicated by average hours worked per week). There 
are also differences in gross weekly wages and in the percentage of 
individuals who earn more than the substantial gainful activity (SGA) 
level at closure (RSA analysis of RSA-911 data, FY 2008).
    A preliminary review of four performance measures (employment 
outcome rate, wages at case closure, hours worked, and percentage of 
individuals earning an amount greater than SGA at closure) in the RSA-
911 data indicates that there are 10 State VR agencies that score in 
the top 20 percent of all State VR agencies for at least three out of 
the four performance measures. Although a more in-depth analysis of 
recent RSA-911 data and other information may provide somewhat 
different results, RSA has concluded from this preliminary review that 
there is a pool of State VR agencies that are able to achieve more 
employment outcomes involving full-time work and higher wages for SSDI 
beneficiaries from which selections for a case study review could be 
    This proposed priority is envisioned as a cooperative agreement 
with significant interaction and collaboration between RSA and the 
grantee. There are several distinct activities involved in this 
research activity. These include: further analysis of existing RSA data 
and other relevant data to identify high-performing State VR agencies; 
investigation of practices within these agencies using rigorous case 
study methodology; analysis of the case study findings; and design, 
implementation, and evaluation of a demonstration project based on the 
findings from the case studies.
    Some of the preliminary work for this data analysis has been 
completed, as discussed previously in this notice. Before a grant is 
made under this priority, RSA staff will conduct a more thorough 
analysis of State VR agency performance related to serving SSDI 
beneficiaries to determine whether there are State VR agencies that 
consistently appear to perform better than others across multiple 
measures. In conducting this analysis, RSA will likely use other 
databases in conjunction with the RSA-911. The analysis will refine the 
criteria for measuring high performance and will be the basis for 
identifying States that meet the identified criteria. RSA will share 
the results of this analysis with the grantee during the discussion of 
the selection of the high-performing State VR agencies to be examined 
further through the case studies.\1\ It is recommended that applicants 
assume that there will be three case studies on the premise that 
further analysis will reduce the pool of State VR agencies that show 
consistent positive outcomes for SSDI beneficiaries and that only some 
of those State VR agencies will agree to participate in the study.

    \1\ State VR agencies that serve individuals who are blind or 
visually impaired will be excluded from this study for two reasons: 
individuals who are blind or visually impaired have significantly 
different benefits under the SSDI program, the most important of 
which is the allowance of a higher level of earnings before meeting 
the SGA requirement; and most of these agencies serve relatively few 
individuals, making analysis more difficult. Likewise, VR programs 
in the Commonwealths of Puerto Rico and the Northern Marianas and 
the territories of Guam, American Samoa, and the Virgin Islands are 
excluded from this study for reasons of small numbers served, cost 
considerations, and significant differences in availability and 
organization of other resources for individuals with disabilities.

    The purpose of the case studies of State VR agencies that 
demonstrate sustained success with SSDI beneficiaries is to determine 
possible factors contributing to that success. High-performing agencies 
will be asked

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by RSA to participate in these in-depth case studies to determine 
factors or variables that are related to high performance as defined 
for this project. The factors or variables may be decisions or 
activities that are under the control of the State VR agency, or they 
may be characteristics of the external State environment. Information 
from the case study analysis will be used in the design of an 
intervention model by the successful grantee that will serve as the 
basis for the demonstration projects to be carried out and evaluated by 
the grantee under this priority.

Proposed Priority

    The Assistant Secretary for Special Education and Rehabilitative 
Services proposes a priority under the Special Demonstration Programs 
to fund a project to identify, develop, and implement model 
demonstration projects to improve outcomes for individuals receiving 
Social Security Disability Insurance (SSDI) who are served by State 
vocational rehabilitation (VR) agencies. Under this priority, the 
project must be designed to contribute to the following outcomes:
     Identify through in-depth case study of selected State VR 
agencies factors that account for the relatively better qualitative and 
quantitative results of these agencies in achieving employment outcomes 
at or above substantial gainful activity (SGA) for SSDI beneficiaries.
     Determine whether there are a sufficient number of factors 
related to the better employment outcome results that are within the 
control of the State VR agency, and if so, develop an intervention 
model incorporating those factors that can be replicated in other State 
VR agencies and that can be evaluated in terms of the model's impact 
after implementation.
     Implement and evaluate the intervention model in at least 
three State VR agencies, selected by the Rehabilitation Services 
Administration (RSA) based on information provided by the grantee, that 
are willing to implement the model. One criterion for selecting these 
State VR agencies is that SSDI beneficiaries whom they serve have an 
employment outcome rate at or below the rate for other State VR 
     If the model demonstration projects show an improved 
employment rate for SSDI beneficiaries, complete the development of the 
intervention model incorporating information acquired through the model 
demonstration projects, recommend any strategies needed for 
implementation of the model by other State VR agencies, and disseminate 
the findings of this demonstration project to State VR agencies.

Types of Priorities

    When inviting applications for a competition using one or more 
priorities, we designate the type of each priority as absolute, 
competitive preference, or invitational through a notice in the Federal 
Register. The effect of each type of priority follows:
    Absolute priority: Under an absolute priority, we consider only 
applications that meet the priority (34 CFR 75.105(c)(3)).
    Competitive preference priority: Under a competitive preference 
priority, we give competitive preference to an application by (1) 
awarding additional points, depending on the extent to which the 
application meets the priority (34 CFR 75.105(c)(2)(i)); or (2) 
selecting an application that meets the priority over an application of 
comparable merit that does not meet the priority (34 CFR 
    Invitational priority: Under an invitational priority, we are 
particularly interested in applications that meet the priority. 
However, we do not give an application that meets the priority a 
preference over other applications (34 CFR 75.105(c)(1)).

Final Priority

    We will announce the final priority in a notice in the Federal 
Register. We will determine the final priority after considering 
responses to this notice and other information available to the 
Department. This notice does not preclude us from proposing additional 
priorities, requirements, definitions, or selection criteria, subject 
to meeting applicable rulemaking requirements.

    Note: This notice does not solicit applications. In any year in 
which we choose to use this priority, we invite applications through 
a notice in the Federal Register.

    Executive Order 12866: This notice has been reviewed in accordance 
with Executive Order 12866. Under the terms of the order, we have 
assessed the potential costs and benefits of this proposed regulatory 
    The potential costs associated with this proposed regulatory action 
are those resulting from statutory requirements and those we have 
determined as necessary for administering this program effectively and 
    In assessing the potential costs and benefits--both quantitative 
and qualitative--of this proposed regulatory action, we have determined 
that the benefits of the proposed priority justify the costs.
    Intergovernmental Review: This program is subject to Executive 
Order 12372 and the regulations in 34 CFR part 79. One of the 
objectives of the Executive order is to foster an intergovernmental 
partnership and a strengthened federalism. The Executive order relies 
on processes developed by State and local governments for coordination 
and review of proposed Federal financial assistance.
    This document provides early notification of our specific plans and 
actions for this program.
    Accessible Format: Individuals with disabilities can obtain this 
document in an accessible format (e.g., braille, large print, 
audiotape, or computer diskette) by contacting the Grants and Contracts 
Services Team, U.S. Department of Education, 400 Maryland Avenue, SW., 
room 5075, PCP, Washington, DC 20202-2550. Telephone: (202) 245-7363. 
If you use a TDD, call the FRS, toll free, at 1-800-877-8339.
    Electronic Access to This Document: You can view this document, as 
well as all other documents of this Department published in the Federal 
Register, in the text or Adobe Portable Document Format (PDF) on the 
Internet at the following site: To 
use PDF you must have the Adobe Acrobat Reader, which is available free 
at this site.

    Note: The official version of this document is the document 
published in the Federal Register. Free Internet access to the 
official edition of the Federal Register and the Code of Federal 
Regulations is available on GPO Access at:

    Dated: March 23, 2010.
Alexa Posny,
Assistant Secretary for Special Education and Rehabilitative Services.
[FR Doc. 2010-6787 Filed 3-25-10; 8:45 am]