Veterans Employment Pay for Success Grant Program, 37753-37756 [2020-11915]
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(2) Filers may access eCRB at https://
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§ 360.23
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[Removed]
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Subpart C—Rules of General
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§ 360.30
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Jesse M. Feder,
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Approved by:
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[FR Doc. 2020–13554 Filed 6–23–20; 8:45 am]
BILLING CODE 1410–72–P
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DEPARTMENT OF VETERANS
AFFAIRS
38 CFR Part 21
RIN 2900–AP72
Veterans Employment Pay for Success
Grant Program
AGENCY:
Department of Veterans Affairs.
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ACTION:
Final rule.
The Department of Veterans
Affairs (VA) established a grant program
(Veterans Employment Pay for Success
(VEPFS)) to award grants to eligible
entities to fund projects that are
successful in accomplishing
employment rehabilitation for Veterans
with service-connected disabilities. VA
will award grants on the basis of an
eligible entity’s proposed use of a Pay
for Success (PFS) strategy to achieve
goals. This final rule adopts with
changes an interim final rule that
established regulations for awarding a
VEPFS grant, including the general
process for awarding the grant, criteria
and parameters for evaluating grant
applications, priorities related to the
award of a grant, and general
requirements and guidance for
administering a VEPFS grant program.
DATES: This rule is effective on June 24,
2020.
FOR FURTHER INFORMATION CONTACT:
Mike Frueh, Deputy Assistant Secretary,
Planning and Performance Management,
(008A), Department of Veterans Affairs,
810 Vermont Ave. NW, Washington, DC,
(202) 632–8784. (This is not a toll-free
number.)
SUPPLEMENTARY INFORMATION: Section
3119 of title 38, United States Code,
authorizes the Secretary of Veterans
Affairs (Secretary) to make grants to or
contract with public or nonprofit
agencies, including institutions of
higher learning, to advance ‘‘the
knowledge, methods, techniques, and
resources available for use in
rehabilitation programs for veterans.’’
Section 3119 specifically authorizes the
Secretary to make grants to such
agencies to conduct or provide support
for projects which are ‘‘designed to
increase the resources and potential for
accomplishing the rehabilitation of
disabled veterans.’’ (See also
implementing regulation at 38 CFR
21.390.)
On August 10, 2016, VA published an
interim final rule in the Federal
Register, 81 FR 52770, under the
authority of sec. 3119 establishing
regulations for administering a VEPFS
grant program to award grants to eligible
entities to fund projects that are
successful in accomplishing
employment rehabilitation for Veterans
with service-connected disabilities. In
general, a PFS model is a strategy for
successfully attaining positive social or
environmental outcomes by paying for
an intervention to achieve such
outcomes only after the intervention
produces these outcomes. The interim
final rule included the general process
SUMMARY:
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for awarding the grant, criteria and
parameters for evaluating grant
applications, priorities related to the
award of a grant, and general
requirements and guidance for
administering a VEPFS grant program.
VA provided a 60-day public comment
period that ended on October 11, 2016,
and received nine comments from a
single entity.
The first comment recommended
amending the definition of
‘‘Employment outcome’’ to include
outcomes that occur ‘‘during’’ as well as
following the service period so that the
PFS agreement reflects the benefits of
the selected intervention while services
are provided. In addition, this comment
and the third comment recommended
amending the definitions of
‘‘Employment outcome’’ and ‘‘Outcomes
payments’’ to allow a PFS project
evaluation to be based on a
‘‘comparison’’ group in addition to a
‘‘control’’ group so there is greater
flexibility when structuring valid
evaluation methodologies. VA agrees
that if employment outcomes can be
measured during the service period, an
evaluator may be able to obtain useful
information that could assist with
determining whether employment
outcomes have improved across the
lifecycle of the project. It is feasible to
assume that some outcomes may be
achievable and measurable at any point
during the lifecycle of the service
period. VA believes measuring
outcomes during the service period may
allow for greater flexibility in
transaction structuring for outcomes
payments. In addition, VA agrees that
basing a project evaluation on a
comparison group or a control group
will allow for greater flexibility in
structuring evaluation methodologies.
Having greater flexibility in this regard
may allow for greater statistical power
when measuring outcomes and benefit
the VA program office when evaluating
the impact of the outcomes on future
rehabilitation policy and programming.
Therefore, we are amending the
definition of ‘‘Employment outcome’’ to
reflect that it means the employment or
earnings of a participant in an
intervention group or a control or
comparison group either during or after
a service period. We are further
amending this definition and the
definition of ‘‘Outcomes payments’’ to
indicate that comparison groups, in
addition to control groups, may be used
when structuring evaluation
methodologies.
The second comment proposed
adding a definition of ‘‘Outcome
metrics’’ and additional comments,
including the sixth comment,
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recommended adding the language,
‘‘outcomes metrics or’’ before ‘‘target
levels’’ in a number of the regulatory
sections in this rulemaking. ‘‘Outcomes
metrics or target levels’’ as a phrase does
not make sense. Outcomes are a kind of
result of interventional or noninterventional activities. Targets are a
hoped-for level of achievement for
various outcomes, or a characteristic of
outcomes, and are not part of an ‘‘either/
or’’ option. Therefore, we will not add
the language ‘‘outcomes metrics or’’ to
any of the regulatory provisions in this
rulemaking. Because we are not adding
this proposed language, there is no need
to add a definition for ‘‘Outcome
metrics.’’
The fourth comment recommended
clarifying that the project partnership
may be memorialized in more than one
agreement. We are amending the
definition of project partnership to
reflect that it may consist of multiple
agreements because allowing for
multiple agreements will provide the
project partnership with greater
flexibility.
The fifth comment recommended
allowing each VEPFS grant to establish
the minimum and maximum number of
years rather than requiring a minimum
5-year period for all VEPFS grants. VA’s
original vision for pay for success
programming did not account for
projects that may have a shorter
duration, such as feasibility studies or
studies that may require long-term
evaluation of certain employment
outcomes. To accommodate a broader
range of PFS projects with the increased
potential for better outcomes, VA agrees
that performance period minimums or
maximums should be established on a
per grant program basis. Thus, we are
amending § 21.442(c) to allow each
VEPFS grant agreement to establish the
project duration instead of setting a
required minimum period.
The seventh comment proposed to
eliminate the requirement that grantees
procure investors in a government
acquisition process following
procurement standards set forth in 2
CFR 200.317–200.326. The commenter
explained that, in typical PFS
arrangements to which it has been a
party, investors are not ‘‘procured’’ and
are not a party to the PFS agreement.
Typically, the government is not a party
to the investor financing agreements and
does not negotiate directly with
investors. The commenter explained
that investors do not provide services to
the government, but fund services to be
provided by the service provider and
bear the risk that the intervention will
not achieve the agreed upon outcomes
metrics. Thus, investors are recruited or
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engaged in a manner that befits their
role as risk-bearing entities in the PFS
model.
We agree to eliminate the requirement
that grant recipients ‘‘procure’’ investors
and follow procurement standards set
forth in 2 CFR 200.317–200.326.
Although the uniform grant regulations
at 2 CFR part 200 apply to recipients
(and subrecipients) of the PFS grants,
they do not contemplate investors as
playing a part in the grant agreement or
carrying out the purposes of the grant.
The procurement of goods and services
by way of contract is a key factor in
creating a procurement relationship. See
2 CFR 200.330(b). The Federal
Acquisition Regulations defining
‘‘procurement’’ and ‘‘acquisition’’
support the position that investors and
investments of capital are not
‘‘procured.’’ As the commenter
explained, because investors supply
money/funding, and do not provide
goods or services, obtaining investments
is not an acquisition or procurement as
contemplated by the uniform grant
regulations. While the funding investors
provide is used to procure goods or
services necessary to carry out the
grant’s purpose, neither the investor nor
the funding is a good or service that is
procured. Therefore, the uniform grant
regulations at 2 CFR part 200 should not
apply, and we agree to exclude
‘‘investors’’ from the requirement in
§ 21.445(b) that partner entities be
procured following procurement
standards set forth in 2 CFR 200.317–
200.326.
The eighth comment proposed to not
require grantees to identify investors at
the time of application. We see no
reason why grantees should not be able
to identify investors at the time of
application and the commenter has
provided no convincing reason. We do
not believe that excluding investors
from the procurement requirement
supports the argument that investors
should be identified later in the grant
process. Furthermore, identifying
investors later in the process would
introduce uncertainty into the overall
viability of the applicant’s proposed
project. Accordingly, we will not make
any changes based on this comment.
The ninth comment proposed to allow
VA and an applicant to negotiate a
cooperative agreement or a grant
agreement to provide flexibility in
finalizing the terms of the VEPFS grant.
As stated above, sec. 3119 provides the
authority for the Secretary to make these
VEPFS grants. It also provides authority
for the Secretary to contract with
entities to fund projects that are
successful in accomplishing
rehabilitation for Veterans with service-
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connected disabilities. However, there is
no authority for the Secretary to enter
into cooperative agreements to fund
such projects. As VA has no authority
to enter cooperative agreements for this
purpose, we must decline to change the
regulations to allow for the negotiation
of cooperative agreements between an
applicant and VA.
Based on the rationale set forth in the
interim final rule and in this document,
VA is adopting the provisions of the
interim final rule as a final rule with
changes, as noted above.
Administrative Procedure Act
The Secretary is issuing this rule
because there is a need to find new
methods for rehabilitating Veterans with
service-connected disabilities to become
employable and obtain and maintain
suitable employment. This rulemaking
serves an important Veterans’ need in
an economical way because it provides
the opportunity for discovering such
new methods using a strategy that will
save taxpayer money. However, funding
for a grant awarded under these
regulations was available to be obligated
within a limited timeframe. Therefore, it
was impracticable and contrary to the
public interest to delay the rule for the
purpose of soliciting advance public
comment or to have a delayed effective
date. Accordingly, VA issued an interim
final rule with an immediate effective
date and is now issuing this final rule
after having considered the comments
submitted.
Executive Orders 12866, 13563 and
13771
Executive Orders 12866 and 13563
direct agencies to assess the costs and
benefits of available regulatory
alternatives and, when regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, and other advantages;
distributive impacts; and equity).
Executive Order 13563 (Improving
Regulation and Regulatory Review)
emphasizes the importance of
quantifying both costs and benefits,
reducing costs, harmonizing rules, and
promoting flexibility. The Office of
Information and Regulatory Affairs has
determined that this rule is not a
significant regulatory action under
Executive Order 12866.
VA’s impact analysis can be found as
a supporting document at https://
www.regulations.gov, usually within 48
hours after the rulemaking document is
published. Additionally, a copy of the
rulemaking and its impact analysis are
available on VA’s website at https://
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www.va.gov/orpm/, by following the
link for ‘‘VA Regulations Published
From FY 2004 Through Fiscal Year to
Date.’’
This final rule is considered an E.O.
13771 regulatory action. Details on the
estimated costs of this final rule can be
found in the rule’s economic analysis.
Paperwork Reduction Act
Although this action contains
provisions constituting collections of
information at 38 CFR 21.445, 21.447,
and 21.448, under the provisions of the
Paperwork Reduction Act of 1995 (44
U.S.C. 3501–3521), no new or proposed
revised collections of information are
associated with this final rule. The
information collection requirements for
§§ 21.445, 21.447, and 21.448 are
currently approved by OMB and have
been assigned OMB control number
2900–0847.
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Regulatory Flexibility Act
The Secretary hereby certifies that
this final rule will not have a significant
economic impact on a substantial
number of small entities as they are
defined in the Regulatory Flexibility Act
(5 U.S.C. 601–612). The Secretary
estimates that, for any VEPFS grant
program, no more than ten nonrenewable grants will be awarded. For
each grant awarded, usually one of each,
but no more than a few, outcomes
payors, project coordinators, evaluators,
investors, and service providers will be
involved with the grant program. The
goal of these grants is to rehabilitate
Veterans with service-connected
disabilities with regard to employment.
Thus, an insubstantial number of small
entities will be affected by this final rule
and, accordingly, there will not be a
significant economic impact on such
affected entities. Therefore, pursuant to
5 U.S.C. 605(b), the initial and final
regulatory flexibility analysis
requirements of 5 U.S.C. 603 and 604 do
not apply.
Unfunded Mandates
The Unfunded Mandates Reform Act
of 1995 requires, at 2 U.S.C. 1532, that
agencies prepare an assessment of
anticipated costs and benefits before
issuing any rule that may result in the
expenditure by State, local, and tribal
governments, in the aggregate, or by the
private sector, of $100 million or more
(adjusted annually for inflation) in any
one year. This final rule will have no
such effect on State, local, and tribal
governments, or on the private sector.
Congressional Review Act
Pursuant to the Congressional Review
Act (5 U.S.C. 801 et seq.), the Office of
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Information and Regulatory Affairs
designated this rule as not a major rule,
as defined by 5 U.S.C. 804(2).
Catalog of Federal Domestic Assistance
The Catalog of Federal Domestic
Assistance number and title for the
program affected by this document is
64.116, Vocational Rehabilitation for
Disabled Veterans.
List of Subjects in 38 CFR Part 21
Administrative practice and
procedure, Armed forces, Civil rights,
Claims, Colleges and universities,
Conflict of interests, Defense
Department, Education, Employment,
Grant programs—education, Grant
programs—veterans, Health care, Loan
programs—education, Loan programs—
veterans, Manpower training programs,
Reporting and recordkeeping
requirements, Schools, Travel and
transportation expenses, Veterans,
Vocational education, Vocational
rehabilitation.
Signing Authority
The Secretary of Veterans Affairs
approved this document and authorized
the undersigned to sign and submit the
document to the Office of the Federal
Register for publication electronically as
an official document of the Department
of Veterans Affairs. Pamela Powers,
Chief of Staff, Performing the Delegable
Duties of the Deputy Secretary,
Department of Veterans Affairs,
approved this document on April 13,
2020, for publication.
Jeffrey M. Martin,
Assistant Director, Office of Regulation Policy
& Management, Office of the Secretary,
Department of Veterans Affairs.
Accordingly, the interim final rule
amending 38 CFR part 21, which
published at 81 FR 52770 on August 10,
2016, is adopted as final with the
following changes:
PART 21—VOCATIONAL
REHABILITATION AND EDUCATION
Subpart A—Vocational Rehabilitation
and Employment Under 38 U.S.C.
Chapter 31
1. The authority citation for part 21,
subpart A, continues to read as follows:
■
Authority: 38 U.S.C. 501(a), chs. 18, 31,
and as noted in specific sections.
2. In § 21.441, revise the definitions of
‘‘Employment outcome’’ and ‘‘Outcomes
payments’’ and the introductory text of
the definition of ‘‘Project partnership’’
to read as follows:
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§ 21.441
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Definitions.
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Employment outcome is the
employment or earnings of a participant
in an intervention group or control or
comparison group during or after the
service period. Improving employment
outcomes means creating positive
impact in terms of these outcomes,
where the results for individuals that
receive the intervention are better than
the results for a valid control or
comparison group that did not receive
the intervention.
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Outcomes payments are funds that are
paid to an investor or service provider
and that are released only for the
achievement of outcomes, as compared
to those of a control or comparison
group, that meet target levels that have
been agreed to in advance of the
provision of intervention (i.e., if positive
impact has been created by the
intervention in terms of these
outcomes). When investors have
provided the upfront capital for the
project, these payments generally cover
repayment of the principal investment
and provide a modest return on
investment for any associated risks of
paying for the intervention upfront.
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Project partnership is a collaboration
among entities that negotiate one or
more agreements and execute a project
to improve employment outcomes for
Veterans with service-connected
disabilities. The entities that may be
involved in a project partnership
include:
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3. In § 21.442, revise paragraph (c) to
read as follows:
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§ 21.442
VEPFS grants—general.
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(c) A VEPFS grant will be awarded for
a minimum and maximum number of
years that is specified in the VEPFS
grant agreement, beginning on the date
on which the VEPFS grant is awarded,
with the availability of no-cost
extensions.
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4. In § 21.445, revise paragraph (b) to
read as follows:
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§ 21.445
Application.
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(b) Description of anticipated project
partnership(s), including the
responsibilities of each of the partner
entities, the experience of any involved
entities with serving Veteran
populations, and other qualifications of
the involved entities that may be
relevant in carrying out responsibilities
of the project partnership. In
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establishing the project partnership,
entities, including the project
coordinator, evaluator, and service
provider, but excluding investors, must
be procured following procurement
standards set forth in 2 CFR 200.317
through 200.326.
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[FR Doc. 2020–11915 Filed 6–23–20; 8:45 am]
BILLING CODE 8320–01–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Part 81
Table of Contents
[EPA–R09–OAR–2020–0151; FRL–10010–
56–Region 9]
Finding of Failure To Attain the 1987
24-Hour PM10 Standard;
Reclassification as Serious
Nonattainment; Pinal County, Arizona
Environmental Protection
Agency (EPA).
ACTION: Final rule.
AGENCY:
The Environmental Protection
Agency (EPA) is taking final action to
determine that the West Pinal County,
Arizona nonattainment area did not
attain the 1987 24-hour national
ambient air quality standards (NAAQS
or ‘‘standard’’) for particulate matter
with a diameter of ten micrometers or
smaller (PM10) by December 31, 2018,
the statutory attainment date for the
nonattainment area. This action is based
on the EPA’s calculation of the PM10
design value for the nonattainment area
over the 2016–2018 period, using
complete, quality-assured, and certified
PM10 monitoring data. With this final
determination that West Pinal County
has failed to attain the PM10 NAAQS by
its attainment date, the Clean Air Act
(CAA) section 188(b)(2) requires that the
nonattainment area be reclassified to
Serious by operation of law. Within 18
months from the effective date of this
reclassification to Serious, the State
must submit State Implementation Plan
(SIP) revisions that comply with the
statutory and regulatory requirements
for Serious PM10 nonattainment areas.
DATES: This rule will be effective on July
24, 2020.
ADDRESSES: The EPA has established a
docket for this action under Docket ID
No. EPA–R09–OAR–2020–0151. All
documents in the docket are listed on
the https://www.regulations.gov
website. Although listed in the index,
some information is not publicly
available, e.g., Confidential Business
Information (CBI) or other information
whose disclosure is restricted by statute.
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SUMMARY:
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Certain other material, such as
copyrighted material, is not placed on
the internet and will be publicly
available only in hard copy form.
Publicly available docket materials are
available through https://
www.regulations.gov, or please contact
the person identified in the FOR FURTHER
INFORMATION CONTACT section for
additional availability information.
FOR FURTHER INFORMATION CONTACT: Jerry
Wamsley, EPA Region IX, (415) 947–
4111, wamsley.jerry@epa.gov.
SUPPLEMENTARY INFORMATION:
Throughout this document, ‘‘we’’, ‘‘us’’,
and ‘‘our’’ refer to the EPA.
I. Summary of the Proposed Action
II. Public Comments and EPA Responses
III. Final Action
IV. Statutory and Executive Order Reviews
I. Summary of the Proposed Action
On April 7, 2020, the EPA proposed
to determine that the West Pinal County
nonattainment area failed to attain the
1987 24-hour PM10 NAAQS by
December 31, 2018, the statutory
attainment date for the area.1 For a PM10
nonattainment area classified as
Moderate under the CAA, such as the
West Pinal County area, section 188(c)
of the CAA states that the area’s
attainment date is ‘‘as expeditiously as
practicable, but no later than the end of
the sixth calendar year after the area’s
designation as nonattainment.’’
Consequently, the applicable attainment
date for West Pinal County, designated
nonattainment in 2012, was December
31, 2018. CAA section 188(b)(2) requires
the EPA to determine whether any PM10
nonattainment area classified as
Moderate attained the 24-hour PM10
NAAQS by the area’s attainment date
and requires the EPA to make such a
determination within six months after
that date.
Our proposed determination that the
West Pinal County area failed to attain
the PM10 NAAQS was based on
complete, quality-assured, and certified
PM10 monitoring data for the
appropriate three-year period, 2016–
2018. As discussed in our proposal, an
area attains the 24-hour PM10 standard
of 150 micrograms per cubic meter (mg/
m3) when the expected number of days
per calendar year with a 24-hour
concentration exceeding the standard,
referred to as an ‘‘exceedance’’, averaged
over a three-year period is equal to or
less than one.
In our proposal, the EPA’s evaluation
of whether the West Pinal County
nonattainment area has met the 1987 241 85
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hour PM10 NAAQS was based on our
review of the monitoring data, the
adequacy of the PM10 monitoring
network in the nonattainment area, and
the reliability of the data collected by
that network. The PM10 standard is
attained when the expected number of
exceedances, averaged over a three-year
period, is less than or equal to one. The
expected number of exceedances
averaged over a three-year period at any
given monitor is known as the PM10
design value for that site. The PM10
design value for the nonattainment area
is the highest design value from a
monitor within that area. Three
consecutive years of air quality data are
required to show attainment of the PM10
standard.
We reviewed the 2018 PM10 design
values for all regulatory monitoring sites
measuring PM10 within the West Pinal
County nonattainment area, expressed
as a single value representing the
average expected exceedances over the
three-year period, 2016–2018.2 The
PM10 data showed that the design values
at multiple monitoring sites are greater
than 1.0 estimated annual average
exceedances of the 1987 24-hour PM10
NAAQS. Consequently, the EPA
proposed to determine, based upon
three years of complete, quality-assured
and certified data from 2016–2018, that
the West Pinal County nonattainment
area did not attain the 1987 24-hour
PM10 NAAQS by the applicable
attainment date of December 31, 2018.
In our proposal to determine that the
West Pinal County area did not attain
the NAAQS by the relevant attainment
date, the EPA noted that the
consequence of our determination is
that the West Pinal County area will be
reclassified as a Serious PM10
nonattainment area by operation of law
and will be subject to all applicable
Serious area attainment planning and
nonattainment New Source Review
requirements. This includes the
requirement to submit a Serious area air
quality plan within 18 months of the
effective date of our final rule, per
section 189(b)(2) of the CAA. This
Serious area air quality plan must
demonstrate attainment of the 24-hour
PM10 NAAQS by December 31, 2022,
ten years after the area’s designation to
nonattainment, per section 188(c)(2) of
the CAA.
2 A design value is calculated using a specific
methodology from monitored air quality data and
is used to compare an area’s air quality to a
NAAQS. The methodologies for calculating
expected exceedances for the 24-hour PM10 NAAQS
are found in 40 CFR part 50, Appendix K, Section
2.1(a).
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]]>Agencies
[Federal Register Volume 85, Number 122 (Wednesday, June 24, 2020)]
[Rules and Regulations]
[Pages 37753-37756]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-11915]
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DEPARTMENT OF VETERANS AFFAIRS
38 CFR Part 21
RIN 2900-AP72
Veterans Employment Pay for Success Grant Program
AGENCY: Department of Veterans Affairs.
ACTION: Final rule.
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SUMMARY: The Department of Veterans Affairs (VA) established a grant
program (Veterans Employment Pay for Success (VEPFS)) to award grants
to eligible entities to fund projects that are successful in
accomplishing employment rehabilitation for Veterans with service-
connected disabilities. VA will award grants on the basis of an
eligible entity's proposed use of a Pay for Success (PFS) strategy to
achieve goals. This final rule adopts with changes an interim final
rule that established regulations for awarding a VEPFS grant, including
the general process for awarding the grant, criteria and parameters for
evaluating grant applications, priorities related to the award of a
grant, and general requirements and guidance for administering a VEPFS
grant program.
DATES: This rule is effective on June 24, 2020.
FOR FURTHER INFORMATION CONTACT: Mike Frueh, Deputy Assistant
Secretary, Planning and Performance Management, (008A), Department of
Veterans Affairs, 810 Vermont Ave. NW, Washington, DC, (202) 632-8784.
(This is not a toll-free number.)
SUPPLEMENTARY INFORMATION: Section 3119 of title 38, United States
Code, authorizes the Secretary of Veterans Affairs (Secretary) to make
grants to or contract with public or nonprofit agencies, including
institutions of higher learning, to advance ``the knowledge, methods,
techniques, and resources available for use in rehabilitation programs
for veterans.'' Section 3119 specifically authorizes the Secretary to
make grants to such agencies to conduct or provide support for projects
which are ``designed to increase the resources and potential for
accomplishing the rehabilitation of disabled veterans.'' (See also
implementing regulation at 38 CFR 21.390.)
On August 10, 2016, VA published an interim final rule in the
Federal Register, 81 FR 52770, under the authority of sec. 3119
establishing regulations for administering a VEPFS grant program to
award grants to eligible entities to fund projects that are successful
in accomplishing employment rehabilitation for Veterans with service-
connected disabilities. In general, a PFS model is a strategy for
successfully attaining positive social or environmental outcomes by
paying for an intervention to achieve such outcomes only after the
intervention produces these outcomes. The interim final rule included
the general process for awarding the grant, criteria and parameters for
evaluating grant applications, priorities related to the award of a
grant, and general requirements and guidance for administering a VEPFS
grant program. VA provided a 60-day public comment period that ended on
October 11, 2016, and received nine comments from a single entity.
The first comment recommended amending the definition of
``Employment outcome'' to include outcomes that occur ``during'' as
well as following the service period so that the PFS agreement reflects
the benefits of the selected intervention while services are provided.
In addition, this comment and the third comment recommended amending
the definitions of ``Employment outcome'' and ``Outcomes payments'' to
allow a PFS project evaluation to be based on a ``comparison'' group in
addition to a ``control'' group so there is greater flexibility when
structuring valid evaluation methodologies. VA agrees that if
employment outcomes can be measured during the service period, an
evaluator may be able to obtain useful information that could assist
with determining whether employment outcomes have improved across the
lifecycle of the project. It is feasible to assume that some outcomes
may be achievable and measurable at any point during the lifecycle of
the service period. VA believes measuring outcomes during the service
period may allow for greater flexibility in transaction structuring for
outcomes payments. In addition, VA agrees that basing a project
evaluation on a comparison group or a control group will allow for
greater flexibility in structuring evaluation methodologies. Having
greater flexibility in this regard may allow for greater statistical
power when measuring outcomes and benefit the VA program office when
evaluating the impact of the outcomes on future rehabilitation policy
and programming. Therefore, we are amending the definition of
``Employment outcome'' to reflect that it means the employment or
earnings of a participant in an intervention group or a control or
comparison group either during or after a service period. We are
further amending this definition and the definition of ``Outcomes
payments'' to indicate that comparison groups, in addition to control
groups, may be used when structuring evaluation methodologies.
The second comment proposed adding a definition of ``Outcome
metrics'' and additional comments, including the sixth comment,
[[Page 37754]]
recommended adding the language, ``outcomes metrics or'' before
``target levels'' in a number of the regulatory sections in this
rulemaking. ``Outcomes metrics or target levels'' as a phrase does not
make sense. Outcomes are a kind of result of interventional or non-
interventional activities. Targets are a hoped-for level of achievement
for various outcomes, or a characteristic of outcomes, and are not part
of an ``either/or'' option. Therefore, we will not add the language
``outcomes metrics or'' to any of the regulatory provisions in this
rulemaking. Because we are not adding this proposed language, there is
no need to add a definition for ``Outcome metrics.''
The fourth comment recommended clarifying that the project
partnership may be memorialized in more than one agreement. We are
amending the definition of project partnership to reflect that it may
consist of multiple agreements because allowing for multiple agreements
will provide the project partnership with greater flexibility.
The fifth comment recommended allowing each VEPFS grant to
establish the minimum and maximum number of years rather than requiring
a minimum 5-year period for all VEPFS grants. VA's original vision for
pay for success programming did not account for projects that may have
a shorter duration, such as feasibility studies or studies that may
require long-term evaluation of certain employment outcomes. To
accommodate a broader range of PFS projects with the increased
potential for better outcomes, VA agrees that performance period
minimums or maximums should be established on a per grant program
basis. Thus, we are amending Sec. 21.442(c) to allow each VEPFS grant
agreement to establish the project duration instead of setting a
required minimum period.
The seventh comment proposed to eliminate the requirement that
grantees procure investors in a government acquisition process
following procurement standards set forth in 2 CFR 200.317-200.326. The
commenter explained that, in typical PFS arrangements to which it has
been a party, investors are not ``procured'' and are not a party to the
PFS agreement. Typically, the government is not a party to the investor
financing agreements and does not negotiate directly with investors.
The commenter explained that investors do not provide services to the
government, but fund services to be provided by the service provider
and bear the risk that the intervention will not achieve the agreed
upon outcomes metrics. Thus, investors are recruited or engaged in a
manner that befits their role as risk-bearing entities in the PFS
model.
We agree to eliminate the requirement that grant recipients
``procure'' investors and follow procurement standards set forth in 2
CFR 200.317-200.326. Although the uniform grant regulations at 2 CFR
part 200 apply to recipients (and subrecipients) of the PFS grants,
they do not contemplate investors as playing a part in the grant
agreement or carrying out the purposes of the grant. The procurement of
goods and services by way of contract is a key factor in creating a
procurement relationship. See 2 CFR 200.330(b). The Federal Acquisition
Regulations defining ``procurement'' and ``acquisition'' support the
position that investors and investments of capital are not
``procured.'' As the commenter explained, because investors supply
money/funding, and do not provide goods or services, obtaining
investments is not an acquisition or procurement as contemplated by the
uniform grant regulations. While the funding investors provide is used
to procure goods or services necessary to carry out the grant's
purpose, neither the investor nor the funding is a good or service that
is procured. Therefore, the uniform grant regulations at 2 CFR part 200
should not apply, and we agree to exclude ``investors'' from the
requirement in Sec. 21.445(b) that partner entities be procured
following procurement standards set forth in 2 CFR 200.317-200.326.
The eighth comment proposed to not require grantees to identify
investors at the time of application. We see no reason why grantees
should not be able to identify investors at the time of application and
the commenter has provided no convincing reason. We do not believe that
excluding investors from the procurement requirement supports the
argument that investors should be identified later in the grant
process. Furthermore, identifying investors later in the process would
introduce uncertainty into the overall viability of the applicant's
proposed project. Accordingly, we will not make any changes based on
this comment.
The ninth comment proposed to allow VA and an applicant to
negotiate a cooperative agreement or a grant agreement to provide
flexibility in finalizing the terms of the VEPFS grant. As stated
above, sec. 3119 provides the authority for the Secretary to make these
VEPFS grants. It also provides authority for the Secretary to contract
with entities to fund projects that are successful in accomplishing
rehabilitation for Veterans with service-connected disabilities.
However, there is no authority for the Secretary to enter into
cooperative agreements to fund such projects. As VA has no authority to
enter cooperative agreements for this purpose, we must decline to
change the regulations to allow for the negotiation of cooperative
agreements between an applicant and VA.
Based on the rationale set forth in the interim final rule and in
this document, VA is adopting the provisions of the interim final rule
as a final rule with changes, as noted above.
Administrative Procedure Act
The Secretary is issuing this rule because there is a need to find
new methods for rehabilitating Veterans with service-connected
disabilities to become employable and obtain and maintain suitable
employment. This rulemaking serves an important Veterans' need in an
economical way because it provides the opportunity for discovering such
new methods using a strategy that will save taxpayer money. However,
funding for a grant awarded under these regulations was available to be
obligated within a limited timeframe. Therefore, it was impracticable
and contrary to the public interest to delay the rule for the purpose
of soliciting advance public comment or to have a delayed effective
date. Accordingly, VA issued an interim final rule with an immediate
effective date and is now issuing this final rule after having
considered the comments submitted.
Executive Orders 12866, 13563 and 13771
Executive Orders 12866 and 13563 direct agencies to assess the
costs and benefits of available regulatory alternatives and, when
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, and other advantages; distributive impacts;
and equity). Executive Order 13563 (Improving Regulation and Regulatory
Review) emphasizes the importance of quantifying both costs and
benefits, reducing costs, harmonizing rules, and promoting flexibility.
The Office of Information and Regulatory Affairs has determined that
this rule is not a significant regulatory action under Executive Order
12866.
VA's impact analysis can be found as a supporting document at
https://www.regulations.gov, usually within 48 hours after the
rulemaking document is published. Additionally, a copy of the
rulemaking and its impact analysis are available on VA's website at
https://
[[Page 37755]]
www.va.gov/orpm/, by following the link for ``VA Regulations Published
From FY 2004 Through Fiscal Year to Date.''
This final rule is considered an E.O. 13771 regulatory action.
Details on the estimated costs of this final rule can be found in the
rule's economic analysis.
Paperwork Reduction Act
Although this action contains provisions constituting collections
of information at 38 CFR 21.445, 21.447, and 21.448, under the
provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3521), no new or proposed revised collections of information are
associated with this final rule. The information collection
requirements for Sec. Sec. 21.445, 21.447, and 21.448 are currently
approved by OMB and have been assigned OMB control number 2900-0847.
Regulatory Flexibility Act
The Secretary hereby certifies that this final rule will not have a
significant economic impact on a substantial number of small entities
as they are defined in the Regulatory Flexibility Act (5 U.S.C. 601-
612). The Secretary estimates that, for any VEPFS grant program, no
more than ten non-renewable grants will be awarded. For each grant
awarded, usually one of each, but no more than a few, outcomes payors,
project coordinators, evaluators, investors, and service providers will
be involved with the grant program. The goal of these grants is to
rehabilitate Veterans with service-connected disabilities with regard
to employment. Thus, an insubstantial number of small entities will be
affected by this final rule and, accordingly, there will not be a
significant economic impact on such affected entities. Therefore,
pursuant to 5 U.S.C. 605(b), the initial and final regulatory
flexibility analysis requirements of 5 U.S.C. 603 and 604 do not apply.
Unfunded Mandates
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C.
1532, that agencies prepare an assessment of anticipated costs and
benefits before issuing any rule that may result in the expenditure by
State, local, and tribal governments, in the aggregate, or by the
private sector, of $100 million or more (adjusted annually for
inflation) in any one year. This final rule will have no such effect on
State, local, and tribal governments, or on the private sector.
Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this rule
as not a major rule, as defined by 5 U.S.C. 804(2).
Catalog of Federal Domestic Assistance
The Catalog of Federal Domestic Assistance number and title for the
program affected by this document is 64.116, Vocational Rehabilitation
for Disabled Veterans.
List of Subjects in 38 CFR Part 21
Administrative practice and procedure, Armed forces, Civil rights,
Claims, Colleges and universities, Conflict of interests, Defense
Department, Education, Employment, Grant programs--education, Grant
programs--veterans, Health care, Loan programs--education, Loan
programs--veterans, Manpower training programs, Reporting and
recordkeeping requirements, Schools, Travel and transportation
expenses, Veterans, Vocational education, Vocational rehabilitation.
Signing Authority
The Secretary of Veterans Affairs approved this document and
authorized the undersigned to sign and submit the document to the
Office of the Federal Register for publication electronically as an
official document of the Department of Veterans Affairs. Pamela Powers,
Chief of Staff, Performing the Delegable Duties of the Deputy
Secretary, Department of Veterans Affairs, approved this document on
April 13, 2020, for publication.
Jeffrey M. Martin,
Assistant Director, Office of Regulation Policy & Management, Office of
the Secretary, Department of Veterans Affairs.
Accordingly, the interim final rule amending 38 CFR part 21, which
published at 81 FR 52770 on August 10, 2016, is adopted as final with
the following changes:
PART 21--VOCATIONAL REHABILITATION AND EDUCATION
Subpart A--Vocational Rehabilitation and Employment Under 38 U.S.C.
Chapter 31
0
1. The authority citation for part 21, subpart A, continues to read as
follows:
Authority: 38 U.S.C. 501(a), chs. 18, 31, and as noted in
specific sections.
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2. In Sec. 21.441, revise the definitions of ``Employment outcome''
and ``Outcomes payments'' and the introductory text of the definition
of ``Project partnership'' to read as follows:
Sec. 21.441 Definitions.
* * * * *
Employment outcome is the employment or earnings of a participant
in an intervention group or control or comparison group during or after
the service period. Improving employment outcomes means creating
positive impact in terms of these outcomes, where the results for
individuals that receive the intervention are better than the results
for a valid control or comparison group that did not receive the
intervention.
* * * * *
Outcomes payments are funds that are paid to an investor or service
provider and that are released only for the achievement of outcomes, as
compared to those of a control or comparison group, that meet target
levels that have been agreed to in advance of the provision of
intervention (i.e., if positive impact has been created by the
intervention in terms of these outcomes). When investors have provided
the upfront capital for the project, these payments generally cover
repayment of the principal investment and provide a modest return on
investment for any associated risks of paying for the intervention
upfront.
* * * * *
Project partnership is a collaboration among entities that
negotiate one or more agreements and execute a project to improve
employment outcomes for Veterans with service-connected disabilities.
The entities that may be involved in a project partnership include:
* * * * *
0
3. In Sec. 21.442, revise paragraph (c) to read as follows:
Sec. 21.442 VEPFS grants--general.
* * * * *
(c) A VEPFS grant will be awarded for a minimum and maximum number
of years that is specified in the VEPFS grant agreement, beginning on
the date on which the VEPFS grant is awarded, with the availability of
no-cost extensions.
* * * * *
0
4. In Sec. 21.445, revise paragraph (b) to read as follows:
Sec. 21.445 Application.
* * * * *
(b) Description of anticipated project partnership(s), including
the responsibilities of each of the partner entities, the experience of
any involved entities with serving Veteran populations, and other
qualifications of the involved entities that may be relevant in
carrying out responsibilities of the project partnership. In
[[Page 37756]]
establishing the project partnership, entities, including the project
coordinator, evaluator, and service provider, but excluding investors,
must be procured following procurement standards set forth in 2 CFR
200.317 through 200.326.
* * * * *
[FR Doc. 2020-11915 Filed 6-23-20; 8:45 am]
BILLING CODE 8320-01-P
