The Secretary shall—

(1) make allotments and grants from the amount appropriated under section 3181(b) of this title for a fiscal year in accordance with subsection (b)(1); and

reserve 20 percent of the amount appropriated under section 3181(c) of this title for the fiscal year for use under subsection (b)(2)(A), and under sections 3223(b) (relating to dislocated worker technical assistance), 3224(c) (relating to dislocated worker projects), and 3225 of this title (relating to national dislocated worker grants); and

(A) reserve 20 percent of the amount appropriated under section 3181(c) of this title for the fiscal year for use under subsection (b)(2)(A), and under sections 3223(b) (relating to dislocated worker technical assistance), 3224(c) (relating to dislocated worker projects), and 3225 of this title (relating to national dislocated worker grants); and

(B) make allotments from 80 percent of the amount appropriated under section 3181(c) of this title for the fiscal year in accordance with subsection (b)(2)(B).

Subject to clauses (iii) and (iv), of the remainder—

Subject to clauses (iii) and (iv), of the remainder—

(A) Reservation for outlying areas (i) In general From the amount made available under subsection (a)(1) for a fiscal year, the Secretary shall reserve not more than ¼ of 1 percent of such amount to provide assistance to the outlying areas. (ii) Applicability of additional requirements From the amount reserved under clause (i), the Secretary shall provide assistance to the outlying areas for adult employment and training activities and statewide workforce investment activities in accordance with the requirements of section 3162(b)(1)(B) of this title.

(B) States (i) In general After determining the amount to be reserved under subparagraph (A), the Secretary shall allot the remainder of the amount made available under subsection (a)(1) for that fiscal year to the States pursuant to clause (ii) for adult employment and training activities and statewide workforce investment activities. (ii) FormulaSubject to clauses (iii) and (iv), of the remainder— (I) 33⅓ percent shall be allotted on the basis of the relative number of unemployed individuals in areas of substantial unemployment in each State, compared to the total number of unemployed individuals in areas of substantial unemployment in all States; (II) 33⅓ percent shall be allotted on the basis of the relative excess number of unemployed individuals in each State, compared to the total excess number of unemployed individuals in all States; and (III) 33⅓ percent shall be allotted on the basis of the relative number of disadvantaged adults in each State, compared to the total number of disadvantaged adults in all States, except as described in clause (iii). (iii) CalculationIn determining an allotment under clause (ii)(III) for any State in which there is an area that was designated as a local area as described in section 3122(c)(1)(C) of this title, the allotment shall be based on the higher of— (I) the number of adults in families with an income below the low-income level in such area; or (II) the number of disadvantaged adults in such area. (iv) Minimum and maximum percentages and minimum allotmentsIn making allotments under this subparagraph, the Secretary shall ensure the following: (I) Minimum percentage and allotment Subject to subclause (IV), the Secretary shall ensure that no State shall receive an allotment for a fiscal year that is less than an amount based on 90 percent of the allotment percentage of the State for the preceding fiscal year. (II) Small State minimum allotmentSubject to subclauses (I), (III), and (IV), the Secretary shall ensure that no State shall receive an allotment under this subparagraph that is less than the total of— (aa) 3⁄10 of 1 percent of $960,000,000 of the remainder described in clause (i) for the fiscal year; and (bb) if the remainder described in clause (i) for the fiscal year exceeds $960,000,000, ⅖ of 1 percent of the excess. (III) Maximum percentage Subject to subclause (I), the Secretary shall ensure that no State shall receive an allotment percentage for a fiscal year that is more than 130 percent of the allotment percentage of the State for the preceding fiscal year. (IV) Minimum funding In any fiscal year in which the remainder described in clause (i) does not exceed $960,000,000, the minimum allotments under subclauses (I) and (II) shall be calculated by the methodology specified in section 132(b)(1)(B)(iv)(IV) of the Workforce Investment Act of 1998 [29 U.S.C. 2862(b)(1)(B)(iv)(IV)] (as in effect on the day before July 22, 2014). (v) DefinitionsFor the purpose of the formula specified in this subparagraph: (I) Adult The term “adult” means an individual who is not less than age 22 and not more than age 72. (II) Allotment percentage The term “allotment percentage”, used with respect to fiscal year 2015 or a subsequent fiscal year, means a percentage of the remainder described in clause (i) that is received through an allotment made under this subparagraph for the fiscal year. The term, used with respect to fiscal year 2014, means the percentage of the amount allotted to States under section 132(b)(1)(B) of the Workforce Investment Act of 1998 [29 U.S.C. 2862(b)(1)(B)] (as in effect on the day before July 22, 2014) that is received under such section by the State involved for fiscal year 2014. (III) Area of substantial unemployment The term “area of substantial unemployment” means any area that is of sufficient size and scope to sustain a program of workforce investment activities carried out under this part and that has an average rate of unemployment of at least 6.5 percent for the most recent 12 months, as determined by the Secretary. For purposes of this subclause, determinations of areas of substantial unemployment shall be made once each fiscal year. (IV) Disadvantaged adultSubject to subclause (V), the term “disadvantaged adult” means an adult who received an income, or is a member of a family that received a total family income, that, in relation to family size, does not exceed the higher of— (aa) the poverty line; or (bb) 70 percent of the lower living standard income level. (V) Disadvantaged adult special rule The Secretary shall, as appropriate and to the extent practicable, exclude college students and members of the Armed Forces from the determination of the number of disadvantaged adults. (VI) Excess numberThe term “excess number” means, used with respect to the excess number of unemployed individuals within a State, the higher of— (aa) the number that represents the number of unemployed individuals in excess of 4.5 percent of the civilian labor force in the State; or (bb) the number that represents the number of unemployed individuals in excess of 4.5 percent of the civilian labor force in areas of substantial unemployment in such State. (VII) Low-income level The term “low-income level” means $7,000 with respect to income in 1969, and for any later year means that amount that bears the same relationship to $7,000 as the Consumer Price Index for that year bears to the Consumer Price Index for 1969, rounded to the nearest $1,000.

Subject to clause (iii), of the amount—

(A) Reservation for outlying areas (i) In general From the amount made available under subsection (a)(2)(A) for a fiscal year, the Secretary shall reserve not more than ¼ of 1 percent of the amount appropriated under section 3181(c) of this title for the fiscal year to provide assistance to the outlying areas. (ii) Applicability of additional requirements From the amount reserved under clause (i), the Secretary shall provide assistance to the outlying areas for dislocated worker employment and training activities and statewide workforce investment activities in accordance with the requirements of section 3162(b)(1)(B) of this title.

(B) States (i) In general The Secretary shall allot the amount referred to in subsection (a)(2)(B) for a fiscal year to the States pursuant to clause (ii) for dislocated worker employment and training activities and statewide workforce investment activities. (ii) FormulaSubject to clause (iii), of the amount— (I) 33⅓ percent shall be allotted on the basis of the relative number of unemployed individuals in each State, compared to the total number of unemployed individuals in all States; (II) 33⅓ percent shall be allotted on the basis of the relative excess number of unemployed individuals in each State, compared to the total excess number of unemployed individuals in all States; and (III) 33⅓ percent shall be allotted on the basis of the relative number of individuals in each State who have been unemployed for 15 weeks or more, compared to the total number of individuals in all States who have been unemployed for 15 weeks or more. (iii) Minimum and maximum percentages and minimum allotmentsIn making allotments under this subparagraph, for fiscal year 2016 and each subsequent fiscal year, the Secretary shall ensure the following: (I) Minimum percentage and allotment The Secretary shall ensure that no State shall receive an allotment for a fiscal year that is less than an amount based on 90 percent of the allotment percentage of the State for the preceding fiscal year. (II) Maximum percentage Subject to subclause (I), the Secretary shall ensure that no State shall receive an allotment percentage for a fiscal year that is more than 130 percent of the allotment percentage of the State for the preceding fiscal year. (iv) DefinitionsFor the purpose of the formula specified in this subparagraph: (I) Allotment percentage The term “allotment percentage”, used with respect to fiscal year 2015 or a subsequent fiscal year, means a percentage of the amount described in clause (i) that is received through an allotment made under this subparagraph for the fiscal year. (II) Excess number The term “excess number” means, used with respect to the excess number of unemployed individuals within a State, the number that represents the number of unemployed individuals in excess of 4.5 percent of the civilian labor force in the State.

For purposes of this subsection, an eligible State means—

(1) In general The Secretary shall, in accordance with this subsection, reallot to eligible States amounts that are made available to States from allotments made under this section or a corresponding provision of the Workforce Investment Act of 1998 for employment and training activities and statewide workforce investment activities (referred to individually in this subsection as a “State allotment”) and that are available for reallotment.

(2) Amount The amount available for reallotment for a program year for programs funded under subsection (b)(1)(B) (relating to adult employment and training) or for programs funded under subsection (b)(2)(B) (relating to dislocated worker employment and training) is equal to the amount by which the unobligated balance of the State allotments for adult employment and training activities or dislocated worker employment and training activities, respectively, at the end of the program year prior to the program year for which the determination under this paragraph is made, exceeds 20 percent of such allotments for the prior program year.

(3) Reallotment In making reallotments to eligible States of amounts available pursuant to paragraph (2) for a program year, the Secretary shall allot to each eligible State an amount based on the relative amount of the State allotment under paragraph (1)(B) or (2)(B), respectively, of subsection (b) for the program year for which the determination is made, as compared to the total amount of the State allotments under paragraph (1)(B) or (2)(B), respectively, of subsection (b) for all eligible States for such program year.

For purposes of this subsection, an eligible State means—

(A) with respect to funds allotted through a State allotment for adult employment and training activities, a State that does not have an amount of such funds available for reallotment under paragraph (2) for the program year for which the determination under paragraph (2) is made; and

(B) with respect to funds allotted through a State allotment for dislocated worker employment and training activities, a State that does not have an amount of such funds available for reallotment under paragraph (2) for the program year for which the determination under paragraph (2) is made.

(5) Procedures The Governor shall prescribe uniform procedures for the obligation of funds by local areas within the State in order to avoid the requirement that funds be made available for reallotment under this subsection. The Governor shall further prescribe equitable procedures for making funds available from the State and local areas in the event that a State is required to make funds available for reallotment under this subsection.

(Pub. L. 113–128, title I, § 132, July 22, 2014, 128 Stat. 1511; Pub. L. 114–18, § 2(d), May 22, 2015, 129 Stat. 213.)