DIRECTIVE	:	UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 21-97
TO	:	ALL STATE EMPLOYMENT SECURITY AGENCIES
FROM	:	GRACE A. KILBANE Director Unemployment Insurance Service
SUBJECT	:	Procedures for the Transfer of State Unemployment Insurance (UI) Resources for State-specific Services Provided by the UI Information Technology Support Center (ITSC)

1. Purpose. To promulgate the subject procedures.

2. Background. The Unemployment Insurance Service (UIS) established the ITSC in September 1994 as a national resource to assist the State Employment Security Agencies (SESAs) in applying automation and information technology solutions to meet the needs of the UI program. The ITSC is a joint project between the Department of Labor and a consortium consisting of the State of Maryland, the Mitretek Corporation, Lockheed Martin Corporation, and the University of Maryland. The Maryland SESA administers the cooperative agreement, which is funded through a grant to the State via Region III, which acts as the grantor.

   The ITSC's goals are to help the SESAs:

   • improve program performance and services to claimants and employers,

   • lower operating costs, and

   • improve coordination and interaction with other employment and training and related programs.

   The ITSC's projects focus on using information technology to facilitate automation advances for the largest number of SESAs at the lowest possible cost. The ITSC has directed its primary efforts toward using information technology to improve service in appeals, tax operations, and claims processing.

   The ITSC Steering Committee, consisting primarily of SESA ADP Chiefs and UI Directors, acts as a board of directors for the ITSC and establishes policies and guidelines for the ITSC's projects and activities. The ITSC Charter, which specifies that the ITSC's projects should benefit the entire UI system and not just specific SESAs, recognizes that SESAs may wish to use the unique technical assistance capabilities of the ITSC. Article VI of the ITSC Charter allows for the separate funding of State-specific projects by States provided that the Steering Committee review and approve such projects in advance to ensure consistency with the ITSC Charter and ITSC goals and objectives. ETA has been asked to provide guidelines on how States may obtain technical assistance regarding UI and UI-related activities directly from the ITSC.

3. Direct State Use of ITSC Services. SESAs may use either of the two methods to obtain the ITSC's services directly:

   a.  SESAs may contract directly for the ITSC's services with Mitretek Corporation, which is the lead entity in the ITSC consortium. After obtaining ITSC Steering Committee approval, these SESAs should contact Mitretek Corporation and directly negotiate a mutually agreeable contract agreement. SESAs interested in this method should contact Mr. Henry James at 301-982-1575.

   b.  SESAs may request deobligation of UI administrative grant funds for transfer to the Maryland SESA for use by the ITSC. SESAs wishing to use this method should send to their Regional Office: (1) a request that specifies the amount of State Administration resources that it wishes to transfer to the Maryland SESA for use by the ITSC; (2) a statement of work along with a statement of rationale and supporting documentation; and (3) a revised SF 424 that reflects the adjusted base allocation. The Grant Officer must approve all proposed shifts in resources. For such approved requests, the UIS Director will coordinate the re-allocation of the obligational authority to Region III for further transfer to the Maryland SESA for use by the ITSC. The Region III Grant Officer will monitor the transferred grant in accordance with ETA regulations and policies.

4. Caveats. It is the SESAs' responsibility to:

   (1)  obtain the ITSC Steering Committee's approval of projects prior to the Grant Officer's approval;

   (2)  determine that the selected procedure is in accordance with State procurement and other applicable regulations and policies; and

   (3)  monitor progress and determine satisfactory performance.

   b.  It;is the Region III Grant Officer's responsibility to monitor the transferred grant in accordance with ETA regulations and policies.

5. Action Required. SESAs are requested to share this information with appropriate staff.

6. Inquiries. Direct questions to the appropriate Regional Office.