ACTION BULLETINS (PY 2007)

AB - #72 Salary and Bonus Limitations for 2007

AB - #72
Effective Retroactive to: January 1, 2007


ACTION BULLETIN

Salary and Bonus Limitations for 2007


TO: All Program Operators, Fiscal Agents, Sub-Contractors and Business Agents

DATE: October 15, 2007

SUBJECT: Individual Salary and Bonus Limitations for 2007


Purpose of the Bulletin:

The purpose of this bulletin is to inform all Program Operators of the limitations on individual salary and bonus payments that can be made with funds appropriated to the Department of Labor (DOL)/Employment and Training Administration (ETA) funded programs, that includes Workforce Investment Act Title I programs for Adults, Dislocated Workers, and Youth. Effective January 1, 2007, the adjusted salary and bonus limit is set at $168,000, until otherwise authorized.

Citations:

State of California Employment Development Department – Workforce Investment Act Directive WIAD06-18 issued May 2, 2007
Public Law 109-234, Section 7013
Department of Labor TEGL 05-06, Implementing the Salary and Bonus Limitations in Public Law 109-234
Salary Table from Federal Office of Personnel Management – website www.opm.gov under Salaries and Wages

Background:

On June 15, 2006, President Bush signed into law an emergency supplemental appropriations bill, Public Law 109-234. Section 7013 of this public law limits salary and bonus compensation for individuals who are paid by funds appropriated to the ETA and provided to program operators and sub-contractors. Specifically, Section 7013 states:

“None of the funds appropriated in Public Law 109-149 or prior acts under the heading ‘Employment and Training’ that are available for expenditure on or after the date of enactment of this section shall be used by a recipient or sub-recipient of such funds to pay the salary and bonuses of an individual, either as direct costs or indirect costs, at a rate in excess of Executive Level II, except as provided for under Section 101 of Public Law 109-149. This limit shall not apply to vendors providing goods and services as defined in OMB Circular A-133. Where States are recipients of such funds, States may establish a lower limit for salaries and bonuses of those receiving salaries and bonuses from sub-recipients of such funds, taking into account factors including the relative cost-of-living in the State, the compensation levels for comparable State or local government employees, and the size of the organization that administers federal programs involved including Employment and Training Administration programs.”

Subsequently, on August 15, 2006, the ETA issued TEGL 05-06. This TEGL informed states and other ETA-funded program operators and sub-contractors of new limitations on salary and bonus payments that can be made with funds appropriated to the ETA.

The State of California decided not to set a salary and bonus limitation below the Federal guideline of $168,000. Their directive requires local areas to comply with federal requirements regarding the limitations on salary and bonus payments.

Action:

All Program Operators, Fiscal Agents, Program Operator Sub-Contractors, and Business Agents must ensure salary and bonus payments to individuals, either employees of their organization or a sub-contractor organization, will not exceed the $168,000 in salary and bonus limits for Title I WIA funds appropriated to the Department of Labor (DOL)/Employment and Training Administration (ETA) funded programs.


Information and Inquiries:

For information and inquiries please contact Linda Slater, MIS Manager at (510) 259-3802 or via email at LSlater@acgov.org