Individual Training Accounts (ITAs) are the primary method to be used for procuring training services under WIOA. However, in certain circumstances, a training contract may be used to provide training services, instead of an ITA.

Training contracts may only be used when:

• The local plan describes the process to be used in selecting the providers under a contract for services
• The Local Workforce Development Board (WDB) has satisfied consumer choice requirements, and
• At least one of the five contract exceptions listed below applies

Contract Exceptions

1. On-the-job training, which may include paying for the on-the-job training portion of a Registered Apprenticeship program, customized training, incumbent worker training, or transitional jobs.
2. If the Local WDB determines that there are an insufficient number of Eligible Training Providers in the local area to accomplish the purpose of a system of ITAs. This determination process must include a public comment period of at least 30 days for interested providers and must be described in the local plan.
3. To use a training services program of demonstrated effectiveness offered in a local area by a community-based organization or other private organization to serve individuals with barriers to employment. The Local WDB must develop criteria to be used in determining demonstrated effectiveness, particularly as it applies to individuals with barriers to employment to be served. The criteria may include:
   • Financial stability of the organization.
   • Demonstrated performance in the delivery of services to individuals with barriers to employment through such means as program completion rate; attainment of the skills, certificates, or degrees the program is designed to provide; placement after training in unsubsidized employment, and retention in employment.
   • How the specific program relates to the workforce investment needs identified in the local plan.
4. If the Local WDB determines that the most appropriate training could be provided by an institution of higher education or other provider of training services in order to facilitate the training of multiple individuals in in-demand industry sectors or occupations. This is true provided that the contract does not limit consumer choice.
5. If the Local WDB determines a pay-for-performance contract is suitable. No more than 10 percent of the local funds may be spent on pay-for performance contract strategies.

A Local WDB may determine that providing training through a combination of ITAs and contracts is the most effective approach. This approach could be used to support placing participants in programs such as Registered Apprenticeships and other similar types of training.