Vocational Rehabilitation Grants to States: Program Overview

Benjamin Collins
Analyst in Labor Policy

Vocational rehabilitation (VR) state grants provide funds to state and territorial agencies to administer services to individuals with disabilities to aid them in securing and maintaining employment. States are required to match a portion of their federal grants. The VR grants program is administered by the Rehabilitation Services Administration (RSA), part of the Department of Education (ED).

To be eligible for VR services, an individual must establish that (1) he or she has a disability that creates an obstacle to employment and (2) he or she would benefit from VR services. After qualifying for VR services, each client works with a VR counselor to develop an Individualized Plan for Employment (IPE). The IPE defines the client’s desired employment outcome and outlines the services necessary to achieve that outcome.

To meet the objective stated in a client’s IPE, a VR agency can coordinate a variety of services. These can range from simple services such as counseling to more complex job training or postsecondary education. VR agencies can also provide support services that aid a client’s progress toward employment, such as transportation subsidies or reader services for clients with visual impairments. In all cases, a client must exhaust all other applicable government assistance before a VR agency will pay for a service.

In cases where a state anticipates that it will not be able to serve all eligible individuals, it must notify RSA that it will implement an order of selection plan. This plan establishes which individuals will receive preference if the state agency is unable to serve all eligible clients. ED dictates that agencies must first serve individuals with the most significant disabilities, but defining the most significant disabilities is left to the state agencies.

Congress appropriated $3.1 billion for VR grants to states in FY2012. In FY2010, the most recent year for which program data are available, more than 1.4 million individuals received some form of VR services and agencies reported almost 172,000 successful employment outcomes. At the end of FY2010, about 33,000 individuals were on VR waiting lists.

VR grants are supported through mandatory appropriations. Authorization for the VR grant program expired after FY2003. The Rehabilitation Act of 1973 specifies that if authorization has expired and Congress has taken no action, the program will automatically be reauthorized for the subsequent year and the authorized annual mandatory appropriation amount will equal the prior year’s appropriation plus an increase equal to inflation. The program has operated under these provisions since FY2004.

Reauthorization of VR state grants was debated by the 108th and 109th Congresses. Separate bills that reauthorized the VR grants program alongside the Workforce Investment Act were passed in each house of Congress, but no consensus emerged. Legislation has been introduced in the 112th Congress (H.R. 2295) to reauthorize the VR state grant program through 2017 with no changes to its funding structure and increased emphasis on transitioning school-age clients to post-school activities.


Date of Report: January 10, 2012
Number of Pages: 28
Order Number: R42148
Price: $29.95

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