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10.6 Incentive Payments


10.6.1 Overview

Effective date: September 4, 2018

Local WDBs may use WIOA funds for incentive payments to in-school youth (ISY) and out-of-school youth (OSY) participants to recognize achievement of program milestones directly tied to work experience, education, or training.1 Program milestones may include but are not limited to: attaining a credential, achieving a certain grade point average, graduating from secondary school or an equivalent program, completing a work experience, entering unsubsidized employment, being accepted into a post-secondary school, and showing improvements marked by testing.2

Local WDBs may provide incentives to youth during their participation in the WIOA Youth Program and the 12-month follow-up period after program exit.3

10.6.2 Local Policy/Procedure Requirements

Effective date: September 4, 2018

If a local WDB chooses to use incentive payments, it must have written policies and procedures in place that:1

  1. clearly identify the types of program milestones that qualify for incentive payments and award amount(s);
  2. specify any limitations (e.g., maximum amount in incentives a participant may receive during the period of participation);
  3. align with the local WDB's organizational policies;2

AND, DWD-DET requires that policies and procedures ensure that the incentive payments are:

  1. administered in a manner so that all participants receive equal rewards for equal achievements;
  2. outlined in the participant's individual service strategy (ISS) before the start of the program element for which the incentive payment is available; and
  3. processed through a voucher or similar method.

Note: The local WDB's policies and procedures must be outlined in writing before it can start awarding incentive payments.3 If a local WDB adds new opportunities for incentive payments, those must be covered by the local WDB's written policies and procedures before they can be extended to participants.

Note: Incentives for entertainment costs are prohibited.4 Examples include tickets for movies or sporting events, or gift cards to movie theaters or other venues whose sole purpose is entertainment.5 Additionally, local WDBs must follow 2 CFR part 200 requirements related to internal controls to safeguard cash and gift cards, which are essentially cash.6 The procurement of non-cash incentives must follow standard procurement procedures as stipulated in the Uniform Administrative Requirements, 2 CFR §200.318-320.

10.6.3 Activities that Local WDBs Cannot Incentivize

Effective date: August 26, 2021

Local WDBs cannot use WIOA funds for incentives to motivate activities that are not directly tied to work experience, education, or training-related program milestones. Prohibited activities include those related to recruitment, submitting eligibility documentation, and participating in the program.1 Specific examples of activities for which local WDBs cannot use WIOA funds to provide incentive payments include:

  • Enrolling in WIOA Youth Program services
  • Referring a friend to the WIOA Youth Program
  • Providing documentation/information for program eligibility
  • Attending career counseling sessions or career awareness activities
  • Choosing a career pathway
  • Communicating/keeping in touch with Youth Program staff
  • Participating in services
  • Researching Labor Market Information (LMI) data
  • Completing financial literacy education activities, including completion of a budget
  • Completing a wellness plan
  • Completing driver's education for a regular (non-commercial) driver's license or earning a regular (non-commercial) driver's license2

Local WDBs may leverage non-WIOA funds for incentives that WIOA cannot fund.

  • 1TEGL 21-16, p.10
  • 2 Guidance received during US DOL Youth-State Liaisons Call on 07/20/21. DOL Federal Project Officer advised that WIOA funds may not be used to incentivize obtaining a driver's license; the license itself is the incentive.

10.6.4 Documentation Requirements

Effective date: September 4, 2018

  • The participant's ISS must identify the work experience, education or training that s/he plans to undertake and the corresponding incentive award(s) to be provided.
  • The participant's file must include documentation of the achievement of each milestone for which s/he received an incentive.
  • The incentive payment(s) must be recorded in ASSET.
  • The payments must be documented and processed through a voucher or similar method.


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