Welf. & Inst. Code, § 11328.8

(a) The department, under the direction of the Health and Welfare Agency, the Chancellor’s office of the California Community Colleges, and the State Department of Education shall each develop and implement regulations whereby any payment for education and training services from funds appropriated for the purposes of this article and delivered pursuant to Section 11322.6 by an entity contracting with a county shall be made in accordance with a competitively selected fixed unit price performance-based contract. Under these contracts, full payment shall not be considered earned until either of the following has occurred:

(1) The participant has successfully completed the education program.

(2) The participant has successfully completed the job training program and has been retained in unsubsidized employment for at least 180 days.

(b) Up to 70 percent of the fixed unit price for job training may be paid upon placement. At least 30 percent of the fixed unit price for job training shall be withheld for the followup during the 180-day retention period. Progress payments shall be made from this portion upon evidence of job retention at 30, 90, and 180 days. A pro rata share of the 70 percent payment shall be paid to the training provider if the participant fails to complete the training.

(c) The department may exempt county contracts for CalWORKs educational services from subdivisions (a) and (b) in instances where counties are unable to obtain educational services due to the absence of an available adult education program or the small number of CalWORKs referrals. The department, in conjunction with the State Department of Education, shall develop criteria for granting the exemptions from subdivisions (a) and (b). The departments shall also consider using funds set aside for CalWORKs educational services in the State Department of Education’s annual budget allocation or funds allocated to the State Department of Education for CalWORKs costs in the annual Budget Act, to pay for the costs of education contracts permitted by this subdivision.