Labor and Employment

WorkNotes

NCSL's Newsletter on Workforce Development Issues

Spring 2002

How Does Your State Measure Up?
Supplemental Budget Proposal Includes New Money
State WIA Expenditures
What do You Really Think about WIA?
WV Legislature Passes Workforce Bill
Summary of Proposed 2002 School-to-Career Legislation
National Conference on Workforce and Economic Development

WorkNotes' Archive

How Does Your State Measure Up?
Did your state's workforce investment programs meet, exceed or fail their federal negotiated performance measures? Find out by going to the WIA Annual State Reports on U.S. Department of Labor's website. The reports provide valuable insight into how your state is faring when it comes to implementing the federal Workforce Investment Act of 1998.
By law, the annual reports must include performance results for the whole state on core measures and customer satisfaction as well as a breakdown of how local areas hit their mark. The report must also include state evaluations of how the system served clients and impacted their job and wage outcomes. Highlights of the evaluations that legislators may be particularly interested in include the relation between the program costs and the participants' outcomes, a comparison of performance between those clients who received training services and those that only received core and intensive services, and performance analysis by population.
Below is a sample of the negotiated levels of performance the federal government worked out with a state. The measures in the table reflect the core measures used in the adult, dislocated worker and youth WIA programs. Percentages are determined by taking the number of clients with positive outcomes (job placement, job retention after 6 months, increased earnings after 6 months and earned credential) and dividing them by the total number of clients that entered into the system. (This does not include people using self-directed services at the one-stops.) The annual reports will have actual performance compared against the federal negotiated rate.

		Negotiated Level
Adult Program	Entered Employment Rate	62 %
	Employment Retention Rate	79 %
	Earnings Change in 6 Months	$2,700
	Employment and Credential Rate	60 %

Dislocated Worker	Entered Employment Rate	64 %
Program	Employment Retention Rate	82 %
	Earnings Change in 6 Months	92 %
	Employment and Credential Rate	60 %

Older Youth	Entered Employment Rate	58 %
(19-21)	Employment Retention Rate	77 %
	Earnings Change in 6 Months	$2,200
	Credential Rate	50%

Younger Youth	Skill Attainment Rate	72 %
	Diploma or Equivalency Attainment Rate	55 %
	Retention Rate	54 %

Customer	Participant Satisfaction Rate	68 %
Satisfaction	Employer Satisfaction Rate	66 %

Incentives and Sanctions
The next question may be, "If my state did not meet some of the federal performance measures, what does that mean?" There were a couple of indicators for which many states did poorly, in particular, the "employment and credential rate" for all three populations, but especially for the older youth. (This indicator is based on the number of adults and older youth that receive training and are employed by the first quarter after the training and receive a credential by the end of the third quarter.) The comparable indicators for younger youth, "diploma or equivalent rate" as well as the "retention rate" were also difficult goals for many states to achieve.
However, incentives and sanctions will be doled out based on an individual state's performance. The federal law classifies performance in three categories:

'Failure' is less than 80% of the negotiated rate
'Acceptable' is between 80-100% of the negotiated rate
'Exceeds' is above the negotiated rate

If a state exceeds negotiated levels for WIA Title I (the dislocated worker, adult and youth programs), Title II (the Adult and Family Literacy Act) and the Carl Perkins Act, then it is eligible to apply for an incentive grant. If a state "fails" to meet the negotiated rate for any indicator, the state may request technical assistance from the Department of Labor after the first year of poor performance. If the state fails to perform on the same measure for two years in a row, the state will incur sanctions of up to five percent, or one percent for every three-percentage points below the negotiated level.
For a more complete explanation of the process for setting negotiated levels and the incentive and sanction process please refer to the Department of Labor's Guidance Letter. If you have any remaining questions, you may contact the Department's Regional Offices.

Supplemental Budget Proposal Includes New Money
President Bush recently unveiled his supplemental appropriation proposal that includes:

A restoration of the $110 million from the dislocated worker program that was rescinded prior to September 11^th
An additional $550 million for National Emergency Grant funds to provide employment and training assistance to workers in areas that are suffering from high unemployment
$50 million for targeted high growth job training discretionary grants that would go to local area partnerships between businesses, one-stops and community colleges mainly in the health care, high-tech manufacturing and
$40 million for community economic adjustment assistance programs to couple Department of Commerce's efforts at job creation in economically depressed communities (like those built on steel and textiles) with worker assistance, bringing together effective economic development and workforce development strategies.

The Department of Labor urges state and local workforce agencies not to spend the dislocated worker money that would be restored because this would be a restoration and not a reversal of the previous budget's rescission. If this provision of the supplemental budget is approved, it is unclear whether states would receive the reinstated dislocated worker allotments based on PY 01 or PY 02 formulas. The Department will be releasing guidance soon on setting aside the rescinded amount, which still has not been taken back by the federal government.

State Expenditures
While the administration proposes replacing the dislocated worker money and adding money to a few discretionary grant programs, the formula-based programs (i.e., adult, dislocated worker and youth programs) are still in the FY 02 budget with level funding and proposed in the FY 03 budget with a 12 percent cut. The assumed rationale behind these budget proposals stems from Department of Labor data that suggest that states are not spending enough of their Workforce Investment Act (WIA) funds. A table of first quarter expenditures from program year 2001 shows that only 12.6 percent of total WIA funds were spent by the states from July 1, 2001 through September 30, 2001. These data do not reflect obligations that may have been promised after September 11^th. The five states that spent the least of their total WIA funds (including carryover from the previous year) were Alaska (4.6 percent), New Mexico (5.3 percent), Ohio (7.2 percent), Puerto Rico (8.8 percent) and New York (8.9 percent). The five states that spent the most were Vermont (34.5 percent), District of Columbia (24.6 percent), Minnesota (24.4 percent), Florida (24.1 percent) and Delaware (23.6 percent).
Last program year only 53 percent of all federal WIA dollars were spent by states, territories and national programs. Thus far the federal government does not require obligated funds to be reported. Some think that including obligated funds in the count would give a more accurate picture of activity in the system. According to the Employment and Training Reporter, the administration may be using expenditure trends to see if more flexibility is needed in shifting money between the adult and dislocated worker funding streams, an idea on the table since discussions are now taking place about recommendations for reauthorization of WIA.

What do You Really Think about WIA?
Although the Workforce Investment Act (WIA) is not up for reauthorization until 2003, the Department of Labor is seeking your input on the next version of WIA and especially how WIA can link with the Temporary Assistance to Needy Families (TANF) program. The Department is looking for specific comment on:

How to enhance use of the One-Stop system under WIA to deliver services for the purpose of improving employment and earning outcomes for TANF recipients;
How better to meet the needs of business in the workforce investment system and improve business participation in the system;
How to balance state and local needs in the governance of the workforce investment system;
How to increase state flexibility in meeting local labor market needs while keeping the focus on connecting people with productive employment;
How the Administration's Unemployment Insurance/Employment Service reform proposal will assist States to improve and expand their One-Stop systems;
How the operation of the One-Stop Career Centers can be improved; and
How individuals can receive improved opportunities for training.

The Department will be holding a series of listening sessions across the country for the public to speak with agency officials. Comments can also be submitted in writing by mailing to: WIA/TANF Reauthorization, Attention: Maria Kniesler Flynn, Employment and Training Administration, Room S-4231, 200 Constitution Avenue, NW, Washington, DC 20210. Fax copies may be sent to: 202-693-3015.
The Department of Education is conducting similar listening sessions for the reauthorization of the Rehabilitation Act.

WV Legislature Passes Workforce Bill
The West Virginia Legislature traveled a two-year journey to its recently enacted Workforce Investment Act. Following on the heels of an NCSL-conducted inventory of its workforce development programs, the law creates the framework of a workforce development system that is modeled closely on the federal law but also includes aspects uniquely suited to West Virginia's needs. The Legislature was keenly aware of the need for strong performance accountability for the system and the law includes many instances of system reporting to the Legislature's Joint Commission on Economic Development.
The law also limits the number of seats on the state workforce board to 39, a more manageable number than previous incarnations of the board, and specifies that a quorum for the state board must include a majority of business representation. West Virginia is the first state to mandate a business majority for a quorum in statute. The U.S. General Accounting Office (GAO), an independent and nonpartisan investigative arm of Congress, wrote about possible improvements to the WIA system last October. A business majority for a quorum was one of its recommendations to Congress. (Other ideas for improving business participation in the system were also discussed. Click here for the report.)
Legislators made another conscious decision of including the director of the Division of Rehabilitation Services on the state board although the agency that includes that division, the Department of Education and the Arts, was serving on the board under the last executive order. It was important to some legislators that Rehabilitation Services have a direct voice on the board, instead of being represented by their Department. Research that the U.S. Department of Education is funding regarding the linkages between vocational rehabilitation (VR) and the workforce investment system supports the notion that there are true benefits to having direct representation on the state and local boards. Mainly, the opportunity to make connections with business leaders that sit on the boards as well as the professional respect that develops, identifying VR as a resource for helping the system better serve people with disabilities.
Another hallmark is the connection between economic development policy and workforce policy in the Legislature. In addition to establishing the Legislative Oversight Commission on Workforce Investment for Economic Development, the law also states that the four legislators that sit on the workforce board will also serve on the commission.
Finally, state agencies that conduct workforce activities must enter into memoranda of understanding (MOU) with the executive director of the Development Office as well as the relevant local workforce investment board. Copies of the MOUs are to go to the state workforce board and the legislative oversight commission.
For a more complete summary of the bill that was prepared by the Joint Commission on Economic Development click here.

Summaries of 2002 School-to-Career Legislation
The summaries below were prepared by NCSL staff in early April, 2002.

California AB2249	Introduced	Prohibits the State Board of Education from requiring students to participate in school-to-career or vocational education activities unless the student chooses to.
AB 2188	Introduced	Current law establishes various programs for vocational and career technical education in the public schools. Any business, trade or professional association, union, or state or local government agency may establish and operate a career preparatory program under the auspices of the local school district. Any pupil, who has completed his or her education through grade 10 and has written parental consent, may choose to follow either a traditional college preparatory curriculum or the career preparatory program established by existing law. According to the bill's legislative digest, "This bill would establish a pilot program to require the establishment of regional career technical high schools as comprehensive high schools, in the same manner as regional occupational centers, as prescribed. This bill would establish funding criteria, would provide for termination of pilot program high schools that do not meet performance targets, would annually appropriate $140,000 to the Superintendent of Public Instruction for administration of these provisions, and would require the department to report its findings and recommendations by August 1, 2007. The appropriated funds would be applied toward the minimum funding requirement for school districts and community college districts imposed by Section 8 of Article XVI of the California Constitution for the 2002-03 fiscal year."
AB 2405	Introduced	This bill would appropriate $100,000 to form a task force to establish educational and workforce training programs relevant to alternative sources of renewable energy. The task force would see that educational and workforce training programs are developed to train students for careers in various facets of the renewable energy sector. In carrying out this function, the task force would consult with public and private elementary and secondary schools, community, junior, and four-year colleges, and postgraduate educational institutions, and with representatives from the renewable energy sector. The task force shall coordinate its efforts with other state agencies in order to secure any available state, federal, and private grant funding available.
Connecticut H 5420	Substituted	The bill would create manufacturing technology centers in the community-technical college system by using current appropriations. The centers are to be involved with school to career programs, internships, work-study programs, job shadowing and mentoring. The centers' curriculum would be based on projections of workforce needs and would include educational and career ladder options while working in concert with public high schools, vocational-technical schools, other postsecondary schools, state agencies and community groups. The bill lists core areas of instruction and expectations for technology clusters. Centers would recruit adults who are currently employed, unemployed, underemployed and dislocated as well as youth in and out of school. The act would take effect July 1, 2002.
Iowa HB 530	Introduced	The legislative digest states that, "This bill amends a portion of the certified school-to-career program relating to consortiums of two or more employers. The bill provides that, if an employer is a consortium and tuition is included as part of a stipend paid by the employer to the participant, the consortium shall be held to different requirements than those of a single employer."
H 2479	Introduced	This bill provides an income tax credit to businesses that employ a student from an Iowa postsecondary institution in an apprenticeship or internship program. The amount of credit equals $400 per student. If the business hires that student after graduation, the business can receive another tax credit of $1,600 for each year, up to three years. The graduate must be employed for at least six months during each tax year the credit is claimed. The bill takes effect upon enactment and applies retroactively to January 1, 2002.
Illinois H 6159	Amended	Appropriation of federal money for school-to-work.
H 6213	Introduced	Appropriations of $1,500,000 general revenue funds to the Department of Commerce and Community Affairs' Bureau of Technology and Industrial Competitiveness for activities under the High Technology School-to-Work Act.
Massachusetts H 1	Introduced	The executive budget includes $6,592,743 for school-to-work matching grants and connecting activities.
Michigan S 1109	Introduced	The governor's budget bill for FY03 includes provisions allowing entities that provide school-to-work transition programs to apply for grants funded under the Work First program and the state's Economic Development and Job Training fund, The training fund has a proposed funding of $13.5 million.
H 5643	Reprinted	Same as S 1109
Minnesota H 2716	Introduced	$10,000,000 appropriation from bond proceeds for grants to local governments to support enrichment activities during non-school hours. Activities could include school-to-work and workforce development enrichment programs, among others.
New Mexico S 1	Vetoed	Appropriated $1.5 million of federal funds to school-to-work program.
H 98	Introduced	Appropriates $1,250,000 for providing a comprehensive, career education opportunity system that prepares students for employment in high skill and high wage jobs through a planned program of study that will lead to a two-year postsecondary degree or certificate. Funding is also intended to continue the school-to-work advisory council, the state, regional and local administrative structure that supports the school-to-work partnerships, the school-based and work-based curricula integration under career pathways, and an evaluation component to support a performance-management system.
Pennsylvania H 2359	Amended	This bill would establish the Office of Community, Business and Education Partnerships to encourage and enhance partnerships between schools and businesses, function as a clearinghouse for material dissemination and provide training to school districts on building partnerships as needed. Among other duties, the Office would submit an annual report to the General Assembly and the Governor to include a summary on the status of partnership programs and make recommendations for improving the efficiency and growth of partnerships.
Rhode Island S 2193	Introduced	Creates a School-to-Career Tax Credit that would credit up to 10 percent or a maximum of $200 per employer for expenses related to a qualified school-to-career program. Expenses related to wages, workers' compensation insurance, unemployment insurance, and training to employ a student or teacher to work or to allow a student or teacher to participate in an internship, externship or apprenticeship are allowable.
H 7732	Introduced	Raises the fees program sponsors and indentured apprentices pay for the apprenticeship. Sponsors and apprentices that are connected through a school-to-work program are exempted. There are other exemptions as well.
South Carolina H 4304a	Enrolled	A resolution that designated February 11-15, 2002, as "South Carolina Career and Technology Education Week". The resolution acknowledges the need for secondary educators to partner with employers, community agencies, and postsecondary education to prepare students to enter the workplace and postsecondary education and be successful. The resolution also underscores the importance of worksite learning and connecting activities between the workplace and schools that school-to-work opportunities provide.
Wisconsin A 1	Passed Assembly	This budget bill decreases funding for the Governor's Work-Based Learning Board by $105,500 for fiscal year 2001-02 and $50,700 for fiscal year 2002-03. It also decreases funding for school-to-work programs for children at-risk by $10,500 for fiscal year 2001-02 and the dollar amount is decreased by $15,000 for fiscal year 2002-03.

National Conference on Workforce and Economic Development
What are your plans for July 9-11, 2002? You can travel to Nashville, Tennessee to join workforce development leaders and decision-makers explore the links between workforce development and economic development. The U.S. Department of Labor is hosting the Workforce Innovation 2002 conference to prepare state and local leaders to:

Focus on business as the primary customer;
Imagine future work and understand the needs of a changing workforce;
Manage today's dynamic organization in an era of globalization;
Integrate technology to enhance learning and improve service;
Discover a role in support of the federal legislative process.

For regular updates on the conference and to register, check out the conference website.

NCSL's WorkNotes is produced by
Learn, Work and Earn Project
National Conference of State Legislatures
444 N. Capitol St., NW, Suite 515
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(202) 624-5400, (202) 737-1069 (fax).

This newsletter is funded by the U.S. Department of Labor. Opinions or conclusions expressed herein do not necessarily reflect the views and policies of the U.S. Department of Labor.