IAWP LEGISLATIVE INFORMATION May 2005 Archives Home Page ***Weekly Update*** From Legislative Committee Chair: Todd Kolden, Aberdeen Central Office Week of May 2, 2005 WIA REAUTHORIZATION UPDATE: SENATE STAFF CONTINUES NEGOTIATIONS AND REQUESTS STATE INPUT • Senate staff met throughout the week continuing negotiations on the details of legislative language to include in the Senate bill to reauthorize the Workforce Investment Act (WIA). A temporary break down in negotiations occurred early in the week, when minority party staff walked out of a meeting to protest the majority staff's desire to use the House approved WIA bill (H.R. 27) as the starting point in consideration of WIA program consolidation. The House bill would consolidate, at the federal level, the Wagner-Peyser, WIA Adult and WIA Dislocated Worker programs into a single funding stream distributed to states in the form of a block grant. Minority party staff members said they, "wouldn't go there," and left the room. Minority party staff members did not make clear what this meant for future discussions. • Significant pressure to compromise is on the majority party staff, as Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Michael Enzi (R-WY) said he wants a bipartisan bill. The Administration continues to push its "WIA-Plus" proposal, which in addition to those programs consolidated under H.R. 27, would include the WIA Youth program and provide governors the flexibility to consolidate additional workforce programs. Senate staff members continue to target May 11 as the tentative date for the Senate HELP Committee to consider their bill. However, one Senate staff person said if language is not completed this week, the May 11 mark-up will not occur because the Senate is in recess the week of May 2 and the staff is not likely to continue legislative negotiations during that period. • Late this week, minority party staff members offered a proposal on WIA consolidation indicating it has the unanimous support of all minority party HELP Committee members. The minority party proposal offers the following: 1. All states who have current waivers for greater flexibility on transfer of funds between disadvantaged adult and dislocated worker funds may choose to continue their waiver authority under any subsequent plans without reapplication as long as they are meeting or exceeding their WIA performance measures. 2. Put statutory language to make the 30% transferability part of current law. 3. Change the current length of time for DOL review of waiver requests from 90 days to 60 days. • Majority party staff members are using today to determine a counter offer to the minority party proposal. CONGRESS PASSES BUDGET RESOLUTION • The House and Senate yesterday agreed, via party-line vote, to a concurrent budget resolution, establishing binding figures on mandatory and discretionary spending imposed on appropriators and authorizing committees for FY 2006 and beyond. The resolution outlines the first cuts to mandatory spending since 1997 by requiring reductions to entitlement programs including Medicaid, farm subsidies and food stamps. Instructions included in the resolution require authorizing committees to identify over five years, reductions to mandatory spending. For instance, the House Committee on Education and the Workforce would be required to reduce spending by $12.7 billion over five-years. According to a House staff person, most of the reductions in the Committee on Education and the Workforce would come from overhauling the Pension Benefit Guaranty Corporation (PBGC). • Spending on Workforce Investment Act (WIA) programs is considered discretionary and would not be affected by the reductions to mandatory spending. Nonetheless, the concurrent budget resolution establishes a tight cap on total discretionary spending at $843 billion, requiring appropriators to carefully choose priorities and spending reductions. The Congressional Subcommittees on Appropriations are nearing completion on hearings gathering input from stakeholders on their funding requests. NASWA submitted its testimony for the official record on April 15. Over the next two-months, the House will use much of its time to consider appropriation bills with an expectation that all thirteen measures will be completed by June 30. The Senate then considers its appropriation bills. Congress is supposed to approve and send to the President all thirteen spending bills before the beginning of the federal fiscal year on October 1, but has been forced in recent years to continue government operations on continuing resolutions as the process broke down. NINETEEN STATES ELIGIBLE TO APPLY FOR INCENTIVE GRANTS • The Departments of Labor and Education announced this week the eligibility of 19 states to apply for a portion of $16.6 million available under the Workforce Investment Act (WIA) incentive awards. Eligible states must submit applications to the Employment and Training Administration's (ETA) Office of Performance and Technology by June 13. The grant awards are available for distribution through June 30, 2007 to support innovative workforce development and education activities under titles I and II of WIA, or under the Perkins Act (P.L. 105-132). • In order to qualify for a grant award, a state must have exceeded performance levels, agreed to by the Secretary's of Labor and Education, governor and state education officer, for outcomes in WIA title I, adult education and vocational education programs. The goals included placement after training, retention in employment, and improvement in literacy levels, among other measures. Amounts available to eligible states was determined by the Departments of Labor and Education based on WIA section 503, and is proportional to the total funding received by these states for the three acts. • States eligible to apply for the awards include: Alabama, Colorado, Delaware, Georgia, Iowa, Indiana, Louisiana, Maryland, Michigan, Minnesota, Missouri, North Dakota, Nebraska, Nevada, Oregon, Pennsylvania, South Carolina, South Dakota and Tennessee. Week of May 16, 2005 SENATE HELP COMMITTEE DELAYS CONSIDERATION OF WIA REAUTHORIZATION BILL UNTIL MAY 18 • Consideration by the Senate Health, Education, Labor and Pensions (HELP) Committee of legislation to reauthorize the Workforce Investment Act (WIA) scheduled this week was postponed and rescheduled for Wednesday, May 18. According to Senate staff members, the delay was due to a scheduling conflict with the Senate Judiciary Committee, which scheduled a concurrent meeting on asbestos legislation. Four members of the Senate HELP Committee also serve on the Senate Judiciary Committee. • On May 12, Senate HELP Committee Chairman Michael Enzi (R-WY) transmitted the Senate HELP Committee's bi-partisan legislative language to the Government Printing Office (GPO) for formal introduction. NASWA VETERANS AFFAIRS COMMITTEE CHAIR TESTIFIES BEFORE HOUSE PANEL ON VETS • Maren Daley, Chair of the NASWA Veterans' Affairs Committee and Executive Director of Job Service North Dakota, testified May 12 on behalf of NASWA before the House Committee on Veterans Affairs Subcommittee on Economic Opportunity. The Subcommittee held the hearing to examine the performance of the Department of Labor's (DOL) Veterans Employment and Training Service (VETS), its resource needs and the state grant program that funds the Disabled Veteran Outreach Program (DVOP) and Local Veterans Employment Representatives (LVER) programs. • NASWA's opening statement began by acknowledging the strong working relationship developed between NASWA and VETS as the two have worked closely to ensure newly developed regulatory requirements under the Jobs for Veterans Act improve the administration of workforce programs in service to veterans. NASWA's statement then transitioned to recommendations for Congress to consider including: appropriating additional funds for the DVOP, LVER and the Veterans Workforce Investment (VWIP) programs proportionate to the number of veterans requiring service and to adjust for inflation; transitioning the DVOP and LVER funding cycle from a federal fiscal year to a program year to align funding, planning and performance with the cycle on which one-stop partners operate; establishing adequate minimum state allocation levels to improve year round service levels; expanding eligibility for Incentive Award grants to include workforce system offices; amending the definition of veterans for the Transitional Assistance Program (TAP) to include military personnel who have definite dates of discharge in the near future; reconsidering the Jobs for Veterans Act provision requiring the Secretary of Labor assign a Director for Veterans' Employment and Training to each state; and support for activities initiated by the President's National Hire Veterans Committee. • Chair Daley was asked by Subcommittee Chairman John Boozman (R-AK) how NASWA reconciles a desire for increased appropriations with the actions of some employment service managers who direct DVOPs and LVERs to perform non-veterans tasks. Chair Daley indicated she recognized the concern surrounding the DVOP and LVER staff occasionally performing service in one-stop environments not directly related to service for veterans, but that it is limited and immediately addressed when identified. Ms. Daley said occasional non-veteran related service by DVOP and LVER staff should not detract from the need for adequate funding for veterans employment programs pointing out that the state allocation has increased by $3.9 million in eight years, or only about one year's increase in inflationary cost. • Representatives from a variety of veterans service organizations (VSOs), Dr. Sigurd Nilsen of the Government Accountability Office and John M. McWilliam, Deputy Assistant Secretary for Operations and Management of VETS, also testified before the Subcommittee. Members of the Subcommittee and VSO representatives focused a majority of their time expressing concerns with the lack of performance indicators for the DVOP and LVER programs and the possible misallocation of staff resources for services provided to non-veterans. • A number of VSO representatives said they believe the tasking of DVOP and LVER staff to non-veteran related clients is a symptom of declining funding for the Employment Service (ES) program, saying pressures on office managers to maintain service in light of declining funding forces temporary non-veteran assignments. In their testimonies, all VSO representatives addressed their opposition to the Administration's proposal for "WIA Plus." Dr. Nilsen used his appearance to release preliminary observations on VETS programs since enactment of the Jobs for Veterans Act including performance (see article below). • Many questions were asked of the panelists by the Subcommittee Chairman, John Boozman (R-AR) and Ranking Member Stephanie Herseth (D-SD). Minimal time was available for responses. Maren Daley had a chance encounter with Representative Herseth following the hearing; this provided an opportunity for her to clarify our recommendations and discuss program issues. GAO RELEASES PRELIMINARY INFORMATION ON VETS PROGRAMS • On May 12, the Government Accountability Office (GAO) published a preliminary report on its findings for the Disabled Veteran Outreach Program (DVOP) and the Local Veterans Employment Representative (LVER) programs. The preliminary report, titled Preliminary Observation on Changes to Veterans' Employment Programs, was released as GAO testimony at the House Committee on Veterans Affairs Subcommittee on Economic Opportunity held on May 12. The preliminary GAO report is available on the Workforce ATM • The testimony is based on GAO's ongoing work in reviewing the DVOP and LVER programs and the status of implementation of the Jobs for Veterans Act. The study focuses on three aspects: 1) the separation of DVOP's and LVER's roles and responsibilities; 2) VETS' performance and accountability system for DVOP and LVER staff; and 3) VETS' system for monitoring DVOP and LVER performance. • The preliminary GAO reports found: o Indications that integrating DVOP and LVER staff into the local workforce offices remains challenging; o State implementation of the incentive award program has varied - 11 states do not plan to participate; o a minimum standard that all states must meet for veterans entering employment will not be available before 2007; o for FY 2003, the programs achieved a 58 percent employment rate for all veteran job seekers (the goal was 58 percent); o for FY 2003 the programs did not achieve the goal of 60 percent employment rate for disabled veterans - actual was 53 percent; o job retention goals for both all veterans and disabled veterans were exceeded by seven percentage points and 12 percentage points respectively; and o it is unclear how VETS staff at the state, regional and national levels will use the information obtained through the new self-assessment and on-site reviews in a consistent manner to guide or improve the DVOP and LVER programs. • GAO has not yet conducted on-site reviews in a selection of states. NASWA staff informed GAO staff of states volunteering for a GAO visit. In a follow-up discussion with Dr. Nilson, NASWA staff learned GAO has not yet determined which states they plan to visit. They are tentatively planning to visit five states. The final GAO report is expected to be completed by the end of December 2005. Week of May 9, 2005 SENATE PANEL FLOATS LEGISLATIVE DRAFT TO REAUTHORIZE WIA AND SCHEDULES CONSIDERATION ON MAY 11 · Staff members to the Senate Health, Education, Labor and Pensions Committee released draft legislation to reauthorize the Workforce Investment Act and indicated the Committee is on track to hold its mark-up on May 11. Senate staff members used the first half of the week to continue negotiations on legislative language, stating in a summary accompanying the draft bill that the product represented an extensive bipartisan effort. Upon a quick review of the legislation, the draft bill would do the following: o Maintain the Wagner-Peyser, WIA Adult, WIA Dislocated Worker, and WIA Youth programs, thereby neither adopting the Administration's "WIA-Plus" proposal to consolidate core WIA programs at the federal level and give governors discretion to combine additional programs, nor the Administration's proposal offered last session and included in H.R. 27 to consolidate the Wagner-Peyser, WIA-Adult and WIA Dislocated Worker programs; o Maintain the ability of local workforce areas to agree upon equitable contributions from mandatory partners for infrastructure funding, unless the local area cannot reach an agreement, in which case the governor of the state would determine appropriate contributions subject to caps; o Amend "sequence-of-service" language to eliminate requirements that individuals receive core and intensive services before proceeding to training; o Reduce required numbers of members of local boards; o Increase the transferability between adult and dislocated worker funding; o Streamline performance measures to accommodate Administration's common performance measurement initiative; o Require co-location of Employment Service (ES) programs in one-stops; o Make TANF a mandatory partner but allow the governor to "opt-out" by choosing not to make TANF a mandatory partner; and, o Direct more resources to out-of-school youth. HOUSE APPROVES PERKINS REAUTHORIZATION BILL SETTING UP CONFERENCE WITH SENATE · The House this week approved (416-9) legislation (H.R. 366) to reauthorize the $1.3 billion Carl D. Perkins Vocational and Technical Education Act of 1998 (P.L. 105-332). Approval by the House triggers a conference with the Senate, which approved its legislation (S. 250) on March 10. Senate minority staff members said this week conferees could be selected as early as next week. Congressional approval of legislation to reauthorize the vocational and technical education program would run contrary to the request of the Bush Administration, which proposed eliminating the program in its FY 2006 Budget request. The Administration released a statement this week reiterating its concern the program "is not adequately preparing students to participate in today's competitive workforce. · The House approved bill would merge Perkins funding with Tech-Prep, a program providing specialized math and science course to ease high school students transition into technical vocational education programs. Approved by voice vote on the floor was an amendment to require states fund Tech-Prep at FY 2005 levels. Another amendment approved on the floor would allow states to use funds to help vocational education students obtain baccalaureate degrees. The House bill would limit states using no more than 2 percent of Perkins grants for administrative purposes. BUDGET RESOLUTION OPENS WAY FOR ADMINISTRATION'S FY 2006 UI REQUESTS · Included in the FY 2006 concurrent budget resolution approved last week by Congress is a provision authorizing appropriators to spend $40 million for the Administration's unemployment insurance (UI) initiatives without being "scored," or counted, against the discretionary budget caps. The Administration's FY 2005 Budget requests a total of $20 million to increase the number of face-to-face beneficiary eligibility reviews (also known as re-employment and eligibility assessments) and $30 million for an identity theft prevention initiative. Language in the FY 2006 concurrent budget resolution would automatically lift the discretionary budget cap to accommodate the additional spending for these UI initiatives if Congress believes the spending is warranted. · The primary reason for making accommodations for the new spending is the Department of Labor's' (DOL) estimate that its identity theft prevention initiative could result in annual trust fund savings of as much as $105 million. The House Committee on Ways and Means could work with DOL to approve legislation this Congress authorizing the effort. The FY 2006 concurrent budget resolution requires the House Committee on Ways and Means to identify savings of $1 billion from FY 2006 through FY 2010. The initiative would support new state investigative positions, training for investigators and claims staff, automated tools to help reduce UI system identity theft and related fraud, and training for front-line staff to detect identity theft. SUBCOMMITTEE ALLOCATIONS FORESHADOW POSSIBLE SPENDING CUTS AND NEED FOR ADVOCACY · Under the spending allocation released this week by House Appropriations Committee Chairman Jerry Lewis (R-CA), the Labor, HHS and Education spending bill would be reduced by about $160 million from the FY 2005 enacted level. Announcement of the allocations, known as 302(b)s, by Chairman Lewis for each of the thirteen spending bills follows approval last week of the concurrent budget resolution, which establishes the overall discretionary budget cap. · Appropriators on each of the thirteen appropriations subcommittees must now determine how to prioritize spending among competing programs funded by each bill. At this early stage, it is unclear how the House Labor, HHS and Education Appropriations Subcommittee, responsible for funding workforce programs, will distribute its funding, but it is clear the publicly funded workforce system must be vocal or risk further reductions. In reaction to the allocation to his Subcommittee, Chairman Ralph Regula (R-OH) said "we will have to make wise judgments about where our priorities are" indicating a preference to do more for the National Institutes of Health and Centers for Disease Control. Although Chairman Regula has been a vocal supporter of the publicly funded workforce system, appropriating what is requested by workforce system advocates will be a challenge. STATES FACE DEADLINE TO ENACT LEGISLATION PREVENTING SUTA-DUMPING · Federal law enacted in August 2004, the State Unemployment Tax Act (SUTA) Dumping Prevention Act of 2004 (P.L. 108-295), requires almost all states to enact legislation during the 2005 legislative season which prohibits certain practices by employers to lower/avoid their state unemployment taxes. State legislation that meets the requirements of Federal law is a condition of grants to states for administration of their state unemployment insurance (UI) programs. · The required effective date for legislation in most states is January 1, 2006. According to an accounting by the Department of Labor (DOL), 28 states have not completed legislative action as of May 3. These states include Alaska, Alabama, Connecticut, Delaware, District of Columbia, Illinois, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, Puerto Rico, Rhode Island, Tennessee, Texas, Vermont, Virgin Islands, Washington, West Virginia, and Wisconsin. · Due to unique provisions of their state UI laws, New Hampshire, New Jersey, Tennessee, and Vermont have until July 1, 2006, to put the required legislation in place. Week of May 25, 2005 SENATE HELP COMMITTEE APPROVES BILL TO REAUTHORIZE WIA The Senate Health, Education, Labor and Pensions Committee this week approved its bill (S. 1021) to reauthorize and reform the Workforce Investment Act (WIA). Consideration of the bill took less than a minute with Chairman Michael Enzi (R-WY) and Senator Edward Kennedy (D-MA) praising the bill and the process leading to a bipartisan report to the full Senate. The bill is now ready for consideration by the Senate. The date the bill might be considered on the Senate floor has not yet been announced, but almost certainly will not occur next week as debate over ending the filibuster of the vote on certain judicial nominees monopolizes the floor. On a related matter, Secretary of Labor Elaine Chao sent a letter to Chairman Enzi just before the Senate HELP Committee's consideration of its bill to express the Administration's strong opposition with the bill. Secretary Chao's letter expresses concern the Senate's bill does not include a number of the Administration's priorities including: consolidation of WIA program and Wagner-Peyser funding streams; authorization of Personal Re-Employment Accounts (PRAs); an increase in state authority to designate local workforce investment areas; targeting a larger percentage of available WIA Youth funds to out-of-school youth; authorization of Individual Training Accounts; and more. DOL ISSUES RULE ESTABLISHING FUNDING CRITERIA FOR VETS AND TAP PROGRAMS The Department of Labor this week issued its final rule to establish the formula criteria for making funds available for veterans' employment services and the Transition Assistance Program (TAP). Section 4 of the Jobs for Veterans Act (P.L. 107-288) required a new funding formula for making funds available to each state, with an approved state plan, to support the Disabled Veterans Outreach Program (DVOP) and the Local Veterans Employment Representative (LVER) programs. Additionally, the formula will be used to make funds available for the TAP program and respond to "exigent" circumstances, or those requiring immediate aid or action. The new rule was published in the May 17 Federal Register and takes effect on June 16. The May 17 Federal Register is available on the Workforce ATM by selecting Federal Register Notices on the Subject Locator. NASWA Veterans Affairs Committee Chair Maren Daley testified last week before the House Committee on Veterans' Affairs Subcommittee on Economic Opportunity on the need for the state allocation formula to be adjusted by increasing minimum distribution. The new formula developed under the Jobs for Veterans Act has caused problems, especially among smaller population states, in providing adequate base level funding to properly administer the DVOP and LVER programs throughout the year. NASWA will work with the Veterans' Employment and Training Service to seek an adjustment to the formula. PRESIDENT BUSH NOMINATES CHARLES CICCOLELLA ASSISTANT SECRETARY OF VETS The White House announced President Bush's nomination of Charles "Chick" Ciccolella to be the next Assistant Secretary of the Veterans Employment and Training Service (VETS) replacing Frederico Juarbe, Jr. Assistant Secretary Juarbe is departing VETS at the end of May. Mr. Ciccolella has served as Deputy Assistant Secretary of VETS since 2001.