Administration's Workforce Investment Act Reauthorization Proposal Released
By Josie Hathway and Shannon Holmes
March 17, 2003
The Subcommittee on Employment, Safety and Training of the Senate Committee on Health, Education, Labor, and Pensions convened its first hearing on the Reauthorization of the Workforce Investment Act (WIA) on March 6, prior to the release of the Administration's proposal. Deputy Secretary of Labor D. Cameron Findlay testified before the Subcommittee on the Administration's proposal for reauthorization. Findlay gave an overview of the Administration's proposal and stated that the personal re'employment accounts, as proposed in the President's economic stimulus package, will also be folded into the law "allowing for maximum flexibility for individuals to choose what is best for them to get back to work."
Subcommittee members raised concerns about the duplication that would be created by setting up the new Personal Reemployment Accounts program and where funds would come from. Furthermore, members expressed concern about the focus on strictly out'of school youth and cuts of existing vital youth programs, urging Findlay to take another look at this issue.
On March 7, the proposal for the reauthorization of WIA was officially released to the public.
Following the release, Representative Howard "Buck" McKeon (CA), Chairman of the 21st Century Competitiveness Subcommittee of the Committee on Education and the Workforce, held a hearing March 11 utilizing the proposal. Assistant Secretary Emily DeRocco for Employment and Training Administration at the Department of Labor (DOL) testifying before the subcommittee on the reauthorization of WIA, gave an overview of the Administration's proposal and stressed the potential benefits of streamlining both the programs and funding streams to better serve populations benefiting from workforce development and rehabilitation programs.
Members of the subcommittee voiced concerns about funding getting down to the local level where services are provided and where the need is growing due to current economic conditions, especially with the increased responsibility to local areas is part of that the DOL proposal.
Representative McKeon has indicated that he will be introducing a bill on March 13.
Below is a brief overview of the proposed Reauthorization of WIA as put forth by President Bush.
Governance: Creating a more effective governance structure because administrative detail is over burdensome. All workforce Investment Boards (WIBs) need to be smaller and more focused.
State Boards —no longer require business majority, but a business member would still hold the role of Chair; provide state'level administrators of One-Stop partner programs with more authority over local One-Stop Career Centers.
Local Boards —remove requirement of One-Stop partner programs' membership; ensure leading industry sectors and geographic areas are represented including local education officials, community groups, and worker advocates.
Youth Councils —drop the mandated requirement, but governors and chief local elected officials would have the authority to choose to continue with the Youth Councils.
Grandfathering —drop grandfathering provisions for state and local boards.
Local Area Designation —eliminate local area's right to appeal non-designation to the Secretary of Labor, end appeal rights at the state level; eliminate initial and subsequent local area designation provisions to allow governors to align local workforce investment areas with local and regional labor markets.
Planning —reduce planning cycle for state and local plans from every five years to every two years.
One-Stop Career Center System: Creating new ways to fund and maintain the local One-Stop Career Center System.
One-Stop Infrastructure —finance operational cost of the local One-Stop system with "One-Stop Infrastructure" funding; each partner program contributes a portion of their funds at either the federal level or a set'aside at the state level, research is being done to determine how much funding is needed.
Comprehensive Array of Services —authorize local areas to provide a broad range of products and services to low'wage workers, such as work supports and retention and advancement services.
Services to Targeted Populations —eliminate barriers to serving targeted populations through the local One-Stop system, such as individuals with disabilities, migrants and seasonal farm workers and older workers.
Comprehensive Services for Adults: Eliminating barriers to money and services where it is needed most.
Consolidated Funding Streams —Combine WIA Adult, WIA Dislocated Worker and Wagner-Peyser funding streams into a single formula grant; labor exchange is the foundation of the local One-Stop system with the remaining funds focused on training and intensive services; promote integrated model with TANF where TANF becomes the primary funding stream for serving low'income workers and WIA funding used to serve dislocated workers and employed.
State Allotments —take into account current formula factors for the three funding streams; base Secretary's reallotment authority on expenditures, not obligations.
With'in State Allocations —governors allocate at least 50 percent of combined funding streams to local areas —40 percent according to a statutory formula and 10 percent according to formula determined by governor; remaining 50 percent available to governor for rapid response, core services in One-Stop system and evaluations and demonstrations.
National Reserve/National Dislocated Worker Grants (formerly National Emergency Grants) —increase portion of funding for Secretary's discretion to address special layoff situations.
Increased Opportunities for Training —addresses misinterpretation of "sequence of service" strategy to provide greater flexibility in delivery of core, intensive and training services
Simplify Eligible Training Provider List (ETPL) Provisions —revise the approach to ETPL by giving governors the authority to determine what standards, information and data would be required. This would ensure a wide range of customer choice for training.
Services to Employed Workers —simplify requirements for customized training, on the job training, and incumbent worker training.
Expanded Use of Individual Training Accounts (ITAs) —expand concept of ITAs into "Career Scholarships" to which employer and individual resources could be added.
Establishment of Personal Reemployment Accounts —establish authority to create personal reemployment accounts as proposed by President Bush in the economic stimulus package.
A Targeted Approach to Serving Youth: Serving only the Out-of-School population
Focus Resources on Out-of-School Youth —end in'school services; establish Targeted State Formula Grant exclusively for Out-of-School youth; governors have discretion to target funds to local areas with highest eligible youth population.
Challenge Grants to Cities and Rural Areas —eliminate Youth Opportunity Grants and establish these new grants with 25 percent off the top of youth formula dollars; will fund Out-of-School activities for in'school youth; would be competitive grants in which cities and rural areas would apply directly to the Department of Labor; remaining 75 percent of the youth funds will go to the Targeted State Formula grants as above.
Performance Accountability: Simplifying the current performance measures
Performance Accountability/Common Definitions —replace current 17 WIA Title I performance indicators with 8 common measures (4 Adult and 4 Youth) established by the Office of Management and Budget (OMB); establish common set of definitions and data.
Negotiation of Performance Outcomes —establish long-term national performance goals which would form the basis for state'level negotiations; establish more dynamic performance negotiation process to take into account local labor markets.
Focus on Fiscal Integrity —establish strong fiscal controls including data validation and strengthened monitoring and oversight.
Expanded State Waiver Authority —remove statutory limitations to increased waiver authority.
Block Grant Authority —Allow for a "State Option" in which governors could apply for block grant authority which would give governors complete discretion as to administer WIA Title I formula programs, both adult and youth; governor would determine sub'state funding and governance structures to the local level.
To see a copy of President Bush's proposal on the reauthorization of the Workforce Investment Act please visit the Conference of Mayors website at usmayors.org/uscm/wash_update/default2.htm.
For more information or questions about the reauthorization of the Workforce Investment Act please call (202) 293-7330 to contact either Josie Hathway at jhatway@usmayors.org or Shannon Holmes at sholmes@usmayors.org.
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