The National Association of State Workforce Agencies (NASWA) is the organization of state officials who administer the publicly-funded workforce programs that are defined under federal statute by the Workforce Investment Act of 1998, but are operated and administered at the state and local level. The following statement reflects the consensus views of NASWA's members on reauthorization of the Workforce Investment Act (WIA).
Background
The publicly-funded workforce system has undergone a remarkable transformation since the passage of the Workforce Investment Act of 1998. Even before passage of WIA, states were moving toward combining the various workforce-related programs into a seamless system where today's workforce learns tomorrow's skills and today's employers can find tomorrow's promising employees.
One of the biggest challenges facing state and local officials today is designing a customer-friendly, publicly-funded workforce development system that is flexible enough to adapt to the various changes in the economy. Since WIA was enacted in 1998, the economy went from being very strong and robust with employers hiring large numbers of people to a recession that resulted in individuals being laid off and employers drastically reducing their workforces.
In addition, the funding for many programs provided under WIA has been uncertain over the last year in particular, making it difficult for state and local officials to make long-range plans. Funding for Wagner-Peyser labor exchange services, the "cornerstone" of the One-Stop system, has been flat-lined for most of the past decade, forcing states to make severe cuts in staff assistance for employer and jobseeker customers. Adequate funding of WIA and Wagner-Peyser is needed to achieve true "universal" services to jobseekers and employers.
NASWA agrees with many of the findings from the General Accounting Office on challenges in implementing the Workforce Investment Act. In summary, the findings indicate that:
Other challenges that our members have identified include:
Despite (or in spite of) the challenges outlined above, the publicly-funded workforce system has improved the lives of thousands of individuals and has helped business owners find qualified staff to meet their workforce needs. To highlight the importance of our services, one must only look back upon two events in our nation's recent history - the terrorist attacks of September 11 and the recession. The response of the workforce system to these events illustrates how the system works to improve career opportunities for workers, helps businesses find qualified workers and helps to stabilize the national economy.
WIA reauthorization provides the publicly-funded workforce system with an opportunity to improve upon the successes and develop solutions to the challenges. NASWA and its members are eager to develop solutions with our federal, state, and local partners to the challenges mentioned above and the many others that have been cited by our members at the various forums and in writing. We look forward to working with the Department of Labor and other federal, state and local partners in the coming months leading up to reauthorization of WIA, Carl Perkins, Vocational Rehabilitation, TANF, Adult Education, Higher Education, and other related federal statutes. The timing of these reauthorizations provides great opportunity to align programs and services to better meet the one-stop workforce development system.
RECOMMENDATIONS FOR WIA REAUTHORIZATION
FEDERAL-STATE-LOCAL PARTNERSHIP
Federal laws, regulations and policies should establish and maintain the minimum requirements necessary to ensure that an effective federal-state-local partnership is in place, leaving governors free to design and administer systems which meet the needs of their respective labor force customers--both businesses and jobseekers--and local labor markets.
NASWA members support an integrated workforce development system that delivers services through a one-stop career center system. It is imperative that the federal government recognizes the diversity of state efforts and not override state innovation with overly prescriptive federal rules or mandates. Therefore the federal government should not prescribe a single approach to a one-stop career system on the states, but rather help facilitate and support statewide workforce development systems that are responsive to local labor market needs. Governors require additional flexibility to design workforce systems that meet the needs of individuals, businesses and local communities. Governors need to be designated as the one in charge of determining how WIA will work in their own state.
GOVERNANCE - STATE AND LOCAL WORKFORCE INVESTMENT BOARDS (WIBs)
WIA should be amended to grant governors and local areas greater flexibility in determining board memberships that meet their needs, while still requiring a private sector majority. Individual representation requirements which affect the size of state and local boards should be left up to state officials. The responsibilities of the states need to be further defined, i.e., issuance of policy, policy coordination, administrative oversight, establishing confidentiality requirements, establishing minimum performance standards, establishing a framework for delivery of services.
Title I of WIA should only include the overall requirements for building a workforce development system: governance, establishment of WIBs and the one-stop requirements. WIA job training should be moved to a separate title. This will reinforce the notion that WIBs and the one-stop centers/system are independent from funded programs, help establish clearer separation between policy and operations on WIBs, and clarify that WIA is more than job training.
FUNDING PROVISIONS
NASWA supports language that gives governors and localities greater authority to transfer funds between all three WIA Title Ib programs (adult, youth, dislocated workers). The 20 percent limitation on transfer of WIA funds across adult and dislocated worker funding streams should be expanded and states should have greater authority to transfer funds between programs to best meet the needs of their customers. The Governor would establish policy and procedures to transfer funds between localities and programs.
The issue of "expenditures" versus "obligations" of WIA funds needs to be clarified. The Administration needs to work with states to determine a common definition and reporting processes to ensure consistent accounting and reporting of WIA spending. NASWA members recommend that "obligations" is a more accurate accounting of what is really occurring in states; however, guidance needs to be provided to all states with definitions and standardized procedures. Furthermore, the deobligation/reobligation provisions need to be modified. The current requirement to reobligate funds to all Boards should include consideration of performance and expenditure levels rather than an automatic reobligation requirement.
Incumbent worker training and/or employee retention is a significant need expressed by businesses. WIA resources should be more flexible to meet this need, and states should be given greater authority to use Title lb funds for incumbent worker training beyond what is currently allowed in regulation.
All partners in the workforce investment system must share the costs associated with the one-stop infrastructure. A portion of the federal funds for partner agencies' programs should be designated to mandate an appropriate share of cost from each federally funded program to share in the administration and operation of one-stop centers/systems.
Resources should be provided for analysis and delivery of state and local employment statistics data which are needed by educational institutions, economic developers, and human resource planners. WIA requires a much expanded use of employment statistics; however, the Act does not provide funds for this requirement. Adequate federal funds should be provided to states to ensure standardization and to maintain data integrity.
Federal cost allocation and expenditure requirements must be simplified, and must consider the one-stop structure. They must be designed to diminish the "silo" aspect of federally funded programs and enable leveraging of resources to support one-stop efforts and to address customer service needs caused by gaps in program funding.
Dislocated worker formula allotment should be modified to minimize funding volatility from year to year. A portion of the Dislocated Worker funds should be reserved to handle spikes in dislocated worker activity. National Emergency Grants (NEG) have been utilized to address emerging and new needs of dislocated workers. The Administration needs to work with states to improve the application process and simplify the grants for NEGs so that the turnaround time efficiently meets the needs of those individuals needing services.
WORKFORCE DEVELOPMENT--ECONOMIC DEVELOPMENT CONNECTION: KEY TO BUSINESS INVOLVEMENT
A section within the WIA legislation should be devoted to business services. This section should require input from the business customer, list potential services for the business customer, authorize the provision of services that meet businesses' workforce needs, and emphasize the linkage between workforce development and economic development.
Developing a workforce equipped with the specific skills needed by employers is a vital component of the development system - workforce preparation activities must be based on a demand side strategy. There is a strong need to "market/highlight" workforce development in general and WIA in particular as an economic development tool.
If states are to be successful in meeting the diverse needs of the current and future workforce, they must be allowed the flexibility to:
Employer engagement will be positively impacted by increasing WIA's involvement with incumbent worker training, including apprenticeship, and promoting a stronger connection with economic development.
MANDATORY PARTNERS
Language in WIA requiring WIBs and the WIA programs to coordinate with over one dozen mandatory partners has been difficult because there is no statutory requirement in the partners' federal enabling statutes for the partners to coordinate or participate in WIA. Federal partners have made very narrow interpretations that reinforce the separateness of the independent programs - symptomatic of an absence of any or little collaboration between partners at the federal level, especially between departments. WIA Reauthorization should address authorizing legislation of the mandatory partners to clarify requirements for participating in the one-stop system. Action on this issue is opportune since most of the partners' programs are up for reauthorization this year.
PERFORMANCE MEASURES & COMMON DEFINITIONS
The workforce development system could be greatly improved by federal program integration - different definitions, funding cycles and performance measures result in competing priorities, administrative complexity and difficulty in providing quality service. A lack of common definitions among programs has negatively impacted states' ability to report performance. Definitions and information/reporting systems should be uniform or at least complementary for one-stop partner programs in the various federal agencies. This will, in turn, allow for better information exchange between programs, better service coordination, and more clearly defined and focused services for customers. The creation of common definitions and reporting formats at the federal level also will encourage common state and local reporting systems for one-stop partner programs.
In a performance-driven system such as envisioned under the WIA, accountability should rely on a limited number of clear, direct, and understandable outcome measures, reported to the Congress and the general public. Common definitions across all programs are a critical need if we are to provide seamless services. NASWA therefore supports the creation of system-wide measures that will also help ensure that programs are better aligned.
The lack of common definitions, differing program eligibility rules, and multiple program-specific performance measures and reporting systems continues to create difficulties in developing a seamless system at the local level. NASWA supports a reduction in the number of individual program measures focusing instead on a handful of system-wide performance accountability measures. Furthermore, the ASCI customer satisfaction system that ETA requires states to use is not cost effective and does not provide states with useful information that will result in continuous improvement. However, NASWA does believe that customer satisfaction is an important measurement, especially for business services. In order to promote continuous improvement governors should be encouraged to establish a customer satisfaction system to measure this service at a state/local level.
The Administration (Office of Management and Budget) has developed common performance measures for approximately 31 job training and employment programs for adults and youths that are funded by 6 federal agencies. Although the programs vary considerably in the types of services provided and the target populations served, their common goal is to improve participants' employment and earnings. The measures include:
Adult Programs
Youth Programs
NASWA applauds the OMB effort and looks forward to working with the Administration and Congress in fine-tuning these measures over the coming year with the goal of finalizing a set of common measures that can be included in WIA reauthorization. In particular, some states are concerned that the measures will provide a disincentive to offer entrepreneurial training to customers. Careful attention must be paid to ensure that checks are put into place so that there are not "performance disincentives" to providing services to those customers with multiple major barriers. Finally, the measures must take into account economic conditions at the state and local levels.
NASWA believes that the use of the Wage Record Interchange System (WRIS) has become a useful tool for states to obtain wage record information for out-of state participants for the purposes of reporting WIA performance. It is important to note that states must still collect real-time data for program management purposes due to the lag time in the availability of wage record information.
ELIGIBLE TRAINING PROVIDERS
The Eligible Training Provider (ETP) list is a good concept, but it has not worked as well as Congress intended. There is little incentive for educational and training institutions to provide necessary performance data for non-WIA students; although, some states have recently indicated that their education institutions are beginning to see the value of reporting performance data for all students. Requirements for reporting on all program participants, regardless of funding source, is having a negative impact on training provider participation in many states. It is believed that the intent of creating the ETP list system was to provide greater customer choice; however, it has resulted in the opposite, diminishing customer choices in many states.
There is a general consensus among states that WIA should be changed so that training providers are not required to report outcome data on students whose training costs are not funded by WIA. Flexibility is needed for governors to implement an ETP system that meets their needs and circumstances.
YOUTH PROGRAMS & SERVICES
In general, WIA is much more flexible than its predecessor, JTPA; however, the youth program provisions are still quite rigid and restrictive. Governors should be allowed more flexibility to design youth programs, services and eligibility criteria that meets the needs of their state and local areas.
There is clear consensus that the youth eligibility criteria for services under WIA are overly restrictive and that the eligibility criteria in place under JTPA that allowed the "free and reduced lunch test" as documentation of low-income status, rather than requiring full family income documentation, should be restored. NASWA recommends that the eligibility criteria for youth be changed to include all "at risk youth", and that "at risk youth" be defined. Some suggestions are: drop outs; youth affected by substance abuse; disabled youth; youth in contact with either the criminal justice system or the welfare system; participant in the "free and reduced lunch test"; and/or economically disadvantaged.
Youth programs should be administered consistently with adult programs in terms of service provider identification and selection and follow-up services. Core WIA principles of collaboration and inclusion are confounded in the requirement that youth programming be competitively bid, thus pitting providers against each other rather than bringing providers together in a collaborative system of services. The required competitive bids should be removed from statute, allowing states to either administer youth programs consistent with adult programs or to utilize the bidding process.
Several states believe that there should be an increase in local flexibility to define out-of-school youth. In addition, states would like the prohibition of Individual Training Accounts for youth to be removed in order to allow for more youth training options.
LABOR MARKET INFORMATION SERVICES
The Workforce Investment Act's Employment Statistics section delineates for the first time in statute a system of employment statistics or labor market information. Governors designate a single state agency to be responsible for the management and oversight of the statewide employment statistics system.
Accurate, timely, and widely accessible information about local, state, and national labor market conditions, trends, and characteristics is vital for business decision making, economic development and analysis, and economic policy decisions. Employment statistics are also an essential component of an effective workforce development system giving individuals vital information about occupations and guiding decisions about the design of training for skills in demand in the labor market, as well as providing students with a smooth transition from school to work.
The increased demand for local data under the Workforce Investment Act has not been addressed by Federal budget requests; NASWA recommends that U.S. Department of Labor consider this demand in future budget requests.
States need the support of both the Employment and Training Administration and the Bureau of Labor Statistics in making the labor market information system more easily accessible, targeted to meet specific users' needs, and "user friendly" (easily understood and interpreted). In addition, states need adequate resources to take advantage of state-of-the-art information technology, including electronic linkages among states and areas.
ADMINISTRATIVE
All workforce development programs should run on consistent program years; funding cycles need to coincide to help alleviate administrative problems.
NASWA encourages efforts to have automated systems communicate with each other.
NASWA members support the continuation of efforts by federal oversight agencies to agree on common definitions and common data elements among the programs that provide employment and training services, including vocational and adult education programs.
Although state reserve funds and administration funds are supposedly cost pooled, obligations, expenditures and draw-downs must be tracked and reported by individual funding silos - this places an administrative burden on state and local workforce areas. If funds are allowed to be cost pooled, states and local areas should be allowed to report them in the same manner.
Procurement and reporting deadlines must be streamlined. Aggregate data should be reported, with individual data available at the state level, if needed. This would save monies, time, and diminish problems/frustrations.
February 10, 2003
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