States want more control over workforce development money

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Posted: Wednesday, August 21, 2013 12:00 am

States struggling to rebuild their workforces in the wake of staggering unemployment say they know better than the federal government how to make the most out of limited workforce development and job training dollars.

Governors want more administrative control over programs funded through the Workforce Investment Act, now before Congress for an overhaul. As that discussion continues, the National Governors Association has a wish list.

“We know the federal dollars have been cut, but what’s even worse is the fact that we have less flexibility,” Iowa Gov. Terry Branstad, Republican vice chairman of NGA’s Education and Workforce Committee, said earlier this month. “We’re saying that we as governors and our directors of workforce development are much more in tune with what the labor force in our state needs than the people in Washington, D.C.”

In particular, the governors are pushing for restoration of a 15 percent “set-aside” of Workforce Investment Act funds that they used to explore new approaches tailored to their states’ workforce needs. In 2011, the federal government cut that to 5 percent. Even with the reduction, states received a total of $120 million in set-aside funds in 2013, so the amount of money at stake is significant.

“With the loss of those funds, we are seeing an elimination of services and a full halt to innovation,” said Joan Wodiska, director of NGA’s Education and Workforce Committee.

Wodiska called the reinstatement of those dollars “a top priority for governors.” She said the 2011 reduction was part of a philosophical shift that moved away from giving large pots of money directly to states without proscribing specific activities.

“They’ve decided where to spend the money, and they’ve really broken the trust that we had,” said Connecticut Gov. Dannel Malloy, a Democrat who chairs the committee. “We’re trying to restore that trust.”

Wodiska said without sufficient set-aside money, states are forced to compete with local governments for more of the Workforce Investment Act funds. This process makes it difficult for states and localities to work together, she said.

»Virginia placed 271 workers who had lost jobs in the textile and tobacco industries in positions at Swedwood USA, an international manufacturer and distributor of wood furniture.

»Colorado spent $3 million to establish 10 regional partnerships in the health care, manufacturing and energy industries, which attracted an additional $1 million in public and private investments. More than 1,000 workers have been trained, and 700 now have jobs.

»Oklahoma created an online portal that allows job seekers to explore different industries, including shifting demand for particular types of workers, salary levels, job openings, and related education and training opportunities.

»Washington state bolstered its aerospace industry, first with a resource center that recruited, screened and trained thousands of production workers to work on Boeing’s 787 Dreamliner and similar projects. A newer program will train more than 500 workers to design, build and maintain aircraft.

»Alaska spent $150,000 to establish construction industry apprenticeships. The funding helped participants acquire skills in heavy civil construction, project management and administration by providing instruction, wage subsidies and on-the-job training.

The set-aside issue is a small piece of a much larger discussion taking place in Congress: How the nation’s sprawling workforce development system should work.

A 2011 U.S. Government Accountability Office report found the U.S. spent $18 billion in 2009 to administer 47 jobs programs with overlapping missions and poor tracking of outcomes and effectiveness.

Congress is considering an update or overhaul of the Workforce Investment Act, originally passed in 1998 and scheduled to be reauthorized a decade ago. Instead, programs have continued through annual appropriations.

The NGA has not endorsed either version.

Both approaches emphasize the role of states in workforce development. The Senate bill asks states to submit a unified statewide plan to the federal government covering all job training, employment services and vocational rehabilitation programs to help streamline administration of the programs. It consolidates some programs and creates an innovation fund to help identify best practices.

The House version consolidates the current system into a block grant program that centralizes control at the state level. Governors would have more input over local workforce development efforts than they do under the current system.

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