WORKFORCE INNOVATION AND OPPORTUNITY ACTISSUES (STATUTORY AND REGULATORY) THAT IMPACT SERVICE DELIVERY DISCUSSION PAPER
Background
The Workforce Investment Act (WIA) of 1998 was amended by the Workforce Innovation and Opportunity Act (WIOA) which was signed into law on July 22, 2014. The WIOA Notice of Proposed Rulemaking (NPRM) for Titles I through IV was published in the Federal Register on April 16, 2015.
During the 60-day public comment period, the Texas Workforce Commission (TWC) submitted numerous comments addressing concerns about regulatory and statutory changes specific to the transition from WIA to WIOA. The public comment period for the NPRMs closed on June 15, 2015. The Department of Labor (DOL) and the Department of Education (ED) reviewed all comments submitted and prepared the final rule with amendments made to the NPRM.
On August 19, 2016, the WIOA Final Rule for Titles I through IV was published in the Federal Register. Most of TWC’s comments were addressed in the preamble of the WIOA Final Rule. In some cases, the responses signaled changes to the final regulations, and in other cases, the Departments of Labor and Education (Departments) declined to make changes to the regulations.
Staff have comprehensively reviewed the final WIOA regulations and the guidance issued by the Departments and have identified issues that continue to pose challenges to the Agency. This document summarizes the issues that staff have identified for the Commission’s consideration as a legislative or regulatory change priority.
WIOA Issues that Require Departmental Action/Regulatory Change
- VR Pre-Employment Transition Services – Directly Supporting Goods and Services
Federal Rehabilitation Services Administration (RSA) guidance under 34 CFR 361.48(a)(2) has created challenges for states regarding what counts toward the fifteen percent Pre-ETS requirement with the restriction on counting goods and services which support customer participation in pre-ETS services, for example, transportation, assistive technology and job coaching. RSA has also created confusion in its determination of how good and services may be funded, for example a uniform purchased for a work experience customer is an allowable Pre-ETS expense if purchased by the employer, but it’s a disallowed Pre-ETS expense if purchased by the case manager. RSA should allow states the flexibility to count goods and services which directly support VR customer participation in Pre-ETS services to count toward the fifteen percent Pre-ETS requirement. This change will allow a more efficient use of VR funds.
- VR Pre-Employment Transition Services - Funding for Authorized Activities
Final regulations only allow States to expend fifteen percent Pre-ETS funds on authorized activities after the State has demonstrated that it has provided the required Pre-ETS activities to all eligible youth. Clarification is needed regarding Final Rule 34 CFR 361.48(a)(3), which indicates that states are allowed to expend Pre-ETS funds on authorized activities when “funds are available and remaining after the provision of required activities found in 34 CFR 361.48(a)(2).” TWC would also note that most of the “authorized activities” are planning activities meant to establish the “required activities” in Section 361.48(a)(2). This would allow states to build the capacity of the system to provide pre-ETS, for example by:
- providing instruction to vocational rehabilitation counselors, school transition personnel, and other persons supporting students with disabilities;
- disseminating information about innovative, effective, and efficient approaches to achieve the goals of this section; and
- developing and improving strategies for individuals with intellectual disabilities and individuals with significant disabilities to live independently, participate in postsecondary education experiences, and obtain and retain competitive integrated employment.
- Performance Accountability
There are several performance issues that hinder the state’s ability to develop shared, common performance accountability systems that promote system integration.
- Application of the Common Measures to all Six Core Programs.
OCTAE has not adopted the Measurable Skills Gains definition in use by all other core programs. OCTAE is not using client-level data in support of required statistical models which are intended to account for the differences in program characteristics and economic conditions. Neither TWC nor our AEL partners would have to collect more data. - Disincentive for Year Round Enrollment – Measurable Skills Gain Measure.
The measure’s methodology, defined in 20 CFR 677.155(a)(1)(v) - primary indicators of performance under WIOA, includes everyone in the denominator immediately, which creates a disincentive for enrolling Participants in training/education programs late in the Program Year because they may not have been in the course long enough to have an opportunity to achieve a gain, but would still be included in performance. This is particularly true for AEL where all Participants are included in the measure and where there may be a more significant influence on program design and scheduling.
Ongoing analysis and review of proposed departmental guidance issued via ICR’s relating to performance accountability will continue to take place, and could result in additional staff comments or additional items for consideration and action on behalf of the Commission.
WIOA Issues that Require Congressional Action/Legislative Change
- Out of School Youth (OSY) Expenditure Requirements
At a minimum, eliminate the expenditure requirement associated with serving OSY from statewide funds. This change would provide for the use of statewide youth funds to support more innovative in school youth programs that align with the intent of WIOA in supporting the preparation of young people for in-demand careers in the workforce, regardless of school status.
In addition, also eliminate the expenditure requirement associated with serving OSY from local formula funds. This change would provide local areas with the flexibility to serve students based on local demographics, again aligning with the intent of WIOA in supporting the preparation of young people for in-demand careers in the workforce, regardless of school status.
- Vocational Rehabilitation (VR) Pre-Employment Transition Services - Tuition Payments
Final VR regulations disallow the use of Pre-Employment Transition Services (Pre-ETS) funds for tuition payments for transitioning youth. Post-secondary educational opportunities are a critical service in assisting youth with disabilities to achieve success. Providing states with the flexibility to use their fifteen percent Pre-ETS funds to support tuition and associated fees for transitioning youth would help address these needs.
- Required Timeframes Related to the Submission of Combined State Plans and VR Comprehensive Needs Assessments
Under WIOA, the unified or combined state plan is a four-year action plan. Within the unified or combined state plan, the VR portion must contain the required VR Comprehensive Statewide Needs Assessment, modified every three years. WIOA statute pertaining to the timeframe for conducting the VR Comprehensive Needs Assessment should be modified from every three years to every four years to align with the WIOA Combined State Plan’s four-year submission requirement.
- Governors’Reserve Sanction for Failure to Meet Performance Accountability Expectations
Under WIOA, a state that fails to meet performance expectations for two consecutive years is subject to a financial sanction. Given that a financial sanction under WIOA was primarily intended to be the result of a failure to achieve acceptable outcomes for system customers, the penalty should be reserved to be spent on technical assistance and performance improvement planning rather than recapturing those funds from the state. Simply removing money from the state rather than redirecting it at the deficient areas is a less effective way of improving performance and would have a greater negative impact on system customers.
- Local Infrastructure Funding Requirements
Under WIOA, all required one-stop partners are required to pay infrastructure costs based on their proportionate share of use of the workforce system and the relative benefit received, regardless of whether they are physically co-located or not. The requirement imposes a disincentive for all one-stop partners to fully integrate, as integration would require going through the cumbersome, burdensome, and costly process of determining, and periodically reassessing, their proportionate contribution to infrastructure funding. These requirements could also create a disincentive for partner programs to make referrals to other partner programs thereby inhibiting integration and continuous improvement. Eliminating the requirement that all required partners contribute to infrastructure funding, or limiting the requirement to only those partners that are co-located, would allow for continued local flexibility in how infrastructure costs are funded and maintain an environment that promotes integration amongst partners.
Support Documents
Additional support information is provided in the following documents:
- Details regarding WIOA Statutory and Regulatory Issues – a detailed account of the issues that hinder WIOA implementation as described in this document.
- WIOA Statutory and Regulatory Issues that may be addressed later – issues that do not have a high priority, but may be considered once other higher priority issues have been addressed.
DP- WIOA Issues that Impact Service Delivery (2.14.17) Notebook