BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                          AB 391 (Pan)
          
          Hearing Date: 7/11/2011         Amended: 5/27/2011
          Consultant: Bob Franzoia        Policy Vote: L&IR 5-0
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          ____
          BILL SUMMARY: AB 391 would require the Employment Development 
          Department (department), commencing by July 1, 2012, to provide 
          unemployment insurance (UI) benefits assistance in comprehensive 
          one-stop career centers in five workforce investment areas.  
          This bill would require that the unemployment benefit assistance 
          services required to be provided at these comprehensive one-stop 
          career centers be funded with existing money available to the 
          department for the administration of the UI program.  The 
          provisions of this bill would sunset on December 31, 2015.
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          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2011-12      2012-13       2013-14     Fund
           Limited in-person      Up to $2,800 annually to redirectSpecial*
          unemployment insurance personnel resources with costs of up to
          benefits assistance    $200 one time per center for operations 
                                 through 2015, resulting in an increase in
                                 direct assistance services. Unknown, 
          likely
                                 similar reduction in on-line/call center 
          services               

          * Unemployment Administration Fund (7100-0870)
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          ____

          STAFF COMMENTS: This bill meets the criteria for referral to the 
          Suspense File. 

          Funding to administer the unemployment insurance (UI) program 
          has been declining for several years.  As a result, EDD has been 
          moving from providing UI services in person to providing 
          electronic services.  By investing in additional staff and not 
          offices and related overhead, EDD has increased staff available 
          to provide services overall, though in-person services have 
          declined.








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          The call center and adjudication center environment provides 
          flexibility in terms of shifting workload between centers.  Work 
          can be processed in any center as needed, as opposed to 
          traditional in-person services, when one center might be 
          overloaded with customers while another center might have few 
          customers.  Whether EDD should provide more direct, in-person, 
          access to EDD staff able to make UI determinations is a subject 
          of much debate.

          Currently UI services are provided via phone, mail, fax, and 
          Internet by staff in regionalized centers throughout the state.  
          Staff in one-stop career centers are available to help 
          individuals with some UI services, and for more complex issues, 
          there is a process to refer the issue to trained UI staff for 
          resolution.

          This analysis estimates that a minimum of five staff are 
          necessary in each of the five comprehensive One-Stop Career 
          Centers, for a total of 25 Employment Program Representative 
          (EPR) staff.  Furthermore, an estimated three Employment Program 
          Managers would be needed to supervise the EPR staff.  The 
          estimated annual staffing cost for staff and management is 
          approximately $2.8 million.  In addition, there would be an 
          estimated one-time cost of approximately $150,000 to $200,000 
          per center for equipment and operating expenses, such as 
          personal computers and furniture.  This bill does not provide an 
          appropriation or reimbursement for these costs, which would have 
          to be absorbed by the existing UI administrative grant.  Any 
          money spent on this effort would result in a decrease in 
          staffing, or at best, potentially a shift in staffing depending 
          on job classifications, that provides services in the 14 UI 
          centers and difficulty in maintaining service levels.   

          AB 857 (Galgiani) 2009 and AB 1827 (Aramula) 2010 which proposed 
          providing in-person UI benefits assistance in at least one 
          comprehensive one-stop career center in each workforce area were 
          held on the committee's Suspense File.














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