BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 1270| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 1270 Author: Eduardo Garcia (D) and Roger Hernández(D) Amended: 4/6/15 in Assembly Vote: 21 SENATE LABOR & IND. REL. COMMITTEE: 5-0, 6/10/15 AYES: Mendoza, Stone, Jackson, Leno, Mitchell SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8 ASSEMBLY FLOOR: 74-0, 5/11/15 - See last page for vote SUBJECT: California Workforce Innovation and Opportunity Act SOURCE: California Labor and Workforce Development Agency DIGEST: This bill makes necessary changes to existing workforce development statutes to conform to the new federal guidelines under the Workforce Innovation and Opportunity Act (WIOA) while preserving core elements of California's workforce development policies. This bill updates statutory references to the Workforce Investment Act of 1998 to instead refer to the WIOA and make related conforming changes. This bill renames the California Workforce Investment Board (CWIB) the California Workforce Development Board and revises the membership of the board. This bill renames the local boards as local workforce development boards and revises their duties consistent with the federal WIOA. ANALYSIS: Existing federal law enacts the WIOA, formerly known AB 1270 Page 2 as the federal Workforce Investment Act (WIA) of 1998, which provides for activities and programs for job training and employment investment in which states can participate. The federal WIOA was signed into law on July 22, 2014, and replaces the WIA and retains and amends the Adult Education and Family Literacy Act, the Wagner-Peyser Act, and the Rehabilitation Act of 1973. Existing state law: 1)Establishes the CWIB and charges the board with the responsibility of developing a unified, strategic planning process to coordinate various education, training, and employment programs into an integrated workforce development system. CWIB is also responsible for the development of an annual workforce metrics dashboard for measuring investment in workforce development. 2)Provides that members of the CWIB are appointed by the Governor and represent the many facets of workforce development - business, labor, public education, higher education, economic development, youth activities, employment and training, as well as the Legislature. This bill: 1)Makes necessary changes to existing workforce development statutes to conform to the new federal guidelines under the WIOA while preserving core elements of California's workforce development policies. 2)Replaces statutory WIA references to the WIOA and makes related conforming changes. 3)Renames the CWIB the California Workforce Development Board and revises the membership of the board. 4)Renames the local boards as local workforce development boards and revises their duties consistent with the federal WIOA - including a requirement that they develop a comprehensive four-year local plan and revise the manner by which the board shares that plan with the public. AB 1270 Page 3 Background CWIB and WIA Funding The CWIB is charged with developing a unified, strategic planning process to coordinate various education, training, and employment programs into an integrated workforce development system. As such, the CWIB has adopted Sector Strategies as the statewide framework for workforce development, and is working closely with the Economic Strategy Panel, other state agencies and departments and its 49 local Workforce Investment Boards to support the emergence of effective statewide and regionally driven sector initiatives. Under federal law, WIA funds are distributed to the states based on formulas that consider unemployment rates and other economic and demographic factors. California and its 49 Local Workforce Investment Boards receive WIA formula funding from the U.S. Department of Labor through three revenue streams - Adult, Youth, and Dislocated Workers. Under federal law, 85 percent of Adult and Youth formula funds, and 60 percent of Dislocated Worker formula funds are distributed to local WIBs. Fifteen percent of Adult, Youth, and Dislocated Worker formula funds (15% discretionary funds) are allocated to the state for a variety of discretionary uses. This split in funds usage has changed in recent years due to federal budgetary restrictions and reductions so that the state generally gets less than the 15% discretionary funds. California's WIA allocation from the U.S. Department of Labor has declined over the years from a high of $630 million in 2000-01 to $391 million in 2014-15. California now receives between $350 and $400 million in federal WIA dollars annually. The federal WIOA The federal WIOA, passed by a wide bipartisan majority and signed into law by President Barack Obama on July 22, 2014, is the first legislative reform of the public workforce system in more than 15 years. WIOA supersedes the WIA. WIOA brings together, in strategic coordination, the core programs of federal investment in skill development, including employment and training services for adults, dislocated workers, youth and individuals with disabilities. WIOA also authorizes programs for AB 1270 Page 4 specific vulnerable populations including Indian and Native Americans and migrant and seasonal farmworker programs, among others. The following are some highlights of the WIOA reforms: Strategically aligns investments in workforce development programs to ensure that services provided are coordinated and complementary to ensure job seekers acquire skills and credentials that meet employers' needs. Promotes accountability and transparency by ensuring that investments are evidence-based and data-driven, and accountable to participants and tax-payers. Fosters regional collaboration to promote alignment of programs with regional economic development strategies to meet local needs. Improves quality and accessibility of services received by job seekers and employers at their local job centers by, among other things, establishing criteria for certification of the centers that ensures continuous improvements. Improves services to employers and promotes work-based training - matching employers with skilled individuals by promoting the use of industry and sector partnerships. Promotes the use of Registered Apprenticeship programs which has proven successful at providing workers with career pathways and opportunities to earn while they learn. Streamlines and strengthens the roles of Workforce Development Boards - both state and local - to ensure programs are coordinated, complementary and consistent across the state. The WIOA provisions take effect on July 1, 2015, the first full program year after enactment. However, the WIOA state unified AB 1270 Page 5 and local plans and the WIOA performance accountability provisions don't take effect until July 1, 2016. The U.S. Department of Labor will issue further guidance on the timeframes for implementation of WIOA. The U.S. Department of Labor, in coordination with the U.S. Departments of Education and Health and Human Services, are working to ensure that states and local areas, other grantees, and stakeholders are prepared for implementation of WIOA by providing technical assistance, tools, and resources to its website, webinars, and virtual and in-person discussions. The U.S. Department of Labor has also recommended that state's review their existing laws to identify areas that may conflict with WIOA and develop plans and strategies to resolve these conflicts. Additionally, beyond complying with the new federal requirements, WIOA offers states an opportunity to continue to modernize the workforce system and create a customer-centered system where 1) the needs of business and workers drive solutions; 2) one-stop career centers provide excellent customer service to jobseekers and businesses; and 3) the workforce system supports strong regional economies. State and local workforce boards - in partnership with workforce, economic development, education, and social service organizations at the state, regional and local levels are encouraged to work together in this transition to achieve the vision of WIOA. To this end, WIOA allows states and locals to use up to two percent of the WIA's 2014 fiscal year Youth, Adult and Dislocated Worker funds for this transition. AB 1270 is one of two bills being sponsored by the California Labor and Workforce Development Agency that will make the necessary changes to existing law for the implementation of WIOA in our State. Related Legislation AB 1507 (Committee on Labor & Employment, 2015) is similar to this bill in that it makes necessary conforming changes to various codes in order to update the WIA to WIOA references, however, each amending different code sections where these changes are needed. AB 1270 Page 6 SB 45 (Mendoza, 2015) is the second piece of legislation sponsored by the California Labor and Workforce Development Agency to make the necessary changes to existing law for the implementation of WIOA. Among other things, the bill requires that the state, in conformity with WIOA and after consultation with local boards and chief elected officials, identify planning regions and requires the locals to prepare regional workforce development plans. SB 45 is pending in Assembly Labor and Employment Committee. FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: Yes SUPPORT: (Verified6/10/15) California Labor and Workforce Development Agency (source) Association of California School Administrators California Chamber of Commerce California Manufacturers &Technology Association California Primary Care Association California Professional Association of Specialty Contractors California Workforce Association La Cooperativa Campesina de California SIATech OPPOSITION: (Verified6/10/15) California Right to Life Committee, Inc. ARGUMENTS IN SUPPORT: According to the sponsor of this bill, the California Labor and Workforce Development Agency, the new federal WIOA seeks to make the workforce system more comprehensive in its approach to service delivery and more responsive to the demands of our global economy. In particular, the new law requires greater policy and operational alignment among workforce services, adult education, job services, and vocational rehabilitation. It also calls for program coordination among workforce services, community college programs, and social service programs, as well as coordinated AB 1270 Page 7 point of service delivery across programs at the regional and local levels, while also directing that workforce training align with regional labor market needs. The sponsor states that this bill is necessary to make technical conforming changes to the State Workforce Act consistent with direction from WIOA. Additionally, the author states that while this bill modifies state workforce development laws to conform to the changes required by the new federal WIOA, the core elements of California's workforce development policies are preserved including a focus on regional economies and sector strategies as well as recently enacted workforce data and measurement metrics designed to incentivize high performing boards, and set minimum local training expenditures. ARGUMENTS IN OPPOSITION: The California Right to Life Committee, Inc. is opposed to this bill because they argue that the language in this bill views government as the conduit for employment, working with existing boards and councils to direct where businesses should be developed or supported. They support less government involvement in business, family and personal lives. ASSEMBLY FLOOR: 74-0, 5/11/15 AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood NO VOTE RECORDED: Brough, Campos, Beth Gaines, Gallagher, Grove, Atkins Prepared by:Alma Perez / L. & I.R. / (916) 651-1556 6/24/15 17:20:38 **** END **** AB 1270 Page 8