BILL ANALYSIS �
AB 923
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Date of Hearing: May 4, 2011
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Sandre Swanson, Chair
AB 923 (Fong) - As Introduced: February 18, 2011
SUBJECT : Workforce development: Lifelong Learning Accounts
Initiative Program.
SUMMARY : Creates the Lifelong Learning Accounts Initiative
Program (Program), beginning January 1, 2014, for the purpose of
providing grants to employers and employees to be used to
establish individual lifelong learning accounts, as defined, for
the deposit of funds to be used for lifelong education and
training. Specifically, this bill :
1)Requires the Employment Development Department (EDD) to
establish a grant program to provide matching grants, as
specified, to employees and employers, thereby encouraging
them to save for lifelong education and training. However,
matching funds will be available based upon EDD's
determination that sufficient funds to cover program costs
exists.
2)Allows the EDD to contract with an individual, nonprofit
organization, or other business to administer and implement
the grant program.
3)Requires EDD to make education and other support services
available to employees and provide technical assistance to
employers for the implementation of the grant program and
allows grant funds to be used to offset costs of providing
support services and for Program administration.
4)Establishes within the State Treasury, a Lifelong Learning
Program Fund to receive contributions from individuals,
foundations, nonprofit organizations, businesses, and the
federal government to be used for the program.
5)Requires the EDD to prepare and submit a report to specified
Legislative Committees evaluating the effectiveness of the
Program at least 20 days prior to the date the Legislature
reconvenes in 2016.
6)Requires the EDD, after consultation with the Treasurer and
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the Scholarshare Investment Board, to adopt rules and
regulations necessary to ensure the implementation and
administration of the Program.
7)Specifies that the Program shall only be implemented if the
Director of Finance makes a written determination that there
are sufficient funds from sources other than the General Fund
available for the program.
EXISTING LAW :
1)Establishes the California Workforce Investment Act (WIA) that
provides for workforce investment activities that increase the
employment, occupational attainment, and retention and
earnings of participants, which will improve the quality of
the workforce, reduce welfare dependency, and enhance the
productivity and competitiveness of the nation's economy. The
California WIA serves to implement a state agency partnership
between the California Department of Education, the California
Workforce Investment Board and the EDD to collaboratively
implement the Governor's WIA Strategic Plan.
2)Authorizes the EDD to administer a variety of services to
Californians under the Job Service, Unemployment Insurance,
Disability Insurance, Workforce Investment, and Labor Market
Information programs. The Workforce Services Branch, within
EDD, administers several statewide workforce preparation
programs and initiatives that focus on preparing adults and
youth for the labor force. California distributes millions of
dollars annually in federal funds statewide to provide
training services for adults, dislocated workers, and youth.
Workforce investment services are provided through
comprehensive one-stop career centers that provide access to a
full range of services pertaining to educational activities,
employer services, and referrals to other appropriate social
services.
FISCAL EFFECT : Unknown
COMMENTS : Lifelong Learning Accounts (LiLAs) are
employer-matched accounts used to
finance education and training. LiLAs help employees save for
additional training and
education, as well as encourage partnerships between workers and
employers by investing in
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education and training that improves workers skills while
meeting the needs of their employers.
Numerous pilot projects involving LiLAs grant-matching have been
adopted over the years in states like California, Indiana,
Illinois, Kansas, Missouri, Maine, and Washington. The CA LiLA
project operates out of San Francisco and includes the
participation of four employers, three in the health care sector
and one in the public sector. According to information
provided, participants have used their LiLAs for a range of
training from intensive language skills for health personnel to
nursing school. Existing pilot projects are generally for a
limited number of workers and/or industries.
In recent years, similar bills to create Lifelong Learning
Accounts have been introduced, but
not passed, at the federal level. HR 5715 by Congress member
Larson was introduced in 2010
and would have amended the Internal Revenue Code of 1986 to
establish lifelong learning
accounts to provide an incentive for employees to save for
career-related skills development and to promote a competitive
workforce through lifelong learning. S. 26 by Senator Cantwell
of 2007 would have amended the Internal Revenue Code of 1986 to
establish a program demonstrating multiple approaches to
Lifelong Learning Accounts, which are portable, worker-owned
savings accounts that can be used by workers to help finance
education, training, and apprenticeships and which are intended
to supplement both public and employer-provided education and
training resources, and for other purposes.
The Council for Adult and Experiential Learning (CAEL) supports
this bill stating that LiLA's
put learning opportunities within reach of adults who have
entered the workforce, but may not
have the skills to compete in the global economy and are
designed to help Californians build a
more competitive workforce. CAEL points to a study by the
Hudson Institute , stating that 60%
of newly created jobs require skills that only 20% of the U.S.
workforce possesses. There is very
little financial assistance for adults who want to expand their
career choices by pursuing
education and training opportunities. CAEL also states that
this bill has been introduced to
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position our state to apply for funds that may be made available
by the federal government and
other sources to assist in the development and implementation of
the Program, so that it would
not require the use of General Fund dollars should federal
legislation pass.
PRIOR AND RELATED LEGISLATION :
AB 1320 (Fong) of 2010, was identical to this bill and
subsequently held on the Senate Appropriations Committee
suspense file.
SB 1457 (Steinberg) Chapter 474, Statutes of 2008 established
the California Scholarshare Advancement Vehicle for Education
(CalSAVE) program within the Scholarshare trust to fund
scholarships for beneficiaries to be determined by the
Scholarshare Investment Board.
REGISTERED SUPPORT / OPPOSITION :
Support
Council for Adult and Experiential Learning
Opposition
None on file.
Analysis Prepared by : Lorie Erickson / L. & E. / (916)
319-2091