Department of Labor and Workforce Development FY

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1 Discussion Points UNEMPLOYMENT INSURANCE 1. The unemployment insurance compensation trust fund (UI trust fund) is the federally maintained account which is used to receive employer and employee UI taxes and to pay all State funded unemployment insurance (UI) benefits. The balance in the fund determines the tax rate for employers for the following year as explained below. On March 31 of each year, the State determines the reserve ratio in the UI trust fund, as statutorily required pursuant to N.J.S.A.43:21-7. The ratio of the UI trust fund is used to establish the tax rate for employers in the following fiscal year. The tax rate is often referred to by its corresponding column in the statutorily established tax rate table, or columns A through E, with A being the lowest tax rate and E being the highest tax rate. Additionally, for all years after FY 2011, P.L.2011, c.81 increased the UI trust fund reserve ratios which are used to set employer UI tax rates in such a manner that larger reserves are required in the UI trust fund to trigger a reduction of employer UI taxes. This change was designed to shore up UI trust fund reserves sufficiently to reduce the likelihood that any future recession will result in the deep UI trust fund deficits which have caused such large employer UI tax increases in prior years. The new reserve ratio triggers still permit employer UI tax reductions as reserves accumulate, but the tax reductions will not be as large. Questions: a. Please provide the UI trust fund reserve ratio for 2016 (including the 3/31 fund balance, any liabilities, and taxable wages for the prior calendar year) and estimates for 2017 and Please provide the assumptions underlying the department s estimates, on a monthly basis, including: insured unemployment rates; total unemployment rates; anticipated UI benefit payments (regular, extended benefits and temporary extended unemployment compensation); employer tax revenue; and employee tax revenue. What does the department estimate the total revenue in UI taxes will be if the "A" schedule is in effect during FY 2017 and FY 2018?..."B" schedule?..."c" schedule, D schedule, E schedule? Response: See Schedule 1-1 for UI Trust Fund reserve ratios. See Schedule 1-2 for UI Trust Fund monthly revenue and expenditure estimates. Below is the Tax Table Estimates for FY 2017 and Unemployment Compensation Fund Employer Contributions Employer Contributions Tables A E (Cash Basis) FISCAL YEARS 2017 & 2018 (in millions) TABLE FY 2017 FY 2018 A $1,288.7 $1,332.0 B $1,567.0 $1,619.6 C $1,839.6 $1,

2 D $2,045.6 $2,114.4 E $2,258.4 $2,334.3 b. Please provide a breakdown of the number of employers and employees in each tax rate under the current tax column. Response: Fiscal Year 2015/2016 (Only Currently Active Employers) Emp UI Tax Rate # of Employers # of Employees , ,278 1,149, , , , , , , , , , , , , , , ,389 81, ,019 57, ,740 65, ,849 52, ,879 11, ,802 86, ,891 46, ,201 37, ,000 29, ,604 25, ,115 44, ,728 22, ,342 18, ,144 17, , ,549 TOTAL: 227,918 4,434, The Unemployment Compensation Auxiliary Fund (UCAF), established in subsection (g) of N.J.S.A.43:21-14, is a repository for all interest and penalties imposed upon employers for violation of unemployment insurance regulations. Moneys from the UCAF are to be used for the cost of the administration of the UI trust fund, for the repayment of any interest bearing advances made for the federal unemployment account, and for essential and necessary expenditures in connection with programs, as determined by the commissioner. Proposed budget language in the FY 2017 Budget Recommendation would authorize the following $ million in appropriations from the UCAF in FY 2017: $1.088 million for administrative and support services; $150,000 for unemployment compensation earned income tax credit costs; $16 million for certain UI collection activities; $ million for the Division of Vocational Rehabilitation; $50,000 for the Disadvantaged Youth Employment 2

3 Opportunities Council; $491,000 for the Board of Mediation; $72,000 for the Council on Gender Parity; and $475,000 for the New Jersey Youth Corps. These amounts are equal to the appropriations from the UCAF in the FY 2016 Appropriations Act. FY 2017 Supplementary Information released separately from the Governor s Detailed Budget indicates that the UCAF will have $27.1 million in FY 2017 resources and transfer $27.1 million to the General Fund, short of the $ authorized by language. Questions: Please list the expenditures, by subject or program area, from the UCAF for FY 2015 and anticipated for FY 2016 and FY Which activities of the department will be affected if the resources of the UCAF are insufficient to support authorized uses, as indicated by projections? How does the department plan to prioritize the use of UCAF resources to manage the projected shortfall? Response: See attached Schedule 2. The Department is projecting utilization of $12 million of the $16 million UCAF Language for FY This will provide a carryover balance in the UCAF to FY The Department can also use the overlap of federal and State fiscal years to address the final three months of Federal Fiscal Year 2017 which falls into State Fiscal Year Pursuant to P.L.2013, c.124, when an individual fraudulently obtains unemployment benefits under the State s unemployment compensation program, the individual is assessed a fine of 15 percent of the amount fraudulently obtained by the individual, and the fine is immediately deposited into the UI trust fund, and a recovered fine of 10 percent of the amount fraudulently obtained is deposited into the UCAF. The same assessment of fines also applies to benefits obtained fraudulently by individuals under any federal unemployment compensation program, and the fines are deposited into the State s UI trust fund and the UCAF. The federal unemployment compensation program includes compensation for federal civilian employees and for ex-service members. Questions: a. What is the total amount assessed to and collected from individuals who fraudulently obtained UI benefits in FY2015 and estimated for FY 2016 and FY 2017? Please include both the base benefits that were repaid and the penalty amount paid by the individuals deposited into the UI trust fund and deposited into the UCAF. Response: Separate and apart from fraudulent payments recovered from the US Treasury Offset Program (TOP) program, listed below are the total amounts assessed and the fraudulent payments recovered for 2015 and estimates for 2016 and FY Total Assessed Amount Collected 2015 $15,676,304 $26,748, (estimated) $18,000,000 $28,000, (estimated) $21,000,000 $30,000,000 A breakdown of the recovery types is not maintained. b. Has the enactment of P.L.2013, c.124 resulted in a financial impact on the UCAF and the UI trust fund? 3

4 Response: Since P.L. 2013, c. 124 was enacted in August 2013, a comprehensive analysis of the data has not been initiated to determine its impact. Prior to the initiation of the TOP program, fines and penalties collected as a result of fraudulently received benefits never exceeded $2.0 million on an annual basis. It is likely that additional collections following the implementation of the TOP program will offset any reductions in revenues to the UCAF caused by P.L. 2013, c Any reductions in allocated fines and penalties to the UCAF will benefit the Unemployment Insurance Benefits fund. Through the TOP program, as of October 13, 2013 through April 21, 2016, total fines collected are $15,729, Since 2011, the Division of Fraud Prevention and Risk Management within the department focuses on the implementation of a variety of programs and initiatives aimed at safeguarding the UI trust fund from fraudulent activity. These measures include the division requiring identity verification on both internet and phone UI claims, crosschecking the UI rolls against the National Directory of New Hires to determine if claimants have returned to work, and joining the Federal Treasury Offset Program to recoup improperly collected UI payments by seizing refunds due on federal income taxes. According to the department, the division s efforts have prevented more than $640 million from being improperly diverted from the UI trust fund since March Questions: a. Please outline all of the division s anti-fraud programs, identifying the financial impact of each program on the UI trust fund in each fiscal year since implementation. Response: See Schedule Anti-fraud Program Impact April 2016 for the major UI fraud initiatives. b. Please detail, by job title, how many staff were dedicated to the division in each fiscal year since its creation. Response: See Schedule Division of Fraud Prevention and Risk Management c. Please provide a full accounting of the division s funding and expenditures in each fiscal year since its creation. Please include the details of any federal funding received. Response: Anti-fraud activities are not funded, budgeted or tracked separately from overall UI operations. In addition to UI administration base funding, four Federal Supplemental Budget Requests specific to UI Anti-fraud efforts have been awarded since FY 2012, totaling $3.1 million. 5. In 2010, the definition of misconduct for UI beneficiaries was modified. Pursuant to P.L.2010, c.37, the UI eligibility criteria for workers who are terminated for misconduct is a three-tiered structure, established as simple misconduct, severe misconduct and gross misconduct. The previous structure identified two levels of misconduct, general and gross 4

5 misconduct, and required a shorter period of re-employment and a smaller amount of earnings before qualifying for UI benefits again. Neither simple misconduct nor severe misconduct is defined in statute; however certain examples of severe misconduct are provided. N.J.A.C.12: provides definitions for both simple and severe misconduct. Simple misconduct is an act of wanton or willful disregard of the employer's interest, a deliberate violation of the employer's rules, a disregard of standards of behavior that the employer has the right to expect of an employee, or negligence in such degree or recurrence as to manifest culpability, wrongful intent, or evil design, or show an intentional and substantial disregard of the employer's interest or of the employee's duties and obligations to the employer. Severe misconduct is an act which constitutes "simple misconduct, and is both deliberate and malicious. Malicious as defined in N.J.A.C.12: is an act done with the intent to cause injury or harm to another or others or when an act is substantially certain to cause injury or harm to others. Pursuant to statute, individuals terminated for simple misconduct must wait seven weeks from their termination date to receive benefits. Individuals terminated for severe misconduct must be reemployed for at least four weeks and earn at least six times their weekly benefit before qualifying for UI benefits again. Gross misconduct is defined in statute as any discharge from employment because of the commission of an act punishable as a crime of the first, second, third, or fourth degree under the New Jersey Code of Criminal Justice. Persons who are discharged due to gross misconduct must be reemployed for at least eight weeks, with earnings of at least 10 times their weekly benefit, before qualifying for UI benefits again. N.J.A.C.12: requires employers to show through written documentation that the employee's actions constitute simple and severe misconduct. However, in the case of gross misconduct: 1. Where an employer provides sufficient evidence to establish that a claimant was discharged for gross misconduct connected with the work, prosecution or conviction shall not be required to sustain that the claimant has engaged in gross misconduct. 2. If an individual has been convicted of a crime of the first, second, third, or fourth degree under the New Jersey Code of Criminal Justice, such conviction shall be conclusive as to a finding of gross misconduct. P.L.2010, c.37 also modified the definition of voluntary quit for UI beneficiaries. An individual must be employed for eight weeks after voluntarily quitting a previous job before qualifying for UI benefits. However, P.L.2015, c.41 makes an exception from that requirement for an individual who leaves one job to accept a subsequent job at least equal in hours or pay, but is laid off from the subsequent job. Questions: a. Does the department plan to implement a system which tracks voluntary quit data, the number of claims for which the department required an employer to provide written documentation of misconduct, or the percentage of claims denied due to misconduct or a voluntary quit? If yes, please outline the plan for implementation. 5

6 Response: No. There is currently no such reporting requirement from the US Department of Labor. b. Please provide simple, severe, and gross misconduct savings for FY 2015 and thus far in FY Response: UI Misconduct Savings (in millions) FISCAL YEAR SIMPLE SEVERE TOTAL 2015 $18.0 $30.7 $ (through February 2016) $10.6 $12.1 $22.7 The Simple Misconduct savings were determined by multiplying the number of Simple Misconducts for FY 2015 and FY 2016 through February 2016 by two (additional weeks of denial) and multiplying this number by $400 (average weekly UI benefit amount). The Severe Misconduct savings were determined by multiplying the number of Severe Misconducts for FY 2015 and FY 2016 through February 2016 by 17 (average net duration of benefits), multiplying this number by 75% (estimate of claimants who do not find other employment) and multiplying this number by $400 (average weekly UI benefit amount). No cost savings are realized for Gross Misconduct since the regulations were not changed. c. Please provide the numbers of individuals who were denied benefits or whose benefits were delayed for misconduct, by the type of misconduct (simple, severe or gross), in FY2015 and thus far in FY Response: TYPE OF MISCONDUCT FY 2015 FY 2016 (through February 2016) Simple 22,511 13,298 Severe 6,016 2,368 Gross 1, d. Please report the numbers of appeals for the denial or delay of benefits due to worker misconduct in FY 2015 and thus far in FY 2016, indicating the number of such appeals that were approved, denied, or pending. Response: Fiscal Year Misconduct Denial Appeals ,784 (3,049 severe misconduct) 2016 (Thru March 16) 9,218 (1,323 severe misconduct) 6

7 6.a. The New Jersey State Unemployment Compensation Claimant and Employer Service System (NJSUCCESS), a project to redesign all UI business processes and technical systems, was put on hold as of April 30, 2009 because of the increased demands on the UI system during the Great Recession. The department indicated in FY 2015 and FY 2016 OLS Discussion Point responses that a consortium was formed with the State of New York to jointly modernize each state s employer/benefits/appeals system. In September 2013 New York and New Jersey received Supplemental Budget Request (SBR) funding in the amount of $4 million from the United States Department of Labor (USDOL) to complete Phase I of the UI Modernization Project. Prior to the end of 2014, the New York and New Jersey partners anticipated that the project would enter Phase II. Phase II is the development and implementation of a fully functional modernization of the UI systems for both states. The USDOL advised both states that, should the consortium proceed with Phase II, a second SBR could be submitted to the USDOL for approval. According to the department, another request was made for SBR funding in July 2014, and a combined $4 million in SBR funds was awarded by the USDOL in September 2014 for the completion of Phase II. According to the department, as of April 2015, the UI Modernization Project is estimated to cost over $100 million, with a majority of the cost being paid for with Job Creation and Worker Assistance Act of 2002 funds, more commonly referred to as Reed Act funds, and additional supplemental grants from the USDOL. Questions: a. Please provide details on the current status of this project. Response: In September 2013, the states of New York and New Jersey committed to a collaborative partnership, with New York as the lead state, to begin the process of modernizing their UI information technology systems. The NY/NJ consortium was funded incrementally by the USDOL to jointly develop business and technical requirements and a mature draft RFP for the consortium with anticipation of receiving additional funding from the USDOL for the system design, development and deployment phase of the project. As of September 2015, the NY/NJ consortium successfully completed the business requirements, high level system architecture and the mature draft RFP on-time and within budget positioning NY and NJ to seek a grant request for system development. In response to a Supplemental Budget Request (SBR), the NY/NJ consortium was advised by the USDOL that due to insufficient national funding availability, no SBR funds would be realized. As such, NY and NJ weren t able to proceed with the consortium s vision for an integrated UI benefits, appeals and contribution system. Although the states jointly agreed to disband the consortium, the completed business requirements, high level system architecture and the mature draft RFP will be used by each state to pursue individual state options which have a proven track record of success. Both New York and New Jersey are closer to a modernized system as a result of the work of the consortium and the investment from USDOL. 7

8 b. What is the total cost for the plan? Please detail the funding source for all monies spent. How much money remains from the Reed Act Funding? Response: Two Supplemental Budget Requests were approved for a total of $8M of Federal funds to the NY/NJ consortium to successfully complete the business requirements, high level system architecture and a draft RFP. No additional funds were used for the project. As of March 31, 2016, a total of $21,959, is the remaining balance from Reed Act. c. Please provide a plan for FY 2016 and FY 2017 for the modernization of the UI system. Response: UI continues to seek system wide improvements wherever possible including: (1) upgrading the telephone network and components including hardware and software applications; (2) upgrading UI online access to a new, single sign on UI and reemployment service model to enhance the customer experience and upgrade identity and access management; (3) consolidating of all UI systems applications under a single platform software service; and (4) modifying the adjudication selection process to provide automated scheduling of cases and online certification enhancements. 6.b. The FY 2016 Appropriations Act and the FY 2017 Budget Recommendation (page D- 230) contain identical language that appropriates $22 million of Reed Act funds for the following: the improvement and modernization of the UI benefit payment system; the development and maintenance of one stop career centers; and various efforts to enhance job opportunities for employment service clients. Question: Please identify the uses and the appropriated amounts of Reed Act funds in each of these three areas in FY 2016 and anticipated in FY Response: There were no Reed Act Funds used during FY It is anticipated that Reed Act Funds will be utilized in FY STATE AUDITOR S REPORT 7.a. The State Auditor s Compliance Review issued on April 14, 2015 contains recommendations for the department on issues relating to FY 2014, and the report also includes recommendations for unresolved issues from FY Specifically, most issues involve various aspects of unemployment insurance in the State. The first recommendation from the State Auditor s report was for the department to finalize and adopt the Unemployment Insurance Division of Information Contingency Plan, since the State Auditor s report found that no such final contingency plan was in place. 8

9 Additionally, the report recommended that the department modify the logical access procedure for users of the Local Office Online Payment System (LOOPS) to match the logical access procedure of the Personnel Management Information System. Furthermore, the State Auditor s office recommended that the department continue to work to achieve compliance from employers in reporting accurate NJ-927 and WR-30 wages, in addition to documentation which confirms remedying of the claimant s affidavit of employment wage system. Questions: a. Has the department remedied any of the FY 2014 issues found within the State Auditor s report? Response: The department is in the process of finalizing and adopting a comprehensive Contingency Plan for the Unemployment Insurance Division as recommended by the state auditors. b. Has the department provided the requested documentation to the State Auditor s office? Response: No such documentation is available at this time. 7.b. In regard to the FY 2013 recommendations, the report found that the department had not changed its procedures and process for getting information from employers in the State. The report stated that the department s current procedures have led to a decline in the department s detection and preventative efforts to identify claimants who underreport wages and earnings or who fail to report earnings, which affects the adjustment of unemployment benefits to individuals who work part-time. Additional issues were addressed in the report which affect benefits payments, such as conflicts with the National Directory of New Hires and the payment of benefits to ineligible payees (i.e., deceased or incarcerated individuals). Question: Please provide an update as to the department s efforts to address the underreporting of wages and earnings, specific to the findings published in the State Auditor s report. Response: A variance report is generated by the department where the wages reported on the NJ-927 differ from the WR-30. In situations where the wage differential is greater than $500,000, a contact is made to the employer to resolve the discrepancy. SECOND INJURY FUND 8. The Second Injury Fund (SIF) was established in 1923 pursuant to N.J.S.A.34:15-94 and provides workers compensation benefits to workers who are already partially disabled who subsequently experience a work related injury which then renders them totally disabled. Additionally, pursuant to P.L.1980, c.83(n.j.s.a.34: ), individuals under the age of 62 whose period of disability began after December 31, 1979 will have their SIF benefits reduced by any federal Social Security disability benefits received. The concept behind the SIF is to encourage employers to hire disabled workers by limiting, in the case of further injury, their liability for compensation payments to amounts applicable to only the latest injury. 9

10 P.L.1980, c.83 (N.J.S.A.34: ) provides that the SIF also pay for a cost of living adjustment (COLA) for totally and permanently disabled workers, dependents of deceased workers and SIF beneficiaries whose date of injury or death occurred prior to January 1, Finally, P.L.1990, c.46 (N.J.S.A.34:15 94) provides that all administrative costs of the Division of Workers Compensation be paid out of the SIF. The SIF is funded through an assessment on workers compensation insurance for both selfinsured and privately insured employers. State and municipal self-insured employers are exempt from the SIF assessment, but State and municipal employees are eligible for benefits if disabled. The level of assessment is determined each year by the Commissioner of Labor and Workforce Development. The commissioner makes this determination by estimating the amounts necessary to pay SIF benefits and administrative costs in the following calendar year, reduced by the net SIF assets at the end of the current year exceeding $5 million, and then multiplying that total by 125% to determine the amount needed in the SIF for the next year. However, due to statutory requirements, the total amount needed must then be reduced by $40 million. P.L.2002, c.5 and P.L.2003, c.111 both amended N.J.S.A.34:15-94 to provide that the two separate transfers of $20 million from the SIF to the General Fund pursuant to P.L.2002, c. 12 and P.L.2002, c.38 are added back into the SIF for computational purposes when determining the assessment amount. The assessment is then charged to employers as a surcharge on their workers compensation insurance payments. According to FY 2016 OLS Discussion Points responses, the department assessed companies approximately $243 million in CY Moreover, the department further indicated that the SIF would have a surplus of $5.5 million by the end of CY 2015, the first year for the fund to have a positive end-of-year balance since Question: a. Please provide for CY 2015 and an estimate for CY 2016 and CY 2017: the total amount expended from the SIF for benefits (please separate benefits by COLA or second injury benefits); the total amount expended for costs (please detail specific administrative costs by minor object detail); the total amount of revenue from assessments; the total amount carried forward in the SIF from the previous year; the total amount of other revenues in the SIF (including transfers in); and the total amount of unexpended balances at the end of the calendar year. Response: Below is the Statement of SIF Revenue, Expenditures and Change in Fund balance. See Schedule 8 for specific administrative costs. Second Injury Fund - Cash Flow Information Calendar Years (in millions) BEG INTEREST ADM SUPP END CY BLNCE ASSMT INCOME EXP BENEFITS BENEFITS BLNCE 2015 $(8.4) $241.5 $36.8 $154.3 $34.9 $7.1 10

11 est b. Please provide the number of claimants, and their average SIF benefit, who are receiving benefits from the SIF for CY 2015 and thus far in CY Please provide the average age of the beneficiary. Response: CY 2015 To Date CY 2016 Average SIF Beneficiaries 8,888 9,016 Average SIF Weekly Benefits $ $ Average SIF Beneficiary Age 67.2 years 67.4 years c. Please provide the number of beneficiaries who are currently receiving COLA benefits from the SIF and the average COLA benefit being paid each calendar year. Please identify the number of beneficiaries who are receiving benefits as a totally and permanently disabled worker, a dependent of a deceased worker, or a SIF beneficiary. Please provide the average age of these beneficiaries. Please detail the base workers compensation benefit paid by a private insurer and the COLA benefit paid from the SIF. Response: Tot/Perm Dependency SIF # Beneficiaries: Average Annual COLA: $14,496 $13,721 $14,167 Average Age: Avg. Annual Base Payable by Carrier/Self Insurer: $2,640 $2,615 d. The department stated that it was transitioning to a new database in 2014 to pay benefits electronically. What is the status of the department s transition? What are the costs of the system? What percentage of beneficiaries received checks electronically in CY 2015 and thus far in CY 2016? Response: The database transition was largely completed in calendar year During CY 2015, 66.5% of beneficiaries received their benefits electronically with no appreciable change seen or anticipated during CY

12 e. How many SIF beneficiaries under the age of 62 also collect Social Security disability benefits? What is the total amount of SIF benefits paid out to these individuals? How much is the amount reduced by the offset of Social Security disability benefits? Response: There are currently 2,767, or 71.7%, of all SIF beneficiaries under the age of 62 receiving total annual benefits of $26,403,676. This amount is, as a result of the reverse offset provisions of N.J.S.A. 34: , a reduction of $17,670,232, or by 40%, from the otherwise payable benefits of $44,073,908. TEMPORARY DISABILITY INSURANCE 9.a. The State Disability Benefits Fund (SDBF) is used by the State s Temporary Disability Insurance (TDI) program to provide partial wage replacement for workers who become disabled due to injury or illness unrelated to work and to pay for administration of the benefits from the SDBF. Those New Jersey employers who do not wish to participate in the State plan may offer an alternative private plan that provides, at a minimum, the coverage offered through the State plan. A determination is made by the commissioner as to what the annual rate of contribution paid by employees should be so that the SDBF is sufficiently funded. The rate equals that amount which is sufficient, when added to employer contributions, to obtain a total amount of contributions equal to 120% of the benefits estimated by the commissioner to be payable for temporary disability leave benefits during the next calendar year, plus an amount equal to 100 percent of the cost of the administration of the payment of those benefits during the immediately preceding calendar year, less the amount of net assets remaining in the fund at the end of the preceding calendar year. The rate of employee contributions which may be charged under a private plan for disability benefits may not be higher than the rate of employee contributions to the SDBF set pursuant to the act. The rate for employees for CY 2016 is 0.20 percent, less than the 2015 rate. The maximum deduction amount per employee is $65.20 for TDI. Questions: a. Please provide the value of revenues (including employer and employee contributions), benefits, regular and 4F, and administrative expenditures, and the cash balance in the SDBF for each month in CY (not FY) 2015; as many months as possible for CY 2016; and estimates for the remaining months of 2016 and for CY Please indicate which monthly figures are estimated and provide annual totals for all data for each CY. Please provide the total taxable wages for each CY from 2011 through 2015, with an estimate for CY Response: See Schedule 9-1 (a) & (b) Below is the Schedule of Taxable Wages. 12

13 Temporary Disability Insurance Fund - State Plan Taxable Wages Calendar Years (in billions) CALENDAR TAXABLE YEAR WAGES 2011 $ $ $ $ $ $73.9 b. Please provide the number of employees that were assessed the TDI tax in CY 2014 and CY 2015, and estimated for CY 2016 and CY Please provide the number of employees that paid or pay the maximum tax in CY 2014 and CY 2015 and estimates for CY 2016 and CY Response: Total Assessed No. of workers paying Calendar Year Employment the Maximum Tax ,614,783 1,704, ,656,967 1,727, ,670,000 (estimated) 1,750,000 (estimated) ,700,000 (estimated) 1,775,000 (estimated) c. Please provide the number of employees who are or were provided private TDI coverage through their employers in New Jersey, and the number of private plan employers, in CY 2014, CY 2015, and estimates for CY 2016 and CY Response: TDI Private Plan covered employment: Calendar Year No. of Employees No. of PP Employers ,981 4, ,041 4, ,000 (estimated) 4,810 (estimated) ,000 (estimated) 4,955 (estimated) d. Please provide the number of employers that were assessed the TDI tax in CY 2014, CY 2015, and estimates for CY 2016 and CY Response: TDI State Plan Employers: Calendar Year No. of Employers , , ,500 (estimated) ,000 (estimated) 13

14 e. Please provide, for CY 2015, the summary of morbidity data for completed claims, including: the major morbidity group (code); the percent of cases; the average duration of claim; and the average gross benefits. Response: See Schedule 9-2 f. Please provide an estimate for the rate, and the maximum amount, of the TDI assessment to be charged each employee for CY Response: Temporary Disability Insurance Fund Worker Rate CY 2017 EST. EST. TAXABLE WORKER RATE WAGE BASE CONTRIBUTION 0.24% $33,700 $ b. Efficiency in processing TDI claims has declined in recent years. As illustrated in table 2 of the Temporary Disability Insurance Workload in 2014 Summary Report issued by the department on October 2014, the portion of eligibility determinations made within two weeks of receipt of the claims declined from 72 percent in 2010 to 53 percent in During the same period, the portion of determinations taking more than four weeks increased from 9 percent to 23 percent. The number of personnel administering the State TDI plan declined from 170 in FY 2008 to 135 in FY The TDI law permits administrative costs of 0.1 percent of total wages subject to the TDI tax, which would permit the assessment of more the $60 million per year throughout that period, but the department has expended less than $40 million annually on administration, notwithstanding the reduced staffing and the slower processing times over that period. According to previous OLS Discussion Points responses, the percentage of TDI-workers who file claims has declined steadily, falling from 5.9 percent in 1987 to 3.6 percent in Questions: a. For each CY from 2010 to 2014, please indicate the portion of initial TDI benefit eligibility determinations which were made in seven days or less, and the average amount of time for the determinations which take 57 or more days. Response: See Schedule 9-3 TDI Time Lapse Claim Distribution. b. Please provide data for 2015 regarding the time taken to make the determinations like those given in table 2 of the Summary Report, the portion of claims made in seven days or less, and the average time for determinations which take 57 or more days. 14

15 Response: See Schedule TDI Time Lapse Claim Distribution. c. What, if any, plans does the department have to increase the average speed of processing TDI claims, including any plans to increase personnel? Response: In February 2016, the Division launched an application to allow claimants to file Temporary Disability claims over the Internet and to allow both employers and health care providers to provide wage and medical information over the web. This is expected to automate more claims processing and increase efficiency. The Division is also in the process of upgrading its DABS application, which includes a document imaging component. These measures are expected to automate more claims processing and increase efficiency in both TDI and FLI. d. What, if any, plans does the department have to increase outreach to inform workers about TDI benefits? Response: The department will consider previously successful outreach efforts utilized within LWD and also explore the best use of available technology for this endeavor. A new option has been recently implemented to increase customer accessibility through the online filing of TDI/FLI applications. In accordance with C.34:1A-1.15, the department has taken steps to incorporate these new requirements to be in full compliance. This new information will be available on the new TDI/FLI webpage. FAMILY LEAVE INSURANCE 10.a. The Family Leave Insurance (FLI) program was established in the department in FLI extends the State s existing temporary disability insurance system to provide up to six weeks of FLI benefits to a worker taking leave to provide care, certified to be necessary, for family members suffering a serious health condition or to be with a new child during the first 12 months after the child s birth or placement for adoption with the worker s family. These benefits are funded through an additional assessment on workers wages subject to TDI taxes ($32,600 in CY 2016). The assessment used to fund the FLI account is a variable assessment which equals the rate which is sufficient to obtain a total amount of contributions equal to 125 percent of the benefits estimated to be payable for family disability leave benefits during the calendar year, plus 100 percent of the amount estimated to be necessary for the cost to administer the benefits, less the amount of net assets which will remain in the account as of December 31 of the immediately preceding year. The assessment is updated on a calendar year basis and the assessment for 2016 is 0.08 percent, less than the assessment in The maximum deduction amount per employee is $26.08 for FLI. These funds are deposited into the FLI account within the SDBF. Questions: a. Please provide an analysis of the current collection of revenue, benefits and administrative costs for the FLI account, by month for CY (not FY) 2015; as many months as possible for CY 2016; and estimates for the remaining months of 2016 and for CY Please indicate which monthly figures are estimated and provide annual 15

16 totals of all data for each CY. Please provide the total taxable wages for each CY from 2011 through 2015, with an estimate for CY Response: See Schedule 10-1 Below is the schedule of Taxable Wages. Temporary Disability Insurance Fund Family Leave Account -Taxable Wages Calendar Years (in billions) CALENDAR YEAR TAXABLE WAGES 2011 $ $ $ $ $ $109.2 b. Please provide an analysis of benefits paid by calendar year for CY 2014 and CY 2015, including the total number of claims and the number of claims attributable to each of the following categories: 1) Bonding with a newborn 2) Bonding with a newly-adopted child 3) Care of a seriously ill child 4) Care of a sick spouse 5) Care of another seriously ill family member Response: See Schedule 10-2 c. For each of the above listed categories, please provide the following data for CY 2014 and CY 2015: the gross benefits, the average cost per claim, and the average duration of the claim; the number and percentage of total FLI claims made for intermittent leave; and the number and percentage of total claimants who had also collected temporary disability insurance through the State TDI program. Response: See Schedule 10-2 d. Please provide the number of employees who were assessed the FLI tax in CY 2013, CY 2014, and CY 2015, and estimated for CY Please provide the number of employees that paid the maximum tax in CY 2013, CY 2014, and CY 2015, and estimated for CY Response: FLI Employees: Total Assessed No. of workers paying Calendar Year Employment the Maximum Tax 16

17 2013 4,577,285 2,180, ,602,568 2,185, ,645,228 2,220, ,670,000 (estimated) 2,230,000 (estimated) e. Please provide the number of employees that are provided FLI through their employers private plan in New Jersey, and the number of private plan employers, in CY 2015, and an estimate for CY Response: FLI Private Plan covered employment: Calendar Year No. of Employees No. of PP Employers , ,835 (estimated) 117 (estimated) f. Please provide an estimate for the rate, and the maximum amount, of the FLI assessment to be charged each employee for CY Response: Temporary Disability Insurance Fund Family Leave Account Worker Rate CY 2017 EST. EST. TAXABLE WORKER RATE WAGE BASE CONTRIBUTION 0.09% $33,700 $ b. Efficiency in processing FLI claims has also declined in recent years. As illustrated in table 3 of the Family Leave Insurance Workload in 2014 Summary Report issued by the department on October 2014, the portion of eligibility determinations made within two weeks of receipt of the claims declined from 77 percent in 2010 to 61 percent in During the same period, the portion of determinations taking more than four weeks increased from 5 percent to 14 percent. A study on New Jersey s FLI program released in March, 2016 by the National Center for Children in Poverty at Columbia University found that a majority of new mothers participating in the program and surveyed for the study said that they experienced substantial delays in benefit payments, sometimes receiving benefit payments only after the end of the six-week benefit period. Many working mothers surveyed for the study had not participated because they were not aware of the program, notwithstanding the requirement of the FLI law that employers notify their employees of the program. Questions: a. For each CY 2010 to 2014, please indicate the portion of initial FLI benefit eligibility determinations which were made in seven days or less, and the average amount of time for the determinations which take 57 or more days. 17

18 Response: See Schedule 10-3 FLI Time Lapse Claim Distribution. b. Please provide data for CY 2015 regarding the time taken to make the determinations like that given in table 2 of the Summary Report, the portion of claims made in seven days or less, and the average time for determinations which take 57 or more days. Response: See Schedule 10-3 FLI Time Lapse Claim Distribution. c. What, if any, plans does the department have to increase the average speed of processing FLI claims, including any plans to increase personnel? Response: In February 2016, the Division launched an application to allow claimants to file Family Leave claims over the Internet and to allow both employers and health care providers to provide wage and medical information over the web. This is expected to automate more claims processing and increase efficiency. The Division is also in the process of upgrading its DABS application, which includes a document imaging component. These measures are expected to automate more claims processing and increase efficiency in both TDI and FLI. d. What, if any, plans does the department have to increase outreach, including outreach to employers, to inform workers about FLI benefits? Response: The department will consider previously successful outreach efforts utilized within LWD and also explore the best use of available technology for this endeavor. A new option has been recently implemented to increase customer accessibility through the online filing of TDI/FLI applications. In accordance with C.34:1A-1.15, the department has taken steps to incorporate these new requirements to be in full compliance. This new information will be available on the new TDI/FLI webpage. INTERNAL FUNCTION JOINT TAX 11. The department imposes an internal function joint tax cost on the funds it oversees to pay for the administrative functions associated with these funds, which includes maintenance of employer accounts, auditing and collections. Furthermore, the Division of Revenue in the Department of the Treasury, under an agreement with the department, imposes an additional charge to certain funds for functions related to the receipt of employer tax reports and remittances, commonly known as shared costs. These shared costs are charged to the Family Leave Insurance Account, the State Disability Benefits Fund, the Workforce Development Partnership Fund, the UCAF and the UI trust fund, among others. The FY 2017 Budget Recommendation includes language authorizing $16 million in FY 2017 appropriations from the UCAF to support UI collection activities (page D-229). This amount is equal to the appropriation from the UCAF for the same purpose in the FY 2016 Appropriation Act. According to the department, as required by federal cost principles, the costs associated with revenue collection are allocated to all benefitting programs using a cost allocation plan. To determine the allocation to each benefitting program, the department s Joint 18

19 Tax Allocation Plan used direct personnel costs along with interviews and observations of employees within the various operating sections as well as data, such as the number of registered employers, delinquency and follow-up billings, judgments and refunds. Complexity factors were developed for some activities in order to provide proper weighting for the level of sophistication and detail required for specific work assignments. Division of Revenue cost sharing allocations are based on the percentage of transactions processed as related to the various tax programs. Question: a. Please provide expenditures, by fund, for the joint tax and shared costs by fiscal year from FY 2015 through FY 2017 projected. Response: See Schedule 11 b. Please detail the amounts appropriated from the UCAF for UI collection activities in FY 2015, and estimated in FY 2016 and FY Response: FY 2015 $ 5,000,000 FY 2016 $12,000,000 FY 2017 $16,000,000 WORKFORCE DEVELOPMENT 12. The Workforce Innovation and Opportunity Act (WIOA), which was enacted on July 22, 2014, supersedes the Workforce Investment Act of 1998 (WIA) and is meant to modernize and improve existing federal workforce development programs. WIOA is the first legislative reform of the public workforce system in more than 15 years and the majority of the Act became effective on July 1, Additionally, proposed federal regulations providing more specificity on the implementation of WIOA were published on April 16, The final rules are expected to be adopted in June The need to address the reauthorization of WIA stemmed from the evolution of the labor market. Millions of Americans looking for work did not have the necessary skills to fill the millions of job openings across the country. WIOA is designed to remedy this issue and improve coordination of employment and training services through increased collaboration of state and local partners and provide job seekers with an increased access to training, education, and other support to succeed in the job market. In this effort, WIOA requires states to produce a single, unified or combined State Plan covering all core workforce development programs. The state plans are designed to improve service delivery and access to the workforce system for job seekers and employers. The department submitted New Jersey s Combined State Plan to the USDOL on April 1, Additionally, Congress sought to simplify the job training programs being offered within each state. Certain limitations that existed within WIA, with respect to training, funding, and service delivery, have been modified under WIOA to provide more flexibility to better meet the unique needs of individual job seekers. For example, under WIOA, local Workforce Investment Boards (WIB) must coordinate with education providers and assess the accessibility 19

20 of the one-stop system for individuals with disabilities. In New Jersey, there are 17 local WIBs that manage a network of 29 one stop career centers Furthermore, WIOA is meant to ensure that federal investments in employment and training programs are accountable to job seekers, employers, customers and taxpayers. Under WIA, many of the existing performance measures were evaluated only a few months after the worker s exit from the workforce development programs, and these measurements were usually conducted only once. Many of the performance measures under WIOA will now be evaluated more frequently and over longer periods of time. According to the USDOL, these measures are designed to indicate the effectiveness and continuous improvement across all core WIOA programs. The department stated in FY 2016 OLS Discussion Point responses that it had partnered with the State Employment and Training Commission (SETC) to address the implementation of WIOA. Work groups were created to address each of the key WIOA components: Governance; Planning; Performance Accountability; One-Stop Operations; Career Pathways and Industry Partnerships; Services to Individuals with Disabilities; and Services to Youth. According to the Governor s FY 2017 Budget Recommendation, the department anticipates approximately $125.4 million in FY 2017 (page C-20) in federal funds to support the WIA activities throughout the State. The majority of the money is to be distributed to local Workforce Investment Boards through a federal funding formula. Additionally, the State may apply for discretionary federal grants for Statewide programs. Question: a. Please detail the WIA/WIOA funding received in FY 2015 and thus far in Please detail the uses of these funds, including the names of local funding recipients (i.e., local WIBs or other entities) and any funds retained by the State for administrative or separate programming costs. Response: See Schedule 12-1 and 12-2 b. Has the department previously applied for or received any discretionary federal WIA/WIOA grant monies in FY 2015 or FY 2016? Does the department anticipate applying for any discretionary federal WIA/WIOA grants for FY 2017? If so, please provide information on these grant applications, including budget and program proposals. Response: The department applied for and received the following grants: FY 2015: New Jersey Atlantic City Reemployment Project (Atlantic City NEG): $13,154,140 - See Response to Question 23a. FY 2016: Disconnected Youth Demonstration Project (Camden): $1,994,350 See Response to Question 18b.a. 20

21 c. How has the department in its partnership with SETC handled the implementation of WIOA? Were there any issues upon implementation? Please report any feedback the department has received from the USDOL in regard to the Combined State Plan. Response: New Jersey recognized WIOA as an opportunity for the state to ensure that its workforce development system is positioned to help individuals obtain the skills and abilities they need to be competitive in an ever-changing economy and ensure the state has the most skilled workforce in the country. The New Jersey Department of Labor and Workforce Development (LWD) and the State Employment and Training Commission (SETC) have worked together with key stakeholders to build a strong foundation for New Jersey s workforce system through this plan and through New Jersey s Blueprint for Talent Development, which formed the foundation of the comprehensive State Plan. The planning process was intentionally inclusive and included the following steps: Workgroups: Workgroups addressing six key opportunities for transformational change were created in December 2014 to inform the development of the Blueprint. Workgroups, consisting of approximately members representing LWD, SETC, local WDBs, One-Stop Operators and other key stakeholders, were charged with reviewing the provisions of WIOA, identifying opportunities for policy and operations recommendations, obtaining feedback from stakeholders and coordinating their work with that of the associated SETC Committee. Workgroups focused on the following topics and reported upward to the respective SETC Committees: o o o o o o Governance and Planning coordinating with the Governance Committee Performance Accountability coordinating with the Performance Committee Career Pathways and Industry Partnerships coordinating with the State Council for Adult Literacy Education Services (SCALES) and the Council on Gender Parity in Labor and Education (GPC) One-Stop Operations coordinating with the full SETC Services to Youth coordinating with the Shared Youth Vision Council Services to Individuals with Disabilities coordinating with the State Rehabilitation Councils NJ WIOA Website: The website was launched in January 2015 to provide a place where stakeholders could receive up-to-date national and New Jersey specific WIOA information. The website continues to be a critical component of both the SETC s and LWD s websites. Individuals were encouraged to submit comments on WIOA implementation to a WIOA Blueprint address: WIOABlueprint@dol.state.nj.us. Workgroup Webinars: Each Workgroup hosted informational, interactive webinars to provide an overview of WIOA provisions and to provide an additional opportunity for feedback to be received about the various opportunities and challenges stakeholders felt WIOA presented. 21

22 Pathways and Partnerships TwoDay Conference: In spring 2015, SETC and LWD jointly hosted the Pathways and Partnerships: Building New Jersey s Blueprint for Workforce Innovation and Opportunity Conference. The conference included more than 300 stakeholders from across the state representing all the key stakeholders and partners in workforce development. Breakout sessions were held on each Workgroup topic, offering opportunities for smaller group discussion and participation. The conference featured: o Overview presentations from national experts about WIOA and critical trends in workforce development. o Extensive breakout sessions were held on each of the six Workgroup topics, offering the participants an opportunity for smaller group discussions and comments on key questions and issues relating to WIOA implementation. o Panel of national experts from the National Governors Association, the National Association of State Workforce Agencies, the National Skills Coalition and the Council of Administrators of Vocational Rehabilitation. o Panel of promising employer-driven partnerships in New Jersey. Stakeholder Feedback Session: In December 2015, the SETC and LWD jointly hosted a two-day policy discussion and feedback session with key stakeholders in the workforce system. Key policies and program initiatives related to Board Governance, Performance & ETPL, Career Pathways and One-Stop Operations were shared with more than 100 representatives from the state board, local workforce boards, state and local partner agencies, community colleges, literacy program providers and state and local workforce program staff. In addition to the verbal feedback received during these two days, participants were able to submit written comments through an online portal on the LWD website. Throughout the planning process, workgroups met with SETC standing committees covering governance, adult literacy, youth and performance to further enhance connection with the SETC. Key policies were adopted as resolutions by the SETC on the recommendation of these standing committees. The NJ Combined State Plan for Workforce Development 2016 was submitted to the federal government on April 1, Feedback from USDOL is pending. d. What aspects of WIOA, such as the performance accountability components, have yet to be implemented at the State level? Please provide information on the status of implementation for these provisions. Response: Performance The Performance Goals for WIOA Core Programs will be implemented beginning July 1, In order to assess the quality, effectiveness and improvement of programs, New Jersey will utilize the performance measurement system outlined in section 116 of the Workforce Innovation and Opportunity Act as well as additional metrics that have been adopted by the SETC for federal and state workforce programs. The State will work to align performance metrics for all workforce programs with those being adopted for the specific titles; for example, the State will explore applying these metrics to the WorkFirst NJ and SNAP E&T programs. 22

23 CoEnrollment of WIOA Title I and Title III Participants It is New Jersey s intent that effective July 1, 2016, all WIOA Title I and WIOA Title III (Wagner-Peyser) participants will be co-enrolled in both programs; this is reflective of the new OneStop service integration and will be reflected in the performance outcomes of both programs. One-Stop Operator Competitive Selection The Workforce Innovation and Opportunity Act requires local workforce areas to competitively select the One-Stop Operator based on eligibility requirements and criteria outlined in Section 121(d)(2). WIOA requires each State to provide their local workforce areas with policy guidance and technical assistance that will assist in the competitive selection of the one stop operator. WIOA defines the minimum role of the One-Stop Operator as a convener, coordinator and manager of the one-stop delivery system in a local workforce area. Local boards can develop a more expanded definition of the role of the One-Stop Operator as long as that role is consistent with state law. Each local board will select the One-Stop Operator through a competitive process. Any Request for Proposal should clearly delineate the role of the prospective one-stop operator to deliver services at a minimum level described within proposed 20 CFR or near it, so as to ensure continued compliance with state law. The local Area process for competitive selection of the One-Stop Operator must be open, transparent and made available to all eligible entities. Local areas must follow state procurement laws at a minimum. Competitive selection must be made prior to June 1, 2017 with implementation of the role of the One-Stop Operator beginning no later than July 1, Competitive selection must be made no less than every two years. OneStop Career Center Certification The Workforce Innovation and Opportunity Act requires States and local workforce areas to certify their One-Stop Career Centers based on requirements and criteria outlined in Section 121(g). The following are the general requirements that will assist in the development and implementation of New Jersey s One-Stop Center Certification Process. Continuous improvement provision Requires the state board to establish objective criteria for one-stop center certification every three years, including access to services and integrated service delivery. Requirements will be established in consultation with chief elected officials and local boards Required in order to be considered for infrastructure funding. The eligibility for receiving infrastructure funding is contingent upon the establishment of an objective criteria and process that will be administered by the local WDB areas. The One-Stop Center Certification criteria and process must be developed with standards related to service coordination on the overall system. The One-Stop Center Certification criteria must include factors relating to the effectiveness, accessibility and improvement of the one-stop delivery system. The criteria must focus on the negotiated local levels of performance, the integration of available services and the needs of the local area employers. The local board areas have the autonomy to develop additional criteria that will respond to labor market, economic and demographic conditions and trends found in the local area. The One-Stop Center Certification Process must be reviewed and or modified by state or local plans on a biennial basis. 23

24 13. New Jersey provides extensive support for a wide range of workforce development programs. The three main components of workforce development programs in the department are: State programs funded by UI payroll tax revenues redirected into the Workforce Development Partnership Fund (WDPF) and the Supplemental Workforce Fund for Basic Skills (SWFBS); programs funded by WIA/WIOA, including programs for adult training, dislocated workers, and youth; and State and federal programs to facilitate transitions from welfare to work, delivered under the State Work First New Jersey (WFNJ) program. WFNJ participants include individuals receiving public assistance from such programs as the federal Temporary Assistance for Needy Families (TANF) program, the State General Assistance (GA) program, and the federal Supplemental Nutrition Assistance Program (SNAP), formerly the Food Stamps Program. Questions: a. Please indicate, for each of the Workforce Development programs (WDPF/SWFBS, WIA/WIOA, WFNJ), how many individuals participated in job training during FY 2015 and how many are expected to participate in job training during FY 2016 and FY Please indicate the cost per individual trained. Please indicate how many individuals accessed services other than job training through WDPF/SWFBS, WIA/WIOA, and WFNJ during FY 2015 and how many are expected to access services other than job training during FY 2016 and FY Please provide or estimate this data for each of the following programs: WDPF dislocated workers; WDPF disadvantaged workers; WDPF customized training grants; WDPF occupational safety and health training; WDPF youth transitions to work; WDPF SMART STEPS; SWFBS State One-Stop Career Centers basic skills training; SWFBS Workforce Investment Boards basic skills training; SWFBS customized training grants; SWFBS community college grant; WIA/WIOA dislocated worker training; WIA/WIOA adult training; WIA/WIOA youth training; WFNJ TANF recipients; WFNJ SNAP recipients; and WFNJ GA recipients. Response: See Schedule 13-1 b. Please define the above programs and explain who provides the services. Response: WDPF Dislocated Workers: The department provides Opportunity Partnership grants to educational institutions and training providers to partner with employers to provide employer-driven training to dislocated workers. The department also provides on-thejob training grants to assist employers who hire formerly unemployed individuals. The department provides funds to local Workforce Development Boards to provide training grants to dislocated workers. WDPF Disadvantaged Workers: The department provides funds to assist individuals receiving Transitional Assistance for Needy Families (TANF) to continue their education. 24

25 WDPF Customized Training Grants: Through the Skills Partnership Grant program, the department provides grants to employers and consortia of employers to assist in upgrading the skills of currently employed individuals. WDPF Occupational Safety and Health Training: The department provides occupational safety and health training to employers. WDPF Youth Transitions To Work: The department provides grants to non-profit organizations and educational institutions to provide high school juniors and seniors with preapprenticeship training and a structured work experience. SWFBS State One-Stop Career Centers basic skills training: The department delivers literacy assistance to job seekers in partnership with local Workforce Development Boards in One Stop Career Centers. SWFBS Workforce Development Boards basic skills training: The department provides funds to local Workforce Development Boards to provide literacy assistance to job seekers in One Stop Career Centers. SWFBS Training Grants: The department provides grants to employers, libraries, educational institutions and non-profit organizations to provide literacy assistance to job seekers. SWFBS Community College Grant: The department provides funds to the New Jersey Community College Consortium to deliver literacy and basic skills training to currently employed individuals. WIA/WIOA Dislocated Worker Training: Local Workforce Development Boards receive funds from the department through the federal Workforce Innovation and Opportunity Act (WIOA) program to provide career counseling, training and other workforce services to dislocated workers. Services are delivered by local governments, training providers, non-profits and other providers. WIA/WIOA Adult Training: Local Workforce Development Boards receive funds from the department through the federal Workforce Innovation and Opportunity Act (WIOA) program to provide career counseling, training and other workforce services to adults. Services are delivered by local governments, training providers, non-profits and other providers. WIA/WIOA Youth Training: Local Workforce Development Boards receive funds from the department through the federal Workforce Innovation and Opportunity Act (WIOA) program to provide career counseling, training and other workforce services to youth. Services are delivered by local governments, training providers, non-profits and other providers. WFNJ TANF recipients: Local Workforce Development Boards receive funds from the department to provide career counseling, occupational training, basic skills training, work experience and other workforce services to individuals receiving TANF. Services are delivered by local governments, training providers, non-profits and other providers. 25

26 WFNJ SNAP recipients: Local Workforce Development Boards receive funds from the department to provide career counseling, occupational training, basic skills training, work experience and other workforce services to individuals receiving SNAP. Services are delivered by local governments, training providers, non-profits and other providers. WFNJ GA recipients: Local Workforce Development Boards receive funds from the department to provide career counseling, occupational training, basic skills training, work experience and other workforce services to individuals receiving GA. Services are delivered by local governments, training providers, non-profits and other providers. c. Please discuss, or provide data regarding, the effectiveness of each program funded by the WDPF/SWFBS in assisting individuals without jobs to find employment providing self-sufficiency and assisting already employed individuals to retain employment or raise earning levels. If there is no evaluation data, please so indicate. Response: Displaced Worker Program Performance History Opportunity Grants Contract vs Actual/YTD Core Benchmarks FY14 Year to date progress: Contract # Actual % FY15 Year to date progress*: Contract # YTD* % FY16 Year to date progress*: Contract # Course Enrollment % % % Course Completion % 195 % 178 % Job Placement % 195 % 178 % *Grantees in process of recruiting FY 2015 and 2016 Opportunity training program by Industry Industry # of Contracts # of Employer- # of Trainees Partners Advanced Manufacturing Bio-Science Construction Finance Health Care Retail Technology Transportation Totals YTD* % 26

27 Grants Open and in Progress FY 2015 Opportunity4Jersey (O4J) training program FY2015 O4J Grantee Name Award Number Number Previous County Amount Trainees Employers Grant Camden County College $10, Y Camden Union County College* $108, Y Union HomeFront* $137, N Mercer Wise Renewal* $191, N Essex PRN* $100, N Cumberland Healthcare IT* $85, N Camden Totals $632, * Grantees in process of training and recruiting. Grants Open and in Progress FY 2016 Opportunity Partnership Grants (OPG) training program FY2016 Grantee Name Award Number Number Previous County Amount Trainees Employers Grant New Community Corp.* $268, Y Essex ASI Career Institute* $162, N Gloucester Hudson County Tech.* $49, N Hudson Humane Concepts* $223, N Union Mercer County Com. College $35, N Mercer Totals $739, *Applications are accepted and reviewed monthly until May 2016 Customized Training Program FY 2015: Skills4Jersey Grant Training program by Industry Industry # of Contracts # of Trainees Amount Awarded Advanced Manufacturing 127 8,566 5,535,831 Bio-Science ,340 Construction 4 2, ,817 Finance 11 4,437 1,064,247 Health Care 40 16,459 4,109,884 Retail 15 15,455 2,205,071 Technology ,280 Transportation 25 2,900 1,773,066 Non-targeted Industry related 22 10,727 3,352,488 Totals ,901 19,230,024 Data may reflect change in prior statistics due to grantee rescinding or DE-OBLIGATING contract Wage data is not gathered. FY 2016: Skills Partnership Grant by Industry (Thru April 2016) Industry # of Grant # of Trainees Amount Awarded Advanced Manufacturing 97 6,780 $3,741,316 Construction 6 1,830 1,325,783 Finance $485,102 Health Care 20 10,210 $1,444,914 Retail 8 2,223 $586,418 27

28 Technology $96,954 Transportation $643,907 Non-targeted Industry related 9 8,920 $1,706,695 Totals ,214 $10,031,089 *Applications for an additional round of awards are currently being evaluated. d. Please indicate the funding levels allocated for WIA/WIOA dislocated worker training, WIA/WIOA adult training, and WIA/WIOA youth training. Please organize this data by funding entity and program for FY 2015, and estimated for FY 2016 and FY Response: See Schedule 12-1 e. Please indicate for the federally funded Work First New Jersey programs, how much funding was received in FY 2015 and estimated for FY 2016 and FY Please indicate the amounts of WFNJ funding distributed to local partners, specifying which local partners received the funding. What level of funding was retained by the State for administrative or separate programming costs? Response: See Schedule According to the Personal Responsibility and Work Opportunity Reconciliation Act (P.L ), signed on August 22, 1996, Able-Bodied Adults Without Dependents (ABAWD) SNAP recipients are limited to three months of benefits in any 36-month period when they are not employed or in a work training program for at least 20 hours a week. However, the federal law allows areas with high and sustained unemployment to suspend this three month limit. As a result of the Great Recession, this provision has not been in place in many states over the past few years. However, 2016 marks the end of the suspension in New Jersey. Each state receives a share of $79 million in federal funding each year for SNAP employment and training (E&T) programs. SNAP E&T programs promote long-term selfsufficiency and independence by preparing SNAP recipients for employment through workrelated education and training activities. In addition to these annual funds, states that offer a training slot to all individuals facing the ABAWD three month time limit can receive a pro-rata share of $20 million in federal funding to defray the cost. Questions: a. Please provide a full accounting for FY 2014, FY 2015, and thus far in FY 2016 of the federal funding received for SNAP employment and training programs, including an itemized list of programs funded, remaining federal balances, and any unspent funds that reverted back to the federal government. Does any of this federal funding include funds specifically for training slots for individuals facing the ABAWD three month time limit? If yes, please highlight the amount. Response: NJLWD received $7 million of Federal funds annually for FY 2014, FY 2015 and FY2016 for SNAP E&T via NJ Department of Human Services (DHS). The training programs for SNAP recipients are provided by the Workforce Investment Boards/Workforce Development Boards, On-the-Job Training programs and employment counseling. The unexpended balances for SNAP E&T were $783, and $244, for FY 2014 and FY 2015, respectively. Any amounts reverted back 28

29 to the federal government are administered by DHS. At this time, FY 2016 unexpended balance cannot be determined because the training programs have until June 30, 2016 to obligate their funding. SNAP federal funding does not include any amounts for ABAWD training. b. Please describe how SNAP recipients are informed of SNAP E&T programs. How many total SNAP recipients, as well as ABAWD SNAP recipients, have participated in SNAP E&T programs in FY 2014, FY 2015, and thus far in FY 2016? Response: SNAP recipients who are determined as mandatory work activities participants are informed of SNAP E&T programs and services when they have their initial employability assessment by staff of the One-Stop Career Center system. At this session an employability plan is developed and the sequence of services are identified and scheduled. FY 14 FY 15 FY 16 (July 1, 2015 March 10, 2016) SNAP Only 3,826 3,946 3,060 SNAP/ABAWD 3,305 2,569 3,006 GA/SNAP 6,684 5,347 2,889 c. Does the department have any plans to address the training and employment requirements for ABAWD SNAP recipients? If yes, please describe. Response: The Department, working closely with local Workforce Development Boards, has completed nearly 250 work registration and information sessions for Able- Bodied Adults without Dependents (ABAWDS) who are receiving SNAP benefits. Letters were sent out to ABAWDs to invite them to these sessions. Approximately 5,000 have attended these information sessions. Individuals who were not ABAWDs were referred back to the County Welfare Agency for additional assistance. Individuals in need of a work activity were referred to employment and training services, which include: job search program, job search training program, community work experience program, vocational training/academic remediation program or a supported work program. The Department is working closely with local Workforce Development Boards to expand work activities for ABAWDs through partnerships with local Community Colleges and other education and training providers. On an on-going basis, County Welfare Agencies will continue to refer ABAWDs to One Stop Career Centers to be referred to an appropriate employment and training service. 15. The New Jersey Workforce Development Partnership Fund (WDPF) was created pursuant to P.L.1992, c.43 (N.J.S.A.34:15D-1 et seq.) to provide training grants to disadvantaged and displaced workers and to employers to offer training to their employees. The WDPF is funded by a dedicated assessment on workers and their employers. Per statute, workers are taxed percent on wages subject to the UI tax ($32,600 in CY2016), while employers are taxed based upon their contribution to the UI trust fund. WDPF moneys are statutorily allocated as follows: Customized Training, 42 percent; Employment and Training Services for Dislocated Workers, 25 percent; administration, 10 percent; Employment and Training Services for Disadvantaged Workers, 6 percent; individual programs approved by the commissioner, 5.5 percent; Youth Transitions to Work Program, 5 29

30 percent; Occupational Safety and Health Training, 3 percent; New Jersey Innovation and Research Fellowship Program, 3 percent; and annual evaluation by the State Employment Training Commission, 0.5 percent. Enacted on January 19, 2016, section 3 of P.L.2015, c.235 (N.J.S.A.34:15D-26) established the New Jersey Innovation and Research Fellowship Program to provide grants to support a technological research and innovation ecosystem in New Jersey. This program is an effort of the department, in consultation with the New Jersey Economic Development Authority, to use WDPF moneys to fund no less than 20 fellowships focusing on information technology research and innovation. The department estimated, in response to the FY 2016 OLS Discussion Points responses, that the payroll tax revenues plus investment earnings would generate approximately $110 million in the WDPF in FY 2016, while diversions to other accounts would total approximately $80.5 million, or 73 percent of the fund s anticipated revenue. The Governor s FY 2017 Budget Recommendation includes multiple language provisions transferring a total of $85.54 million of the WDPF s revenue to other purposes in FY 2017, including: $1.85 million to the New Jersey Youth Corps (page D-236); $64.69 million total to the Work First New Jersey Programs (pages D-236 and D-211); and $19 million to Vocational Rehabilitation Services (page D-236). Questions: a. For FY 2015, please provide the following actual funding data for each component of the WDP program (customized training, dislocated worker training, disadvantaged worker training, youth training, occupational safety and health training, program administration, New Jersey Innovation and Research Fellowship Program, annual evaluation by SETC, and transfers to programs other than WDP) and provide estimates of the same information for FY 2016 and FY 2017, based on the assumption that the current percentages, which are required by statute to be deposited in accounts for each component, will remain in effect. Please include: 1) The amount required to be deposited in the accounts for each allocation, and the amount actually spent; Response: See Schedule 15 2) The amount transferred out of the fund for each purpose not indicated in the WDP law (such as the Work First New Jersey and New Jersey Youth Corps programs); Response: See Schedule 15 3) The balance at the end of the year; and the amount encumbered as a reserve for future payments of multi-year grants for each WDP program component. Response: See Schedule 15 30

31 16. The Supplemental Workforce Fund for Basic Skills (SWFBS) was created pursuant to P.L.2001, c.152 (N.J.S.A.34:15D-21 et seq.) to provide basic skills training to the workforce. The SWFBS is funded from a portion of employer and employee tax contributions. Per statute, workers are taxed percent on wages subject to the UI tax ($32,600 in CY2016), while employers are taxed based upon their contribution to the UI trust fund. The funds collected are statutorily allocated in the following manner: 24 percent to support basic skills training delivered at the State s One-Stop Career Centers; 28 percent to fund basic skills training grants provided by Workforce Investment Boards; 25 percent to Customized Training to fund grants to consortia of labor, business, and community groups providing basic skills training; 13 percent to fund a grant to the New Jersey Community College Consortium for Workforce and Economic Development to provide basic skills training; and 10 percent for administrative costs. The department estimated, in FY 2016 OLS Discussion Points responses, that the payroll tax revenues, plus investment earnings, would generate approximately $31 million in the SWFBS in FY 2016, while diversions to other accounts would total approximately $20.5 million, or 66 percent of the fund s anticipated revenue. The FY 2017 Budget Recommendation includes multiple language provisions transferring a total of $21 million of the SWFBS s revenue to other purposes in FY 2017, including: $2.2 million to the New Jersey Youth Corps (page D-236) and $18.8 million to county colleges for operating aid in association with remedial courses (page D-374). Questions: a. Please list by category how the funds from the SWFBS were utilized in FY 2015 and estimates for FY 2016 and FY 2017, using the same format used in Schedule XVI in the department s response to the 2016 OLS Discussion Points responses. Response: See Schedule 16 b. Please detail any new programs that have been funded in FY 2016 and will be funded in FY 2017 from the SWFBS monies. Response: The Department launched a pilot grant program to create direct partnerships between local libraries and New Jersey s Federal WIOA Title II adult literacy instructional service providers. New Jersey libraries are an essential partner in providing adult literacy services within their communities. LWD views the services provided by New Jersey libraries as complimentary to the WIOA Title II system and as such wants to create new and/or expand existing partnerships between the two groups. The expected outcome is that New Jersey residents will see expanded service opportunities that includes additional locations and time availabilities that meet their needs. This pilot program funding is designed to improve access and instructional opportunities for New Jersey residents to increase their Adult Basic Education and/or English Language proficiency skills through the state s library system. WIOA Title II providers are envisioned to best provide traditional classroom instruction and the libraries to provide the delivery setting and wrap around support services to achieve success. 31

32 The Department sets a priority on awarding grants that demonstrate clear and meaningful outcomes. The key outcomes established by LWD for this pilot training grant program are one or more of the following: 1. Functional grade level advancement based on WIOA Title II metrics; 2. Increase in the student s Workplace, Financial, or Health Literacy Skills; or 3. Connection and enrollment to a credential bearing career pathway opportunity. All funded training efforts must contribute towards greater employability opportunities and/or career advancement for New Jersey residents in need of jobs as well as those in lowwage, lower-skilled occupations. c. Please provide a report of the monies provided to each county college from the SWFBS, including both funds allocated via statute and funds allocated via budget language, and the clients served by each county college with these funds in FY 2015 and thus far in FY How has the allocation from the SWFBS to the county colleges been used by the county colleges to assist the department in reaching the basic skills program goals? Response: Detailed information regarding the monies provided to the county colleges and the clients served by each of the colleges can be found via the weblink below: Talent Networks are a department program intended to connect businesses in certain key industries with educational institutions, workforce development agencies, and government and community groups to identify the skills and training employers require in prospective employees to remain competitive in the global market. By acquiring training in those required skills, the program seeks to assist students and job-seekers in finding long-term jobs and boost the State s economy. The seven key industries for which Talent Networks are utilized included: transportation, logistics and distribution; life science; advanced manufacturing; financial services; health care; technology and entrepreneurship; and retail, hospitality and tourism. The department has stated it will use these same Talent Networks in the reemployment efforts for Atlantic City. Questions: a. How much did the department expend in FY 2015 and how much does the department estimate to expend in FY 2016 and FY 2017 on Talent Networks, by network or industry, and what is the source of funding for each network? Please detail the performance metrics used by the department to measure the success of the individual networks. Response: In Fiscal Year 2015, the Department expended $2,509,604 for the Talent Networks. The source of funding was WIA: $2,007,766 and WDP: $501,

33 Estimated Funding for Fiscal Year 2016 is shown below. The source of funding for Fiscal Year 2016 is WIOA: $1,560,000 and WDP: $390,000. Below are the expenditures for FY 2015, FY 2016 and FY TALENT NETWORK FY2015* FY 2016 Estimated FY 2017 Estimated Advanced Manufacturing $375,000 $300,000 $300,000 Financial Services $375,000 $250,000 $250,000 Health Care $375,000 $250,000 $250,000 Life Sciences $375,000 $250,000 $250,000 Technology & Entrepreneurship $375,000 $150,000 $150,000 Transportation, Logistics & Distribution $369,077 $250,000 $250,000 Retail, Hospitality & Tourism (North) $372,796 $250,000 $250,000 Retail, Hospitality & Tourism (South) $375,000 $250,000 $250,000 TOTAL $2,991,873 $1,950,000 $1,950,000 *Reflects 18 month contracts. Talent Networks will play two key roles in New Jersey s Workforce Development system in FY 2016 and in support of LWD s continuing efforts. Task 1. Serve as a key source of intelligence about the workforce needs of the industry - Provide feedback to LWD in the identification of industry-valued credentials upon request. - Provide feedback to LWD in the development of career awareness materials upon request. - Convene roundtable discussions with employers and report findings to LWD labor market analysts and staff bi-monthly. - Host an annual, one-day industry workforce summit to bring together education, workforce and employers to identify opportunities for partnerships, to highlight highquality partnerships. - Maintain a website and a presence on social media (with a focus on LinkedIn) to disseminate industry intelligence and labor market information to job seekers, students, employers and education and workforce stakeholders. Task 2. Build high-quality employer-driven partnerships between employers, educational institutions and workforce organizations in three regions of the state. 33

34 - Facilitate the development of high-quality employer-driven partnerships in three regions of the state each year. Partnerships should be employer-driven (involving multiple employers and industry associations) and include at least three key education and workforce providers/stakeholders including high schools, community colleges, four year colleges and universities, training providers, Workforce Development Boards and community and faith-based organizations. - Develop a Strategic Pathways Plan for each region that will include: o Identification of priority workforce needs of the industry in the region and the key workforce challenges faced by employers in the industry in the region; o Identification of career pathways in each region that can form the basis for workforce solutions; o Development of detailed proposed solutions focused on multiple occupations with budget; o Identification of leveraged resources, including employer commitments and philanthropic investments; and o Identification of target population to be served by the partnership. b. Please provide details on how the re-employment efforts for Atlantic City are utilizing the State s Talent Networks. How many individuals impacted by the casino closures have been provided assistance through the Talent Networks? Response: The Health Care and Retail, Hospitality and Tourism Talent Networks have been assisting workers affected by the downturn in Atlantic City. These talent networks have assisted in job placement efforts including, but not limited to, holding industry specific workshops, resume writing and review clinics, connecting AC NEG participants with Talent Network employers and connecting participants with training opportunities for industry recognized credentials. Additionally, workshops have been held to assist workers in exploring jobs available in these industries. Over 1,200 individuals have participated in the Departments Atlantic City Re-Employment services. c. Has the implementation of WIOA affected the purpose of the Talent Networks? If so, please explain. Response: The Workforce Innovation and Opportunity Act puts an emphasis on creating a workforce system that is responsive to the needs of employers. As a result, the Talent Networks, which had previously focused on connecting jobseekers, educational institution, workforce programs and employers within seven key industries, will now concentrate on addressing the needs, challenges and opportunities in the employer community within those industries. The new focus of the Talent Networks centers on: 1) Developing high-quality, employer-driven partnerships. The Talent Networks will work with employers, local workforce boards, educational institutions and other stakeholders to develop Targeted Industry Partnerships in three geographic areas of the state. The Talent networks will engage employers and identify industry workforce needs, 34

35 assemble stakeholders to assess capacity and facilitate the development of a workforce plan for each Targeted Industry Partnership in each area. 2) Developing industry intelligence to inform workforce investments. Talent Networks, working closely with LWD labor market analysts, will frame the understanding of key industry workforce trends and the workforce needs of employers by hosting an Industry Summit to gather intelligence and inform key workforce stakeholders on essential employer needs. Each Talent Network will produce an annual industry report with quantitative data and feedback from employers. Additionally, Talent Networks will engage the employer community to contribute to the industry-valued credentials and degrees list. 18.a. In December 2012, after Hurricane Sandy, the Customized Training (CT) program and the other employer training programs of the department were rebranded to provide a single application process for employers and training groups to access training funds. This new format for workforce development funds includes Recovery4Jersey On-the-Job Training (OJT) grants, Skills4Jersey grants, and Opportunity4Jersey grants. The funding sources for these programs is the sum of the funding that is dedicated to the Customized Training (CT) program, (42 percent of the WDPF revenue; 25 percent of the SWFBS revenue), Safety Training Funds (3 percent of the WDPF revenue), and Individual Training-Dislocated Workers grant funds (25 percent of the WDPF revenue). Employers apply for one grant for training and the department determines which funding source best meets the needs of the employers requested programs and allocates the funding in the appropriate manner. Previously, employers or training groups applied separately for CT grants, Basic Skills grants, and Safety Training grants. Recovery4Jersey OJT is a program that encourages employers to hire from the unemployed by assisting with the costs of training new workers. In exchange, former job seekers get a full-time job and an opportunity to learn a new skill while employers rebuild their businesses and receive reimbursement for half of the new hire s salary (up to $10,000) for up to six months. (Positions must pay at least $10.00 an hour and cannot be commission based.) Skills4Jersey is the department s incumbent worker training program and supplies matching grants to employers for the purpose of training their existing workforce. These training programs are generally focused on upgrading the occupations, literacy and safety skills of their current employees and training new workers for purposes of retaining highly skilled and high wage jobs in the State. Opportunity4Jersey supplies grants to approved training providers working in partnerships with New Jersey employers to supply training to eligible WDP-dislocated workers to fill immediate and future job openings in the State s targeted industry sectors. The Individual Training-Dislocated Workers grant funds will only be used for Opportunity4Jersey awards. Questions: a. Please provide information on any changes to the application process for employers and training groups to access training funds from the CT program and the other employer training programs. Response: In 2015, Customized Training migrated from a traditional paper application and contracting format to the new SAGE (System for Administering Grants Electronically) system for ease of customer application. 35

36 b. Please provide the number of grant applications received for the CT program and the other employer training programs, the number of grants issued, the amounts issued, the number of employees trained, and the average cost per trainee for FY 2015 and estimated for FY 2016 and FY Please itemize this information by funding source and grant title. Response: Skills Partnership Grant Fiscal Year # of Applications # of Approved Estimated to Average Cost per Received Grants be Trained Trainee FY ,901 $311 FY16 Estimated ,000 $287 FY17 Projected ,000 $260 * FY16 projected numbers includes the submittal of SPG applications that still need to be reviewed by the panel, for consideration to be awarded as a grant. A list of the grants awarded for fiscal year 2015 and 2016 (thru April 2016) can be viewed on New Jersey Department of Labor & Workforce Development s website at c. On average, how many hours per week and how many weeks total did trainees participate in the CT program and the other employer training programs in FY 2015 and estimated for FY 2016 and FY 2017? How many total jobs were funded through these programs in FY 2015 and estimated for FY 2016 and FY 2017? Does the department asses the length of employment for each trainee after training is complete? If so, please provide that data. RESPONSE: The course training varies per contract. Since it is dependent upon the needs of the company, the structure of the training format is designed by the grantee. If awarded a grant, the grantee is given a one year period in which to deliver the training. As a result, the data is not available as requested. However, an analysis of the total number of trainees divided by the total request clock to conduct all the request training revealed that the trainee in: FY15 would average an estimated 19.8 hours FY16 would average an estimated 24.0 hours d. Please list each of the CT programs and the other employer training programs grantee s names, their location, the amount granted and details of each of the grants awarded. Which of these grantees had not previously received grants through WDPF/SWFBS funding? RESPONSE: A list (by fiscal year) of the Skills Partnership Grants awarded (including FY 2015 and FY thru April 2016) can be viewed on the Department of Labor & Workforce Development s website at: 36

37 e. How much funding remains for the rest of FY 2016 and anticipated for FY2017 for the CT program and the other employer training programs? What funding streams are dedicated to each of these programs in FY2016 and anticipated for FY 2017? Response: Funding sources for the Customized Training (CT) program consist of the dedicated funds from the Workforce Development Partnership Fund (42% Customized Training and 3% Occupational Safety & Health Training) and the Supplemental Workforce Fund for Basic Skills (part of 25% Basic Skills Training). Remaining funds for (CT) in FY 2016 is approximately $500,000. It is anticipated that CT funding in FY 2017 will be approximately $16 million. 18.b. In February 2015, the Christie Administration announced the department s commitment of approximately $500,000 for workforce development training programs specific to the Camden region. These funds are made available through an open, competitive process and assist with incumbent worker training, pre-employment training and pre-apprenticeship programs. The department has made the grants available through the Skills4Jersey, Opportunity4Jersey, and New Jersey Builders Utilization Initiative for Labor Diversity (NJBUILD) programs. NJBUILD is a State program for training women and minorities in the construction trades. Questions: a. Please detail how these programs were utilized in the Camden region. How many employees or organizations sought assistance, and how many received assistance? What kinds of training services were provided? How many individuals participated in training programs? Response: The NJBUILD-Camden program was launched with the release of a Notice of Grant Opportunity in late February/early March 2015 to promote outreach and preapprenticeship training in the construction trades industry for female and minority Camden residents to prepare them for entry in a union apprenticeship or employment in a construction-related job. Two agencies, Union Organization for Social Services (UOSS) and New Life CDC, received a total grant of $150,000. The contract period began 6/30/2015 with the goals of training and graduating 20 individuals and placing 18 in construction jobs or apprenticeship programs. NJLWD was awarded $1,994,350 from the US Department of Labor to expand services to disconnected, out-of-school youth residing in Camden, NJ. The CamdenCorpsPlus program will help engage and connect Camden City youth with training and employment opportunities. The grant will serve 113 Camden City youth (age 16-24) who lack a high school diploma or equivalency. NJLWD has announced and is reviewing applications for the following Notices of Grant Opportunities: Lead Agency - $1,110,850 and Education Provider - $883,500. Grantees will work with community- 37

38 based and faith-based organizations to provide Education & Work Preparation, Work Sampling and Internships to Camden City youth participants. The overall goal of the program is to provide youth with education, occupational skills and on-the job training that will result in unsubsidized employment and retention. b. Are there any additional grants or services still available for the Camden region? The department expects to continue the NJBUILD-Camden program in FY2017 through the issuance of a Notice of Grant Opportunity. The department will continue to look for other opportunities to target investments for workforce development services to Camden. 19. In April of 2015 the department announced a $2.5 million initiative to provide grants to State libraries to serve as access points for job seekers to obtain workforce services that will help them secure employment. The New Jersey Libraries Career Connections Grant for Uniform Career Guidance and Job Search Assistance Service provides funding to 26 county and local libraries ($50,000 each) to distribute job search information and to assist job seekers in using the Career Connections digital platform on the Jobs4Jersey website. The department provides grant recipients training and support to effectively help their local residents connect to job search information. Additionally, this grant provides the State Library with $200,000 to assist in the implementation of this initiative. The amount of funding for this grant is $1.5 million. The Adult Literacy and Community Library Partnership Pilot Grant Program provides funding to State, county, or local libraries, or a consortium of those entities, to supplement existing adult literacy services. This grant program actively promotes partnerships between libraries and their local WIOA Title II service providers, such as local educational agencies, community-based or faith-based organizations, volunteer literacy organizations, institutions of higher education, or public or private nonprofit agencies. The amount of funding for this grant is $1 million. Questions: a. Please provide an update on the current status of the New Jersey Libraries Career Connections Grant for Uniform Career Guidance and Job Search Assistance Service, including the funding sources for the grant program, a description of the State Library s role, and a list of libraries awarded grant funds. Will the grant be offered in FY 2017? Response: A total of 18 libraries and/or library systems applied to a competitive Notice of Grant Opportunity for New Jersey Libraries Career Connections Grant for Uniform Career Search Guidance and Job Search Assistance and are receiving a grant from the department. The 18 libraries receiving grants are Newark Public Library, Warren County Library, Paterson Free Public Library, North Bergen Free Public Library, Union Public Library, Roselle Public Library, Plainfield Public Library, Sussex County Library System, New Brunswick Free Public Library, East Brunswick Public Library, Monmouth County Library Headquarters, Manalapan, Monmouth County Library Eastern Branch, Shrewsbury, Long Branch Free Public Library, Ocean County Library, Atlantic City Free Public Library, Gloucester County Library System, Cumberland County Library and Salem Free Public Library. The source of funds for this program is from the 38

39 New Jersey Workforce Development Partnership Fund (WDP) and from the state setaside funds in the federal Workforce Innovation and Opportunity Act (WIOA). The grant period will be from July 1, 2016 to June 30, The State Library will be acting in a supportive role to the Library grantees and will also be providing assistive services to the public. The department will closely monitor the work of the libraries throughout the grant period and will provide training and technical assistance to each participating library. The department expects to continue this program in subsequent years. b. Please provide an update on the current status of the Adult Literacy and Community Library Partnership Pilot Grant Program, including the funding sources for the grant program, the goals and measures of success of the program, and a list of libraries awarded grant funds along with a description of their existing adult literacy services. Will the grant be offered in FY 2017? Response: A total of 11 libraries and/or library systems applied to a competitive Notice of Grant Opportunity for Adult Literacy and Community Library Partnership Pilot Grant Program and are receiving a grant from the department. The 11 libraries receiving grants are Camden County Library System, Maplewood Memorial Library, Gloucester County Library System, Kearny Public Library, Sparta Public Library, Elizabeth Public Library, Montclair Public Library, Paterson Free Public Library, Somerset County Library System, Newark Public Library and Passaic Public Library. The source of funds for this program is from the New Jersey Supplemental Workforce Fund for Basic Skills. The grant period will be from July 1, 2016 to June 30, The department will closely monitor the work of the libraries throughout the grant period and will provide technical assistance to each participating library. The department expects to continue this program in subsequent years. 20. With the exception of certain programs, most proprietary or vocational schools that operate in New Jersey are licensed by the Training Evaluation Unit (TEU) within the Center for Occupational Employment Information (COEI) within the department. The TEU, in conjunction with the Department of Education s Bureau of Program Review, is responsible for evaluating and approving private vocational schools, out-of-state private vocational schools, and correspondence schools that wish to operate within New Jersey s workforce readiness system. All approved providers are subject to annual reviews in order to maintain continued approval. However, in order to be eligible to receive State or federal job training funds, schools must also be included on the Eligible Training Provider List (ETPL) established by P.L.2005, c.354, s.14 (N.J.S.A.34:15C-10.2). Further, only schools that provide certain information to the COEI to illustrate the effectiveness of their training providers will be listed on the ETPL. Pursuant to P.L.2013, c.208, this information includes: the number of enrollees; the completion rate; placement in employment information, including the names and locations of employers where placements are made; licensing information; examination results; enrollee demographic information; and information showing the long-term success of former trainees of each provider and school in obtaining permanent employment and increasing earnings over one or more time periods following the completion or other termination of training, including a period of two years following the completion or other termination of training. This information is compiled in 39

40 a Consumer Report Card (CRC) and is published, along with the ETPL, on the New Jersey Training Opportunities (NJTOPPS) website, accessible at Entities on the ETPL are also required to share with the COEI certain information about trainees, such as the participant's Social Security number, gender, date of birth, date of enrollment, any date of completion, date of termination, date of start in a job, date of application for a license, licensing examination result, date of issue of a license, and any credentials issued. According to the department, the changes established in WIOA placed the COEI s activities surrounding the implementation of a new NJTOPPS system on hold until the requirements of WIOA could be fully clarified. Proposed federal regulations providing more specificity on the implementation of WIOA were published on April 16, Furthermore, the department s blueprint outlining the key action items that must be addressed under WIOA included a NJTOPPS technical overhaul. Questions: a. Please provide the number of vocational/proprietary schools that were reviewed, approved, and rejected by the TEU in FY 2015, thus far in FY 2016, and estimated for FY Response: Total Approved Schools FY 2015: 325 FY 2016: 295 (estimate) FY (estimate) COEI provides technical assistance and works with the applicants until they make the necessary revisions to come into compliance. b. Please provide a budget and funding source for the COEI. Please detail how many staff are dedicated to the Center s activities and include the number that are dedicated to maintaining the NJTOPPS website, the CRC, and the ETPL. Response: The COEI Training Evaluation Unit is supported by $625,000 in WDP and WIOA funds. A total of 4.6 FTE s are allocated, of which 2.2 FTE s are dedicated to maintaining the NJTOPPS website, the CRC and the ETPL. c. Please provide the status of the upgrade of the NJTOPPS website and the department s efforts to comply with CRC requirements of P.L.2013, c.208. Response: The reporting requirements established by P.L.2013, c.208 and the federal Workforce Innovation and Opportunity Act (WIOA) require the creation of new and large scale information collection and decision making processes. Even though the federal government has not yet produced the anticipated regulations to fully clarify the ETPL related requirements of WIOA, NJLWD has taken important steps forward. One example of this is the recent release of our Industry-Valued Credential List for Public Comment. This list was developed over the last year based on intensive labor market research and analysis and will be reviewed by the state s newly created Credential Review Board in the spring of This work will enable NJ to define the important 40

41 reporting term, recognized post-secondary credential. Once defined, the process of collecting and decimating educational outcome results via the CRC can begin. 21. One-Stop Career Centers (OSCCs) are designed to provide a full range of assistance to job seekers under one roof. Established under WIA, the centers offer training referrals, career counseling, job listings, and similar employment-related services. Customers can visit a center in person or connect to the center's information through a computer or remote access kiosk. Many of the workforce development training programs in the State are accessed and managed through OSCCs located in all 21 counties. The OSCCs are funded through a variety of State and federal sources. Each OSCC is unique in the services it offers and therefore its funding sources. Overall, most OSCCs offer consumers the ability to access UI staff (federally funded), employment services (State and federal funding), and other social service programs. However, research indicates that the OSCCs are not uniformly operated, and within each center, are not centrally managed. That is, each service provided at the center has its own manager, either on site or by region. Questions: a. Please provide the amount of State and federal funding each OSCC location receives. For each OSCC, please indicate: the programs or services provided on site, a description of each program or service, and a list of staff by job title. Response: See Schedule 12-1 & 13-2 for State and Federal funding. WNJ Staff Provides the following services at each One-Stop Career Center: Labor Exchange One-Stop Career Centers provide jobseekers online and in-person labor exchange services (matching employers and jobseekers). Online services are available at jobs4jersey.com. On Ramp at jobs4jersey.com offers employers and jobseekers a state of the art, intelligent engine for matching based on skills required by employers and possessed by jobseekers rather than using more traditional keyword matching techniques. Skilled professionals at the One-Stop Career Centers assess customers and provide workshops to increase the competitiveness and opportunities for jobseekers on topics such as using technology in the job search, resume writing, interviewing skills and networking Job Placement for Job Ready Referrals Business representatives work directly with employers to identify their human resources needs and work with their One-Stop Career Center colleagues providing jobseeker services to identify and refer qualified and dependable job ready applicants to job openings. 41

42 Public Access One-Stop Career Centers provide PCs, printers, fax machines, telephones and staff expertise to assist jobseekers looking for employment. Jersey Job Club The Jersey Job Club provides the tools and support jobseekers need to find a job. JJC staff will help jobseekers develop new skills and build up current skills. The Jersey Job Club gives jobseekers the tools and support they need to find a job. Staff will help jobseekers develop new skills and build up current skills. Reemployment Services and Eligibility Assessment (RESEA) UI claimants are required to attend a workshop at the One-Stop Career Center to learn about available job search and training assistance, review their eligibility for benefits, better understand the labor market and potential opportunities and develop a customized reemployment plan. Jobs for Veterans State Grant - Veterans with significant barriers to employment are identified during the intake process and referred to staff specially trained in serving this population. Business representatives funded under the grant work with employers looking to hire veterans and facilitate the connection to job ready veterans. Shared Responsibility with WIOA Partner services includes: Triage/Intake and ABAWD/TANF/GA Job Search Workshops. One-Stop Career Centers offer services funded under various titles of the Workforce Innovation and Opportunity Act, Workforce Development Partnership Act, and public assistance (TANF/GA/SNAP). These services are co-located at the One-Stop. The One-Stop Operator hired with the consent of the local Workforce Development Board is empowered to convene and coordinate the partners. Triage/Customer Intake is a responsibility of the One-Stop Operator to help ensure there are no wrong doors and customers receive the services most appropriate for their employment success. b. Does the department undertake any evaluation of OSCCs to measure the effectiveness of services provided in assisting jobseekers and to serve as the basis for assisting OSCCs in improving performance? Response: The Department and the State Employment and Training Commission (SETC) have contracted with the Heldrich Center for Workforce Development at Rutgers University to conduct an evaluation of OSCC s in New Jersey. The Heldrich Center is currently completing the evaluation. 22. P.L.2009, c. 313 (N.J.S.A.52:38-7 et seq.) requires that any State or local public body, upon entering into any public works contract in excess of $1,000,000 funded, in whole or in part, by funds of the public body, or any public works contract of any size which is funded, in whole or in part, by funds provided to the public body pursuant to the American Recovery and Reinvestment Act of 2009 (ARRA), must transfer an amount equal to 0.5 percent of the portion of the contract amount to the department. Certain Statewide authorities are excluded from the requirement to transfer the funds to the department. A Statewide authority which enters into an eligible public works contract and administers a program providing outreach and training programs for minority group members and women in the construction trades may retain the funds as necessary for the program. 42

43 The department is required to use the transferred funds to provide on-the-job or off-thejob outreach and training programs, including programs of preparation for admission into registered apprenticeships, for minority group members and women in the construction trades, with opportunities for long-term trade and professional employment providing economic selfsufficiency for the minority group members and women. P.L.2009, c.335 (N.J.S.A.52:40-1 et seq.) requires the Contract Compliance and Audit Unit, transferred to the department in 2012, to determine whether each of the State entities whose performance it monitors has properly allocated and released to the department 0.5 percent of the total cost of a construction contract of $1,000,000 or more. This unit also monitors the NJBUILD program to ensure that the set-aside funds, pursuant to P.L.2009, c.313, are used to train minorities and women for employment in construction trades. According to FY 2016 Discussion Point responses, the department estimated that the NJBUILD Fund would open FY 2016 with approximately $1,500 in funds. The FY 2017 Budget Recommendation anticipates $3.5 million in dedicated revenue deposited into the NJBUILD Fund in FY 2017 (page C-12). In addition, the Budget Recommendation contains language authorizing the appropriation of $470,000 from the NJBUILD Fund for Administration and Support Services for enforcing the provisions of P.L.2009, c.335 (N.J.S.A.52:40-1 et seq.) (page D-226). This amount is equal to the appropriations from the NJBUILD Fund in the FY 2016 Appropriations Act. The NJBUILD Fund has frequently been targeted to help balance the budget. Fund balances were lapsed to surplus in five of the last six completed fiscal years: FY 2010, $1.5 million; FY 2011, $5 million; FY 2012, $6 million; FY 13, $4.9 million; and FY 2015, $2.5 million. These lapses, totaling $19.9 million, comprised about 79 percent of total NJBUILD revenue over that time period. Questions: a. Please provide the amount of revenue from the 0.5 percent transfer required pursuant to P.L.2009, c.313 in FY 2015 and revenue estimates for FY 2016 and FY Please detail this revenue by source and be specific as to local entity, authority, State entity, educational entity, etc. Response: See Schedule 22 b. Please provide information on the programs to be funded through the NJBUILD account, including the budget and clients served in each program in FY 2015, and estimates for FY Response: See Schedule 22 What new programs were proposed in FY 2016? What new programs will be proposed for FY 2017? Please detail the funding required for each program. Response: See Schedule 22 d. Please detail the use of any remaining funds in the NJBUILD account, including any administrative costs incurred, in FY 2015 and estimates for FY 2016 and FY

44 Response: Projects are identified and assessed as funds become available. Projected administrative costs have been incorporated into Schedule 22. e. Please explain why the department apparently has been unable to utilize NJBUILD Fund resources as intended by the Legislature, leaving unexpended resources that are then targeted for budget-balancing purposes. Based on average costs of providing training programs, pre-apprenticeship programs and other activities that lead to longterm employment, how many persons could have been served annually had NJBUILD Fund resources not be diverted over five of the last six completed fiscal years? What impact could that have had on the unemployment rate among minority groups and women? Response: The construction industry was hit hard by the Great Recession in 2008, over 43,100 construction jobs were lost. During this period, there were few new job opportunities in the industry. As the economy improves and as the construction industry expands in FY2016, and as NJBUILD revenues become available, the department looks forward to continuing the funding for existing annual programs as well as implementing new ones. ATLANTIC CITY 23. Beginning in August 2014, an estimated 7,800 workers were impacted by the closing of several Atlantic City casinos and businesses, including the Showboat Atlantic City Hotel and Casino, the Revel Casino Hotel, and the Trump Plaza Casino. The department identified 37 additional employers who had closed or laid-off a significant amount of employees as a direct result of the closure of these casinos. On January 12, 2015, the department announced that its proposal for a National Emergency Grant (NEG) to retrain and re-employ workers impacted by the closing of the Atlantic City casinos was approved by the USDOL, securing an initial $13 million of the total $29 million awarded to the State for this purpose. The department oversees the grant, which is being administered through the Atlantic Cape May Workforce Investment Board, the Cumberland Salem Workforce Investment Board, and through the AC Re- Employment Initiative. Questions: a. Please provide details on the services the department provided with the NEG funding. How many individuals applied for, and how many received, assistance through the AC Re-Employment Initiative? Response: As of April, 2016, approximately 1,200 individuals have been found eligible for AC NEG services out of approximately 1,500 who applied for services. Those found ineligible for grant services were advised by One-Stop staff of other funding streams from which they might benefit. After initial intake and assessment, including TABE testing, AC NEG customers were placed in training through ITA classes administered by One-Stop partners or ESL/ABE classes administered by Atlantic Cape Community College. b. Has the department exhausted all of the funds from the NEG? If not, how much funding remains from the NEG and what programs will utilize the funds provided? 44

45 Response: Funds are committed according to the federal USDOL regulations that oversee National Emergency Grants Program. To date, the Department has obligated $8.39 million of the initial $13.1 million in NEG funding to the local WDB s, the project operators, and LWD grant administration. VOCATIONAL REHABILITATION 24. The Governor s FY 2017 Budget Recommendation provides $ million in Grantsin-Aid funding for Vocational Rehabilitation Services, of which $ million is appropriated through budget language (page D-236) as follows: $14 million from the Workforce Development Partnership Fund; $9.114 million from the UCAF; and $6.168 million from the Department of Human Services for extended employment client slots. The Budget Recommendation also provides for an additional $5 million in Grants-in-Aid funding for Vocational Rehabilitation Services, specifically Extended Employment, Extended Employment Transportation, and Long--Term Follow Along Services, appropriated through budget language from the Workforce Development Partnership Fund (page D-236). These amounts are equal to the appropriations provided for Vocational Rehabilitation Services in the FY 2016 Appropriations Act. In addition to State funds, the Budget Recommendation projects $56.2 million in federal funding for Vocational Rehabilitation Services. Grants-In-Aid funding for Vocational Rehabilitation Services is awarded to community service providers to support programs and services that assist persons with disabilities to prepare for, obtain, and maintain employment, such as: Sheltered Workshop Transportation; Supported Employment Services; Sheltered Workshop Support; and Independent Living Centers. Proposed federal WIOA regulations published on April 16, 2015 suggested several changes be made to Vocational Rehabilitation Services, including three key provisions focusing on youth with disabilities. The first provision requires state vocational rehabilitation programs to spend at least 15 percent of their federal allotment for vocational rehabilitation to provide pre-employment transition services to students with disabilities who are eligible or potentially eligible for services. Transition services include vocational counseling and guidance, placement services, job seeking skills, supported employment, and skills training The second provision requires state vocational rehabilitation programs to spend at least 50 percent of their federal allotment for supported employment programs for services to youth with the most significant disabilities. Under the proposed regulations, youth are defined as individuals with disabilities who are between the ages of 14 and 24 when entering the program, while significant disability is defined as a severe physical, mental, cognitive, or sensory impairment that substantially limits an individual's ability to function independently in the family or community or to obtain, maintain, or advance in employment. In addition, states must provide a non-federal share of 10 percent of the federal funds reserved for supported employment services to youth. The third provision institutes limitations on the payment of subminimum wages by employers holding special wage certificates, also known as sheltered workshop certificates, under the federal Fair Labor Standards Act. Specifically, such employers are prohibited from 45

46 hiring youth with disabilities at a subminimum wage level unless the youth are afforded meaningful opportunities to access services. Questions: a. For FY 2016 and anticipated for FY 2017, please provide the amount of Vocational Rehabilitation Services State funding, federal funding, or other funding received by each program area as itemized in the FY 2017 Budget Recommendation. Response: See Schedule 24 b. How much federal money has the department spent on transitional services for students with disabilities during FY 2015 and thus far in FY 2016? Does the amount spent satisfy the proposed requirement under WIOA? Response: DVRS did not budget for WIOA pre-employment transition service programs in FY The final WIOA regulations have not been released by the Department of Education. It is anticipated they will be released in June of FY 2016 c. How much federal money has the department spent on supported employment programs for youth with the most significant disabilities during FY 2015 and thus far in FY 2016? How much State money has the department spent on supported employment programs for youth with the most significant disabilities during FY 2015 and thus far in FY 2016? Do the amounts spent satisfy the proposed requirements under WIOA? Response: DVRS did not budget for WIOA supported employment youth programs in FY The final WIOA regulations have not been released by the Department of Education. It is anticipated they will be released in June of FY d. What would be the impact of a 10 percent increase in the minimum wage on State funding of supported employment programs, particularly those programs for youth with the most significant disabilities, as well as other Vocational Rehabilitation Services? Response: DVRS supported employment programs are funded using a per person feefor-service model with vendors under state contract. e. How many employers in the State have been issued special wage certificates to employ individuals with disabilities below minimum wage? Does the department have any procedures in place to monitor the use of special wage certificates to employ individuals with disabilities under the age of 24? Response: There are approximately 168 special wage certificates issued by the Department of Labor. The Division of Vocational Rehabilitation is developing procedures to ensure VR counselors provide services that offer individuals 24 and under the opportunity to experience community-based, competitive integrated employment before being referred to a sheltered workshop. 46

47 WORKPLACE STANDARDS: 25. The Division of Labor Standards and Safety Enforcement, formerly known as the Division of Workplace Standards, enforces statutes and rules by inspecting work premises and conditions. Additionally, the division develops and interprets rules, issues formal variances, and hears appeals. It also issues certain licenses and permits and issues approval for the operation of boilers, pressure vessels, and nuclear components. The division has numerous fees for licenses, permits and inspections. The FY 2017 Budget (pages D-233 and D-234) recommends an appropriation of $16.99 million in non-state and $4.39 million in State funds for the division in FY These amounts are equal to the revised appropriations provided for the division in the FY The FY 2017 Budget Recommendation funds 169 positions in the division in FY 2017, which is two positions less from the count of funded position in FY 2016, but a reduction of 53 positions since the peak staffing level of 222 filled positions in FY Questions: a. Please list the revenue collected by the division in FY 2015 and anticipated in FY Please specify this revenue by the source of collection, such as fines, license fees, annual fees, etc. Please detail the sources of all non-state funds. Response: See Schedule 25-1 b. For FY 2016 and the estimate for 2017, how many of the filled positions, by job title, are allocated for each of the following categories: Wage and Hour law enforcement; Child Labor law enforcement; Apparel Registration and related enforcement; Public Works Prevailing Wage law enforcement; construction contractor registration; Service Prevailing Wage law enforcement; Mechanical, Crane Operator, Mine, Pit, Quarry, and Explosive inspections; Asbestos Control and Licensing; Public Employees Safety; OSHA Consultant Services; and Mine Safety Training. For each category, please indicate how many of the filled positions are supported by State funding, federal funding, or other funding. Response: See Schedule 25-2 c. Does the department have an adequate number of employees to properly monitor each of the above categories? If not, how many additional staff would be needed, in which categories, and at what additional cost? Response: The Division has sufficient staffing resources to support the needs of their programs. Staffing levels are evaluated on an on-going basis. d. Does the department have adequate resources (i.e.: automobiles, computers, etc.) to support staff in each of the above categories? If not, what resources are needed, in which categories, and at what additional cost? 47

48 Response: The programs have sufficient financial resources to support the needs of their staff. Their needs are evaluated on an on-going basis. e. How many complaints has the department received in each of the above categories in FY 2014, FY 2015 and thus far in FY 2016? How many violations have resulted from these complaints in FY 2014, FY 2015, and thus far in FY 2016? Response: See Schedule

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