2798-S2.E AMS HOCH 500

2798-S2.E AMS HOCH 500

E2SHB 2798 - S AMD TO S AMD (S5932.3) 527

BySenator Hochstatter

On page 15, on line 2 of the amendment, insert the following:

NEW SECTION. Sec. 27 Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Board" means the Washington full employment act advisory board established in section 5 of this act.

(2) "Department" means the department of social and health services.

(3) "Participants" means recipients and noncaretaker parents of aid to families with dependent children, food stamps, or unemployment insurance.

(4) "Pilot program" or "program" means the Washington full employment act pilot program established in section 2 of this act.

(5) "Washington full employment act" means the Washington full employment pilot program established in section 2 of this act.

NEW SECTION. Sec. 28 (1) In establishing and implementing a pilot program to be known as the Washington full employment act, it is the intent of the legislature to utilize the benefits of the job opportunities and basic skills program (JOBS) to promote greater economic self-sufficiency among families and workers by:

(a) Requiring all recipients and unemployed noncaretaker parents of aid to families with dependent children, and recipients of food coupons to participate in the program;

(b) Increasing the employability of participants who are unemployed and underemployed workers through on-the-job training;

(d) Ensuring that participants improve their work skills, education, and employability through worksite training, mentoring, job placement, and necessary support services that include child care, transportation, and health care; and

(e) Guaranteeing that participation in the Washington full employment act does not result in reductions of net income to participants.

(2) The Washington full employment act is created as a three-year pilot program in which residents of five selected counties shall, in lieu of receiving payments from the aid to families with dependent children program and coupons under the food stamp program, be provided jobs that promote self-sufficiency and encourage independence from public assistance.

(3) Recipients of unemployment insurance in the pilot counties also may be offered employment under the program.

NEW SECTION. Sec. 29. The governor and the department shall seek all exemptions and waivers from and amendments to federal statutes, rules, and regulations necessary to implement the program at the earliest possible date.

NEW SECTION. Sec. 30. (1) Upon obtaining all such exemptions, waivers, and amendments referred to in section 3 of this act, the department, with the advice of the board, shall adopt changes to current rules as may be required to implement the program.

(2) The department, with the advice of the board, shall amend the state plans for the aid to families with dependent children program, the job opportunities and basic skills program, and the food stamp program to incorporate the programs into the Washington full employment act program for the pilot counties, and shall obtain federal approval of plan amendments.

(3) The department, with the advice of the board, shall obtain any exemptions and waivers from federal statutes and regulations necessary to qualify the program as a federally approved demonstration project under section 1115 (42 U.S.C. Sec. 1315) of the Social Security Act and section 17 (7 U.S.C. Sec. 2026) of the Food Stamp Act.

(4) The purpose of this section is to facilitate implementation of the pilot program at the earliest possible date and with maximum federal financial participation. Therefore, the department is directed to expedite the acquisition of federal waiver and amendment approvals, and the adoption of necessary statute amendments in close and continuous coordination with appropriate federal officials, and to prepare and submit completely and in a timely manner all forms and data required by those officials. The department, with the advice of the board, is authorized to make such changes to the program as are necessary to achieve federal waiver approval. Any such changes should be, in the judgment of the secretary of the department, the fewest necessary to achieve federal approval for the program. Such changes must maintain the general purpose and effect of the program described in section 2 of this act. If changes to the program required to gain waiver approval would be too extensive to maintain the general purpose and effect of the program, the department, with the advice of the board, shall seek the amendments to federal statutes that are required for implementation of the pilot program.

(5) The counties for the pilot program shall be chosen by the department with the assistance of the advisory board.

NEW SECTION. Sec. 31. (1) The Washington full employment act advisory board is established to advise the department in the direction and administration of the pilot program. The board shall have seven members, consisting of five representatives of the business community, one employed former recipient of the aid to families with dependent children program, the food stamp program, or the unemployment insurance program, and one labor representative. Members shall serve three-year terms. The governor shall appoint the members and the chair.

(2) It is the intent of the legislature that the board shall meet monthly with the assistant secretary for economic services administration within the department.

(3) The board shall report at least annually to the governor and the legislature on the status and progress of the pilot program in meeting program goals and legislative intent. The chair of the board shall have the additional duty to work with and coordinate the local councils created in section 6 of this act.

NEW SECTION. Sec. 32. A Washington full employment act implementation council shall be established in each pilot county listed in section 4 of this act to assist the Washington full employment act advisory board and the department in the administration of the Washington full employment act and to allow local flexibility in dealing with the particular needs of each pilot county. Each council shall be primarily responsible for recruiting and encouraging participation of employment providers in the county. Each council shall be composed of seven members who shall be appointed by the county commissioners in each pilot county. Councilmembers shall be residents of the pilot county in which they are appointed and shall serve three-year terms. The council shall have one member who is a current or former recipient of the aid to families with dependent children program, the food stamp program, or the unemployment insurance program, one member who represents labor, and five members who represent the local business community.

NEW SECTION. Sec. 33. (1) The Washington full employment act special fund is created in the state treasury separate and distinct from the general fund. Moneys in the fund may be spent only after appropriation and shall be used exclusively to meet the necessary expenses of the program. The fund shall be held and administered by the state treasurer.

(2) All funds appropriated for expenditure by or apportioned to the department for operation of the aid to families with dependent children program, the job opportunities and basic skills program, the food stamp program, and employment-related day care in the pilot counties shall accrue to the fund.

(3) All income earned on moneys in the fund shall be credited to and deposited in the fund to the extent permitted by state and federal law.

(4) Expenditures from the fund shall include pilot program wage reimbursements to participating employers, aid to families with dependent children cash grants, food stamp allotments, Washington full employment act payments, and employment-related day care payments to eligible residents of the pilot counties and administrative costs directly associated with the operation of the pilot program. At the end of the three-year pilot program, expenditures from the fund shall not exceed accruals to the fund.

(5) No less than quarterly, the department shall meet with the board to review the cost-effectiveness of the program and shall take any necessary action to modify or suspend the program to maintain cost neutrality.

(6) The individual education account is established in the Washington full employment act special fund in order to improve the position of Washington full employment act participants in the work force by increasing their access to continuing education. Employer contributions to the account under section 8(10) of this act shall be used to pay for further education.

(7)(a) There is hereby created the Washington full employment act unemployment wage fund. Such fund shall consist of moneys collected or received by the employment security department.

(b) The Washington full employment act unemployment wage fund is created in the state treasury, separate and distinct from the general fund.

(c) All income earned on moneys in the Washington full employment act unemployment wage fund invested by the state treasurer shall accrue to the fund. Any balance in the fund shall not lapse at any time. Moneys in the fund may be spent only after appropriation to the economic services administration of the department for the payment of wages and wage-related expenses of participants in the Washington full employment act who were otherwise eligible to receive unemployment insurance benefits. Such payments shall be made in the form of a reimbursement to the department, which shall be the central disbursement point for all employer-related financial transactions under the provisions of this chapter. Contribution rates are based on the counties selected by the department.

(8) The economic services administration of the department is authorized to continue to make reimbursements as necessary from the Washington full employment act unemployment wage fund for a period not to exceed six months following the end of the three-year pilot program authorized under this chapter.

(9) In administering the fund, and consistent with other provisions of the pilot program and to the extent permitted by federal law, the department shall maximize the use of federal grants and apportionments of the aid to families with dependent children program, the job opportunities and basic skills program, the food stamp program, and employment-related child care.

(10) To the extent that additional moneys may be obtained for the program from sources other than state tax revenues, the additional moneys shall be appropriated to the fund.

NEW SECTION. Sec. 34. (1)(a) The department shall adopt by rule a method to determine which employers, including public and private sector employers, within this state shall have the opportunity to utilize pilot program participants. The department shall give priority in assigning pilot program participants to those employers located in the five pilot counties identified in section 4 of this act. No employer is required to participate in the Washington full employment act. In the event that there are unassigned participants whom no employer desires to utilize, they may be assigned to work for a public agency.

(b) The department by rule may:

(i) Establish criteria for excluding employers from participation for failure to abide by pilot program requirements or other demonstrated unwillingness to comply with the stated intent of the program;

(ii) Provide that employers that have shown a pattern of terminating participants prior to the completion of training without cause shall be ineligible to receive additional participants.

(2) The department shall assign in priority order individuals eligible for the pilot program who are:

(a) Two-parent families who are receiving aid to families with dependent children benefits;

(b) Single adults and caretaker relatives who are receiving aid to families with dependent children benefits;

(d) Adult food stamp program recipients except as described in subsection (6)(b) (iv) and (vi) of this section; and

(e) Unemployment compensation recipients.

(3) The department shall ensure that jobs made available to pilot program participants shall:

(a) Not require work in excess of forty hours per week;

(b) Be in conformity with section 3304(a)(5) of the Federal Unemployment Tax Act;

(d) Not pay a wage that is substantially less than the wage paid for similar jobs in the local economy with appropriate adjustments for experience and training.

(4) Failure of the participant to cooperate with the requirements of the Washington full employment act shall result in the participant's removal from the Washington full employment act and the removal of the needs of the adult or adults from the grant in accordance with Washington full employment act rules.

(5)(a) Individuals desiring work through the pilot program shall contact the nearest economic services administration office of the department serving the pilot county in which they reside if they are aid to families with dependent children program or food stamp program applicants or recipients. Unemployment insurance applicants or recipients shall gain access to the pilot program through their local employment security department office.

(b) With input from the participant, case workers shall prepare an employment development plan designed to assist the participant in removing barriers to employment, acquiring work skills, and obtaining unsubsidized employment. The case worker shall periodically review the employment development plan and assess participant progress in accordance with rules for the Washington full employment act.

(c) With the assistance of the local council and the board, the department shall develop a job inventory of sufficient size to accommodate all of the participants who desire to work in the program. In consultation with the participant, the department shall try to match the profile of a participant with the needs of an employer when assigning a participant to work with the employer.

(d) Either the employer or the participant may terminate the assignment by contacting the appropriate department office. In such event, the department shall reassess the needs of the participant and assign the participant to another Washington full employment act placement or another Washington full employment act component and, at the employer's request, provide the employer with another participant.

(e)(i) If after six months in a placement, a participant has not been hired for an unsubsidized position, the employer shall allow the worker to undertake eight hours of job search per week. Participating employers shall consider such time as hours worked for the purposes of paying wages.

(ii) If after nine months in a placement, a participant has not been hired for an unsubsidized position, the placement shall be terminated, and the case worker shall reassess the participant's employment development plan.

(6)(a) Assignment of participants to available jobs shall be made first by employing nonworking parents of children receiving aid to families with dependent children, food stamp recipients, or unemployment compensation recipients, in that order.

(b) Pilot program jobs shall not be offered to the following groups of persons, irrespective of the priority referred to in (a) of this subsection:

(i) Teenage custodial parents working to receive their general education development certificate or high school diploma;

(ii) Persons determined by department rule to require substance abuse treatment prior to job placement;

(iii) Persons determined by department rule to be permanently or temporarily incapacitated and persons who are primary caregivers to such persons;

(iv) Food stamp applicants or recipients who are employed full time or are food stamp eligible college students enrolled full time in an institution of higher education or enrolled half time in an institution of higher education and working at least twenty hours per week;

(v) Teenage persons who have not received a general education development certificate or high school diploma;

(vi) Food stamp recipients in the pilot counties who are eligible for supplemental security income benefits or other ongoing state or federal maintenance benefits based on age or disability;

(vii) Persons for whom suitable child care arrangements are necessary but not available; and

(viii) Persons who would be required to commute for more than one hour each way without access to public or employer-sponsored transportation, in accordance with Washington full employment act rules.

(c) Unemployment compensation recipients may be referred to available work through the Washington full employment act if the qualifying base year wages used to establish the claim do not exceed ten thousand dollars. If referred, unemployment compensation recipients shall be referred to the Washington full employment act in accordance with the job referral process used to refer applicants to available work. When a pilot program job is offered to an unemployment insurance recipient and the job is refused, the employment security department shall investigate the refusal and identify and decide all issues arising from the refusal, including suspension of benefits.

(d) Aid to families with dependent children and food stamp benefits shall be suspended at the end of the calendar month in which an employer makes the first wage payment to a participant who is a custodial parent in a family that receives aid to families with dependent children or to any adult member of a household receiving food stamps.

(7)(a) Employers shall pay all participating individuals at least the hourly rate of the Washington minimum wage.

(b) Sick leave, holiday, and vacation absences shall conform to the individual employer's rules for new employees.

(c) Group health insurance benefits shall be provided by the employer to pilot program participants if, and to the extent that, state or federal law requires the employer to provide such benefits.

(d) All persons participating in the Washington full employment act shall be considered to be temporary employees of the individual employer providing the work and shall be entitled only to benefits required by state or federal law.

(e) Employers shall provide workers' compensation coverage for each Washington full employment act participant.

(8) In the event that the net monthly full-time wage paid to a participant would be less than the level of income from the aid to families with dependent children program and the food stamp benefit amount equivalent that the participant would otherwise receive, the department shall determine and pay a supplemental payment as necessary to provide the participant with that level of net income. The department by rule shall adopt an equivalency scale to be adjusted for household size and other factors. The purpose of this equivalency scale is to ensure that participants are not economically disadvantaged, in terms of net income, by accepting a job under the pilot program. The department shall determine and pay in advance supplemental payments to participants on a monthly basis as necessary to ensure equivalent net pilot program wages. Participants shall be compensated only for time worked.

(9) In addition to, and not in lieu of the payments provided for under subsections (7) and (8) of this section, participants shall be entitled to retain the full child support payments collected by the department.

(10)(a) After the participant has participated in the Washington full employment act for thirty days, in addition to the participant wage, the employer shall pay one dollar for each participant hour worked into the participant's individual education account. Contributions to such an account shall be tax deferred or tax exempt to the extent permitted by federal and state law. This contribution shall not be reimbursed by the Washington full employment act special fund except as provided in (b) of this subsection. The employer may provide individuals with additional training and education at the employers expense without any effect on the individual's education account.

(b) If the employer hires a participant in an unsubsidized position for at least one hundred twenty days, the Washington full employment act special fund shall reimburse one-half of the employer's contribution to the individual education account to the employer. This reimbursement shall not be subject to chapter 82.04 RCW.

(c) Any participant for whom an individual education account contribution is made shall be eligible for access to education benefits from that participant's individual education account at any time after the participant has left the Washington full employment act and has held a full-time, unsubsidized job for at least thirty days.

(d) When any participant has qualified for use of that participant's individual education account, an amount equal to that participant's individual education account balance shall be transferred for that participant's use. Only one individual education account shall be created for any participant. Each account shall be administered by the employment security department and shall be used for continuing education and training in any of the state's community colleges or institutions of higher education for the participant and the participant's immediate family.

(11) Pilot program participants who are eligible for federally and state-funded medical assistance at the time they enter the pilot program shall remain eligible as long as they continue to participate in the pilot program. In conformity with existing state and federal employment-related child care program regulations, child day care shall be provided for all pilot program participants who require it.

(12) Washington full employment act employers shall:

(a) Endeavor to make Washington full employment act placements positive learning and training experiences;

(b) Maintain health, safety, and working conditions at or above levels generally acceptable in the industry and no less than that of comparable jobs of the employer;

(d) Recruit volunteer mentors from among their regular employees to assist the participants in becoming oriented to work and the workplace; and

(e) Sign an agreement for each placement outlining the specific job offered to the participant and agreeing to abide by all requirements of the pilot program, including the requirement that the pilot program not supplant existing jobs. All agreements shall include provisions noting the employer's responsibility to repay reimbursements in the event the employer violates pilot program rules.

(13) Pilot program participant wages shall be subject to federal and state income taxes, social security taxes, and unemployment insurance tax or reimbursement as applicable, which shall be withheld and paid in accordance with state and federal law. Supplemental payments made pursuant to subsection (8) of this section, to the extent allowed by federal law, shall not be subject to federal income taxes and social security taxes.

(14)(a) The department shall reimburse employers for the employer share of social security, unemployment insurance, and workers' compensation premiums paid on behalf of pilot program participants, as well as the minimum wage earnings paid to pilot program participants by the employer from the Washington full employment act special fund.

(b) If the department finds that an employer has violated any of the rules of the Washington full employment act, the department:

(i) Shall withhold any amounts due to employers under (a) of this subsection;

(ii) May seek repayment of any amounts paid to employers under (a) of this subsection.

(15) The existing Washington full employment act shall continue in the pilot counties and serve those currently eligible for Washington full employment act services who have not been placed in a Washington full employment act job.

NEW SECTION. Sec. 35. If approval is obtained from the federal government during the three-year pilot program established in this chapter, the department may distribute food stamp program benefits to any eligible person in the five pilot counties in the form of cash rather than coupons.

NEW SECTION. Sec. 36. (1) Six months prior to the completion date of the three-year test period of the pilot program, the department shall submit a written report to the legislature and the governor containing a full and complete analysis of the pilot program. The report shall include recommendations from the department and the board regarding appropriate revisions to the pilot program and the potential for its permanent implementation for the entire state.

(2) The evaluation of the pilot program shall be conducted by an independent evaluator using a combination of group comparison, survey and individualized event and attitude recording techniques. Performance in attaining pilot program goals in each pilot county shall be matched against performance using the traditional welfare and employment characteristics. In addition, the composite performance of the five pilot counties shall be compared to the rest of the state. The evaluation shall include measurements of whether program participation has improved the quality of life of program participants. In addition, as a part of the evaluation of the Washington full employment act, the employment security department shall determine whether the pilot program has displaced unsubsidized employment opportunities that would otherwise have been available and whether the pilot program has had any discernible impact on the economies or wage levels in individual pilot counties.

(3) The target goals for the program are to reduce the Washington full employment act eligible aid to families with dependent children, food stamp, and unemployment compensation caseloads in the pilot counties by fifty percent by the end of the third year of the pilot program, and to reduce the costs associated with these caseloads by twenty-five percent over the three-year pilot period.

(4) Twelve months after the beginning of the Washington full employment act, the department shall present to the legislature a report on the cost neutrality projections of the pilot program. If it appears that the pilot program is not likely to achieve cost neutrality over the course of the three-year pilot period, the department shall also present a plan to modify or suspend the pilot program.

NEW SECTION. Sec. 37. In the event that the department is not able to obtain the necessary exemptions, waivers, or amendments referred to in section 3 of this act prior to January 1, 1997, this act shall expire on that date and shall have no further force or effect. Any unexpended and unobligated moneys remaining in the Washington full employment act unemployment wage fund on that date may not be spent and are subject to legislative appropriation.

NEW SECTION. Sec. 38. The appointment of the members of the board and the establishment of the Washington full employment act implementation council shall occur within sixty days after the effective date of this act.

NEW SECTION. Sec. 39. A new section is added to chapter 82.04 RCW to read as follows:

Amounts received under section 8(10)(b) of this act are not subject to tax under this chapter.

NEW SECTION. Sec. 40. Sections 1 through 12 of this act shall constitute a new chapter in Title 74 RCW.

NEW SECTION. Sec. 41. If any part of this act is found to be in conflict with federal requirements that are a prescribed condition to the allocation of federal funds to the state, the conflicting part of this act is inoperative solely to the extent of the conflict and with respect to the agencies directly affected, and this finding does not affect the operation of the remainder of this act in its application to the agencies concerned. The rules under this act shall meet federal requirements that are a necessary condition to the receipt of federal funds by the state.