H-3138

AN ACT Relating to employment and training; amending RCW 50.16.090, 50.16.096, and 28B.15.820; adding new sections to chapter 28B.50 RCW; creating new sections; repealing RCW 43.131.377, 50.16.094, and 50.12.261; providing an effective date; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that:

(1) The economy of the state depends on a well-trained work force that generates productivity needed by employers to compete in the global economy and to pay workers a reasonable wage.

(2) Many of Washington's unemployed workers need new or enhanced work force skills to meet current demand in the labor market, and many find they are unlikely to return to their principal occupation or previous industry because their particular skills are no longer demanded.

(3) It is imperative that unemployed workers have access to a training system that allows them to enter training as quickly as possible, to return to the work force soon after training is completed, and to focus on occupational skills and vocational education.

(4) Unemployed workers need access to assistance to complete any necessary training that efficiently utilizes all available sources of assistance to students and individuals in training while serving the needs of as many unemployed workers as possible.

The legislature intends to focus the work force training system, and the community and technical college system in particular, on developing and maintaining a training system for unemployed workers that meets the labor market demand in Washington for well-trained workers.

Sec. 2. RCW 50.16.090 and 1993 c 226 s 4 are each amended to read as follows:

There is hereby established the employment and training trust fund. All moneys in this fund are irrevocably vested for the administration of this title. The employment and training trust fund shall consist of all moneys from employment and training trust fund contributions as established in RCW 50.24.018. The treasurer of the employment security department shall deposit, administer, and disburse all moneys in the fund under rules adopted by the commissioner and RCW 43.01.050 and 43.84.092 are not applicable to this fund. The treasurer of the employment security department shall be the treasurer of the employment and training trust fund as described in RCW 50.16.020 and shall give a bond conditioned upon the faithful performance of his or her duties in connection with the fund. All sums recovered on the official bond for losses sustained by the employment and training trust fund must be deposited in the fund. Notwithstanding any provision of this section, all moneys received and deposited in the fund ((~~under chapter 226, Laws of 1993,~~)) shall remain part of the employment and training trust fund and may be used solely for the following purposes:

(1) Providing training and financial assistance and related support services((~~, including financial aid,~~)) to individuals who have been terminated or have received a notice of termination from employment, and who are eligible for or have exhausted their entitlement to unemployment compensation benefits within the previous twenty-four months; and

(2) ((~~Assisting workers in finding employment through job referral, job development, counseling, and referral to training resources;~~

(3) Obtaining labor market information necessary for the administration of the unemployment insurance program and to assist unemployed workers in finding employment. In obtaining the information the employment security department shall ensure the inclusion of information gathered from small businesses as defined in RCW 43.31.025, with particular emphasis on businesses with fifteen or fewer employees;

(4) Performing research by an independent state auditing agency or an independent contractor to determine effectiveness of unemployment insurance programs and to determine whether program changes would benefit workers and employers;

~~(5)~~)) Collecting contributions for and administration of the employment and training trust fund((;

~~(6) Improving service through improved use of information technology; and~~

(7) Establishing collocation employment security and job service outstations at community and technical college campuses across the state. These outstations shall provide a one-stop point of access for unemployed and dislocated workers seeking job placement services, training program information, and labor market information. In communities without co-located outstations the local job service center and community or technical college shall collaborate to provide these services)).

Sec. 3. RCW 50.16.096 and 1993 c 226 s 8 are each amended to read as follows:

((~~(1)~~)) The employment security department shall disburse the amounts appropriated by the legislature ((~~for the purposes of chapter 226, Laws of 1993~~)) from the employment and training trust fund to the state board for community and technical colleges for unemployed worker retraining under section 5 of this act. ((~~These funds shall be allotted for, and only for, training programs and related support services, including financial aid, in the community and technical college system that:~~

(a) Are consistent with work force training priorities and based upon the comprehensive plan for work force training developed by the work force training and education coordinating board. The state board for community and technical colleges shall develop a plan for use and evaluation of these funds which is to be approved by the work force training and education coordinating board for consistency with their work force priorities. In developing and approving the plan, information shall be gathered from small businesses as defined in RCW 43.31.025, with particular emphasis on businesses with fifteen or fewer employees. Further, the state board for community and technical colleges shall report to the work force training and education coordinating board and the legislature annually on the progress and results of the training and support services provided to eligible participants;

(b) Provide increased enrollments for individuals who have been terminated or have received a notice of termination from employment, and who are eligible for or have exhausted their entitlement to unemployment compensation benefits within the previous twenty-four months, with first priority given to individuals who are unlikely to return to employment in the individuals' principal occupation or previous industry because of a diminishing demand for their skills in that occupation or industry; and

(c) Provide increased enrollments and support services, including financial aid, that do not replace or supplant any existing enrollments, programs, support services, or funding sources. For fiscal year 1994, the state board for community and technical colleges may borrow from the general fund to initiate the programs authorized under chapter 226, Laws of 1993. However, the board shall repay the borrowed amount by the end of the fiscal biennium from funds appropriated to it from the employment and training trust fund.

(2) For purposes of chapter 226, Laws of 1993, training provided by the community and technical colleges shall only consist of basic skills and literacy, occupational skills, vocational education, and related or supplemental instruction for apprentices who are enrolled in a registered, state-approved apprenticeship program. Community and technical colleges may contract with skill centers to provide training authorized in this section. Upon the request of an eligible recipient, a community and technical college may contract with a private technical school for specialized vocational training. Available tuition for the training is limited to the amount that would otherwise be obtained per enrolled quarter to a public institution. Furthermore, the funding is only available to students who seek training in a course of study not available at a public institution within an eligible recipient's congressional district.))

NEW SECTION. Sec. 4. A new section is added to chapter 28B.50 RCW to read as follows:

(1) The college board shall establish a job retraining advisory committee to review and approve proposals from community and technical colleges, private vocational schools, and state and federally approved apprenticeship programs.

(2) Membership on the job retraining advisory committee must include at least three members representing business, three members representing labor, a member representing the state board for community and technical colleges, a member representing the employment security department, and a member representing private vocational schools. Additional members may be appointed as deemed appropriate by the college board. However, business and labor members shall represent a majority of the total committee membership.

(3) In reviewing and approving proposals, the advisory committee shall consider at least the following criteria:

(a) Training must prepare students for occupations that have demonstrated employment demand for qualified workers;

(b) Training programs must lead to jobs that provide a living wage appropriate to the local labor market;

(c) Dislocated workers shall have priority access to training programs and financial assistance under section 5 of this act.

NEW SECTION. Sec. 5. A new section is added to chapter 28B.50 RCW to read as follows:

(1) Any money appropriated by the legislature to the state board for community and technical colleges for the purposes of retraining unemployed workers may be allotted and expended only for:

(a) Training programs approved by the job retraining advisory committee using a request for proposal process;

(b) Financial assistance for individuals who are unemployed workers, are in training under an approved training plan, and will exhaust unemployment benefits before their training under the training plan is completed. Financial assistance may also be directed to unemployed workers enrolling in training to allow them to enter training and provide assistance before other training aid is actually available; and

(c) Tuition grants to students enrolling in a private technical school licensed under RCW 28C.10.060 or chapter 18.16 RCW, or authorized under chapter 28B.85 RCW.

(2) For purposes of chapter . . ., Laws of 1997 (this act), an unemployed worker is an individual who has been terminated or has received a notice of termination from employment, and who is eligible for or has exhausted his or her entitlement to unemployment compensation benefits within the previous twenty-four months. A dislocated worker is an unemployed worker who is unlikely to return to employment in the individual's principal occupation or previous industry because of a diminishing demand for his or her skills in the occupation or industry.

(3) Training programs approved by the job retraining advisory committee and provided by the community and technical colleges shall consist only of occupational skills and vocational education. These programs may include short-term focused training programs. The short-term focused training programs may include programs offered during nontraditional times such as nights and weekends and programs that can be completed in one academic term or less. Appropriate funding levels for short-term focused training programs may be negotiated between the job retraining advisory committee and the college board.

(4) Training provided to fulfill an unemployed worker's individual training plan must concentrate on occupational skills and vocational education but may be supplemented by basic skills and literacy training. Training may include related or supplemental instruction for apprentices who are enrolled in a federally registered or state-approved apprenticeship program.

(5) A private technical school licensed under RCW 28C.10.060 or chapter 18.16 RCW, or authorized under chapter 28B.85 RCW, may submit requests for tuition grants for unemployed workers seeking retraining under chapter . . ., Laws of 1997 (this act) directly to the job retraining advisory committee for approval.

(6) Increased enrollments, financial assistance, and related support services provided under this section may not replace or supplant any existing enrollments, programs, support services, or funding sources.

(7) The state board for community and technical colleges shall develop a plan for use and evaluation of these funds and shall submit the plan to the work force training and education coordinating board for approval. The plan must show how the use of these funds responds to the proposals approved through the request for proposal process.

(8) The state board for community and technical colleges shall report to the work force training and education coordinating board and appropriate committees of the legislature by December 1, 1998, and every even-numbered year thereafter, on the progress and results of the training and financial assistance provided to eligible participants. The report must include the following:

(a) The number of certified student full-time equivalents receiving training as provided in chapter . . ., Laws of 1997 (this act);

(b) Information on the outcomes of the training provided under chapter . . ., Laws of 1997 (this act);

(c) Indices of placement rates, student demographics, training plan completion rates, comparisons of preprogram and postprogram wage levels, and the job placements that occur in the occupation for which the student was trained compared to job placements in occupations unrelated to the training; and

(d) The number of students served through the program with specific designation of students who are unemployed workers and students who are dislocated workers.

NEW SECTION. Sec. 6. A new section is added to chapter 28B.50 RCW to read as follows:

(1) Community and technical colleges, state and federally approved apprenticeship programs, and private technical schools licensed under RCW 28C.10.060 or chapter 18.16 RCW, or authorized under chapter 28B.85 RCW, may submit to the state board for community and technical colleges a proposal that meets the criteria established under section 4 of this act and criteria established by the job retraining advisory committee. The proposal must contain the college's, state or federally approved apprenticeship program's, or private technical school's plan for retraining eligible individuals.

(2) Each community and technical college shall confer and consult with its respective labor-management advisory board in the development of the college's proposal.

(3) State and federally approved apprenticeship programs and private technical schools shall consult with the local community and technical college labor-management advisory board, chambers of commerce, or similar entities to determine job availability and the demand for job skills and shall submit their proposals with the community college's request for proposal to the state board for community and technical colleges. Except as provided in subsection (4) of this section, the state board for community and technical colleges shall allocate enrollments and funding based on the proposals submitted to the state board for community and technical colleges and approved by the job retraining advisory committee.

(4) The state board for community and technical colleges may withhold a portion of the work force training enrollments and funding in an emergency pool to be used by colleges in the event of an emergency. If the request for proposal has been submitted by a college to the state board for community and technical colleges and occupational demand for enrollment exceeds a community or technical college's original request for proposal, then with the recommendation of the job retraining advisory committee, the state board for community and technical colleges may fund some or all of the additional enrollment without requiring the community or technical college to adhere to the full requirements of the request for proposal process.

Sec. 7. RCW 28B.15.820 and 1995 1st sp.s. c 9 s 10 are each amended to read as follows:

(1) Each institution of higher education, including technical colleges, shall deposit a minimum of three and one-half percent of revenues collected from tuition and services and activities fees in an institutional financial aid fund that is hereby created and which shall be held locally. Moneys in the fund shall be used only for the following purposes: (a) To make guaranteed long-term loans to eligible students as provided in subsections (3) through (8) of this section; (b) to make short-term loans as provided in subsection (9) of this section; or (c) to provide financial aid to needy students as provided in subsection (10) of this section.

(2) An "eligible student" for the purposes of subsections (3) through (8) and (10) of this section is a student registered for at least six credit hours or the equivalent, who is eligible for resident tuition and fee rates as defined in RCW 28B.15.012 ((~~through [and]~~)) and 28B.15.013, and who is a "needy student" as defined in RCW 28B.10.802.

(3) The amount of the guaranteed long-term loans made under this section shall not exceed the demonstrated financial need of the student. Each institution shall establish loan terms and conditions which shall be consistent with the terms of the guaranteed loan program established by 20 U.S. Code Section 1071 et seq., as now or hereafter amended. All loans made shall be guaranteed by the Washington student loan guaranty association or its successor agency. Institutions are hereby granted full authority to operate as an eligible lender under the guaranteed loan program.

(4) Before approving a guaranteed long-term loan, each institution shall analyze the ability of the student to repay the loan based on factors which include, but are not limited to, the student's accumulated total education loan burdens and the employment opportunities and average starting salary characteristics of the student's chosen fields of study. The institution shall counsel the student on the advisability of acquiring additional debt, and on the availability of other forms of financial aid.

(5) Each institution is responsible for collection of guaranteed long-term loans made under this section and shall exercise due diligence in such collection, maintaining all necessary records to insure that maximum repayments are made. Institutions shall cooperate with other lenders and the Washington student loan guaranty association, or its successor agency, in the coordinated collection of guaranteed loans, and shall assure that the guarantability of the loans is not violated. Collection and servicing of guaranteed long-term loans under this section shall be performed by entities approved for such servicing by the Washington student loan guaranty association or its successor agency: PROVIDED, That institutions be permitted to perform such servicing if specifically recognized to do so by the Washington student loan guaranty association or its successor agency. Collection and servicing of guaranteed long-term loans made by community colleges under subsection (1) of this section shall be coordinated by the state board for community and technical colleges and shall be conducted under procedures adopted by the state board.

(6) Receipts from payment of interest or principal or any other subsidies to which institutions as lenders are entitled, that are paid by or on behalf of borrowers of funds under subsections (3) through (8) of this section, shall be deposited in each institution's financial aid fund and shall be used to cover the costs of making the guaranteed long-term loans under this section and maintaining necessary records and making collections under subsection (5) of this section: PROVIDED, That such costs shall not exceed five percent of aggregate outstanding loan principal. Institutions shall maintain accurate records of such costs, and all receipts beyond those necessary to pay such costs, shall be deposited in the institution's financial aid fund.

(7) The governing boards of the state universities, the regional universities, and The Evergreen State College, and the state board for community and technical colleges, on behalf of the community colleges and technical colleges, shall each adopt necessary rules and regulations to implement this section.

(8) First priority for any guaranteed long-term loans made under this section shall be directed toward students who would not normally have access to educational loans from private financial institutions in Washington state, and maximum use shall be made of secondary markets in the support of loan consolidation.

(9) Short-term loans, not to exceed one year, may be made from the institutional financial aid fund to students enrolled in the institution. No such loan shall be made to any student who is known by the institution to be in default or delinquent in the payment of any outstanding student loan. A short-term loan may be made only if the institution has ample evidence that the student has the capability of repaying the loan within the time frame specified by the institution for repayment.

(10) Any moneys deposited in the institutional financial aid fund that are not used in making long-term or short-term loans may be used by the institution for locally-administered financial aid programs for needy students, such as need-based institutional employment programs or need-based tuition and fee scholarship or grant programs. These funds shall be used in addition to and not to replace institutional funds that would otherwise support these locally-administered financial aid programs. In community colleges and technical colleges, first priority in the use of these funds shall be provided to needy resident dislocated and unemployed workers to assist these students with tuition and fees, books, childcare, and transportation. In the baccalaureate institutions, first priority in the use of these funds shall be given to needy students who have accumulated excessive educational loan burdens. An excessive educational loan burden is a burden that will be difficult to repay given employment opportunities and average starting salaries in the student's chosen fields of study. Second priority in the use of these funds shall be given to needy single parents, to assist these students with their educational expenses, including expenses associated with child care and transportation.

NEW SECTION. Sec. 8. The legislature finds that the work force training and education coordinating board has identified work force development goals, performance indicators, standards, and evaluation criteria for our state's comprehensive work force training programs. However, despite these efforts, the legislature finds that Washington's work force development programs are unduly fragmented, spending eight hundred sixty-six million dollars in fiscal year 1996 through multiple agencies and various programs. In order to identify and coordinate the most efficacious use of work force development funding and to streamline program efforts, the legislature finds that the work force training and education coordinating board must intensify its efforts on: (1) Identification of program funding; (2) options for program consolidation; and (3) coordination of related programs in order to redirect resources toward programs that most effectively meet the needs of those businesses that produce family wage jobs for workers in our state.

NEW SECTION. Sec. 9. For the purposes of sections 10 through 12 of this act, the term "program" does not include the activities of individual institutions, such as individual community or technical colleges, common schools, service delivery areas, job service centers, or individual fields of study or courses.

NEW SECTION. Sec. 10. (1) By July 1, 1998, the work force training and education coordinating board shall prepare a comprehensive report to the legislature identifying all current work force development programs available in our state. For each program identified in the report, the board shall, at a minimum, include the following information:

(a) The program's funding sources, whether state or federal, including a breakdown by administrative and direct service expenditures at the state, regional, and local levels. For the purposes of this subsection, the board shall define "administration" and "direct service cost" so as to ensure that the aggregate report will be comparable among programs;

(b) An indication of whether or not matching funds are required for the receipt of funds and, if so, by whom;

(d) The current number of program participants and their geographic representation;

(e) Any program participation requirements for qualification to enter the program;

(f) A review of program rules;

(g) The type of training and other services provided to program participants;

(h) A review of program completion rates for a period of five years or the existence of the program, whichever is less, where appropriate and available; and

(i) A review of job placement rates in relation to training activities for a period of five years or the existence of the program, whichever is less, where appropriate and available.

(2) For programs for which the information required under subsection (1)(h) and (i) of this section is appropriate, but not available, the work force training and education board shall recommend measures for the programs to produce such information.

(3) All current work force development programs available in our state shall participate in the preparation of this report as required by the board. If any work force development program fails to participate in the report, that fact shall be highlighted in the report.

NEW SECTION. Sec. 11. (1) By November 1, 1998, the work force training and education coordinating board, using the information compiled under section 10 of this act and the outcome, net-impact, and cost-benefit evaluations required in RCW 28C.18.090, shall provide the legislature with efficiency recommendations including modification, consolidation, or elimination of programs identified in RCW 50.16.096. At a minimum, the recommendations must include all state board for community and technical colleges administered vocational programs; dislocated worker training programs; adult basic education programs; secondary vocational education; participating private vocational school programs; job training partnership act Titles IIA, IIB, IIC, and III; and the state job skills program.

(2) The recommendations in this report must take into account any performance reports available for the programs.

(3) The recommendations made under this section must include provisions that will streamline and coordinate program offerings and direct training resources in response to local labor market demand. The board shall also provide recommendations to improve program effectiveness measured by retention and completion rates for program participants, and job placement and retention rates of participants in relation to training activities.

NEW SECTION. Sec. 12. The joint legislative audit and review committee shall:

(1) Conduct a performance evaluation of the work force training and education coordinating board. The evaluation must include an assessment of the degree to which tasks required of the board under RCW 28C.18.060 have been completed, an assessment of the barriers that exist to completion of required tasks, and an assessment of board recommendations and the underlying analysis used to support those recommendations; and

(2) Report its findings to the appropriate committees of the legislature by December 1, 1997.

NEW SECTION. Sec. 13. The following acts or parts of acts are each repealed:

(1) RCW 43.131.377 and 1993 c 226 s 18;

(2) RCW 50.16.094 and 1995 c 57 s 1 & 1993 c 226 s 6; and

(3) RCW 50.12.261 and 1993 c 226 s 17.

NEW SECTION. Sec. 14. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 15. 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 or the eligibility of employers in this state for federal unemployment tax credits, the conflicting part of this act is inoperative solely to the extent of the conflict, and the finding or determination does not affect the operation of the remainder of this act. Rules adopted under this act must meet federal requirements that are a necessary condition to the receipt of federal funds by the state or the granting of federal unemployment tax credits to employers in this state.

NEW SECTION. Sec. 16. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 1997.