House Committee on WIA Reauthorization

On March 29, 2012, Rep. Virginia Foxx (R-NC), Rep. Joseph J. Heck (R-NV) and Rep. Howard P. McKeon (R-CA) introduced a Workforce Investment Act (WIA) reauthorization bill (H.R. 4297). The bill consolidates funding from twenty seven national and state-administered workforce programs, including: WIA Adult, WIA Dislocated Workers and WIA Youth, Job Corps, the Senior Community Service Employment Program, and a section of the Wagner-Peyser Act into a new Workforce Investment Fund that would be distributed by formula to states and local areas.

On June 7, 2012, The House Committee on Education and the Workforce, chaired by Rep. John Kline (R-MN), approved an amended version of the legislation, The Workforce Investment Improvement Act of 2012 to reauthorize the Workforce Investment Act of 1998 (WIA). The bill was approved on a party line vote, 23 to 15.

Representative Virginia Foxx (R-NC) began the markup session by offering several changes to the original H.R. 4297, with an Amendment in the Nature of a Substitute to H.R. 4297. Representative Foxx’s substitute would make the following changes to the bill:
• Authorizes an increase in the state set aside for statewide activities from 5 percent to 10 percent.
• Includes industry-recognized credentials and recognized postsecondary credentials as a common performance measure.
• Requires state and local workforce investment boards to describe the strategies and services they will use to assist at-risk youth and out-of-school youth in workforce development program activities.
• Prohibits funds allotted to the Rehabilitation Act of 1973 from being consolidated by the governor into the Workforce Investment Fund.
• Requires the Secretary of Labor to reserve 28 percent of the total amount appropriated to fund a national Job Corps program and reforms to the program. 
• Reduces the Secretary’s reservation from 2 percent to 0.5 percent to reflect the repeal of WIA NEG, restricting the Secretary's activities to conducting technical assistance and evaluations.
• Requires state and local boards to better coordinate workforce development and literacy programs with non-profit organizations in the community, including public libraries.
• Expands the Statewide Adults with Barriers to Employment Grants to include at-risk youth and renames the program as the Statewide Individuals with Barriers to Employment Grants.
• Includes pay for performance initiatives as allowable uses of state and local employment and training activities.
• Reduces the number of full time equivalent (FTE) staff positions at the Department of Labor to reflect the reduced federal role intended by the bill.

During the markup session there were over twenty amendments offered to H.R. 4297, with nine amendments being adopted. Of the nine amendments adopted into the bill there were several provisions of significance:

Veterans Employment Services
The amended language would eliminate the current federally staffed Local Veterans Employment Representative (LVER) and Disabled Veterans Outreach Program (DVOP) specialists and replace them with a Veteran Employment Specialist (VES) whom would be hired by a local area. The total funding available would be increased by inclusion of the funds currently authorized for Veteran’s programs including State Administrative Grants, Federal administrative funds, Homeless Veterans and the National Employment and Training Services Institute, increasing the total funds available from $6.080 billion to $6.292 billion.

Wagner Peyser Services
The language in the original Bill repeals sections 1 through 13 of the Wagner-Peyser Act, eliminating the Employment Service (ES), but retains the requirement to collect employment statistics.

Federal Unemployment Tax Act
Funds for Wagner-Peyser Act services are collected annually by the Federal Unemployment Tax Act’s (FUTA) levy of 0.6 percent on the first $7,000 of UI covered employment. Eighty percent of that money is earmarked by law for UI administration and Wagner-Peyser Act services. These FUTA revenues are deposited into the Employment Security Administration Account (ESAA) in the Federal Unemployment Trust Fund. With the repeal of the majority of Wagner Peyser Act in H.R. 4297, it is questionable funds in the ESAA could be appropriated for labor exchange services provided under the WIF. The authority for appropriations for grants to states for administration of employment services under the Social Security Act alludes to the Wagner Peyser Act only and H.R. 4297 does not amend the Social Security Act. The House Committee on Ways and Means has jurisdiction over the Social Security Act, but H.R. 4297 was not referred to that Committee.