Legislature(2017 - 2018)BARNES 124
03/06/2017 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB79 | |
| HB141 | |
| HB79 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 141 | TELECONFERENCED | |
| += | HB 79 | TELECONFERENCED | |
| + | HB 132 | TELECONFERENCED | |
| + | SB 14 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 141-AK WORKFORCE INVESTMENT BOARD;FUNDS
3:18:23 PM
CHAIR KITO announced that the next order of business would be
HOUSE BILL NO. 141, "An Act relating to allocations of funding
for the Alaska Workforce Investment Board; and providing for an
effective date."
3:18:43 PM
REPRESENTATIVE ZACH FANSLER, Alaska State Legislature, as
sponsor, presented HB 141. He read from the sponsor statement,
which read as follows [original punctuation provided]:
AS 23.15.820 authorizes the Alaska Workforce
Investment Board to administer the Alaska Technical
and Vocational Education Program (TVEP). This
legislation reauthorizes the allocation of the TVEP
funding for five years.
TVEP was established by Legislature in 2000 with the
purpose of enhancing the quality and accessibility of
job training across the state, and aligning training
with regional workforce demands. TVEP funds are
obtained from a portion of employee contributions to
the unemployment insurance trust fund.
The TVEP funds are allocated to technical and
vocational education entities across Alaska designated
by AS 23.15.835. Each entity receives a set percentage
of the TVEP funds available each fiscal year. The
current allocation sunsets June 30, 2017. Unless the
allocation is reauthorized this funding will sit
unused in the TVEP account instead of being used by
these entities to train Alaskans.
TVEP recipients are required by statute to track and
report program outcomes to the Alaska Workforce
Investment Board. Each year the Board compiles and
provides to the legislature a TVEP performance report
containing this information. In Fiscal Year 2016, the
ten TVEP recipients were allocated $12,510,900 and
served 10,295 youth and adults. A statewide network of
training providers is critical to developing an
Alaskan workforce.
This legislation is necessary to help educate and
train Alaskans for Alaska's jobs.
REPRESENTATIVE FANSLER listed the programs that currently
receive TVEP funds: University of Alaska statewide receives 45
percent, Galena Interior Learning Academy (GILA) receives 4
percent, the Alaska Technical Center in Kotzebue receives 9
percent, Alaska Vocational Technical Center (AVTEC) in Seward
receives 17 percent, the Northwestern Alaska Career and
Technical Center (NACTEC) in Nome receives 3 percent, the
Southwest Alaska Vocational and Education Center (SAVEC) in King
Salmon receives 3 percent, Yuut Elitnaurviat in Bethel receives
9 percent, Partners for Progress in Delta receives 3 percent,
the Amundsen Educational Center in Soldotna receives 2 percent,
and Ilisagvik College in Utqiagvik receives 5 percent.
REPRESENTATIVE FANSLER explained that the bill would reauthorize
funding for five years and the distributions would be set until
June 30, 2022. He expressed that the bill is important to many
communities around the state and is important to the state's
resource development systems. The bill would ensure that
Alaskans are trained to perform the jobs in their regions.
3:23:12 PM
REPRESENTATIVE BIRCH asked where the funds come from.
REPRESENTATIVE FANSLER described that TVEP is funded by a
portion of the contributions to unemployment insurance paid by
every working Alaskan. The funds are distributed to technical
and vocational education entities across Alaska's regions in
accordance with AS 23.15.835.
REPRESENTATIVE BIRCH asked how TVEP benefits his constituents
who have funds taken out of their wages.
REPRESENTATIVE FANSLER noted that unemployment [insurance
contributions] are currently pulled out for "unemployment
reasons." He said that one benefit of TVEP is the ability to
train a worker for a well-paying job, like those on the North
Slope. He added that the programs are regionally based and
target the industries of each region. He explained that the
Yuut Elitnaurviat in Bethel does a lot of [Commercial Driver's
License] (CDL) training. He proposed one might consider the
TVEP program as an opportunity for upward mobility for employees
to get better jobs, for Alaska to keep its high-paying jobs
within the state, and [to have the wages from such jobs remain]
in Alaska's economy.
3:25:25 PM
REPRESENTATIVE BIRCH offered his interpretation that [TVEP
funding] "comes out of the hide of the working person" and the
money is taken out of an individual's paycheck to fund training
for someone that might replace him/her. He said he is not
convinced that is a good thing. He acknowledged the pot of
money is big, but he questioned what the return value is for the
person who is working and seeing his/her paycheck diminish.
REPRESENTATIVE FANSLER responded that there is a wide
distribution of jobs around the state that require a
professional degree. He said that TVEP is a program designed
specifically for jobs that would utilize resource development
industries to provide skills to Alaskans. He stated that the
funding mechanisms for [TVEP] have been in place for many years.
He remarked:
Ideally, I think what we all want as Alaskans is to
[at] some point get to a place where workers can ...
get that upward mobility and be able to say, "I no
longer ... qualify for ... just the bare minimum wage
job."
REPRESENTATIVE FANSLER suggested that TVEP provides an
opportunity for such a worker to get a job with a respectable
living wage to bring back to the community and help the overall
economy of Alaska. He noted that billions of dollars leave the
state each year with people that don't live in Alaska: He said,
"They're working two on, and then they're flying down to live
their two off." He observed that such money is being taken out
of the Alaskan economy and is directly impacting Alaskans. He
remarked:
We want those jobs to being going to folks that are
going to - if they are taking a two on, two off,
they're going to return to your ... region; they're
going to come back, and they're going to put that
money back ... into the economy locally.
REPRESENTATIVE FANSLER offered that the goal of HB 141 is to
train Alaskans to do Alaska's jobs.
3:28:53 PM
REPRESENTATIVE STUTES asked whether the funds for the program
come from "the unemployment that is paid."
REPRESENTATIVE FANSLER answered yes.
REPRESENTATIVE STUTES offered her understanding that
unemployment insurance would not be reduced even if the TVEP
program were discontinued.
REPRESENTATIVE FANSLER agreed. He remarked:
This is not going to be a means of putting money back
in the pockets of currently working Alaskans. This is
money that is simply designated from that unemployment
removal to make sure that we can get as many Alaskans
back to work as possible.
3:29:56 PM
REPRESENTATIVE WOOL asked where the Alaska Technical Center is
located.
REPRESENTATIVE FANSLER said it is in Kotzebue, Alaska.
3:30:14 PM
REPRESENTATIVE JOSEPHSON asked if other states make similar
investments with unemployment insurance benefits. He also asked
what percent of all the collected unemployment insurance TVEP
receives.
REPRESENTATIVE FANSLER said he would follow up with information
on other states' unemployment investments. He noted that TVEP
receives .16 percent of the employee unemployment insurance
contributions.
3:31:34 PM
REPRESENTATIVE BIRCH asked if [paying unemployment] is optional
to the employee. He said, "Obviously, if people ... choose to
have a benefit, then they can opt to." He offered his
understanding that the program is basically just "layered into"
what is perceived to be unemployment insurance; however, the
program takes $5 million from working people's paychecks to fund
training all over the state.
REPRESENTATIVE FANSLER responded that there is a good chance the
working Alaskans [who contribute to unemployment insurance] have
passed through TVEP programs to qualify for their jobs. He
suggested that they are paying back into a system that has
already benefited them. He mentioned that the program provides
training at a reasonable price close to communities allowing
individuals to become a "very important part of our fiscal
climate."
REPRESENTATIVE BIRCH pointed out that employees don't have a
choice to participate.
3:33:33 PM
CHAIR KITO indicated that the money is being paid by the
employees regardless of whether or not the TVEP program
continues. He commented that the program provides opportunities
for retraining individuals who might need to change career
paths. He remarked:
Not having that opportunity, I think, is going to be a
challenge for Alaska, especially when we see a
contraction in the economy where people might need to
be retrained. So, we could we let the program go
away, but then we're not going to have opportunities
for individuals in Alaska that could get the training
that could get them into productive careers in the
future. So I do think that the idea is ... keep the
program going so we can keep some training available
for people that might need to change careers.
REPRESENTATIVE BIRCH asked for clarification that the program is
paid for with unemployment insurance.
CHAIR KITO answered, "Correct."
3:34:34 PM
REPRESENTATIVE KNOPP expressed that Representative Birch's
concerns are unrelated to HB 141. He noted that the bill
extends the deadline by five years and allocates a percentage of
money already collected.
3:35:05 PM
REPRESENTATIVE FANSLER agreed that the bill does not affect how
much is taken out of the unemployment compensation. Rather, the
bill designates a method to use those funds for vocational and
technical education programs.
3:36:17 PM
REPRESENTATIVE WOOL asked if the approximately $4 million [of
TVEP funds] represents .016 of all [unemployment insurance] (UI)
contributions.
REPRESENTATIVE FANSLER clarified that it is .16 percent.
3:37:28 PM
REPRESENTATIVE SULLIVAN-LEONARD asked how much unemployment
insurance is captured on an average yearly basis since it began
in 2000.
3:37:49 PM
PALOMA HARBOUR, Director, Central Office, Division of
Administrative Services, Department of Labor & Workforce
Development (DLWD), responded that she does not have a rolling
total from 2000. She explained that the amount projected to be
available in the fund for distribution in fiscal year 2018 (FY
18) is almost $12 million, which is similar to the last three
years.
3:38:49 PM
CHAIR KITO asked whether $12 million is the entire collection of
unemployment insurance or the amount available for TVEP.
MS. HARBOUR clarified that it is the amount available for TVEP.
3:39:03 PM
REPRESENTATIVE BIRCH asked what flexibility the legislature has
in designating the use of the TVEP funds.
MS. HARBOUR reported that the entities are designated in
statute; therefore, the legislature decides who receives the
funding and what percentage they receive. She noted that HB 141
is a straight reauthorization of the current distribution for
five more years.
REPRESENTATIVE BIRCH asked if the .16 percent is the percentage
of the total unemployment insurance received by TVEP.
MS. HARBOUR responded that .16 percent is the percent of each
employee's UI taxable wage base - which is close to $40,000 -
that goes into the TVEP fund for each employee. She noted that
overall UI employment contributions vary each year, but on
average they are about .5 percent of the taxable wage base.
REPRESENTATIVE BIRCH asked, "So .16 goes into .5 about 3 times,
so it's like 30 percent?"
MS. HARBOUR responded, "That would makes sense."
REPRESENTATIVE BIRCH concluded that 30 percent of the
unemployment insurance is being redirected to TVEP funds.
MS. HARBOUR answered no. She explained that 30 percent of an
employees' contribution goes to TVEP, and the employer pays
another .7 percent.
REPRESENTATIVE BIRCH described that one-third of employee's
contribution is being directed by the legislature to these
programs. He asked whether there are any constraints on the
percentages. He said he is challenged by the idea that
unemployment insurance is funding education.
MS. HARBOUR stated that [the legislature] could direct up to 100
percent of the employee contribution to TVEP. She explained
that doing so would impact the amount contributed by the
employer: There is a formula describing how much money needs to
be collected to support unemployment insurance. She remarked,
"If you decide to divert more of the employee's contribution to
training programs, then the employer will have to fund more of
that total contribution that's needed to fund unemployment
insurance."
REPRESENTATIVE BIRCH said that unemployment insurance is
supposed to be available to those who are unemployed. He
offered his belief that using a third of the insurance to fund
an education program for those who are already employed is not
using the funds as they were originally intended.
3:43:24 PM
HEIDI DRYGAS, Commissioner, Department of Labor & Workforce
Development (DLWD), said she will follow up with the percentage
of overall UI [that goes to TVEP]. She offered her
understanding that TVEP has been working since 2000. She
offered that the adage 'A rising tide lifts all boats' really
encapsulates what the TVEP program is about. She stated that UI
is an insurance program which kicks in when someone is out of
work. She explained that the TVEP programs fall "squarely
within the ambit of unemployment insurance." She opined that
the idea is for people to collectively have a portion of their
insurance syphoned off to help all Alaskans go back to work.
She noted that TVEP has 10 recipients across the state who use
the money to train Alaskans for jobs - which is why UI was
created. She noted that the program has been extremely
successful and the department fully supports the program.
REPRESENTATIVE BIRCH expressed that he buys insurances which
benefit him or his beneficiaries. He opined that the one-third
of employees' contributions to unemployment insurance is being
taken away to train other people, which does not benefit the
payers. He offered that [the TVEP program] doesn't fill the
role of insurance since it does not benefit the payer.
Syphoning off a third of $12 million to support colleges and
learning academies is not insignificant. He again noted that he
is not comfortable with using unemployment insurance for that
purpose.
3:46:24 PM
CHAIR KITO offered that he pays for auto insurance without
receiving a benefit unless he is in an accident. He stated, "I
can pay for many years and not receive a benefit of that
insurance." He added that [employees] pay to try and benefit
the overall program which provides education and retraining for
unemployed individuals.
3:47:10 PM
FRED VILLA, Associate Vice President, Workforce Programs,
University of Alaska Fairbanks (UAF), testified in support of HB
141. He stated that the university uses TVEP funding to respond
to the needs of the state of Alaska with outreach, academic,
certification, and professional development programs. He said
that the funding is critical to provide the size, scope, and
quality of the programs and is critical to the access to
programs throughout the state. He relayed that the university
is focused on career pathways, opportunities for economic
development, and high-demand jobs in areas throughout the state.
He remarked:
We work specifically based on the priorities
established by the [Alaska] Workforce Investment
Board, in priority industries and occupations. So
this is a critical[ly] important program to the
university as we look at addressing issues across the
state.
MR. VILLA drew attention to documents [included in the committee
packet] which show the milestones and contributions TVEP has
made across the university system. He explained that TVEP has
helped all health related fields, which is the largest industry
sector in the state; TVEP has helped double the number of
engineers; and it has helped high school students receive double
credit for technical skills.
3:49:53 PM
PEARL BROWER, Ph.D., President, Ilisagvik College, testified in
support of HB 141. She explained that Ilisagvik College is
Alaska's only tribal college and only independent community
college. In the fall of 2016, it was rated the number two
community college in the nation and Alaska's number one
community college. Ilisagvik College is a public institution
accredited by the Northwest Commission on Colleges and
Universities. She stated that Ilisagvik College advocates for
the reauthorization of the TVEP funds through HB 141. Ilisagvik
College is among nine other organizations that are part of the
[TVEP] program and that all have a mission of providing quality,
workforce development designed education to support the needs of
Alaskans.
DR. BROWER noted that Ilisagvik College receives five percent of
the allocated TVEP funding. The funding has allowed Ilisagvik
to serve over 700 students. She stated that Ilisagvik College
ranks the highest in 2016 performance measures among the
programs that receive TVEP funding. She relayed that 82.7
percent of Ilisagvik's TVEP students were employed with a median
wage of over $24,000 within seven to twelve months of exiting
the program.
DR. BROWER explained that TVEP allows Ilisagvik College to offer
training opportunities to residents across the state in order to
get credentialed for jobs or to advance in their current jobs.
Due to the many required certifications, many employed residents
must get certified and recertified every year. She stated that
without TVEP funding, Ilisagvik College would not be able to
reach as many Alaskans or provide as many workforce development
training opportunities. She remarked:
As we look to the future, I believe we all know that
education must be a priority for all of us Alaskans.
We must continue to support programs that provide
opportunity for the future of our state. At
Ilisagvik, we say, "More education, more options, more
out of life."
3:52:44 PM
DENNIS DISHION, Executive Director, Yuut Elitnaurviat, testified
in support of HB 141. He explained that Yuut Elitnaurviat
translates to "The people's learning center." The center
educates local people for family-wage jobs locally. Various
programs use TVEP funding for new training and incumbent worker
training, and several programs operate on an as-needed basis.
He remarked, "All of our programs are structured to where people
go to work at the completion of their program." In FY 16, Yuut
Elitnaurviat serviced 724 individual students with 1,082
services given.
MR. DISHION noted that the programs at Yuut Elitnaurviat
include: National Center for Construction and Education
Research certifications, adult basic education, [General
Educational Development](GED) training, dental assistant and
health aid therapy training, certified nursing training, federal
apprenticeship programs for plumbers and electricians, driver's
license and CDL programs, and other various on-demand trainings
that lead directly to employment. He said that TVEP is
important to Yuut Elitnaurviat to maintain its structure and the
ability to train local Alaskans close to their home for high-
paying jobs.
3:54:44 PM
CHAIR KITO opened public testimony on HB 141.
3:55:08 PM
JOEL ALOWA, Community Health Services Director, Maniilaq
Association, testified in support of HB 141. He explained that
the Maniilaq Association is a regional non-profit that provides
medical, social, and tribal services for the 8,500 residents of
the Northwest Artic Borough and the community of Point Hope. He
said that the Maniilaq Association has an important working
relationship with the Alaska Technical Center (ATC) in Kotzebue,
which provides training and training facilities for regional
medical providers and water sanitation and infrastructure
technicians. He observed that the medical and health field is
continually changing with new practices and technology. He
remarked, "Our partnership with ATC enables our staff to be
trained and be provided with the best medical and health
environment services possible to all of our regional and state
residents." He stated his support of HB 141 and urged the
reauthorization of funds for technical training.
3:56:39 PM
ANISHA ELBIE, Co-executive Director, Southwest Alaska Vocational
Educational Center (SAVEC), urged the committee's support of HB
141. She stated that with large declines in taxable wages, TVEP
will have a shortfall of $1.32 million, and SAVEC will have a
detriment of $39,600 for FY 18. She said that providing
training and retraining Alaskans for Alaskan jobs becomes more
important as more workers get displaced. She explained that
SAVEC provides workforce training for 31 villages within its
service area, which has a direct impact on the local economy.
She remarked:
In the state's 2014 wage report for SAVEC, 115
[Hazardous Waste Operations and Emergency Response]
(HAZWOPER) trainees contributed over $5 million to the
state's economy in the first year after training.
This April, SAVEC will have three HAZWOPER restructure
courses and one 40-hour HAZWOPER class. These
students ... will continue to add to the local and
state economy.
MS. ELBIE noted that SAVEC is working to improve the hiring of
Alaskans in the seafood processing industry. She acknowledged
that the state has made gains in hiring residents but still
battles [high] non-resident hire. She pointed out the Bristol
Bay Borough has a non-resident hire rate of 93.8 percent,
Dillingham 84.6 percent, and Lake and Peninsula Borough 91.3
percent. This amounts to over 3,300 jobs and over $29 million
that could have stayed in the state and multiplied in the local
economy. She expressed that SAVEC provides workforce training
through strong partnership funding including TVEP and local
contributions from regional organizations: the Bristol Bay
Native Corporation, the Bristol Bay Native Association, the
Bristol Bay Borough, and the Bristol Bay Housing Authority. She
stated that the [University of Alaska Fairbanks] (UAF) Bristol
Bay Campus and the Bristol Bay Economic Development Corporation
provide contributions directly for training. Since the fall of
2016, 152 students have been trained in 22 classes at SAVEC, and
there are 12 more trainings planned this spring. She thanked
the committee and the bill sponsor.
4:00:06 PM
ANNETTE CARUSO, Co-executive Director, Southwest Alaska
Vocational Educational Center (SAVEC), testified in support of
HB 141. She stated that she had nothing further to add to Ms.
Elbie's testimony.
4:00:19 PM
D'ANNE HAMILTON, Personnel Officer, Teck Alaska, testified in
support of HB 141. She explained that Teck Alaska operates the
Red Dog mine in Northwest Alaska and employs 600 people at its
busiest time of the year. She stated that Teck Alaska works
closely with the Alaska Technical Center and provides input to
develop [Alaska Technical Center's] (ATC) process technology
program. She noted that the ATC responded quickly to Teck
Alaska's request for more soft skill development, which was
important to Teck Alaska. She explained that ATC revised its
schedule to demonstrate to students what working long days at a
mine would be like and show a realistic viewpoint of life in a
mine.
MS. HAMILTON offered her belief that [training at ATC] improves
employee retention. She noted that Teck Alaska recently brought
11 ATC students to the mine to build on ATC training by
providing job shadow experience and allowing the students to see
firsthand the work they could be doing after completing
training. She remarked that ATC helps students gain access to
high-paying jobs and make connections to the industry that would
likely not have happened without ATC. Through its process
technology and millwright maintenance programs, ATC works very
hard to teach the skills needed at the mine. She expressed that
TVEP funding is important for ATC to continue its work and she
urged the committee to reauthorize funding for TVEP by passing
HB 141.
4:02:28 PM
CHERYL EDENSHAW, Director, Alaska Technical Center (ATC),
testified in support of the reauthorization of funding for TVEP
proposed under HB 141. She noted that ATC is recognized by the
state as a statewide post-secondary training center eligible for
TVEP funding. She thanked the committee and the State of Alaska
for the support of workforce development by investments to ATC
over the years. She stated that ATC has key partnerships with
business and industry to train safe and responsible Alaskan
workers and to help develop and sustain the state's economy.
She remarked:
Without the TVEP funds, we would not be in a position
to maintain our long-term commitment to meet
employers' needs in the local and statewide economy
that we fulfilled since our inception in 1981.
Without TVEP funding, we would not be able to provide
training necessary for jobs in the ... areas of health
care, resource development, process technology,
culinary arts, and construction training. We would
also be not poised to respond to employers' market-
driven, on-demand training needs in a timely fashion
to align with those job opportunities. I urge you to
support reauthorization of TVEP and, with the state's
help, we can build a future for Alaskans strengthening
our families and communities across the state.
4:04:35 PM
KAREN CEDZO, Partners for Progress in Delta, testified in
support of HB 141. She explained that Partners for Progress in
Delta has been a part of TVEP's regional training center group
since 2008. Partners in Progress for Delta came about as a
result of the U.S. Department of Defense (DoD) identifying a
lack of skilled workers in Delta Junction when it was making the
decision whether to establish a ground-based military
installation in Delta Junction. She noted that the DoD
completed an economic development report identifying a lack of
skilled workers, which resulted in the Delta/Greely School
District taking the lead to bring educational partners together.
This led to a very formal educational consortium which includes
partners such as: the Delta/Greely School District, the Alaska
Works Partnership, the UAF Community and Technical College, and
the UAF Cooperative Extension Service. She stated that all the
partners have a dedicated vision of building Alaska's workforce
through education and training.
MS. CEDZO stated that "the board" remains committed to that
mission. She stated her interviews with students involved in
the program have shown her how life-changing the program is,
especially for the young people in the community. She stated,
"Many would not have the opportunity to go on and get real jobs
and be able to contribute to a fund that makes it possible for
those in need to be assisted." She noted that some young people
who do not plan on attending college are not sure what do to
with their lives. The quality of the augmented career and
technical classes at the Delta/Greely High School operated by
Delta/Greely School district and Partners for Progress in Delta
would be at risk without TVEP funding.
MS. CEDZO explained that some high school students are taking
dual-credit courses such as occupational endorsements for
welding, certificates in applied business, expanded health
classes, construction trade, math for a trade, English 111, and
other core requirement classes. Additionally, a wealth of
programs are offered through [UAF] Cooperative Extension for
pesticide certification and agricultural related programs. She
relayed that there are adults in Delta who are not able to go to
Fairbanks to earn a degree, but can work towards a degree in
Delta with the local access to the facility. She stated, "It's
an amazing experience to walk into that building and see young
people's eyes light up getting an idea of what might be an
option for a career path in their future." She added that a
significant component of the program is the entry-level summer
construction trade academy which is a three-week intensive
training program in Delta. It is an approved training program
from which some participants might have direct opportunities.
MS. CEDZO explained that since the inception of the academy in
2006, more than 125 participants have been accepted for
opportunities in apprenticeships or construction trade related
industry [positions]. She indicated that the academy's twelfth
program would be offered in June as a three-week intensive
program. Students walk away from the program with work ethic
and safety skills, as well as certifications in such things as
[Mine Safety and Health Administration] (MSHA), [Occupational
Safety and Health Administration] (OSHA), and forklift training.
She listed that participants of the program have come from North
Pole, Delta, Tok, Glen Allen, Valdez, Juneau, and some rural
villages. She stated that the program has a very successful
working relationship with the operating engineers.
4:10:13 PM
CHAIR KITO announced that HB 141 was held over.