02/12/1996 02:10 PM Senate CRA

         SB 229 STATE TRAINING & EMPLOYMENT PROGRAM                        
                                                                               
  SENATOR TORGERSON  brought SB 229 before the committee as the next           
 order of business.  He directed attention to a letter from Rebecca            
 Nance of the Department of Labor providing additional information             
 to the committee on questions raised during the February 7 hearing            
 on the legislation.                                                           
                                                                               
 Number 070                                                                    
                                                                               
  REBECCA NANCE , Director, Division of Employment Security, in                
 response to clarifying administrative costs for accounting and                
 collection, explained that this is a U.S. Department of Labor                 
 compliance measure, which mandated that STEP's share for use of the           
 federally funded collection and accounting system was computed to             
 be 19 percent.  She added that is 19 percent of the state's                   
 employment service tax data collection and accounting.                        
                                                                               
  SENATOR KELLY  inquired how many people in the department collect            
 these taxes.   ARBE WILLIAMS , Director, Administrative Services,             
 Department of Labor, replied that there are 19 positions in the tax           
 section.  The federal agreement requires that 19 percent of those             
 total costs are reimbursed in the system.  She clarified that the             
 money is not sent back to the federal government; it is used for              
 their internal operations.  It allows those supplanted UI dollars             
 in their field offices or in other operations of the Employment               
 Security Division.  She further clarified that the STEP program is            
 funded with one-tenth of one percent of employees' contribution to            
 the Unemployment Insurance Trust Fund.  The trust fund funds the              
 benefit payments process through the Employment Security Division.            
                                                                               
  SENATOR TORGERSON  asked if employee/employer contribution ratings           
 that must be posted for the Unemployment Insurance program show               
 that part of the money they are paying is going for administrative            
 costs for accounting and collection.   REBECCA NANCE  responded that          
 the contribution is lumped together on the form.   SENATOR TORGERSON          
 asked that she look into whether it should be listed on the form              
 separately should STEP become a permanent program.                            
                                                                               
 Number 200                                                                    
                                                                               
  REBECCA NANCE  also clarified that the Employment Security Division          
 received State Employment and Training Program Funds through two              
 Reimbursable Services Agreements (RSAs) with DCRA, which are used             
 for counseling, job seeking skills and employment assistance in               
 local offices.  These positions are located in Kenai, Fairbanks,              
 Nome and Ketchikan.  In addition, there are two positions in DCRA:            
 one is a grants administrator and one is an internal auditor.                 
                                                                               
 Ms. Nance noted that she had provided the committee with an                   
 expanded list of contractors with the type of training that was               
 provided from 1990 through 1994.  The 1995 list is still not                  
 complete because they are waiting on the Fairbanks service delivery           
 area, but she said she could provide the information on the other             
 service delivery areas.                                                       
                                                                               
  SENATOR KELLY  questioned if there wasn't a time frame for awarding          
 these grants.                                                                 
                                                                               
 Turning to the fiscal note, Ms. Nance said the $252,000 figure is             
 projected for inter-agency transfer to the Department of Labor for            
 Labor Market Information (LMI) so that they can track the program's           
 success and connect it to the UI Trust Fund to see if there is a              
 lesser impact on the trust fund.  It also provides for the analysis           
 of the data.                                                                  
                                                                               
  SENATOR KELLY  commented that it seems to him they are propping up           
 the LMI with STEP money that they are not getting out of the                  
 general funds.   ARBE WILLIAMS  agreed, and added that a couple of            
 years ago $50,000 was cut from their general funds and the                    
 Legislature specifically said that $50,000 would come from the STEP           
 fund for analysis and production of the Alaska Resident Hire                  
 Report.  The $252,000 provides a base for the ability for the                 
 department to evaluate not only the STEP program, but also track              
 the success of clients in the JOBS program and the AVTEC program.             
  SENATOR KELLY  said it is pretty clear from the clarification of the         
 fiscal note that we are entering some real soft uses for this STEP            
 money; it is getting far beyond training people who are out of                
 jobs.                                                                         
                                                                               
 Number 300                                                                    
                                                                               
  SENATOR TORGERSON  asked if their formula tracks to the LMI so that          
 the money they allocate to their job training is to the at-risk               
 occupations.   ARBE WILLIAMS  responded that this is one of the very          
 few programs in the state where they can provide that kind of                 
 program evaluation.                                                           
                                                                               
 Number 325                                                                    
                                                                               
  SENATOR TORGERSON  said he wouldn't roll the STEP program into some          
 other employment program, but, by his count, there are currently 15           
 employment programs and he thinks that's too many.  He said it is             
 time to start consolidating some of them and doing away with a few            
 positions, and he requested the committee be provided with                    
 information on the job programs currently running.                            
                                                                               
 There being no further testimony on SB 229,  SENATOR TORGERSON                
 stated it would be held in committee for further information, and             
 then adjourned the meeting at 2:37 p.m.