State of Nevada Department of Employment Training and

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Transcript State of Nevada Department of Employment Training and

4/26/2020

State of Nevada Department of Employment Training and Rehabilitation American Recovery and Reinvestment Act (ARRA)

Impact on Unemployment Compensation and Workforce Investment Programs March 10, 2009 1

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Unemployment Insurance Compensation Program Impacts

Extension of Emergency Unemployment Compensation (EUC) Program    Tier I EUC provides 20 weeks of extended benefits Tier II provides an additional 13 weeks for high unemployment states, such as Nevada The ARRA extends the application period for EUC from a March 31, 2009 end date to December 31, 2009. It does not add additional payable weeks.

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4/26/2020 Unemployment Insurance Compensation Program Impacts Federal Additional Compensation (FAC)  Adds $25 to weekly payments for all types of claims for benefits payable through the end of the calendar year 2010  100% Federally Funded 3

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Unemployment Insurance Compensation Program Impacts

  State Extended Benefits –

State Extended Benefit programs respond to economic conditions in individual states by providing additional unemployment insurance benefits to those who exhaust their regular claims.

Nevada “Triggered-on” State Extended Benefits starting February 22, 2009. The program makes up to 13 additional weeks of benefits available to those who have exhausted regular benefits and both federal extensions

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Unemployment Insurance Compensation Program Impacts

State Extended Benefits (cont.)

ARRA Impacts –

 Allows States to Pay Federal Extended Benefits prior to State extended benefits which preserves State Trust fund assets.

   Waives the open benefit year requirement Provides for 100% of federal funding of State Extended Benefit payments for claims against Contributory Employers under certain circumstances through the end of the calendar year – Reimbursable (Self-Funded) Employers (State and Local Government, School Districts, University and Community College system pay 100% of claims just as with regular benefit claims.

States are considering temporary adoption of an optional trigger that would add up to 7 weeks of State Extended Benefits to the 13 standard weeks. No Impact to Contributory employers due to 100% federal reimbursement. However Reimbursable employers would pay costs associated with extra 7 weeks of claims. 4/26/2020 5

Unemployment Insurance Compensation Program Impacts Temporarily waives interest payments on loans to states with depleted trust funds through December 31, 2010

Nevada’s Unemployment Insurance Trust fund is expected to be depleted by the end of calendar year 2009 and have a deficit of approximately $750 million by the end of 2010 4/26/2020 6

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Unemployment Insurance Compensation Program Impacts Suspension of Federal Income Tax

 Temporarily suspends federal income tax of the first $2,400 of unemployment benefits per recipient  No agency impact -- The exemption will be handed via federal tax returns 7

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Unemployment Insurance Compensation Program Impacts

Unemployment Insurance Modernization Provisions Special $500 million distribution to states for the administration of Unemployment Insurance (UI) Compensation programs. Nationally, UI programs have been under-funded by $3 billion collectively over the past 6 years.

 Nevada will receive approximately $5.26 million to augment administrative funding 8

Unemployment Insurance Compensation Program Impacts

Unemployment Insurance Modernization  Special “Reed Act” distribution of $7 billion to the states  Nevada could be eligible for approximately $77 million

However, statutory changes and permanent program expansion is required in order to access these funds.

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Unemployment Insurance Compensation Program Impacts

Unemployment Insurance Modernization Incentive Funds Permanent program expansion is required in order to access these approximately $77 in incentive funds Uses –   Deposited in the Unemployment Insurance Trust fund to pay benefits With Legislative approval, funds may be used for program administration and infrastructure investments 4/26/2020 10

Unemployment Insurance Compensation Program Impacts

Unemployment Insurance Modernization – Incentive Funds  To access the first 1/3 ($26 million) of the incentive funds of the incentive payments, Nevada Unemployment Law would have to be changed to implement an “Alternate Base Period”  The remaining 2/3 ($51 million) may be accessed by implementing 2 of 4 optional provisions  The program expansion provisions must be permanent – no sunset or expiration date 4/26/2020 11

Unemployment Insurance Compensation Program Impacts

Unemployment Insurance Modernization – Incentive Funds (cont.) To be eligible for the 2/3rds ($51 million) in incentive funds, states must allow benefits under 2 of 4 conditions: 1. A claimant limits his/her work search to part-time

employment.

2. A claimant quits work for compelling family reasons (specifically domestic violence, “trailing

spouse” and family member’s illness) 3. The state implements dependent allowances ($15 per dependent) to the benefit amount calculation 4. The state provides an extra 26 weeks of UI benefits while in training Nevada currently qualifies under provision 1 and 2.

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Unemployment Insurance Compensation Program Impacts

Unemployment Insurance Modernization Incentive Funds (cont.)

However . . .

To be eligible for the 2/3rds, ($51 mil.) a significant statutory and programmatic changed must be implemented to enact Alternate Base Period provisions which provides access to the first 1/3rd ($26 mil.)  

Currently, wages earned in the first four of the last five completed quarters are used to establish an Unemployment Insurance Benefit claim An Alternate Base Period would allow wages earned in the most recent completed quarter to be used to establish monetary eligibility for a claim

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Unemployment Insurance Compensation Program Impacts

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Cumulative Benefit Cost of ABP Implementation

$160.00

$140.00

$120.00

$100.00

$80.00

$60.00

$40.00

$20.00

$ 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1.2% of Benefits 2.4% of Benefits

Depending on ABP program participation rates, Incentive Funds would cover the costs of this program expansion to some time between 2012 and 2018

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15% set-aside for State activities -Mandated Activities -Allowable discretionary activities

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SWIB determines Disperses & U.S.. Department of Labor Title I Funds Adult,Dislocated Workers & Youth

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Workforce Investment System Programs Impacts

Workforce Investment Act Formula grants

As of March 6th, $25,274,000 pass through funds to Local Workforce Investment Boards   Adult - $3,392,179 Dislocated Worker - $14,311,733  Youth ( Including Summer Youth ) - $7,570,211 * 15% set aside for Administration, Infrastructure and special projects 16

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Workforce Investment System Programs Impacts Workforce Investment Act Formula Grants

The State of Nevada—DETR has the responsibility to oversee funds allocated to Local Workforce Investment Boards   Implementation Plans are Underway at DETR and Local Workforce Investment Boards Some Plan Initiatives Include Assessing Service Delivery Gaps and Identifying Barriers to Employment 17

Workforce Investment System Programs Impacts

Wagner/Peyser - Employment Service

Approximately $3.4 million

 

Approximately $2 million to be utilized to support Reemployment Services for Unemployment Insurance Claimants to assist them in returning to work as soon as possible through connection to Employment and Training services.

Remaining funding for traditional employment and training activities offered through Nevada JobConnect offices

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Workforce Investment System Programs Impacts Vocational Rehabilitation

Additional program funding of approximately $4.2 million  No State Match Required (regular funding requires an approximately 4 to 1 match).

 $280,000 for Older Blind program – doubles current allocation.

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Workforce Investment System Programs Impacts

Competitive Grant Opportunities - $750 Million

By 06 30 2010, DOL is mandated to offer competitive grant opportunities for worker training and placement in high growth and emerging industry sectors  $500 million is designated for worker training in energy efficiency and renewable energy industries  Priority for the balance of funds is given to projects that prepare workers for careers in the health care sector 4/26/2020 20

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Trade Adjustment Assistance Program

Trade Adjustment Assistance (TAA) Program Expansion     Extends TAA to trade-affected services sector workers and workers affected by off shoring or outsourcing to all countries, including China or India Increases training funds available to states by 160% to $575 million per fiscal year; creates a new TAA program for trade-affected communities Allows for automatic TAA eligibility for workers suffering from import surges and unfair trade Makes training, healthcare and reemployment TAA benefits more accessible and flexible

Difficult to gauge the impact to Nevada’s trade program which is fairly small. . .

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Department of Employment Training and Rehabilitation

Caveats –

Detailed program guidance yet to be issued on some programs A “stimulus cleanup” bill could change some provisions

Thank you

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