Adult, Dislocated Worker, and Youth Activities

COLORADO WIOA WAIVER REQUEST 1

WAIVER OF THE OBLIGATION OF ELIGIBLE TRAINING PROVIDERS (ETPs) TO COLLECT AND REPORT ON THE PERFORMANCE DATA ON ALL PARTICIPANTS IN A TRAINING PROGRAM 

1.    Statutory/Regulatory Requirements to be waived: WIOA Sections 116 and 122, which require the collection and reporting of performance data on all students participating in training programs on the state’s Eligible Training Provider List (ETPL).

Subsequent to the passage of WIOA in 2014, the state of Colorado immediately began working towards the implementation of the new ETPL provisions. At that time, CDLE was in the process of forging a new partnership with the Colorado Department of Higher Education to replace an outdated technology platform and build a new, robust ETPL. Since CDHE already receives student outcome data from colleges and other training providers around the state, CDLE determined that contracting with CDHE for both technology and outcome data analysis would create some efficiencies, including relieving the burden on training providers to provide their student data twice to different state agencies. This new online platform would provide enhanced features and accessibility to our shared customers.

We have been working diligently with CDHE and their vendor over the last few years and we have made significant progress. Prior to WIOA, Colorado was not collecting performance data on ETPs. A new data system has been built to house the training provider data, including the step-by-step approval process for WIOA funding eligibility. Two new websites have been developed and launched - a training provider site at ColoradoETPL.org and a consumer-facing site at cotrainingproviders.org.

However we have also encountered delays with our vendor in the development of the ETP application that will accept student information from providers. Multiple approaches to collecting the relevant student data were analyzed and a full rewrite of the proposed solution was initiated after the ETP discussions at the SMART training in March. We are fully reliant on this application to collect the non-WIOA participant data that will supplement the submission of WIOA participant data from the PIRL. Based on the current timelines with the vendor, we do not expect to have the application ready to accept data on all students (including non-WIOA funded students) until mid-2020 at the earliest. Without the technical application up and running, the collection of non-WIOA participant data is not possible.

In addition to the technical delays, providing data on all students is burdensome and time-intensive to the training providers and the state and local workforce staff, particularly when a small percentage of their overall students are WIOA participants. Most private occupational schools do not currently collect students’ social security numbers, which are required for wage matching. The reporting burden may result in a smaller number of training providers on the ETPL, therefore limiting consumer choice and accessibility, especially in rural parts of the state. 

2.    Actions the State has undertaken to remove State or local barriers:

N/A - There are no state or local statutory or regulatory barriers to implementing the proposed waiver.

3.    Programmatic outcomes resulting from the implementation of the waiver:

We anticipate that waiving the obligation of ETPs to collect performance data on all students will result in improved consumer choice, i.e. additional training providers on the ETPL. We have anecdotal evidence from smaller providers that it is burdensome to collect data on all students and they do not have the capacity to track this information, especially social security numbers. If this waiver is granted, we plan to track the number and type of providers before and after the waiver to demonstrate increased consumer choice. Therefore, the greater flexibility resulting from this waiver will result in:

• Increased numbers of training providers opting in to the ETPL
• Enhanced consumer choice for training programs
• Stronger partnerships between training providers and Colorado’s public workforce system

4. Alignment with Department policy priorities:

This waiver request aligns with ETA’s Strategic Objective 1.1 to “create customer-focused workforce solutions for American workers.”

5. Individuals, groups, or populations affected by the waiver:

The waiver will benefit all WIOA participants accessing the ETPL by increasing the number of available training programs and enhancing consumer choice. The reduced reporting burden will also have a significant impact on training providers and state and local workforce staff.

Recent updates to Colorado's ETPL application now include a mechanism allowing providers to submit all student data. While the waiver is in place, Colorado plans to test this functionality while simultaneously working to increase the number and variety of providers available on the ETPL. Social security numbers provided for all students will be matched to UI wage data to calculate the following performance data for continued eligibility:

1. The percentage of program participants who are in unsubsidized employment during the second quarter after exit from the program

2. The percentage of program participants who are in unsubsidized employment during the fourth quarter after exit from the program

3. The median earnings of program participants who are in unsubsidized employment during the second quarter after exit from the program

4. The percentage of program participants who obtain a recognized post-secondary credential, or a secondary school diploma or its recognized equivalent during participation in or within 1 year after exit from the program

6.     How the State plans to:

a. Monitor the progress of waiver implementation:

CDLE has a long standing, comprehensive monitoring and performance accountability system that measures and evaluates results for job seekers and employers accessing Colorado’s network of One-Stop centers. On a monthly and quarterly basis, CDLE reviews and analyzes client enrollment and service levels, program expenditures, and performance outcomes. In addition, State program monitors conduct quarterly reviews designed to assure that contract requirements are being met for all WIOA programs. On an annual basis, comprehensive compliance monitoring is conducted onsite. Should this waiver request be granted, CDLE will regularly monitor the outcomes and impacts of this waiver authority to ensure appropriateness and effectiveness.

b. Provide notice to any local board affected by the waiver:

If approved, CDLE will update state policy guidance to inform local boards of the change.

c-d.Provide any local board affected by the waiver an opportunity to comment on the request and ensure meaningful public comment, including comment by business and organized labor, on the waiver.

This waiver request was published for a period of 30 days on the public websites maintained by the Colorado Department of Labor and Employment and the Colorado Workforce Development Council, allowing for public comment on its content and potential impact. In addition, electronic copies of the waiver were sent via email to local boards and one-stop operators. No comments were received during this period.

e. Collect and report information about waiver outcomes in the State’s WIOA Annual Report.

CDLE has a long standing, comprehensive monitoring and performance accountability system that measures and evaluates results for job seekers and employers accessing Colorado’s network of One-Stop centers. On a monthly and quarterly basis, CDLE reviews and analyzes client enrollment and service levels, program expenditures, and performance outcomes. In addition, State program monitors conduct quarterly reviews designed to assure that contract requirements are being met for all WIOA programs. On an annual basis, comprehensive compliance monitoring is conducted onsite. Should this waiver request be granted, CDLE will regularly monitor the outcomes and impacts of this waiver authority to ensure appropriateness and effectiveness. Specifically we will track the number of providers on the list before and after the waiver is granted to assess increased consumer choice.

Should this waiver request be granted, CDLE will regularly monitor the outcomes and impacts of this waiver authority to ensure appropriateness and effectiveness and will report on the outcomes in the WIOA Annual Report.

7. The Secretary may require that States provide the most recent data available about the outcomes of the existing waiver in cases where the State seeks renewal of a previously approved waiver.

N/A – This is not a renewal of an existing waiver.

Colorado Response to ETA - February 2020:

The waiver request below was originally submitted in December 2018. ETA’s response (dated March 13, 2019) stated “WIOA Section 189(i)(3)(A)(i) explicitly forbids the Secretary from waiving any statutory or regulatory requirements relating to the ‘allocation of funds to local areas.’ Therefore, a waiver of the WIOA Title I Adult and Youth formula methodology cannot be approved.” Colorado respectfully re-submits this waiver request with further clarification. The waiver would allow Colorado to modify the definition of one factor in the formula methodology or add an additional factor as approved by the Governor and the State Workforce Development Council. Colorado would be in full compliance with the requirement for “allocation of funds to local areas,” using the statutorily defined formula with one modification. We take issue with how the excess unemployment standard is defined, and we ask that our waiver request be reconsidered with this new lens. 

COLORADO WIOA WAIVER REQUEST

PREPARED BY THE COLORADO DEPARTMENT OF LABOR AND EMPLOYMENT

September 2018 (Updated February 2020)

1. Identifies the statutory or regulatory requirements for which a waiver is requested and the goals that the State or local area, as appropriate, intends to achieve as a result of the waiver and how those goals relate to the Unified or Combined State Plan.

WIOA Sections 128(b)(1), (2), and (3) and 133(b)(1)(A), (2)(A) and (3): Statutory formula methodology for the Title I Youth and Adult programs’ within state allocations. Currently the WIOA statute requires states to use one of two formula options to distribute Title I Youth and Adult funds to local areas.

Note:This waiver request does not impact the requirement for the state to allocate funds to local areas; it is strictly to allow modification of the within state formula methodology, similar to the WIOA provision allowing modifications to the WIOA Title I Dislocated Worker within state formula.

The waiver, if granted, would allow Colorado to change the statutory formulas in one or more of the following ways, after consultation with the Governor, the state workforce development council, and various stakeholders:

• Modify the 4.5% excess unemployment standard to reflect current labor market conditions;
• Replace the excess unemployment factor with a different factor, for example, Census data related to groups with barriers to employment;
• Add a factor to the existing formulas, such as Census data related to groups with barriers to employment; or
• Apply the state’s percentage cut, or increase, equally to all local areas.

 Reasons why the waiver is being requested:

• The methodology for the within state formulas was originally developed 20 years ago under WIA and should be updated in accordance with current economic, structural and demographic shifts and trends.
• WIOA requires priority of service for a variety of groups with barriers to employment, who are not considered in the formula methodology.
• "Excess unemployment" is required for 1/3 of the youth and adult formula factors and it is also required in the alternative formulas.
• The standard for excess unemployment is 4.5%. However, the PY16 unemployment rates for seventeen of the states were below this level, with an additional fourteen states having an unemployment rate of 4.6 - 5%. In most cases these rates have gone down even further for PY18 and PY19.

 Current Labor Statistics, Dec 2019

• The impact within Colorado and other states is that some local areas end up having a Zero or close to Zero in the excess unemployment factor, thereby creating a reduction in funding greater than 10%, even with the 90% hold harmless calculation applied to the formula.
• As long as unemployment rates stay at historic lows in Colorado and other states, many local areas will be victims of this formula inequity, with major changes to their percent share of the total funding from year to year. Most recently the primary changes represented double digit decreases in funding, resulting in layoffs and reduction in services, thus destabilizing the system. In limited cases there were also double digit increases. 
• Through the use of a modified Dislocated Worker formula, allowed by WIOA and approved by USDOL, Colorado has strategically allocated funding to the local areas where it can be best utilized. (Colorado added two factors: percent share of the previous program year’s DW expenditures and percent share of DW customers served in the previous program year.) This precedent within the law should be applied to the Adult and Youth within-state formulas. 

The following is the actual impact of the required formula upon the PY18 Youth funding, versus PY17 Youth funding, followed by the equivalent for the PY18 versus PY17 Adult funding:

Note:

• Colorado’s calculations were reviewed by the USDOL Dallas Regional Office and determined to be accurate.
• Colorado also calculated local allocations using the alternative youth and adult formulas, which resulted in even greater local disparities.

2. Describes the actions that the State or local area, as appropriate, has undertaken to remove State or local statutory or regulatory barriers

N/A - There are no state or local statutory or regulatory barriers to implementing the proposed waiver.

3. Describes the goals of the waiver and the expected programmatic outcomes if the request is granted

• The waiver is expected to minimize swings in local allocations, thus minimizing layoffs and other significant disruptions in the delivery of services within both the youth and adult programs.
• Financial stabilization of the local workforce system will allow local areas to focus resources on the long-term goals of:
  • Increasing the use of sector strategy initiatives 
  • Increasing the use of work-based learning opportunities, particularly apprenticeships
  • Continuing progress toward serving 100% of customers with barriers to employment and moving individuals into living wage jobs 

4. Describes how the waiver will align with the Department’s policy priorities

• Expand regionally-focused sector partnerships that are championed by business and industry to drive career pathways and skill-based hiring
• Expand and implement a full spectrum of work-based learning opportunities, with an emphasis on the expansion of the number and types of apprenticeships
• Establish a customer-centric focus to increase access to and effectiveness of services for all customer groups with barriers to employment

This waiver request is closely aligned with the Department of Labor’s priorities to strengthen and improve our nation's public workforce system and help get Americans into high-quality jobs and careers and help employers hire and retain skilled workers. We cannot stabilize our local system with these severe funding fluctuations.

5. Describes the individuals affected by the waiver, including how the waiver will impact services for disadvantaged populations or individuals with multiple barriers to employment

• Out-of-school youth and in-school youth in all eligibility and barrier categories
• Priority of service adults, including veterans, low income, public assistance recipients, those who are basic skills deficient, the disabled, and other groups with barriers to employment
• Local boards seeking a stable workforce infrastructure that is poised to meet the long-term needs of their communities
• One-Stop Partners seeking to align their service delivery to youth and adults with the one-stop system and leverage resources to meet customer needs.

6. Describes the processes used to:

A. Monitor the progress in implementing the waiver;

B. Provide notice to any local board affected by the waiver;

C. Provide any local board affected by the waiver an opportunity to comment on the request;

D. Ensure meaningful public comment, including comment by business and organized labor, on the waiver.

E. Collect and report information about waiver outcomes in the State’s WIOA Annual Report.

CDLE has a long standing, comprehensive monitoring and performance accountability system that measures and evaluates results for job seekers and employers accessing Colorado’s network of One-Stop centers. On a monthly and quarterly basis, CDLE reviews and analyzes client enrollment and service levels, program expenditures, and performance outcomes. In addition, State program monitors conduct quarterly reviews designed to assure that contract requirements are being met for all WIOA programs. On an annual basis, comprehensive compliance monitoring is conducted onsite utilizing outcome reports generated from CDLE’s statewide databases. Should this waiver request be granted, CDLE will ensure regular review of WIOA programs and discretionary grants to monitor the outcomes and impacts of this waiver authority.

 CDLE will utilize the following mechanisms to track and monitor the use of waivers in each local are:

• Regional and local plans
• Workplans and quarterly goals specific to the WIOA youth and adult formula programs
• Local policies
• Activity and performance reports available through state database systems

7. The Secretary may require that States provide the most recent data available about the outcomes of the existing waiver in cases where the State seeks renewal of a previously approved waiver. 

There is no existing waiver.