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MEMO: AP 01-13

Last Updated: November 15, 2016


DATE:
  March 26, 2001

TO: WIB Directors; WIB Chairpersons; Grant Recipients

FROM: Lorna Joseph, Director of Program Support

SUBJECT: Draft WIA Incentive and Sanctions Policy

America's Workforce Network

Reference: Workforce Investment Act of 1998, Section 136; USDOL Training and Employment Guidance Letters 7-99 and 8-99.

Background: The Workforce Investment Act mandates that each local workforce investment board (WIB) in a state negotiates target performance levels on 17 core indicators of performance. The states are required to negotiate target performance levels on these same 17 core indicators with the U.S. Department of Labor. In TEGL 8-99, the U.S. Department of Labor describes the process by statesí performance will be evaluated for the purpose of determining eligibility for financial incentive awards, and for determining if a state will be sanctioned for poor performance. Each state must also develop such an incentive and sanctions framework, to determine WIB eligibility for incentives, and for determining when a WIBís performance is sanctionable.

In order to comply with federal requirements, the state Core Policy Team assigned responsibility for the development of a Connecticut Incentive and Sanctions Policy to a subcommittee consisting of staff from the Department of Labor, WIB areas, and a consultant working for the Office for Workforce Competitiveness. The result is the draft policy included here. The policy needs to be approved by the Connecticut Employment and Training Commission before it can be finalized.

  1. Sanctions. In order to determine if a WIBís performance requires sanctioning, the boardís performance on each of the 17 core indicators of performance will be compared to the negotiated level for that indicator. A WIB will be subject to sanctions if its performance falls below 80 percent of the negotiated performance level of any of the 17 core indicators of performance.
  1. Levels of Sanctioning. There will be two levels of sanction, level 1 sanctions and level 2 sanctions, based upon the degree and type of performance difficulty being experienced by a WIB that is subject to sanction.
  2.   

    Level 1 sanctions will be imposed if a WIBís performance falls below 80 percent of their negotiated target level on only one measure in one program category (other than customer satisfaction), or if the WIBís performance falls below 80 percent of their negotiated target level on only one measure in two different program categories. Level one sanctions involve the receipt of mandatory technical assistance, and the requirement for a written corrective action plan that documents how the WIB will address the performance problem.

    Level 2 sanctions will be imposed if a WIBís performance level falls below 80 percent of their negotiated target on the participant customer satisfaction level, or if a WIBís performance level falls below 80 percent of the target on more than one measure within a program category (adult, dislocated workers, or youth). Level 2 sanctions will also be imposed if a WIBís performance level falls below 80 percent of their negotiated level on three or more measures total. In the first year of sanctioning, level 2 sanctions involve the receipt of mandatory technical assistance, the requirement of a written corrective action plan, formal quarterly performance reviews, and possible state mandated corrective action.
     

  3. Second Year Process. Two years of level 2 sanctions necessitate substantive organizational change; financial penalties of up to 5 percent of the total local area allocation may be assessed. A WIB that becomes subject to level 1 sanctioning for two consecutive years would progress to level 2 sanctions in the second year.
  4.  

    B. Incentives. The initial qualifying gate for incentives is reaching 80 percent of the target level on the WIA participant customer satisfaction measure. An incentive pool will be created for each program category (adult, dislocated workers, and youth). A local area must reach at least 80 percent of the negotiated target levels on all measures in a program category and average 100 percent of the negotiated target level across all measures in a program category to be eligible for incentives in that program area. Being sanctioned in one program category does not preclude receiving incentive funds in another program category, although missing 80 percent of the target level on the participant customer satisfaction level disqualifies a WIB from any eligibility for incentives.

  1. Distribution of Incentive Funds. For each program category, WIBs that qualify for incentives will be divided into two groups: those that reached an average of 100 percent of the negotiated performance level for that program category, and those that reached an average of 110 percent of the negotiated level for that program category. As stated above, an incentive pool will be created for each program category (adult, dislocated workers, and youth). This pool will be divided into a base amount category (60 percent of the total funds available in the pool) and a proportional amount category (40 percent of the total funds available in the pool). These categories will be further subdivided into subpools for the WIBs reaching an average of 100 percent of their target performance level in that program category, and those reaching an average of 110 percent of their target performance level in that program category. Funds in the base amount pool, as subdivided above, will be divided by the number of qualifying WIBs in each subpool. Funds in the proportional amount pool as subdivided above, will be distributed to the qualifying WIBs in each subpool proportionate to the total WIA allocations of those qualifying WIBs in that subpool. Table 1 provides an example of the incentive fund distribution process for one program category (dislocated workers).
  2.  
      Table 1. Example Incentive Distribution (amounts for illustration purposes only).
     
    Total Incentive Pool (Dislocated Worker Program) $116,000       Amount Received By Each Qualifying Area
               
    Base Amount $69,000 Areas Qualifying at 110% of Target Levels $41,400 4 Areas Qualify $10,350
               
        Areas Qualifying at 100% of Target Levels $27,600 8 Areas Qualify $3,450
               
    Proportional Amount $47,000        
               
        Areas Qualifying at 110% of Target Levels $28,200 4 Areas Qualify $7,050

    (approximately, since this is proportional)

               
        Areas Qualifying at 100% of Target Levels $18,800 8 Areas Qualify $2,350

    (approximately, since this is proportional)


     

  3. Redistribution of Incentive Funds. If no local area qualifies for an incentive in a program category, the incentive funds for that program category will be reserved for innovation awards. Funds will be reserved in equal amounts for each local area. An individual area shall submit a narrative and budget for use of these funds. The funds will be awarded only if the area demonstrates the funds will be utilized for a specific innovation or program improvement, with preference given to improvement projects that focus cross-program collaboration.
    C. Adjusting for Local Conditions. There will be no adjustment of target performance levels for local conditions in the first year. In subsequent years, baseline data from the first year will be used to develop an adjustment model to take local conditions into account. This approach will be introduced during the renegotiation process at the start of the second year of full WIA implementation.

    D. Timing of Incentives and Sanctions Process. The determination that a WIB is subject to sanctions or eligible for incentives will be made approximately 6 months following the end of the WIA program year. Data examined for incentive and sanctions purposes in the first year will include data on JTPA and WIA exiters from October 1, 1999 through September 30, 2000 for wage-file based measures, and data on WIA exiters from July 1, 2000 through June 30, 2001 for non-wage file based measures. This "staggered" approach is consistent with federal reporting requirements.

We believe this policy provides for a fair and equitable process for measuring WIA board performance for the purpose(s) of both sanctions and incentives. We are requesting you review this draft and provide comments by no later than April 6, 2001.

This review does not limit your opportunity to comment as it is made available for review and approval by the CETC.

Please provide comments in writing to Stephen Litke.

Administrative Procedures Memos


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