ALC Hospital Committee: Jan. 14

Senator Jane English … be doing is looking at our social programs, as well as our workforce system. And we have invited Nick Moore, who is the assistant secretary of the Office of Career and Technical Education to speak to us today. Nick is not just a federal bureaucrat. Until recently, he was the Chief Workforce Officer for the state of Alabama. So Nick understands the state and how we operate in this at the state level. So I’m very glad to introduce him to you this afternoon, this morning. And Mr. Nick Moore, we’re so pleased to have you here. Welcome to our committee meeting. 

Workforce presentation from US Department of Education

Nick Moore Thank you, Senator. I appreciate you very much. And I’m going to share some slides here in just a second if I can get that worked out. But just to kind of level set with you and give you some ideas about where we’re coming from here, the idea of increasing the state’s labor force participation rate and really figuring out an opportunity for also increasing post-secondary attainment is what we’re all about and also getting less, I would say, sort of overhead and system out of the money and getting more dollars in the hands of states and governors so that you can do the work of connecting your state’s human resources talent development system. 

And so that we’re really thinking about workforce and education and training and human services as one integrated system. And I know that’s what y’all are talking about today. So it’s very exciting to have states like Arkansas that are taking advantage of a lot of the opportunities that we’re hoping to bring to bear through the partnership between education and the Department of Labor. Can y’all see my slides now? Perfect. 

So since September, we’ve had a group of folks that have been detailed from the Office of Career Tech and Adult Education, and that’s my office called OCTAE at the Department of Labor. And we’re implementing this partnership because, on this first slide, what I want to lead off with is that Congress aligned the Every Student Succeeds Act, Carl D. Perkins, and Workforce Innovation Opportunity Act that provides about 10% of the K-12 education and Perkins money to states. 

But these were really aligned by design to create an integrated P-20 talent system so that we’re helping students move through every stage of transition from pre-K through the workforce. But in reality, that’s not happening. There’s been a hodgepodge of federal agencies that have been set up since the New Deal and Great Society, and concurrently states have also erected their own bureaucracies.

And I’ll show you some data on my point of why we think that’s problematic, but what we want to do is work with you all to help live out a more integrated vision. And there’s a lot of people up in DC who write white papers for a living, who think that programs are only education programs or only workforce programs. And I know that the work that y’all are doing, the work we want to do with you, is proving that academic and technical skills are not mutually exclusive. The CTE programs and workforce programs are in fact just different sides of the same coin. 

And when it comes to our students, our employers, we’re serving two customers, our students and our families, but also employers. And so we can do both of those things of making sure students are living out their interests, aptitudes and aspirations, but also do it in a way that prepares them for the next phase, whether that’s continuing their education or going directly to work or entering the military. 

When we talk about WIOA, there’s really four major titles, or programmatic titles. And federally, Title I and III have always been at the Department of Labor. And Title II and IV have always been at the Department of Education. So, I and III, Wagner-Pyser, and then adult, youth, and dislocated worker with Title I, that’s been primarily what has funded the American Job Center system. And adult education now primarily has been separate, although it’s Title II of WIOA. And a lot of times these are located in high schools or community colleges. And then Title IV of voc rehab generally is in its own state agency. 

And so very soon we will have under the Department of Labor what I call the one big beautiful Department of Talent all four of these WIOA titles under the same roof federally. So we hope that that’s going to do a number of things, not least of which is for you to have fewer federal agencies to interact with when we come on site to do site visits and technical assistance, to get one integrated team when you submit a plan, whether it’s a unified or combined plan that you get feedback from one set of bureaucrats rather than getting conflicting information from two sets. 

And so we have a state plan. You know, it’s been an option since 2020 to do a combined plan. Only nine states have done it. Because heretofore, it’s been a great messaging exercise, but not so much as far as actually having an aligned timeline for the dates to submit your Perkins and WIOA plan. And then as my previous point, sometimes you’d get conflicting feedback on those plans. 

Our goal now in what we’ve done for the 2026 mod, and you’ll see in the next week or two, something we call the training employment guidance letter. It’s basically just a memo from the Department of Labor, an … that says, every two years, you got to do a modification of the four year plan. So 26 is the modification. 28 will be the next big four year plan. 

But we’re letting states know, look, we’ve unfettered a lot of the red tape that’s held you back. We’re going to be accepting plans on or before April 30, both for Perkins and WIOA. And we’re going to have an integrated, fine-tuned group of people from my office in DOL that are doing the review. So hopefully several states, maybe even Arkansas, would lean into that and decide to submit a combined plan for this year. 

And so the importance of a combined plan is, I would say, the biggest thing now will help you with the implementation of Workforce Pell. State boards and governors are going to have a bigger role in looking to your labor market information, your primary LMI from your labor agency, state workforce agency, and coming up with a methodology for in-demand jobs and then the programs that are aligned to those. 

And so the states that submit the cleanest list of programs to the Secretary of Education not only will have an easier time getting those approved, but I also think it’s going to be a point of competition among states that those that are implementing workforce Pell in a way that’s most aligned with their workforce and economic development needs. 

And so some best practices, as you’ll see in our TEGL that we’re going to be promoting this year for state plans and going forward is more of a human-centered approach. You know, people, when they walk into the one-stop or the community college, they don’t want to hear about Wagner-Peyser or they don’t want to hear about title this or that. They just want to know, how do I walk in, figure out what jobs are available, be able to assert what I know today, look at what benefit cliffs I may be facing if I’m on SNAP, TANF, Medicaid. How do I allow myself to be held harmless so that I can upskill, get the training I need, but then also have a way so that I’m not becoming worse off in real dollar terms in the short term. 

So that’s one of our big challenges in workforce development. Why states like my own in Alabama and Arkansas have had historically low labor force participation rates because the poverty trap is just so steep. Because we’ve done the right thing by not having a big bloated sort of entitlement system, but what’s tough is that when somebody begins transitioning off those sort of forms of assistance, even though that it’s not a tremendous amount of money, often those benefits taper more quickly than they can make up for that in paid employment. 

So we’re, at the federal level, trying to simplify workforce development to say, rather than have 43 federally funded programs across nine agencies, we want to do the Making America Skilled Again essentially block grant so that we’re not spreading these little jars of mayonnaise over a big old loaf of bread. The governor and the state can figure out, okay, do we need to invest more in out-of-school youth? Do we need sure up our talent pipeline in this one area? Is it in-school youth? Is an adults? Do we do two-gen approach? Do you want to invest in our data system? 

Do we want to have fewer brick-and-mortar job centers, which in Alabama what we discovered is that if you run myriad job centers, by the time you end up funding the bureaucracy and the brick and mortar for that, you don’t have much left for training. So we also want to have more of an evangelical outreach. I would say not so much in a religious sense, although that’s fine too, but to get out of our offices and to go and find people where they are. 

And so we’ll be messaging the states that you’ve got to have special populations, focused populations in your state plan, set labor force goals for each of those populations, and then let’s hold ourselves accountable on whether we’re actually hitting those, not just putting down somebody that walked in and asked for directions to the 7-Eleven. But what does the foot traffic look like? How is it meaningful? And then when it comes to the integrated case management system, y’all have got a really good head start on most states with what you’ve got with Arkansas Launch, with CB Form, with your integrated intake questions. 

So imagine a world where we get to the point somebody walks in the job center, you ask them 6 to 12 diagnostic questions, and, in that process, they could be potentially co-enrolled in SNAP, TANF, Medicaid if that’s needed, but primarily a job and training all in one setting. So that you don’t get a different outcome based on what person you’re talking to and you don’t got to go back and see Sally on Thursday because she’s only there from 2 to 4, but one person that’s cross-trained across all of those programs to do co-enrollment for all of them. 

And you’ll see more flexibility coming out from us too around things like Wagner-Peyser merit system requirements so that more people actually want to be a one-stop operator because you don’t have to operate a big merit system bureaucracy staff in order to do so. So we’d love to see more community colleges, more libraries, but, even better yet, virtual service delivery. And it’s funny how a lot of states are going to this. 

And there’s always going to be people who have the need for adaptive assistance or need help with literacy and other things. And that’s why we always require there to be one comprehensive center. But in the waiver, or the sort of set of innovations that the Department of Labor came out with in November, you can even get past that so long as you’re partnering with folks like Voc Rehab to provide that adaptive assistance. 

So no need to operate a vast comprehensive center, just to serve a handful of people. So I’ll speed it up here a little bit and just say that, read through all these because I hit on a couple of them. But a big thing is that we want to focus on a two-gen approach and connecting our sort of in-school programs. And for a long time people thought, well, we really need to focus on reserving our WIOA youth money for out of school youth. 

My take on that is, why don’t we prevent them from becoming out-of-school-youth and fish for them while they’re in the net instead of letting kids sort of aimlessly go through high school and maybe they’re not being met as far as their interests. It’s not lined up. Let’s get them the type of training, whether it’s a pre-apprenticeship, whether it’s some other form of work-based learning, and keep them connected so that they are not falling out of school and becoming not employed and not in training. 

And states can reserve a part for out-of-school youth where that’s needed. But if we do it the way with a two-gen approach, we’re going to be working with families on either side of that spectrum and over time, having many fewer out of school youth and also for people to be– not that we’re tracking people or training somebody for the sprocket factory because they live next to it, but a lot of times we find that our CTE programs that we are offering or the programs on our eligible training provider list are not connected with the labor market in regard to the way they should be. 

And so again, that’s not to say that we’re not, have some flexibility or that you have to go into this job because you live in this one place. But why would we not be doing a better job of saying, here’s the jobs that are in demand in your area, here are the programs that are available, then working with our high schools to say, look, we’re trying to make sure that we are filling this talent pipeline. But you’re running a bunch of cosmetology programs that have nothing to do really with our labor market demand. 

So when you’re using that primary LMI, you’ve got those people involved in the state board, the governor’s office is involved, the legislature is involved, it’s much harder for somebody to be a stick in the mud and preserve those programs that aren’t in demand because they see that stakeholders are really demanding that. And so just to take a little bit of this into perspective, this is WIOA nationally and the reason why we’ve got to do a better job. 

So with over a half billion dollars, we train less than 100,000 people. And very few of those were employed in the job for which they were trained the year after. And we were spending over $14,000 for these folks. And in many cases you could send somebody through a four-year university for less than that. And so what’s troubling is that if you’ve got a goal for increase in the labor force participation rate, let’s say, 1 percentage point, it would take about 3 million people nationally to do that. But only 240,000 people came out of the WIOA system. Again, less than 100,000 were actually employed in the job for which they were trained. 

So in any book you want to look at, this is a failure. And before, the previous administration liked to say, yes, WIOA can. Well, I don’t think it can if these are the results. So that’s part of what our project is here is to integrate this better with our youth-serving programs and to get so much of the overhead out of the system. And that’s what’s one of the big problems is that every bit of this is laden with bureaucracy, both at the state and the federal level, so that by the time you get down to brass tacks, we’re not spending enough of the money on training. 

And when we are spending it on training, we’re running people through ITAs with a big eligible training provider list that has programs that aren’t in demand. And we see a lot of people cycling through ITAs every six months and it’s not doing anybody any good. So this is something that we’re going to really be working with states to overcome. And we can do it, but we’ve got to make tough decisions. Not every one stop can remain open. We’re going to have to cross train people. We’re going to have to call that eligible training provider list to make sure that we’re not training people into poverty. 

And we’ve got to do more informed customer choice. And I’ll speak to that here in a minute. But the number one thing we’ve got to do is figure out who are the people that we’re really targeting. And they’re, when we’re talking about people that are not in the labor force first, you’ve got to ask, who are those that want the job and those that don’t. And when we are talking about labor force participation, we’re talking about everybody 16 and above, right? 

And so when we think about 16 and above ,there’s going to be, at the front and the back end of that population, a lot of people that are young and are in school and they’re not working for that reason. And there’s a lot of people at the more senior end of things that are retired. So not everybody that’s not in the labor force is our target. Our target is the shadow labor force. And I don’t say that in the pejorative sense. 

But shadow means that they’ve got first or last dollar problems that are preventing them from entering the labor force and persisting. Maybe they’re facing the benefit cliffs and we gotta make that more of a slope so that they’re overcoming the fact that those benefits taper off more quickly or they need training. They’re underemployed or maybe dropped out of the labor force because they can’t make enough to justify childcare costs or they don’t have access to childcare. 

So it’s a matter of training, human services and information asymmetry. And some of it, information asymmetry is where people don’t know how to articulate their skills in a way that will allow them to connect talent to opportunity. So I say that also as a plug for our new challenge that the application will go live tomorrow called Connecting Talent to Opportunity. And we’re going to be working with states to scale or launch new talent marketplaces that essentially help people take what they know and match up directly with job descriptions that employers have available. 

And Arkansas is really primed up well to be competitive for that because you do have the base of Arkansas Launch that’s going really well. So moving on a little bit here. When we figure out people that want a job and we figure out whether they’re marginally attached to the labor force or just discouraged or they really got a gap, when we narrow that down, that’s about 3 percent of the population. 

So when we’re talking about just generally nationally, about 37% of the population is not in the labor force. When you discount all the retirements and school and all this stuff, there’s really about 3 to 5% that’s our target population. But that’s a beautiful thing, because if we got 3% more in the labor force, we would be having almost 10 million more people in the labor force and working. 

And just to put that into perspective, our high water market labor force participation nationally was back at the year 2000, we were at 67%. We’re at 62%. So even if we stretched it and we got 5% more in the labor force, it’s not undoable. Because if you think about it, our economy is not less dynamic than it was in the year of 2000. It was a lot stronger. So that’s over 10 million people that would be back in the labor force. 

That would help us to close the gap on a lot of the skilled trades where we’ve got five people retiring for every two people that are entering. But to get to that point to where we are focusing in and really helping to not only get those people that are in that 3 to 5 percent of the shadow labor force into the system, but you got to help them complete and persist and actually know what happened and not just collect administrative data that goes into some black hole up here in DC and nobody sees it again. 

Or we maybe give you some report two years later that means nothing to you, because all the people that are in the report are no longer part of the equation. So this is a logic model for how when you do have that integrated case management system at point one. And we’ve got kind of the Goldilocks assessment of what you can do now, what you want to do, what is the sort of level of skills that you can connect directly with jobs that are available on two. 

When you get to three, you either get put in a job or a training program. And at four, we’re making sure that you’re ready to exit that training or become fully self-sufficient. And then the goal is that you exit with a credential and a job in the unsubsidized employment so you’re fully self sufficient. 

And this is a logic model that should take advantage of not just WIOA, but it’s SNAP and TANF programs. Everybody that is eligible for work on SNAP, TANF and Medicaid should be co-enrolled and take part of that same process because that’s where you’re going to find the lion’s share of that 3 to 5 percent of folks that are in your shadow labor force. They’re probably on one of those three programs, but they’re hung up in this poverty trap so that when they start transitioning, the money just doesn’t work for him. 

And so if you wanted to do some things quickly that would be in line with the direction we’re heading into for 26 and 28, looking at administrative costs, states have different ways of looking at it from the most complicated and sophisticated, also most effective, like a Random Moment in Time that Utah does. May not be ready for that. At least look at the cost per square foot for an employee. And what we found in Alabama is that we had some career centers to where you had too many people, too much space, in the same local area, multiple different centers. 

So whatever that looks like in a state. But generally speaking, a good rule of thumb is for the admin cost to not be more than 20%. And also, you don’t let career staff hide programmatic costs or administrative costs and program costs. If we’re paying a bureaucrat salary, that’s overhead. That’s not a program cost. Program cost, even if technically you can do that, what I think stakeholders and what governors and legislators and citizens want to know, how much is actually going to the front line? 

If we think about this in military terms, who’s in the rear with the gear versus the frontline soldiers. And in this, we would think of the training and the money that’s actually going to support citizens. That’s the actual programmatic costs. Everything on the back end, that’s support. But a lot of times in WIOA, those things get conflated. And part of it is because you’re supposed to keep your actual admin costs under 10%. So they’ve got all these different levels of sophistry that can be employed to cover those costs up.

 And it’s not to say that you want to do something to get yourself hooked up with that 10%, but just being transparent with your boards to say somebody that’s being paid to run a program is not actually part of the training. Also, in the TGLE that we put out in November through ETA, there’s better options for the state to employ a state-level infrastructure funding agreement rather than each local area in the state having to negotiate to the point of frustration to come up with a local mechanism. 

The governor could now employ a state funding mechanism so that you got one recipe for the stone soup. So that in Little Rock versus Fayetteville, you got the same level that adult ed and voc rehab and so on all contributes. And that keeps it a lot easier for laypeople and the few staff that are supporting the board to be focused on the important thing of training and policy and strategy, rather than trying to be an accountant coming up with this complicated IFA, which largely ends up just getting recycled over. 

And that’s where we end up with a lot of the substantial overhead costs coming from. Because who’s got time to sit around and read legalese and 150 page document when you shouldn’t have to be involved with it to begin with. And then, on your budget practices, I hit on some of this. But just making sure that the lay people on your board and the business people there understand transparently, what are we spending on staff? What are we spending on leases, equipment, copiers, materials, program expenses, training costs? 

In most places, and maybe y’all are an outlier, I don’t know, but just about ubiquitously, a lot of these things get covered up by the program staff so that they’re not transparent. And it’s very hard for the local board or the state board to make decisions about what we need to cut, what we need to add up if it’s about as clear as mud. And so just requiring that transparent budgeting process. 

And you may have to go back and send that steak back 10 times before they get it to the right temperature. And I would just stay on them until they make it transparent like you need it to be. And the same thing goes with systems integration and data sharing. It’s not just the one stop, but y’all have got a great data system and a great CIO with Robert McGough. And so we’re a lot further along. 

But you’ve got to have your administrative data from those human service programs as well to get a full picture of what somebody’s pathway to self-sufficiency is. That can be tough, but it can be done. And having a talent marketplace where people can individually advocate for themselves through open data where they can curate a resume and directly match up with a virtual job description. That’s going to really help people make that leap into the labor force and persist. 

Then there’s a lot of underutilized programs that are out there like the Workforce Opportunity Tax Credit. The Federal Bonding Program sometimes is sort of ensconced in a state workforce agency. Just a few companies are using it. But the Workforce opportunity tax credit, anybody that basically is low income, the employer can get a tax credit for employing them for doing so. And federal bonding program, if, let’s say, somebody’s coming out of prison or justice involved, maybe the employer feels like they’re high risk, they can be bonded for very cheap. It’s like $100, I think, for several thousand dollars in bonding. And this is widely underutilized. 

And it’s something that we can just elevate to our employers and make sure that they’re able to take more advantage of it. It’s not going to work for everybody, but it’s a good option for some. And then particularly now that Workforce Pell is coming out, having a very clear process for calling balls and strikes on your ETPL and other non-degree credentials, making sure that we’re looking at short-term credentials as a bundle or a wrapper for a set of competencies that’s then connected to a job is key. 

And so that if we’re training somebody with a welding program or a commercial truck driver program, a CNA program, we need to be able to take the course outcomes of that course, if it’s at a Community college, and then map that to the job and the credential so that somebody can do the validation at the individual level and also at the system level. We’ve got to know the actual skills that are being trained. That will also help you to make sure that we’re not paying different amounts willy nilly for the same program. 

Nursing is one where there could be a vast spectrum of costs associated with the program, really for no need other than it’s just that this provider gets away with charging more than the other one. And career connected learning is really important, will become even more important. States that are not office of apprenticeship states– or excuse me, state apprenticeship agencies that are using the federal OA, now’s a good time to take a look at whether you want to have more of a role in managing apprenticeship at your state level. 

Speaking for myself in the state of Alabama, we were very pleased with the process we were able to make with expanding apprenticeships after we set up a state apprenticeship agency because we were kind of in control of our own destiny rather than using one federal Office of Apprenticeship official who was covering multiple states and kind of registering. We had an apprenticeship program in Birmingham, South Carolina, obviously, which doesn’t exist, but they use these collective bargaining agreements and various contracts, multiple multi-state employer things to juice up the data. 

So if you actually want to know what is going on in your state, having control of that yourself is a great way to do it. Also, you can put a better spectrum of work-based learning together that begins with job shadowing, internships, pre-apprenticeships that culminates in registered apprenticeship, and other high quality employer based training programs that maybe the employer chose not to register it, but it’s still a really good high quality program. 

Sectoral partnerships are a great way too, with a system of actually making sure that it’s employers and not just people like me sitting in a room saying, here’s our list of in-demand jobs. But once you come up with a process, what your criteria are, arranging employers and the best practice would be to have the governor or the legislature to appoint them and have an iterative cycle of activities where they vet your regional and in-domain jobs, they look at your credentials of value criteria. 

There’s no better validation on whether a program is in demand than the fact that an employer is actually hiring people that has completed that program. And so their experience there is key. But it’s also easy to waste their time and wear them out if we’re just calling them in for a one-day rubber chicken dinner type thing and some consultant writes a report. So if you’re going to convene them, you’ve got to do that in a way that really takes advantage of their expertise and they see a clear value add. 

And there’s nothing wrong with just calling out the bottom line. I mean, you’re there to help save them time and money. And if we’re not doing that, then we’re really not connecting the way we should.

 And cross training, I can’t stress this enough that it’s a best practice, particularly now, to get your WIOA Title I and III and anyone else that’s in that career center cross-trained. And whether it’s somebody that is being paid out of Wagner-Peyser, adult ed, or whatever the partner is, they ought to know how to do the intake process and arrive at the same outcome for anybody that walks in front of them and not just program specific. Because again, going back to the beginning, if I’m a citizen walking in and I don’t know whether I’m going to have something to eat tomorrow, the last thing I want to know is somebody’s alphabet soup for programs and have to go to be ferried around to multiple physical locations because this one group can’t get me all the way there. 

And then there’s nothing wrong with adding additional performance and accountability metrics outside of the six core performance indicators. A lot of our federal performance indicators are the result of years of compromise, kicking the can down the road. Doesn’t tell you much meaningful because we’re talking about things like quarterly wages. Well, if you ask somebody how much they make, they’re going to either tell you an hourly figure or an annual figure. I’ve never had anybody tell me how much they made in terms of quarterly wages. 

And we also have an issue because the WIOA performance metrics are over-engineered. We’re 11 years removed from WIOA being passed and reauthorized, but it’s still not fully implemented because the statistical adjustment model for measurable skill gain isn’t statistically valid yet. And so, if you really want to look at things that matter, you could look at increases in the labor force participation rate, cost for successful training, looking at the number of the percentage of funds expended for job-related skills development, retention with the same employer. 

So those are just things that you can do. Now, the feds won’t let you hold your grantees accountable, as far as sanctions for it. But let’s be honest. Nobody really lost any money for failure to perform on WIOA at the federal level, either. But at least it gives you the kind of bully pulpit and a little bit of naming and shaming that if you’re not seeing any results, you’ve got these other measures to point to. 

So just a couple more, and we’ll conclude here, is that we really need to increase the training related employment rate. Nationally, if only about half of the people that complete a WIOA program are in a job for which they were trained, that’s not good. I mean, if that was a charity at the end of the year and it said, well, you know, 10 cents on the dollar goes to actually saving the whales and so on, you wouldn’t give them any money. And that’s part of the problem Congress has with WIOA. It’s a low investment, low outcome equilibrium trap. 

So the lot of states like Alabama, like Arkansas, have seen their Title I allocation diminish. But the results are also bad, too. That’s nationally. Not pointing finger at Arkansas or Alabama or anybody else. It’s just that there’s nobody other than us through this partnership with DOL and y’all as state leaders who are going to make that change. It largely won’t be the career staff at these agencies at the state or federal level. 

So we got to push it and make the point that we’re either going to get these programs reforming in the way they need to or Congress may just get rid of them. And that may be positive too. But the status quo is untenable. And so stronger connection between state agencies, that’s where the legislature and the governor can come in. 

What I recognize both in the current role and when I was in the state is there’s an A Team of the people that have been appointed. They’ve got a short time horizon to get some big things done. Then there’s the B Team of I’m going to be here after you’re gone. And so the motivation of a lot of those folks is to just sort of hem haw around, wait you out, slow things down, smile and act like we’re moving dilatory tactics. It’s not always that way, but you’ve got to have a strong sense of when that’s happening to sort of push it forward. 

And messaging and just the EO or having a press conference, that’s not enough. The only way it really happens is when you get tactical and you come up with an operational plan with timelines and really holding somebody accountable to be the quarterback. It’s not just somebody that goes out and attends events and cuts ribbons, but somebody who knows the minutia of how to get these things done. 

And not only that, but knows who– they may not have to be the one that does everything, but they’re responsible for getting it done. And that person has to be held accountable. And they got to share the time horizon with the governor and the legislature. Shared case management system. A lot of these off-the-shelf solutions were built 25 years ago on a sort of waning tech stack and the people who operate these things have no incentive to modernize it. 

So it’s a good time to, if you’re been, I don’t know who your case management provider is, and so I’ll be careful too not to impugn anybody because they get mad about that. But if it’s not meeting your needs, it’s probably because it’s designed to and it probably won’t. Because nationally, these people know that in 10 years, AI and a lot of these alternative sort of customized off the shelf programs are going to upset the current market. And they’re just going to squeeze whatever juice is left in it. 

So I’ll close with this. And this one, I think, is the most important, is ending unrestricted customer choice. WIOA and the public workforce system is about employment. There is consumer choice in the law. But there’s a deficit in growth-based thinking. A lot of times, people that are operating the front line and the job center, they feel like, Oh, well, if I give people too much information about their benefit cliff, they may decide not to go forward. Or if I don’t let them choose the first job they walked in telling me they want to get into, they may just walk out. 

Well, guess what? It’s gotta be informed customer choice. We want people to know, what’s your pathway to overcome benefit cliffs. And what job or job should you choose based on your current skillset, what training may be available to fill that gap in? But there’s always been two ways to go in the world, people that thought you win by holding information back and people that think you win by adding more. 

And I would say that when you look at the ledger, usually people that err towards that growth-based rather than deficit-based mindset end up further along and have a longer track record of success. You may be able to hold things back for a moment in time, but that doesn’t work long term because somebody else will be doing those things. 

So that’s kind of where I’ll turn it back over to you, Senator. And I’ll just say we really look forward to Arkansas being one of those key partners as we know that Governor Huckabee Sanders, your legislature have been leaders in this. So I’m largely just recapitulating some things that y’all have already been doing. It’s not the same in every state. 

And I don’t just say that to patronize you, but y’all are much further along and certainly very closely aligned with the president and both Secretary McMahon and Secretary of Labor’s vision for how we can improve the system. And ultimately, it’s about getting more Americans in the workforce so that we can maintain our economic competitive advantage. And this is about national security. 

The People’s Republic of China is not slowing down. And certainly if you’ve got a top down communist state, you can do some things on dime that we can’t and don’t want to do. But we cannot slow down on integrating our workforce and talent system. Because if we do, there are those there that are waiting to take advantage of that and create problems for us. So this is important in many different ways and would love now to have a conversation with you or answer any questions. 

Senator Jane English We do have some questions in here. This has been very informative for all of us. Representative Beck, did you have a question? 

Representative Rick Beck Yes ma’am. So, okay, Mike, can you hear me? Okay, good, there’s a few questions that I have, but I’ll start out with one. A lot of times when we get hung up on programs like this, you kind of hit two topics. One was flexibility and one was accountability for the programs. 

And those two are not opposite of each other, but they certainly aren’t on the same end of the fields. I mean, sometimes accountability reduces your flexibility and vice versa. So my question was this. There’s some federal programs, federal guidelines that we go by. And I understand that you’re asking for a state plan here. 

But the guidelines from the federal are so restrictive that we really can’t incorporate accountability at the state level. It’s more at the federal level. And then without accountability, we can’t really guide the program where we need. So I’d ask you to, can you embellish that just a little?  

Nick Moore Yes, sir. So, and tell me if I’m saying this back, but you’re saying that basically the confluence of all the rules of the individual programs that you’re getting from the feds make it tough to add any additional level of accountability when you add those up. And I agree with you. I mean, that’s a big problem. That’s a different tactic that we’re taking. And that’s why we put that flexibility memo out. 

But I’ll say this, if y’all want to do something and it involves one of our programs and you face frustration, we want to help you get to yes and give you a clear answer. So my goal is to get to a yes or no and not to play a game of cat and mouse where you gotta deal with 10 lawyers from the Department of Labor and they’ll give you some sort of coy answer. And if it can’t be done, we’ll just say, well, it can be done for this reason and here are the members of Congress to talk to you about it. 

But in most cases, if we can’t get you all the way there, we’ll at least make some progress towards it. And that’s something that frustrated me at the state level, like when we set up a state apprenticeship agency. And we talked with these folks to say, What do I gotta do, X, Y, and Z to make it happen? And you got a different answer from different people. So that’s a huge problem that we want to lean into, not only with this modification process, but with the four year plan. 

And we want states to think about levels of not just accountability, but new ways of thinking about program administration, the actual way that you’re implementing the program. So if you have faced that inertia before, I would just ask you to try again with us and see if you might not get a different answer. 

Representative Rick Beck Thank you. Another question? The other thing that kept coming up in my mind was the role of post secondary education versus the employers. I mean, obviously we want the employers there because they’re the ones that are going to hire these individuals eventually get them to sustainable employment. 

So that’s one aspect of it. But almost on the other side of that would be the employers sort of looking at people for the skills they need right now versus looking forward maybe to the AI initiative. What I’m saying is their guidelines, employers might give us guidelines that are meeting the needs of today versus meeting needs of two or three years from now or five years from now. 

Nick Moore Yeah, that’s right. I mean, the system we’re talking about here ought to be about putting somebody in a job so that they can get a better job and then get a career. And so a lot of times there has been a confusion about trying to make the public workforce system just another education program. Now WIOA is not the Pell Grant program. WIOA is not a student loan program. 

And for a long time, there’s been institutions that have used WIOA as kind of a honey pot and you just put all these different programs on the ETPL. So that’s one thing you can do, is just make sure that the programs that we’re using for WIOA Title 1 are actually aligned with your list of in demand jobs. And then beyond that, you can do more pay for performance contracts. 

You could get an employer that’s doing more of their own training and be partially reimbursed with that. There’s also more cohort level training that can be done. So ITAs and these kind of ITA vouchers are not the only way we can train people. 

And there’s a lot more that can be done to grade funding for things like the SNAP and TANF training programs, like SNAP P&T generates a 50 percent reimbursement for every SNAP eligible that’s trained. That could be used to endow the corpus of a fund that could, say, support childcare, housing, and other things those people may need as they’re coming off the program. 

Senator Jane English Representative Ladyman.

Representative Jack Ladyman Thank you, madam chair. Well, thank you for presenting this. It’s a lot of good information. A lot of it is above my head. I don’t understand some of the programs you’re talking about here. But you talked about being more efficient in training centers. You know, maybe the output is not worth the effort, the money that’s put in. But when I think about that, I think, we talk about food deserts here in Arkansas. I think probably Alabama may be similar to us, but I think we have training deserts. That’s what I like to call it. 

Arkansas is very rural like Alabama is. 75% of our cities have a population of less than 2,000 people. So we have a lot of cities in the Delta and in South Arkansas that have 2,000 people. They have no opportunities, and they’re 30 to 50 miles from a training center. I think we need to take the training to them. We need to have traveling teachers rather than traveling students because they may not have the ability to travel. 

And I think there should be a program like that where we target. Because what comes first, the jobs or the training? I’ve been involved in siding factories. So if you go into an area, the trained people have to be there already or you won’t go there. So can we train them before the jobs come there? Can you talk about that a little bit? Or is Alabama doing anything like that in training deserts or anybody else? 

Nick Moore Yeah, no, it’s rural. So I’ll begin by just directly answering the question. I think one-stop centers are best when they’re co-located where training happens, whether that’s on a high school, community college campus. But for most of these brick and mortar one stop centers, they mainly just operate like a DMV to where they’re taking somebody through an enrollment process. They’re not actually doing any of the training, and that all happens at another site. There is a lot more that we can do with integrating these in the community college and others. 

But I think what you mentioned about virtual service delivery is important, too, or mobile sites. I mean, that’s one thing we invested in and continue to do that and it’s building up now. Mobile career centers that also have career exploration through virtual reality integrated in there and you can share that between high school and adults, and that really helps promote the two-gen strategy. 

So you can have career fairs, job fairs, employers on-site and talk about opportunities. But what you mentioned about trying to get that to folks that they’re not having to travel 30 or 40 miles, because in a lot of times it just won’t happen. I mean, people, until you get them there and get them hooked and connected with the why, they’re just not going to spend limited resources spending the little gas they’ve got to drive to some building they don’t even know why they’re going there. So that’s a huge point. 

Senator Jane English Do we have some other questions? Representative Bentley. 

Representative Mary Bentley Thank you, Mr. Moore, for being here today. It’s really exciting to hear the things that are happening on the federal level to make us much more effective here in Arkansas. So am I hearing from you that we are going to be able to combine some of these titles together and make the requirements the same if we come with a statewide waiver?

 Is that what I’m hearing from you, that guys are willing for us to work with some of those titles to make the requirements the same so that people can get those benefits in a different manner than they are now? 

Nick Moore Basically, the ultimate goal, which has not happened yet because it takes Congress to act on this, is essentially block grant every one of these programs into one pot of money that we give to the governor, who then works with you all to determine what agency needs to hold it and what you’re going to do with it, unfettered with all of the trappings of reporting and conditions. 

Until we get there, we’re going to think innovatively. And so take a look at TEGL training, employment guidance, guidance letter 525. And that has a list of existing state waivers, as well as some ideas of others you can take advantage of. And not everyone of them will work for every state. 

But if you, like I mentioned to the other gentleman earlier, if you’ve got an idea that’s been untested, pitch it at us. We want to look at it with you and try to you there. But certainly, streamlining some of the reporting and data collection, those are some things we’re working through as well. 

Representative Mary Bentley Thank you. 

Senator Jane English I think for so many of the programs, and that may be what Mary’s alluding to, but they have different requirements and different eligibility requirements. And I think that’s sometimes that for some of our social programs and also for our workforce programs. So are you really saying that we could apply for a waiver for some of these programs for them as the eligibilities? 

Nick Moore Waivers will help in some cases. And two other things I’d recommend you doing is try to– and this is not easy. I’m well aware of that because I’ve faced it myself. There’s no reason to house all these programs in separate state agencies. It’s better off where they’re under one cabinet secretary that is on the same time horizon with the governor, who can be held accountable with the governor, to the people and the Legislature. 

And at the point of intake, and it can be done through technology– and if you haven’t talked with Robert McGough yet, he can explain to you about their integrated decision tree. But even though some of these programs have different rules, you can ask people a set of 6 to 12 common questions when they walk in the door. And based on their responses, you can determine which programs they can be co-enrolled in so that person doesn’t have to fill out five different forms then. 

And it just works based on the technology and the algorithm that is behind that. And I know he’s worked with Google, he’s worked with the private sector to develop that. And that is a best practice. So that if I’m Joe Smith and I walk in the career center, I tell you where I currently work or if I am not working, what assistance I’m getting or not getting, how many kids I have or don’t have, where I live, what I want to do. 

And based on those answers, you tell me what I qualify for at that one point. And so if you can do those things, look at the waivers, look at trying to integrate some of your state agencies where you can, and then adopt that common intake process, I think that’s kind of the tripartite recipe for integrating the programs. 

Senator Jane English Thank you. I think that’s kind of what we’re looking at. Senator Irvin. 

Senator Missy Irvin Thank you. Correct me if I’m wrong, but it’s my understanding that there were federal funds paid for a technology or creation of a system describing that in a different state, then we would be able to utilize that program. Do you know of a state that has done that using federal dollars, as it relates to workforce? 

And I’m thinking of the state of Mississippi, because I know they’ve done a lot of work in this space with technology so that they can identify in real time online where people that have a certain skill set reside in an area. I’m fairly confident that’s how they were able to win an automobile manufacturing facility into their state. 

So are you aware of that system in Mississippi and or any other states that have done that, number one? And number two, are you aware if they utilized any federal funding for that system? 

Nick Moore So on the last part first, I think there’s some nuance on that. Just because somebody uses federal dollars for a project in their state doesn’t necessarily make it like a public utility that’s just free use to the whole country. They certainly could offer it up to be used. Most instances, it’s not always just going to be federal funds. Sometimes they’re using state longitudinal data system or workforce data quality initiative funds. 

But in many cases, states are open to interoperating because they are political boundaries, commuting patterns that respect political boundaries. So you’ve got people that are living in one state and crossing over to work another. I’ll tell you what I would do, and I know Robert in the data office has done a lot of this, you need a state longitudinal data system to where you don’t have to use fuzzy and bridge matching to where can take student records, K-12, post-secondary, and then workforce records, not so that you have some permanent record and this all becomes de-identified and anonymized. 

But the sort of linchpin in all that is modernizing and updating your UI wage records. And I know politically that can be tough because usually the NFIB affiliate gets upset with you and talks about what a burden that is on small businesses. But there’s a way to make it to where there’s very little or anything that the business has to do. They’re all using payroll vendors anyway. All we want to do is add the job location, the name of the occupation down to a six digit zip code and the wage. 

And that would give you enough information to mention what you said, senator, being able to get down and say, okay, we’ve got these needs. These are how many people are in this area that are trained or on the pathway to being trained to fit that job. And then you can start employing that for economic development purposes. A lot of states are still using these proprietary, Light Cast or Burning Glass Institute. 

Secondary LMI is not bad, but nothing is better than your primary LMI. And it’s basically impossible to get anything out of that until you can enhance your UI wage record because the competence interval in those matches is just too low without it. 

Senator Missy Irvin Are you aware of the system that Mississippi developed with Mississippi State? 

Nick Moore Yes, we actually took Mississippi Spark. We went out there and took a look at that. They still haven’t enhanced their wage records in Mississippi, as far as I know, unless it’s happened since I kind of quit paying so much attention to each individual state legislative activity. They may have. 

But until they do that, they’re still going to have the same limitation, even though they’ve got a education based longitudinal data system. And they’ve got some of their human service system so they can generate a lot of good reports and get some of the outcomes. But if you want to get to that level of economic modeling you’re talking about, the wage record still needs to be enhanced. 

Senator Missy Irvin Okay, okay. So it’s a good start, but it needs to be built upon, a foundation that probably just needs to then continue to be built upon. 

Nick Moore Yes, ma’am. And I would argue that there’s probably not much that Mississippi Spark can do that Robert currently can’t do. He just needs those enhanced wage records. 

Senator Missy Irvin Well, I know that we had worked with this. Representative Deborah Ferguson and I had worked on this with our state agency here. So I know they implemented a lot and looked through that. So I just wanted to get your take on it. Thank you. 

Nick Moore Yes, ma’am. Thank you. 

Senator Missy Irvin Representative Brown.

Representative Karilyn Brown Am I on? Thank you. Secretary Moore, thank you very much for this report and for being here today. You mentioned earlier something about the reticence maybe of some administrative type people not being very cooperative with the new theory and practice, like their theory doesn’t help with the practice. 

And that has been my experience in another organization I was involved with. So did you find that at times if you could not get these people to enthusiastically cross train and share that information with the people they were over, did you have to move them to another department or ask them to find a new career? 

Nick Moore We did, and I’ll tell you that. If we had the flexibility like y’all are about to have in the next couple of months with the merit system flexibility, we would have taken everybody that works in the career centers outside of the merit system, put them on performance based contracts, and they basically are eat what they kill and they get rewarded based on how effective they are. This sort of malicious compliance, I think, is endemic in most bureaucracies. 

And it’s just more acute in what we’re talking about because the bottom line is when there’s that level of information asymmetry, if past is prologue, the permanent bureaucracy sees a revolving door of political staff come in. Most of the political staff really don’t know what they’re doing or don’t have a full handle on the programs they’re administering. So it’s easy to kind of just mark time and you’re not adding any new work to yourself. But who suffers out of that is the people that we’re trying to serve. 

So I think it’s critical for these decisions to be made, not about the feelings of whether it’s some high ranking person in the governor’s cabinet or whether it’s somebody working in a career center, you gotta have a posture that’s effective. And that can only happen when you get the governor, the legislature, and the business community, not only swimming in the same stream, but actually making the tough decisions. It’s easy to do the press release or the kind of messaging stuff or set up an office or something. 

But to go in there and really move stuff around and do what you got to do, that’s tough. Those are the thankless things. But ultimately those are things that are going to make or break whether this sticks or not. 

Senator Jane English Representative Beck.

Representative Rick Beck Thank you, Madam Chair. Thanks, Secretary Moore. I really like this program. I like the approach of it. You might be surprised to learn that this very committee has talked about some things that we were trying to do and they hit on some of your points. One of the ones is this sort of, I’m going to call it– we call it a one-stop shop, right? You show up and you don’t have to be an expert on the system as an individual. One person’s going to get you to where you need to be and get you the help that you need. So that’s very positive. 

But it’s also positive, I think, in another way, in holding administrative costs down. Because so many times we get these individuals, the individual agency might be charging 10% or 15% administrative costs. But when you get four agencies doing that, before you know it, your money’s gone or at least a large portion of your money is gone. So I applaud those efforts. The concern I have is that I think this program is going to have to give the states a lot of flexibility. 

I like almost everything you said except for one thing. You said there’s one recipe for the stone soup. And I thought, well, you know, I don’t know about that. There’s going to be a lot of different people are going to approach from a lot different matters. So that recipe is going to change. 

But if we have the flexibility in our plan to do that, I think we can do that. The point of trying to needle at the flexibility is I think Arkansas is working, as you mentioned, we’ve started working on a lot of this stuff. I think this committee has started already gathering data related to some of the things that you’re asking us to do now. 

And I just want to make sure that there aren’t any catches as far as, don’t do this, as far as our state plan is concerned. And the reason for that is, I’ve seen this where a program is put together and we’ve got to go back and forth several times before we can get the federal and the state to agree in alignment. 

So I’m asking you, are there things that are just, don’t touch that type deals in any state plan that we would develop versus– I think I got what you’re wanting. But i’m asking, are there any places where we don’t– any things we shouldn’t be touching in the plan? Thank you. 

Nick Moore I don’t think any area is out of bounds entirely, but I’ll say if you look at that TEGL I referenced, 525, it mentions the criteria in WIOA that the secretary just doesn’t have the authority to waive. A lot of that is on annual reporting requirements, on the eligibility categories, not so much on the policy stuff. 

And I’ll clarify to say there’s no national recipe for the stone soup. What I meant by that is under current law, let’s say if you’ve got 10 local areas, 10 regional boards, every one of them are required to come up with their own recipe for stone soup without you and the governor being able to set one for the state. And you may not want to. You may as a state want to say, well, we want every local area to have to go through this process. 

But if you wanted to, under this waiver or under these flexibilities, you and the governor can say, we’ve been doing this long enough to know that adult ed ought to contribute 10%, that we’re going to make this sort of required square foot or per employee. And then the local board, rather than having to do all this accounting stuff, spends more their time on the policy and the service provision. But we at the federal level are not going to mandate that the state has one recipe for the stone soup, just giving you the option. 

Senator Jane English Representative Garner

Representative Denise Garner Thank you, Madam Chair. I just want to ask a little bit more about some of the integration issues. And I agree with you, I love this program. I love the flexibility. I love the accountability. I’m worried a little about– and I’m coming from a medical and nonprofit background. So I’m a little worried about where the client comes, who’s navigating the system for the client. If we can get all of this information integrated, then are you seeing the Department of Labor? Who is actually managing the client? 

Nick Moore The Title I and III staff that are currently running your one-stop centers. And so, it’s going to be a combination between the human element, which is always key for somebody to be there one-on-one coaching. But then also making the technology system to where it’s not just a guess game to where you’re not just saying, well, this person looks like they’d be a good fit for this job. 

And that’s kind of how it happens, if we’re being too honest with ourselves now, is that we get some of these kind of my next move or that kind of thing, career navigation thing. And we just look and say, well, what do you want to do? And we pop somebody into an ITA or we just look at the jobs that are there. 

So it’s a little bit between the training the folks in the center, and then again, making them not be about one program, about all the programs, and then using the technology so that we’re not having to do that in an analog process. 

Representative Denise Garner Great, thank you very much. 

Senator Jane English Do I see further questions? Mary, do you have anything?

Representative Mary Bentley  I just want to, again, thank you so much for giving us your time today. We’re a committee that’s knee deep in making sure we get something good for workforce moving forward and get our workforce participation rate the highest we’ve ever had it. That’s our goal here in this state. 

This gets the people that are trapped in poverty out and you’ve just given us great incentive here today. It’s glad to know that we have some partners at the federal level instead of those trying to put the brakes on what we’re doing. So thank you again so much for your time, and the information you’ve given us today is very, very valuable. Definitely get back to you. Thank you so much for being with us today. 

Nick Moore Thank each of you and thank you for your leadership. And an honor to partner with you. And President Trump wants us to feed the lead dogs, and y’all are certainly a lead dog. And so we want to do everything we can to support you and get you as far along as we can. Absolutely. 

Senator Jane English It’s something that people in their minds have been thinking about for a long time or questioning why we aren’t doing something different. So we’re looking forward to working with you and we appreciate your spending the time with us. Thank you very much. And so far we are– oh, we’ve got one other thing to take care of here. 

Thank you very much, Nick. Appreciate it. Okay. Let me see. We have our update of our reimbursement rates that we need to be presented. Is somebody here from DHS? Oh, good. Okay. Thank you. If you’d come to the end of the table, appreciate it. If you’d identify yourselves, you’ll be recognized. 

Janet Mann Good morning. Janet Mann, DHS Secretary. 

Jay Hill Good morning. Jay Hill, Director for Aging and Adult Behavior Health Services with DHS. 

Senator Jane English Thank you, go ahead. 

Living Choices Waiver rates

Janet Mann Yes, ma’am. Thank you very much. Just a quick update. The letter is before y’all that we are still working through the process. Last month’s meeting, we had indicated that we had over 100 public comments. We have compiled those and have answered those and they’re on our public website. 

We have sent a recommendation to the governor’s office to continue holding the current rate. So that’s what we’re waiting on to go through executive decision-making before we will close that out. And then also I asked Director Hill to attend this morning also because it’s January. So now we’re starting our cost reporting process over again. And I didn’t know if you would have any questions about that. 

Senator Jane English Are there any questions?

Representative Mary Bentley  Just real quick, I’ve got a question. What’s our timeline? You said we’re doing it through executive review. Can you give us a timeline on what that looks like, Secretary Mann? 

Janet Mann I can give you an estimated timeline. It always depends on the review process and the question and answers that we get back. Usually it takes 30 to 60 days, depending on if they have any questions. Since we had over 100 public comments, we included those public comments with our package to the Governor’s office. So I do anticipate questions. 

Senator Jane English Thank you, Senator Irvin.

Senator Missy Irvin  Thank you. Just a quick question. The legislation that was passed that requires this monthly verbal and written report, was it specific to the subcommittee or to Public Health Committee? 

Janet Mann I believe it began as legislation to ALC and then was moved to the subcommittee. But I’m more than happy to go back and look at it because I don’t know definitively now that you asked. 

Senator Missy Irvin Yeah, no, if you don’t mind. Yeah, I just wanted to look at that. Thank you. 

Senator Jane English Are there any further questions? So thank you very much. So we are about to adjourn. But this afternoon at 1 o’clock we have our report from our consulting company who did the audit of our programs here in the state. And I think you’re going to find that very interesting. So that’s going to be at 1 o’clock over in the Big Mac building. So we are adjourned.