Provisions of the Prospective Applicant Conference: Unemployment Insurance Reemployment Demonstration Projects April 27, 2012

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Access to Webinar Resources Recordings and transcripts are available within 2 business days after the event. Access to Webinar Resources

Featured Speakers Presenters Gay Gilbert, Administrator, Office of Unemployment Insurance (OUI) Suzanne Simonetta, Chief, Division of Legislation, OUI Mike Miller, Lead Actuary, Division of Fiscal and Actuarial Services, OUI Scott Gibbons, Reports Lead, Division of Fiscal and Actuarial Services, OUI Jonathan Simonetta, Deputy Chief Evaluation Officer, Office of the Assistant Secretary for Policy

Purpose of Today’s Webinar Objective Purpose of Today’s Webinar To provide information about the Reemployment Demonstration Projects Authorized by the Middle Class Tax Relief and Job Creation Act (P.L. 112-96)

Overview of the statutory requirements in P.L. 112-96. Agenda Overview of the statutory requirements in P.L. 112-96. Discussion of key elements of Unemployment Insurance Program Letter (UIPL) 15-12. Application process for approval of a demonstration project.

Statutory Requirements Section 2102 of P.L. 112-96 permits the Secretary of Labor to enter into agreements with up to 10 states to conduct innovative reemployment demonstration projects designed to: Test and evaluate measures designed to expedite the reemployment of recipients of state unemployment compensation; or Improve the effectiveness of a state in carrying out its state law with respect to reemployment.

Statutory Requirements Demonstration projects are limited to two specific types of activities: Subsidies for employer-provided training, such as wage subsidies; or Direct disbursements to certain employers who hire individuals receiving unemployment compensation.

Statutory Requirements Demonstration projects must operate for a period of at least one calendar year but no more than three years, and must end no later than December 31, 2015. States are permitted to use UI administrative grant funds to implement a demonstration project. DOL has no additional funds available to support the demonstrations. States are required to meet reporting requirements prescribed by the Secretary of Labor.

Statutory Requirements States may request a waiver of the following provisions in Federal unemployment insurance law: Section 3304(a)(4) of the Federal Unemployment Tax Act and section 303(a)(5) of the Social Security Act (SSA), which provide that states may only withdraw funds from their state’s account in the UTF to pay unemployment compensation (UC)

Statutory Requirements Section 303(a)(1), SSA, which requires state law to provide for such “methods of administration” as are reasonably calculated to ensure full payment of UC “when due”, which includes merit staffing. States must have authority under their state law to conduct the demonstration project and must demonstrate it in their application. The waiver authority under state law may only apply to the demonstration project.

Statutory Requirements States must assure that project participants’ employment meets: The state’s suitable work requirements Federal labor standards defined in 3304(a)(5), FUTA The Fair Labor Standards Act

Statutory Requirements A demonstration project may not result “in any increased net costs” to the state’s account in the Unemployment Trust Fund (UTF). States are required to conduct an impact evaluation of the demonstration project using an appropriate methodology to determine the effects of the project, including on individual skill levels, earnings, and employment retention.

Statutory Requirements States must submit applications to the Secretary of Labor. The Secretary must inform the state if the application is approved or denied within 30 days of receipt of a complete application.

Secretary’s Priorities The Secretary’s priorities for demonstration projects include: Demonstration designs leading to permanent employment in good jobs for claimant participants who volunteer to participate Open and inclusive stakeholder outreach in planning the project-including discussions on the impact to the trust fund Use of existing infrastructure to implement the demonstration project

Secretary’s Priorities Fair and impartial treatment for claimants Employer engagement during the course of the project Employers participation conditioned on the viability of the employer’s business Ongoing monitoring and audits of the project are supported by access to employer records

Secretary’s Priorities Other elements that might contribute to a better national understanding of effective reemployment models: A variety of approaches across the projects State diversity (e.g. geography and size) Populations served

Trust Fund Impact Requirements Assurances that the project will not result in any increased net costs to the state’s account in the UTF over the period of the project which includes: The state’s analysis for the assertion Description of the mechanism for continuous review of the trust fund status The process the state will use if actual experience indicates a potential net cost will occur

Trust Fund Impact Analysis Project trust fund balance – with and without demonstration project – recommend quarterly NOTE: States with approved demos will provide actual data to determine actual impact No net cost = no decrease in TF balance for period of demonstration project and some reasonable time for further impacts Demo costs can be offset by benefit savings (reduced duration) or increased UI taxes (due to accelerated participant reemployment and/or automatic tax adjustments)

Trust Fund Impact Analysis Cost estimates based on target group Estimates must be well-justified Potential impact on state ability to qualify for FUTA credit reduction avoidance/cap

Reporting Requirements Application must describe approaches and methods to be used to assess the effect of the demonstration project on: Individual skill levels Earnings Employment retention The Department will work with each state approved for a demonstration project to individualize the reporting requirements, monitoring, or other element of the agreement

Reporting & Evaluation Data Exact reporting requirements will vary depending on project States have flexibility in how they generate the data Applications should describe how state will meet the two reporting elements: quarterly monitoring and evaluation Attachment 1 - Demonstration Quarterly Report Requirements Quarterly submittal to DOL through regional office States must provide all available data and a narrative of activities States must also include any data specified in agreement Attachment 2 - Collection of Individual Data Elements Used in state and Federal evaluation of program Participant data and outcome data is required State should adapt service delivery information to demonstration design

State Evaluation Evaluation of impact of demonstration project required by statute Preference given to applications with most rigorous approach to determining impact and unbiased estimate of impact on the trust fund Random assignment in the proposal is highly preferred. Quasi-experimental (QE) and regression discontinuity (RD) design will be considered.

State Evaluation Applications should include a description how the impact evaluation will be conducted: Who will conduct the evaluation If a contractor will do the evaluation, how the contractor will be selected A detailed description of the methodology and design of the evaluation Data the state will collect as part of the project to support the evaluation—including proposed metrics for measuring success Source of funding and anticipated cost

Evaluation Methodology Evaluation methodology should include: Universe of individuals in demonstration project Number of individuals to be served (treatment and control) Participant flow from intake to exit with point of random assignment Method of conducting random assignment Mechanism for tracking progress of groups Metrics for measuring outcomes Evaluation of the effect on the trust fund

DOL will conduct national evaluation that: Measures net impacts on individuals and impacts on states’ account in the UTF for all participating states through meta-evaluation techniques synthesizing results from all the demonstration states Includes a structured implementation evaluation component with cross-site analysis Be sponsored by DOL and conducted by an evaluation contractor (TBD)

National Evaluation: State Role States must: Make available all data for both treatment and control groups including management information system, confidential wage records and claimant files; Provide access to demonstration project and unemployment insurance staff and participants during and after the end of the demonstration, as needed by DOL.

Application Process An application will be considered received the first business day DOL has a full day’s access to the application, whether in email/ hard copy. Upon receipt of an application, OUI staff will: Notify the state that the application has been received (preferably via email); and Review the application for completeness. NOTE: If any statutory requirements are missing, the application will be denied.

Application Process States are strongly encouraged to consider the Secretary’s priorities when developing their applications and to use the application check list when completing their applications The Secretary will approve/deny applications within 30 days as required by statute Applications and the Secretary’s decision to approve or deny will be posted on the DOL and ETA websites

When an application is approved, the state will be notified. Application Process When an application is approved, the state will be notified. An agreement with the Secretary must be signed subsequent to the application approval and prior to implementation of the project.

Application Process If an application is denied the state will be provided an explanation. States may submit subsequent applications. NOTE: To ensure a fair process giving all states an opportunity to apply, no individualized technical assistance will be provided to states that are developing an application.

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Resources for the Demonstration Project: http://ows.doleta.gov/unemploy/jobcreact.asp

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