1. WIOA: Fiscal & Legal Issues
Michael Brustein, Esq.
Steven Spillan, Esq.

2. 2017 Case Study: Maine
July 27, 2017, local WIBs receive just 1/3 of their Title I-B funds for PY 17
Period of performance: July 1- October 31, 2017
Governor has a pending request to DOL to do away with local WIBs (July 11, 2017)
DOL Rejected request
Governor “rejected” continued participation
Notified local WIBs to “wind down” by November 30

3. Maine Case Study (cont.)
October 23 – Maine DOL withholds remainder of PY 16 funds
October 24 - Local board files suit against State to release funds
Maine DOL offers to settle with local WIB
WIB must agree to spend 60% of funds on direct training
No resolution?

4. Maine Case Study (cont.)
Primary Issue:
Governor’s authority to:
Bypass local WIBs
Withdraw from Title II-B of WIOA
Mandate local use of funds?
Things to Consider:
Statutory framework of local boards
Governor’s authority in a “State-administered” program
Congressional intent

5. Maine Case Study (cont.)
Relevant Laws & Regulations:
WIOA Sec. 128(b) & 133(b) – within state allocations
20 CFR Part 679, Subpart B – State and local governance under WIOA
2 CFR § (a)(2-3) – authority of pass-through entities

6. Legal Authorities Training & Employment Notices (TENs) Statute
Workforce Innovation and Opportunity Act (WIOA)
29 U.S.C. §§ 3101 et seq.
Regulations
Program Regulations
WIOA Implementation Rules
20 CFR Parts 676, 677, 678, 679, 680, etc.
34 CFR Parts 361 and 461, 462, 463, etc.
Administrative Rules, Cost Principles, Audit Requirements (Uniform Guidance)
Includes 2 CFR Part 200; Part 2900
Guidance
Training & Employment Guidance Letters (TEGLs)
Training & Employment Notices (TENs)

7. Workforce Innovation & Opportunity Act
Signed into Law: July 22, 2014
Effective Date: July 1, 2015
Unified/Combined State Plans Due: April 1, 2016
Notice of Proposed Rulemaking NPRM: April 16, 2015
Final Rules: June 30, 2016 (Available); August 19, 2016 (Federal Register)
New Accountability Provisions Effective: July 1, 2016
Provisions delayed until July 1, 2017…

8. Performance Reports TEGL No. 03-17 (9/12/2017)
Annual Performance Reports Due October 1, 2017
Accepted through October 16, 2017
New Guidance Regarding Data Elements:
TEGL No , Change 1

9. Infrastructure Costs & Proportionate Use Relative Benefits Received
General Policy:
Infrastructure Costs must be based on:
Proportionate Use
&
Relative Benefits Received
Citation: 20 CFR §

10. What Does That Mean?
Controlling Authority 2 CFR § of the UGG “Allocable Costs” 20 CFR § (a)(3)

11. Allocability
Services must be “assignable” based on benefit received by program.
Examples:
20% of participants enrolled in college or provider are referred by One-Stop
5% of college/provider staff work directly/indirectly with One-Stop

12. But…
What if college/provider has no participants referred from One-Stop, and no staff interface with One-Stop?
WIOA statute/regs/guidance all require partner programs provide “career services” through the One-Stop, regardless of proportionate benefit

13. What does that mean for infrastructure?
Does the “career services” mandate establish the requisite nexus with the One-Stop? If so, would it mandate an Infrastructure Costs Agreement?

14. How Do We Rectify This?
Complete an Infrastructure Costs Agreement (IFA)
15 Easy Steps!

15. Step 1
Local WIBs and Chief Elected Officials (CEOs) finalize list of One-Stop partner programs
Sec. 121(b) of WIOA

16. Step 2
WIBs, CEOs, and partners determine One-Stop locations and types:
Comprehensive
Affiliate
Virtual
Satellite

17. Step 3
WIBs, CEOs, and partners determine services to be provided through One-Stop system

18. Step 4
WIBs and partners enter into a MOU. The MOU describes how One-Stop partners coordinate services. (Deadline: 7/1/2017)

19. Step 5
MOU includes a One-Stop operating budget which reflects One-Stop operating costs

20. Step 6
A required component of the One-Stop operating budget is the Infrastructure Costs Agreement (IFA) which outlines the budgeted infrastructure costs and additional costs
(Deadline: 1/1/18)

21. Step 7 Additional Costs: Must include applicable career services
20 CFR §
May include shared operating costs and shared services necessary for general operation of the One-Stop Center
20 CFR §

22. Shared Operating Costs
Initial intake assessment of needs, appraisal of basic skills, referrals, etc.

23. Step 8 Funding for IFA may be: Cash Non-cash
3rd party in-kind contributions
20 CFR §

24. Step 9 Perkins funds may be administrative.
AEFLA funds must be administrative.

25. Step 10 Examples of Infrastructure Costs (§678.700) Utilities
Common supplies/equipment
Telephone systems
Common reception area
Informational services
Data input on consumers
Maintenance of space

26. Step 11 These costs may be: Direct costs that benefit one program
Shared direct costs that can be readily allocated to different programs
Indirect costs incurred for common purposes, but not readily assignable to different programs

27. Step 12
These costs must be allocated to the benefitting programs, based on benefits received, not availability of funds.
Cannot shift costs that are not allowable.

28. Step 13
WIOA
Title I
AEFLA
PERKINS
P/S
Unshaded center are shared costs that benefit WIOA, CTE, & AEFLA participants

29. Step 14
Staffing formula
Calculate full time equivalent (FTE) of the partner program divided by total FTE of all programs at the Center (based on average of past 2 years)
Percentage shall be multiplied by sum total of infrastructure costs
Establish a schedule to reconcile projected costs to actual costs quarterly

30. Step 15
Customer Formula:
Same as above, but based on participants

31. WARNING!!!!!!!
If no Agreement, State option triggered

32. Questions?

33. Legal Disclaimer
This presentation is intended solely to provide general information and does not constitute legal advice or a legal service.  This presentation does not create a client-lawyer relationship with Brustein & Manasevit, PLLC and, therefore, carries none of the protections under the D.C. Rules of Professional Conduct.  Attendance at this presentation, a later review of any printed or electronic materials, or any follow-up questions or communications arising out of this presentation with any attorney at Brustein & Manasevit, PLLC does not create an attorney-client relationship with Brustein & Manasevit, PLLC.  You should not take any action based upon any information in this presentation without first consulting legal counsel familiar with your particular circumstances.