Business Advocates Speak on Welfare Reform Transition

By rejecting proposals to create more government jobs for people coming off the welfare rolls, state lawmakers made it clear this year that they will rely largely on the business community to put to work the expected hundreds of thousands of former welfare recipients under California’s welfare reform program that begins Jan. 1.

This week, in hearings held by the Senate Committee on Economic Development in Burbank and Riverside, business advocates had a chance to tell state legislators exactly what kind of help they will need to smooth the transition.

At the top of their list was help in cutting through the red tape so local job training programs and nonprofit groups can access the $200 million set aside by state and federal agencies for training welfare recipients--little of which has yet to filter down to the community level.

“The state now has something like 86 [job] development programs run by 32 different state agencies,” said Gus Koehler, senior policy analyst at the California Research Bureau, a state agency. “These programs can be focused more effectively.”

When lawmakers return to Sacramento on Jan. 5, they will take up legislation that would allocate $5.2 million to create a program to serve as a kind of one-stop shop to coordinate job-training funding and move newly trained workers into the private sector.

The legislation, AB 899 by Assemblywoman Grace Napolitano (D-Norwalk) is a priority for groups like the Economic Development Corp. of Los Angeles County, of which Bank of America, Atlantic Richfield and Southern California Edison, among others, are members.

“If we’re going to create these new jobs, we need to have an educated work force,” said Lee Harrington, president and chief executive of the EDC. “But we need to get at that seed money for job training programs if welfare reform is going to work.”

Small businesses are also backing AB 899 and pushing for tax incentives to hire workers straight from the welfare rolls.

These elements are key, business groups say, if welfare-to-work programs planned by businesses are to succeed.

One such program in the planning stages by the California Small Business Assn. would partner businesses with local nonprofit agencies. The nonprofits would provide the initial job training and the businesses would underwrite the costs.

“The employees would stay on the payrolls of the nonprofits and the businesses would pay their wages,” said Scott Hague, chairman of the state SBA, which plans to test the program first in San Francisco. “The nonprofits will serve as a sort of temp agency or middle man” to help minimize the risk for small business.

HOT BILLS

* Small-Business Exports

Bottom Line: Allocates $100,000 for the California Office of Export Development to help small- and medium-sized businesses sell more of their products in foreign markets and win more contracts with foreign governments.

Chances: The bill cleared the Assembly 57-19 and cleared the Senate 32-6 in September before Gov. Pete Wilson signed the measure into law last month.

Next Step: Takes effect Jan. 1.

Details: AB 896 author Grace Napolitano (D-Norwalk) can be reached at (916) 445-0965 or by e-mail at grace.napolitano@assembly.ca.gov

* Affordable Housing Exemptions

Bottom Line: Increases the number of housing developments exempted from full-scale environmental review in an effort to spur more low- and moderate-income housing. Current exemptions are limited to developments with 45 units on two acres of land. This bill grants exemptions to projects of 100 units on five acres of land.

Chances: Won final approval from the Legislature in August and was signed by the governor in September.

Next Step: Takes effect Jan. 1.