State Gets $189 Million in Job Creation Funds

With more impoverished people than any other state, California on Wednesday was awarded the biggest share--$189 million--of a $1.1-billion federal jobs pot designed to create work opportunities for the hardest to employ welfare recipients.

The award, announced by Vice President Al Gore at a White House welfare-to-work conference, provides funds for a broad array of programs that California can use to move long-term welfare recipients with few job skills and little or no work history into the labor force.

“These funds represent a dramatic commitment to help break the cycle of poverty in every state,” Gore said during the conference.

But California officials immediately expressed concerns that the bulk of the money was being distributed to local areas in a way that would make it difficult to coordinate with other job programs in the state’s new $6-billion-a-year welfare reform plan known as CalWorks.

And state and local officials complained that they had not earmarked any funds to provide their one-third share of matching funds required by the federal government.

“We don’t want to appear unappreciative for a substantial amount of money but, certainly with some of the constraints that are attached to it, we do have concerns,” said Gov. Pete Wilson’s press secretary, Sean Walsh. “These are issues we are going to have to work out.”

In a letter to federal officials earlier this summer, Zev Yaroslavsky, chairman of the Los Angeles County Board of Supervisors, said local governments could ill afford to kick in any of the required matching funds.

“We urge that the one-third match be eliminated or as an alternative waived for states such as California which have unemployment, poverty and welfare utilization rates that exceed the national average,” he wrote.

The new funds are being distributed as part of a $3-billion initiative by the federal government to help states over the next two years deal with entrenched welfare recipients who are expected to provide the toughest challenge for the welfare reform act approved by Congress last summer.

The act limits the amount of time individual recipients can collect assistance and requires states to put welfare recipients in the work force gradually or face federal penalties.

Critics have contended that the act’s success or failure will depend on states’ abilities to find jobs for recipients who face the most serious barriers to employment, such as long-term dependency on welfare, substance abuse problems, no work history and little education.

“If this had been easy to do, it would have been done by now. This is not easy to do,” Deputy U.S. Labor Secretary Kitty Higgins said in an interview. “We have to make sure that [these recipients] can financially succeed, and that’s going to require that they be in jobs that pay a decent amount of money.”

For most states, designing programs for the highly dependent welfare recipient is still “uncharted territory,” said John Wallace, vice president and western regional manager for the New-York based Manpower Demonstration Research Corp., which studies welfare-to-work programs.

“There is no recent history and certainly not any recent research guidance that provides a clear direction as to the services that these people are going to need,” he said.

The new funding targets recipients who have less than a high school education, low reading and math skills, require treatment for drug abuse or have a poor work history.

States must spend at least 70% of the money on long-term welfare recipients or those who are within 12 months of reaching their time limits. The rest can be spent on individuals who share some of the same characteristics of the long-term recipients but have spent less time on aid.

The money can be spent in a variety of ways, including wage subsidies to public or private employers, on-the-job training and community service jobs.

Federal officials used a formula to apportion the first $1.1 billion in funds to all 50 states, based on the numbers of people living in poverty and adults receiving welfare.

California--which has 13% of the nation’s poor and 787,830 adults on welfare--is receiving far more funding than any other state. The next-largest grant went to New York, which qualified for $96 million--about half of California’s grant.

Still, officials complained that the formula discriminated against the nation’s most populous state.

Brian Webb, deputy director of Wilson’s Washington office, said California will get about 12% of the total funds but that it normally gets about 22% of other federal welfare allocations. Using the usual formula “would have been much more fair,” he said.

He said Wilson and other governors have also objected to requirements that 85% of the funds be distributed to local private industry councils, nonprofit organizations composed of private and public sector representatives. They are financed by the Job Training Partnership Act and have been given the responsibility of designing job training programs to meet the needs of particular employers.

“The major question is, ‘Who has control of the dollars?’ ” Webb said. “The bottom line is the entity with full authority to spend these funds is the [council]. . . . And then the question becomes how well is that spending going to be coordinated with other statewide efforts.”