When Illinois lawmakers criticized a state agency last spring for failing to adequately monitor how training funds were spent, they took matters into their own hands. They gave control of nearly $7 million to five private entities and promised to track their results.
A year later the legislators’ promise has gone unfulfilled.
Rep. Fred Crespo, D-Hoffman Estates, chairman of the Appropriations-General Services Committee, had pledged to have the five private entities testify before the committee and explain what they did with the money. The purpose was to determine whether the training programs were a good use of taxpayers’ dollars.
Now Crespo says his goal is to meet with the private entities over the summer and have them testify next year, when lawmakers take up the issue of funding the state’s main economic development arm, the Department of Commerce and Economic Opportunity.
The agency has made a concerted effort to educate lawmakers about how it manages its training programs, spokeswoman Sandra Jones said Thursday.
“This is year one,” Crespo said. “It’s kind of hard to come up with measurements only after one year.”
After a series of hearings and private meetings this year with the agency, lawmakers increased funding for training programs for fiscal 2014 to $21 million, up from about $13 million for the fiscal year ending this month. And despite threatening at one point to abolish the agency, lawmakers gave it control over two-thirds of that budget, with the remaining funding control given to the five private entities.
Job training funds are an important tool in Gov. Pat Quinn’s efforts to retain and attract companies to the state. He has yet to sign off on the most recent allocation of funding. A spokeswoman said in an email that “the governor supports this legislation as it will support economic growth in Illinois and help employers create good paying jobs.”
Of the groups receiving funds, at least three have been funded in past years, according to the comptroller’s contract database website. Since 2009, the Illinois Manufacturers’ Association, the Chicago Federation of Labor, and New Start Inc. collectively have received more than $9.4 million.
Mark Denzler, vice president of the manufacturers group, said it acts as an administrator. Manufacturing companies across the state apply for reimbursement for up to 50 percent of the cost of worker training. “Workforce development is one of the major issues facing manufacturers today,” Denzler said.
Asked what percentage of the funds the association keeps for administration, Denzler said the “overwhelming majority (of the money) goes to the companies.”
The Chicago Federation of Labor Workers Assistance Committee said it has trained workers since 2010 in such areas as information technology, basic skills, technical and workplace skills, and safety.
“Over 30 local unions and companies received reimbursement for skills training of current workers since 2010,” Tricia Hyland, a spokeswoman for the committee, said in a statement. She added that more than 13,000 workers have been trained. The committee keeps 9 percent of funds for administration, Hyland said.
New Start Inc. offers an accelerated, 17-day basic nurse assistant training program in Springfield. The state funds pay for most of the cost of the $1,000 program for people employed at health care facilities, according to the school’s website.
Steve Torricelli, New Start’s executive director, said the school trained 121 people in 2011 and 90 people last year. Torricelli said the school plans to use fiscal 2013 and 2014 funds to partner with a Chicago-based nonprofit and train nurse assistants in the city. Classes are to start in July, Torricelli said.
The other two entities that were allocated funds in fiscal 2013 were the Illinois Manufacturing Excellence Center and Chicagoland Regional College Program.
Servelure McMath Bostick, associate executive director at the Chicago Regional College Program, declined to provide information about its training. “I’m not in a position to discuss that this year. As you know, we are a college program,” she said.
On Thursday, Bostick said in an email that the program is a public-private partnership that “provides support for area residents to pursue a college education and career training at seven area universities and community colleges.” The state funds, Bostick wrote, help students with tuition, books and college-related fees. Also, she said, students are employed as part-time package handlers at the UPS in Hodgkins.
David Boulay, president of the Illinois Manufacturing Excellence Center, said the money helps fund the center, which offers manufacturers a number of services including workforce training, techniques to improve productivity and supplier scouting. Boulay said the center’s programs help companies create and retain jobs in Illinois.
The agency’s funding for fiscal 2014 includes about $5.1 million set aside for grants “associated with business and community development.” The agency said it will use the money to fund programs to support entrepreneurship, workforce development and community development.
The remaining $9 million will fund three programs, including the Employer Training Incentive Program, or ETIP, which is popular among manufacturers because it pays for up to 50 percent of training costs. Past recipients have included Chrysler Group ($875,000), Navistar International Corp. ($750,000) and Ford Motor Co. ($2.95 million).
While Crespo said he still has concerns about ETIP, the agency’s director convinced lawmakers that training funds are critical to helping retain and grow the state’s manufacturing base.
“I think the biggest question is, if the ETIP (funding) were to go away, what impact would it have in our manufacturing in the state of Illinois,” Crespo said, adding that he expects to get that question answered in meetings with the agency and manufacturers throughout the upcoming fiscal year.
Even if lawmakers hadn’t agreed with the director’s argument, Crespo said they still would have funded the program because the agency has multiple-year contracts with companies. As a result, lawmakers last February approved $5.7 million in additional funds for the agency so it could make good on its commitments.
“That’s something that the committee feels uncomfortable with because when we appropriate, we appropriate for one year, we don’t appropriate for two,” Crespo said. He said he has asked Adam Pollet, the agency’s director, to end that practice.
The agency has said ETIP grants are monitored and have the same accountability standards as other grants it administers. With an operating budget of $1.7 billion, the agency oversees more than 65 federal and state programs. Companies are required to submit quarterly financial and programmatic reports, and they are subject to audits. If a company does not meet the terms of the grant, the department can recapture it.
“The notion that there is lack of accountability is an unsubstantiated, baseless accusation,” Jones, the agency’s spokeswoman, said in a statement. She added that the agency is required to evaluate organizations seeking job training funds based on their performance, “a mandate the agency takes seriously and applies with vigor.”
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