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F I S C A L I M P A C T R E P O R T





SPONSOR: Wilson DATE TYPED: 02/08/00 HB
SHORT TITLE: Require NM WORKS Act Applicant Job Search SB 374
ANALYST: Taylor\Dunbar


APPROPRIATION



Appropriation Contained
Estimated Additional Impact
Recurring

or Non-Rec

Fund

Affected

FY00 FY01 FY00
See Narrative



(Parenthesis ( ) Indicate Expenditure Decreases)



Duplicates/Conflicts with/Companion to/Relates to HB 244



SOURCES OF INFORMATION



LFC files

Human Services Department



SUMMARY



Synopsis of Bill



SB 374 amends the New Mexico Works Act, Section 27-2B-4 NMSA 1978, to require certain applicants for the New Mexico Works cash assistance program to "make employment contacts and to submit employment applications"( job search) while the application is pending approval. All persons subject to participation in work program activities must go through job search unless they meet one of the following conditions:



Significant Issues



The Department of Labor (DOL) maintains that the job search function belongs in their agency and note that DOL provides the more practical venue for job seekers to register for employment.



FISCAL IMPLICATIONS



HSD estimates that during FY 01, the applicant job search requirement will result in 1200 applicants finding employment.



The department believes that HSD budget items for transportation and child care expenses will increase because of the up-front job search, thus reducing the need for cash assistance. The HSD Fir does not quantify the impact.



ADMINISTRATIVE IMPLICATIONS

The department stipulates that the job search requirement will be administered by the Income Support Division eligibility staff. The department believes that the increased workload to eligibility staff will be offset by caseload reductions resulting from employments.



Currently the department contracts out employment services to contractors. The department does not provide information as to why the department is not considering contracting the job search requirement to these contractors.



Also, the department presently has a job search component as part of the work participant requirements through its NM WORKS contractors. These individuals can receive cash assistance with child care and transportation as well as other services offered through the HSD contractors. The department did not provide any data on the number of cases that are being closed due to job search activities and the number of individuals that have found employment by participating in such activities.



DOL staff insists that their agency should administer the employment registration procedure because the infrastructure is in place to deliver this service.



CONFLICT/DUPLICATION/COMPANIONSHIP/RELATIONSHIP



The bill is a duplicate to HB 244



OTHER SUBSTANTIVE ISSUES



Advocates are concerned that the applicants do not have the resources to provide for up-front transportation costs or child care and then wait for reimbursement.



Advocates are also concerned that the bill contradicts the purpose of the NM WORKS Act which is to "focus on addressing the barriers to participation in work activities."



Other areas that are disturbing to some advocates are:



The Human Services Department (HSD) reports that national studies of applicant job search projects conducted by the Manpower Research Development Corporation found that these projects were effective in reducing welfare dependency and increasing family income. Descriptions of some of those job search projects were not provided by the department. The HSD Fir does not address whether these projects were up-front job search(while application was pending) or as part of work program activity for individuals who were recipients of assistance. NM has a job search component for recipients of assistance as noted above.



Although the department indicates that the program will only be implemented in limited areas, they do not identify those areas or provide information on approximate numbers of individuals who will be exempt from this requirement.



HSD specifies that the job search requirement will not delay the processing of applications for Food Stamps or Medicaid. Job search related to transportation costs will be reimbursed by HSD in accordance with existing program rules. Child care costs for applicant job seekers will be reimbursed by the department at established rates.





HSD describes the following advantages when a person secures employment during applicant job search:





AMENDMENTS



The department suggests the following amendment:



Under sub section D, the term "wavier" should be changed to "exemption" to comport with Section 27-2B-5 .



DOL proposed that the bill be amended to allow for NM WORKS applicants to register for work in their agency.



POSSIBLE QUESTIONS



A questions arises pertaining to the current contractors who provide employment services. If a person finds and accepts employment through up-front job search but is still eligible for and opts to receive cash assistance, will the recipient be referred to the current employment contractors and will the contractors be reimbursed for offering employment services to this recipient?



BT/njw