Last year, an obscure state agency called the Employment Training Panel found itself in a financial pickle.
A year before, in 2013, the panel’s members, especially chairman Barry Broad, a labor union lobbyist, had worried aloud that while they had a lot of money to spend, not enough was going out the door.
“We really need to see more good proposals… we do not have enough,” Broad told one meeting. “It is no secret that if you are a state agency and you do not move your money, others will find some other way to allocate it.”
A year later, in 2014, it was a different story. Having failed to account for increased utilization, the panel was turning down applicants because of a supposed lack of funds, resulting in some high-decibel board meetings.
Then, just weeks after the board adopted a rationing plan to stretch out its resources, it was discovered that the ETP had a $24.2 million balance in its account, financed from payroll taxes on employers
“I personally was not aware of it,” Broad said.
The ETP spends about $70 million a year, supposedly training and retraining workers to make them more employable in a fast-changing economy.
Whether the program succeeds well enough to justify the cost is almost beside the point, because its emphasis is on shoveling money out the door in response to pleas from organizations that depend on it.
And what’s true about the ETP is largely true about a jumble of programs that are supposed to be preparing California students and workers to better themselves and attack the state’s stubbornly high unemployment rate.
Recent reports from the Legislature’s budget analyst, Mac Taylor, reveal that the state has at least 30 “workforce development” programs scattered among nine state agencies, spending an estimated $5.6 billion each year, $3.1 billion from the state general fund and another $2.5 billion from other sources, mostly special taxes and the federal government.
Whenever the economy takes a nosedive, politicians feel bound to take some action – and that often means creating a new job training program.
Thus, over time, the programs proliferate with almost no coordination or evaluation. They become political entitlements whose beneficiaries – the organizations that live off the flow of money from Sacramento – lobby the powers that be to keep the cash moving.
We don’t even know how many people receive training from the 30 programs. Taylor’s office estimates 3 million to 6 million a year, including 2 million in high schools and community colleges. And we certainly don’t know whether they are worth what we are spending.
It’s a shame these programs operate so haphazardly because $5.6 billion, if spent effectively, could be a major factor in bolstering California’s middle class, which is shrinking rapidly, making us a two-tier society with the nation’s highest poverty rate.
The money could be a tool to attract industrial investment and jobs. Or it could just continue to be spent blindly.