Connecticut Seal

General Assembly

File No. 631

    February Session, 2018

Substitute Senate Bill No. 535

Senate, April 23, 2018

The Committee on Finance, Revenue and Bonding reported through SEN. FONFARA of the 1st Dist. and SEN. FRANTZ, L. of the 36th Dist., Chairpersons of the Committee on the part of the Senate, that the substitute bill ought to pass.

AN ACT ESTABLISHING THE APPRENTICESHIP CONNECTICUT INITIATIVE AND CONCERNING ECONOMIC DEVELOPMENT AND MANUFACTURING BONDS FOR SUBMARINE FACILITY CAPITAL IMPROVEMENTS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2018) (a) There is established the Apprenticeship Connecticut initiative to develop work force pipeline programs to train qualified entry-level workers for job placement with manufacturers and employers in other industry sectors in the state that are experiencing sustained work force shortages. The initiative shall include, where practicable, outreach to underserved populations, including youths, to achieve success in the program and support the state's economic development progress.

(b) (1) Not later than January 1, 2019, the Labor Commissioner shall issue a request for qualifications to solicit proposals from regional industry partnerships for a work force pipeline program to serve the work force needs of manufacturers and other employers in the region. To be eligible to submit a proposal, a regional industry partnership shall include as members of such partnership (A) entities and organizations with expertise in regional economic and work force development, including, but not limited to, entities offering apprenticeship or other work force training programs, (B) the regional work force development board, established pursuant to section 31-3k of the general statutes, for the applicable work force region, and (C) at least one educational institution such as a vocational-technical school or an institution of higher education or at least one employer located in the work force region. A regional industry partnership may include other entities, organizations or institutions that support the goals of the partnership and initiative.

(2) Prior to the date established by the commissioner for the submission of responses to such request for qualifications, each regional work force development board shall submit a report to the General Assembly, in accordance with the provisions of section 11-4a of the general statutes, that sets forth the most pressing work force needs within such board's region and identifies the industry sector or sectors in which such needs are the greatest.

(c) Each proposal shall be submitted by the partnership through the regional work force development board and shall demonstrate the targeted goal of preparing qualified entry-level workers for careers that provide a living wage. Each proposal shall include plans for the following core program components:

(1) Identification of the region's most pressing work force needs and the industry sector or sectors in which such needs are the greatest, as reported to the General Assembly pursuant to subdivision (2) of subsection (b) of this section;

(2) Recruitment in the program of, and outreach efforts to, potential job seekers;

(3) (A) Screening and assessment of individuals interested in manufacturing work or employment in other sectors proposed to be targeted by the partnership, by which individuals will be assessed for work readiness, aptitude for the relevant work skills and on other metrics as specified by the partnership or as recommended by the Labor Department;

(B) Redirecting or connecting individuals determined through the screening and assessment process not to be suited for participation in the program to or with alternative career resources or services available to residents of the state that may be better suited to such individuals;

(C) Placement of individuals screened and assessed who are selected to participate in a training program, with an employer identified by the partnership, upon such individual's successful completion of the training program. Such identified employer shall commit to hire one or more individuals who successfully complete the training program and may further offer related on-the-job training or other in-house training opportunities to such individual or individuals. The partnership shall seek to leverage any such training or opportunities, apprenticeship programs, the Labor Department's subsidized training and employment program and other wage-subsidy programs with employers who commit to hiring individuals, and may seek program funding for retention services;

(4) (A) Separate training programs for participants (i) in the eleventh or twelfth grade, and (ii) eighteen years of age or older who are not currently enrolled in eleventh or twelfth grade. Such training programs shall be provided by partnership members or with the assistance of other parties as identified in the proposal;

(B) Training programs shall be not less than five consecutive weeks and not more than twenty-six consecutive weeks in duration. At least one training program offered for each age group shall be provided through a certified preapprenticeship program offered by the Labor Department. Any other training program may include a preapprenticeship component or award industry-recognized certificates, as proposed by the partnership;

(C) Training programs shall be developed and revised periodically through ongoing consultation with employers targeted for job placement of program participants;

(5) The duration of a work force pipeline program shall be not less than four years from the date of its establishment;

(6) For each core program component, identification of specific existing resources available to such partnership through the regional work force development board, the United States Department of Labor's American Job Center system, the state Labor Department, employers, apprenticeship or other work force training programs, educational institutions in the state or other public or private funds. If the partnership proposes using program funds for the purposes of core program components, it shall demonstrate for each such component that there will be leveraged funding support from existing resources and that the use of program funds for such purposes will not affect the availability of such existing resources; and

(7) The following limits shall apply to the use of any program funds awarded to a partnership: (A) Not more than seventy per cent of such funds shall be used for the training programs set forth in subdivision (4) of this subsection; (B) not more than twenty per cent of such funds shall be used for supporting services for the program, including recruitment and outreach efforts, screening and assessment, transportation, stipends, workplace tools or equipment and preemployment supports; and (C) not more than ten per cent of such funds shall be used for any other purpose, including administrative costs.

(d) (1) The commissioner shall review all qualifying responses to the request for qualifications and select as many proposals as the commissioner deems to be well-planned and the partnership to be capable of implementing its proposal. The commissioner shall select proposals so as to achieve a goal of not fewer than ten thousand individuals placed into new jobs over the first four years of a program, with one-third of such individuals from the group under subparagraph (A)(i) of subdivision (4) of subsection (c) of this section and two-thirds of such individuals from the group under subparagraph (A)(ii) of subdivision (4) of subsection (c) of this section.

(2) (A) The commissioner shall award funds to the partnerships selected under subdivision (1) of this subsection in proportion to the magnitude of the work force needs within the work force region proposed to be served, relative to the comparable work force needs within other work force regions of the state, provided no partnership shall receive more than twenty million dollars in total funding. The commissioner may further weight such distribution according to any total cost per program participant proposed by a partnership that the commissioner deems reasonable, and may give preference to a partnership with a lower total cost per program participant.

(B) The commissioner shall reserve from any funds awarded under subparagraph (A) of this subdivision sufficient funds to support the use of the certified preapprenticeship program offered by the Labor Department and shall transfer such reserved funds to the appropriate departmental account to be used for such purpose.

(e) Any regional industry partnership may seek (1) to leverage tuition or financial assistance programs for purposes of the program and for the benefit of individuals participating in the program, and (2) philanthropic and employer investments to meet the goal set forth in subdivision (1) of subsection (d) of this section and to support retention of individuals participating in the program.

Sec. 2. (Effective July 1, 2018) (a) For the purposes described in subsection (b) of this section, the State Bond Commission shall have the power from time to time to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate fifty million dollars.

(b) The proceeds of the sale of such bonds, to the extent of the amount stated in subsection (a) of this section, shall be used by the Labor Department for the purposes of funding work force pipeline programs selected pursuant to section 1 of this act.

(c) All provisions of section 3-20 of the general statutes, or the exercise of any right or power granted thereby, that are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section. Temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with section 3-20 of the general statutes and from time to time renewed. Such bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of such bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization that is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission, in its discretion, may require. Such bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on such bonds as the same become due, and accordingly and as part of the contract of the state with the holders of such bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the State Treasurer shall pay such principal and interest as the same become due.

Sec. 3. Section 32-235 of the 2018 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(a) For the purposes described in subsection (b) of this section, the State Bond Commission shall have the power, from time to time to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate one billion seven hundred fifty-five million three hundred thousand dollars, provided (1) one hundred forty million dollars of said authorization shall be effective July 1, 2011, and twenty million dollars of said authorization shall be made available for small business development; (2) two hundred eighty million dollars of said authorization shall be effective July 1, 2012, and forty million dollars of said authorization shall be made available for the Small Business Express program established pursuant to section 32-7g and not more than twenty million dollars of said authorization may be made available for businesses that commit to relocating one hundred or more jobs that are outside of the United States to the state; and (3) one hundred seventy-five million dollars of said authorization shall be effective July 1, 2018. Any amount of said authorizations that are made available for small business development or businesses that commit to relocating one hundred or more jobs that are outside of the United States to the state, but are not exhausted for such purpose by the first day of the fiscal year subsequent to the fiscal year in which such amount was made available, shall be used for the purposes described in subsection (b) of this section. For purposes of this subsection, a "small business" is one employing not more than one hundred employees.

(b) The proceeds of the sale of said bonds, to the extent of the amount stated in subsection (a) of this section, shall be used by the Department of Economic and Community Development:

(1) [for] For the purposes of sections 32-220 to 32-234, inclusive, including economic cluster-related programs and activities, and for the Connecticut job training finance demonstration program pursuant to sections 32-23uu and 32-23vv, provided:

(A) [three] Three million dollars shall be used by said department solely for the purposes of section 32-23uu and not more than five million two hundred fifty thousand dollars of the amount stated in said subsection (a) may be used by said department for the purposes of section 31-3u; [,]

(B) [not] Not less than one million dollars shall be used for an educational technology grant to the deployment center program and the nonprofit business consortium deployment center approved pursuant to section 32-41l; [,]

(C) [not] Not less than two million dollars shall be used by said department for the establishment of a pilot program to make grants to businesses in designated areas of the state for construction, renovation or improvement of small manufacturing facilities, provided such grants are matched by the business, a municipality or another financing entity. The Commissioner of Economic and Community Development shall designate areas of the state where manufacturing is a substantial part of the local economy and shall make grants under such pilot program which are likely to produce a significant economic development benefit for the designated area; [,]

(D) [five] Five million dollars may be used by said department for the manufacturing competitiveness grants program; [,]

(E) [one] One million dollars shall be used by said department for the purpose of a grant to the Connecticut Center for Advanced Technology, for the purposes of subdivision (5) of subsection (a) of section 32-7f; [,]

(F) [fifty] Fifty million dollars shall be used by said department for the purpose of grants to the United States Department of the Navy, the United States Department of Defense or eligible applicants for projects related to the enhancement of infrastructure for long-term, on-going naval operations at the United States Naval Submarine Base-New London, located in Groton, which will increase the military value of said base. Such projects shall not be subject to the provisions of sections 4a-60 and 4a-60a; [,]

(G) [two] Two million dollars shall be used by said department for the purpose of a grant to the Connecticut Center for Advanced Technology, Inc., for manufacturing initiatives, including aerospace and defense; [, and]

(H) [four] Four million dollars shall be used by said department for the purpose of a grant to companies adversely impacted by the construction at the Quinnipiac Bridge, where such grant may be used to offset the increase in costs of commercial overland transportation of goods or materials brought to the port of New Haven by ship or vessel; [,] and

(I) One hundred million dollars shall be used by said department for the purpose of grants to a company that (i) is engaged in the design, construction and lifecycle support of submarines for the United States Navy, (ii) has a production facility and an engineering office in the state prior to July 1, 2018, (iii) plans to expand production of submarines in response to increased demand from the United States Navy, and (iv) has a parent company that is engaged in the aerospace and defense industry. Such grants may be used for (I) acquisition of lands, buildings, machinery, equipment or any combination thereof, (II) site and infrastructure improvements, and (III) planning costs;

(2) [for] For the purposes of the small business assistance program established pursuant to section 32-9yy, provided fifteen million dollars shall be deposited in the small business assistance account established pursuant to said section 32-9yy; [,]

(3) [to] To deposit twenty million dollars in the small business express assistance account established pursuant to section 32-7h; [,]

(4) [to] To deposit four million nine hundred thousand dollars per year in each of the fiscal years ending June 30, 2017, to June 30, 2019, inclusive, and June 30, 2021, and nine million nine hundred thousand dollars in the fiscal year ending June 30, 2020, in the CTNext Fund established pursuant to section 32-39i, which shall be used by CTNext to provide grants-in-aid to designated innovation places, as defined in section 32-39j, planning grants-in-aid pursuant to section 32-39l, and grants-in-aid for projects that network innovation places pursuant to subsection (b) of section 32-39m, provided not more than three million dollars be used for grants-in-aid for such projects; [,]

(5) [to] To deposit two million dollars per year in each of the fiscal years ending June 30, 2019, to June 30, 2021, inclusive, in the CTNext Fund established pursuant to section 32-39i, which shall be used by CTNext for the purpose of providing higher education entrepreneurship grants-in-aid pursuant to section 32-39g; [,]

(6) [for] For the purpose of funding the costs of the Technology Talent Advisory Committee established pursuant to section 32-7p, provided two million dollars per year in each of the fiscal years ending June 30, 2017, to June 30, 2021, inclusive, shall be used for such purpose; [,]

(7) [to] To provide (A) a grant-in-aid to the Connecticut Supplier Connection in an amount equal to two hundred fifty thousand dollars in each of the fiscal years ending June 30, 2017, to June 30, 2021, inclusive, and (B) a grant-in-aid to the Connecticut Procurement Technical Assistance Program in an amount equal to three hundred thousand dollars in each of the fiscal years ending June 30, 2017, to June 30, 2021, inclusive; [,] and

(8) [to] To deposit four hundred fifty thousand dollars per year, in each of the fiscal years ending June 30, 2017, to June 30, 2021, inclusive, in the CTNext Fund established pursuant to section 32-39i, which shall be used by CTNext to provide four hundred fifty thousand dollars in each of the fiscal years ending June 30, 2017, to June 30, 2021, inclusive, for the purposes of growth grants-in-aid pursuant to section 32-39g.

(c) All provisions of section 3-20, or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section, and temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed. Such bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission, in its discretion, may require. Said bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on said bonds as the same become due, and accordingly and as part of the contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the Treasurer shall pay such principal and interest as the same become due.

This act shall take effect as follows and shall amend the following sections:

Section 1

July 1, 2018

New section

Sec. 2

July 1, 2018

New section

Sec. 3

July 1, 2018

32-235

Statement of Legislative Commissioners:

In Section 1(b)(2) and throughout Section 1(c), provisions were rewritten for consistency with other provisions in the Section, and the title was changed.

FIN

Joint Favorable Subst. -LCO

 

The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.


OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 19 $

FY 20 $

Out Years $

Treasurer, Debt Serv.

GF - Potential Cost

See Below

See Below

72.3 million total

Note: GF=General Fund

Municipal Impact: None

Explanation

The bill authorizes $50 million in General Obligation bonding for work force pipeline programs to be administered by the Department of Labor. To the extent that the authorized bonds are allocated by the State Bond Commission, the state would need to repay the principal amount of the bond plus associated fees and interest. If bonds were approved for use and issued in FY 19, the state could begin repayment of up to $2.5 million in FY 20. A later issuance date would not result in repayment cost in the biennium.

The bill also obligates $100 million of funds previously authorized for the Manufacturing Assistance Act to a qualified submarine manufacturer. This may change the expenditure rate of the authorized GO bonds, with a commensurate change in future debt service payments.

The Out Years

Under current market conditions, the state would repay a $50 million bond over 20 years at an approximate total cost of $72.3 million (for principal and interest, including the initial $2.5 million payment described above), or approximately $3.6 million per year on average.

OLR Bill Analysis

sSB 535

AN ACT ESTABLISHING THE APPRENTICESHIP CONNECTICUT INITIATIVE AND CONCERNING ECONOMIC DEVELOPMENT AND MANUFACTURING BONDS FOR SUBMARINE FACILITY CAPITAL IMPROVEMENTS.

SUMMARY

This bill authorizes up to $50 million in general obligation (GO) bonds and requires the Department of Labor (DOL) to use the proceeds to fund a new Apprenticeship Connecticut initiative that develops workforce pipeline programs to train qualified entry-level workers for jobs with manufacturers and employers in sectors experiencing workforce shortages. The bill requires the program to include, where practicable, outreach to underserved populations, including youth, to successfully complete the program and support the state's economic development.

The bill requires the DOL commissioner, by January 1, 2019, to issue a request for qualifications (RFQ) to solicit proposals for the program from regional industry partnerships. It establishes the RFQ's required components and, among other things, requires the commissioner to select proposals to achieve a goal of at least 10,000 individuals placed in new jobs over the program's first four years. The bill caps at $20 million the amount of funds any one partnership may receive in total funding.

The bill requires each regional workforce development board to submit to the General Assembly, before the RFQ's submission deadline, a report indicating its region's most pressing workforce needs and the industry sector or sectors with the greatest needs.

The bill also earmarks $100 million in existing Manufacturing Assistance Act (MAA) bonds and requires the Department of Economic and Community Development (DECD) to use the proceeds to provide grants to an eligible submarine production company. It requires the company to use the grants to (1) purchase land, buildings, machinery, or equipment; (2) make site and infrastructure improvements; and (3) pay planning costs.

EFFECTIVE DATE: July 1, 2018

APPRENTICESHIP CONNECTICUT

Regional Industry Partnerships

By January 1, 2019, the bill requires the DOL commissioner to issue an RFQ soliciting proposals from regional industry partnerships for workforce pipeline programs serving the workforce needs of manufacturers and other employers in the region.

Eligible partnerships may include entities, organizations, or institutions that support the partnership's and initiative's goals and must include:

Core Components

The bill requires each proposal to include the core components described below.

Targeted Goal, Training Needs, and Sectors. Each proposal must demonstrate the targeted goal of preparing qualified entry-level workers for careers providing a living wage. It must also identify the region's most pressing workforce needs and the industry sector or sectors with the greatest needs, which were reported by the workforce development board to the General Assembly.

Recruitment, Screening, and Assessment of Participants. The proposals must include recruitment and outreach efforts and a screening and assessment process for participants. The screening must assess individuals' work readiness, aptitude for the relevant work skills, and other metrics the partnership specifies or DOL recommends. Those determined not to be suited for the program must be redirected to or connected with alternative career resources or services available to state residents that may be better suited to them.

Training Programs. The proposals must include separate training programs, one for participants who are in 11th or 12th grade and another for those who are at least 18-years-old and not currently enrolled in 11th or 12th grade. The training programs must last between 5 and 26 consecutive weeks and be provided by partnership members or with help from other identified parties. They must be periodically developed and revised through ongoing consultation with employers targeted for job placements.

At least one program offered for each age group must be provided through a certified pre-apprenticeship program offered by DOL. Other programs may (1) include a pre-apprenticeship component or (2) award industry-recognized certificates, as proposed by the partnership.

Job Placement. Each proposal must include a mechanism for placing selected participants who successfully complete the training program with an employer identified by the partnership. The selected employer must commit to hiring one or more participants and may offer additional on-the-job training or other in-house training opportunities. The partnership must seek to leverage any such employer training or opportunities, apprenticeship programs, DOL's subsidized training and employment program, and other wage-subsidy programs with such employers, and may seek program funding for retention services.

Duration. The workforce pipeline programs must last at least four years.

Resources. For each program core component, the partnership must identify the existing resources available to it from the following sources: the regional workforce development board, the U.S. DOL's American Job Center system, the state DOL, employers, apprenticeship or other workforce training programs, state educational institutions, and other public or private sources. If the partnership proposes using program funds for any core component, it must demonstrate for each component that (1) there will be leveraged funding support from existing resources and (2) using program funds for such purposes will not affect the availability of the existing resources.

The bill limits the partnerships' use of program funds as follows:

The bill also authorizes the partnerships to (1) leverage tuition or financial assistance programs for workforce pipeline programs and to benefit program participants and (2) pursue charitable and employer investments to meet the program's hiring goal and support the retention of program participants.

Selected Proposals

The bill requires the commissioner to review all qualifying RFQ responses and select as many proposals as he deems to be well-planned and submitted by partnerships capable of implementing them. He must select proposals so as to achieve a goal of at least 10,000 individuals placed into new jobs over the program's first four years, one-third of which must be in the 11th or 12th grade and two-thirds of which must be at least 18-years-old and not currently enrolled in 11th or 12th grade.

Awarded Funds

The commissioner must award funds to the selected partnerships in proportion to the magnitude of their region's workforce needs, relative to the other regions' comparable needs. He may also (1) weigh the distribution according to the partnership's proposed total cost per program participant (that the commissioner deems reasonable) and (2) give preference to a partnership with a lower per participant cost.

The bill caps at $20 million the amount of funds any one partnership may receive in total funding. It also requires the commissioner to (1) reserve, from any awarded funds, an amount sufficient to support the use of DOL's certified pre-apprenticeship program and (2) transfer the reserved funds to the appropriate DOL account to be used for such purpose.

ELIGIBLE SUBMARINE PRODUCTION COMPANY

The bill earkmarks $100 million in existing MAA bonds and requires DECD to use the funds to provide grants to a company that:

COMMITTEE ACTION

Finance, Revenue and Bonding Committee

Joint Favorable

Yea

44

Nay

7

(04/05/2018)

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