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CHAIRMAN QUINN, MEMBERS OF THE COMMITTEE, MY NAME IS MIKE SHERIDAN AND I AM PLEASED AND HONORED TO BE WITH YOU TODAY TO ADDRESS ISSUES CONCERNING EMPLOYMENT AND TRAINING SERVICES FOR OUR NATION'S VETERANS. I AM THE OWNER AND PRINCIPAL CONSULTANT FOR MSC CONSULTING, AUSTIN, TEXAS. MY FIRM IS A LEADING GENERAL GOVERNMENT AND BUSINESS2GOVERNMENT CONSULTING TEAM WITH MORE THAN 30 YEARS OF STATE/FEDERAL GOVERNMENT SERVICE AND EXECUTIVE MANAGEMENT EXPERIENCE. PRIOR TO THIS, I MOST RECENTLY SERVED AS THE EXECUTIVE DIRECTOR OF THE TEXAS WORKFORCE COMMISSION. WHILE I AM HERE TODAY AS A PRIVATE CITIZEN, MY MESSAGE COMES FROM EXPERIENCE GAINED BY OVER 32 YEARS OF PUBLIC SERVICE.

TEXAS HAS A HISTORY AND TRADITION OF SERVING VETERANS. FROM THE ALAMO TO BOSNIA, WHERE ELEMENTS OF THE TEXAS NATIONAL GUARD ARE NOW DEPLOYED, WE HAVE TAKEN GREAT PRIDE IN SERVING THOSE WHO HAVE DEFENDED THEIR COUNTRY. OUR ACCOMPLISHMENTS

SPEAK FOR THEMSELVES. THIS PAST PROGRAM YEAR, WHICH ENDED JUNE 30, 2000, TEXAS ASSISTED OVER 56,000 VETERANS, OR 46 PERCENT OF THOSE REGISTERED FOR SERVICES, ENTER JOBS, INCLUDING 3,920 DISABLED VETERANS. ADDITIONALLY, OUR SERVICE LEVEL TO THOSE VETERANS REGISTERED IS THE HIGHEST IT HAS EVER BEEN. BY ALL MEASUREMENTS WE HAVE DONE WELL, BUT WE KNOW WE CANNOT REST ON OUR PAST ACHIEVEMENTS BUT MUST WORK TODAY AND BUILD FOR TOMORROW.

THE WORLD OF EMPLOYMENT AND TRAINING WHICH SERVES EMPLOYERS AND VETERANS IS AN EVER-EVOLVING ENVIRONMENT. TO KEEP PACE WITH THESE RAPIDLY CHANGING SITUATIONS SERVICE PROGRAMS MUST HAVE FLEXIBILITY. THE VETERANS CUSTOMERS WHO NEED WORKFORCE PROGRAM ASSISTANCE TODAY ARE NOW IN A POSITION OF DEMANDING 24 HOUR, 7-DAY-A-WEEK SERVICES AND ARE WILLING AND ABLE TO USE COMPUTERIZED JOB MATCHING AND SELF-ENTERED APPLICATION/RESUME INTERNET APPLICATIONS. THE RIGID SYSTEMS OF THE PAST WILL NOT MEET THE DEMANDS OF THE FUTURE AND I APPLAUD YOUR ENDEAVORS TO MOVE VETERANS' EMPLOYMENT AND TRAINING DELIVERY INTO THE 21^ST CENTURY.

THE PROPOSED LEGISLATION OFFERS MORE FLEXIBILITY TO THE STATES IN DELIVERING SERVICES, EMPHASIZES CREATION OF REALISTIC MEASUREMENTS, REWARDS SUPERIOR PERFORMANCE, AND EXPANDS SERVICE DELIVERY FROM THE TRADITIONAL "OFFICE" 8 to 5 MODE TO THE 7/24, E-BUSINESS CAPABILITY EXISTING TODAY.

AT THIS TIME I WOULD LIKE TO OFFER A FEW SPECIFIC COMMENTS.

1. THE NEED FOR CREATION OF REALISTIC MEASUREMENTS IS CRITICAL AND WILL IMPACT ANY INCENTIVE PROGRAMS. AS YOU KNOW, STAFF WILL PAY SPECIAL ATTENTION AND PERFORM THOSE TASKS FOR WHICH THEY ARE MEASURED. WE NEED CLEAR, CONCISE MEASUREMENTS THAT REMAIN CONSTANT. WHILE NOT EXPRESSED BY THE BILL, I HOPE THAT STATE AGENCIES, THE GRANT OPERATORS, WILL BE INCLUDED IN ANY PROCESS TO ESTABLISH THE NEW MEASUREMENTS.

 

2. I WELCOME ESTABLISHMENT OF THE INCENTIVE PROGRAMS. THE UTILIZATION OF FINANCIAL INCENTIVES TO REWARD PERFORMANCE IS A SOUND CONCEPT. FULLY SUPPORTING THIS ENDEAVOR, I FEEL IT IS IMPORTANT TO POINT OUT THAT THE PRESENT STAFFING GRANT SYSTEM UTILIZED BY DOL-VETS, WHICH INCLUDES QUARTERLY RECAPTURE AND REDISTRIBTION OF ALLOCATED STATE FUNDING, IF CONTINUED, WILL DEFEAT ANY TRUE INCENTIVE EFFORTS. I HEARTILY RECOMMEND MOVING AWAY FROM A STAFFING GRANT TO A PROGRAM GRANT.

 

3. THE PROPOSED LEGISLATION PLACES A 20 PERCENT LIMITATION ON ADMINISTRATIVE COSTS FOR THE BASE GRANT. THIS IS A CRITICAL POINT FOR STATE GRANT OPERATIONS. IF THE DEFINITIONS OF ADMINISTRATIVE COSTS ARE STRUCTURED SIMILAR TO OTHER EXISTING PROGRAMS, LIKE THOSE UNDER THE WORKFORCE INVESTMENT ACT, I FORESEE NO PROBLEMS FOR STATES TO STAY UNDER THAT CEILING. HOWEVER, IF DOL-VETS RETAINS THEIR CURRENT DEFINITION, WHICH CATEGORIZES ALL COST OTHER THAN PERSONAL SALARY AND BENEFITS AS ADMINISTRATIVE, THEN STATES WILL SIMPLY NOT BE ABLE TO OPERATE A VIABLE PROGRAM. FOR EXAMPLE, THE NATIONWIDE AVERAGE OF STATES DVOP/LVER GRANT ADMINISTRATIVE LEVEL FOR THE PERIOD 1996 TO 1998 WAS APPROXIMATELY 28 PERCENT AND AS WE ALL KNOW BASIC EXPENSES ARE GOING UP NOT DOWN. I BELIEVE THIS NEEDS TO BE REVEIWED MORE CLOSELY AND I ENCOURAGE YOU TO SPEND THE TIME NECESSARY TO ENSURE STATES ARE NOT PLACED IN A NO WIN SITUATION.

 

4. CLOSELY RELATED TO THE ADMINISTRATIVE LIMIT ON THE GRANT IS THE REQUIREMENT CONTAINED IN PRESENT FEDERAL RULES THAT THE STATES PAY THE ADMINISTRATIVE COSTS FOR DOL-VETS STAFF ASSIGNED IN THE STATE. THE ADMINISTRATIVE COSTS INCLUDE RENTS/LEASES, COMMUNICATIONS, TELEPHONES AND SUPPLIES. FUNDS USED TO PAY COSTS FOR ADMINISTRATIVE SUPPORT FOR FEDERAL EMPLOYEES DECREASE THE AMOUNT OF MONIES AVAILABLE TO DELIVER SERVICES TO THE CITIZENS OF THE STATE. UPON REVIEW I THINK YOU WILL FIND THAT THE STATES CURRENTLY PAY A MAJOR PORTION OF THE TOTAL DOL-VETS STAFF ADMINISTRATIVE COSTS. I BELIEVE STATES SHOULD NOT BE BURDENED WITH PAYING COSTS FOR FEDERAL EMPLOYEES AND SOLICIT YOUR SUPPORT TO CORRECT THIS SITUATION.

 

5. THE PROPOSED LEGISLATION EXPANDS VETERANS PRIORITY TO "ANY QUALIFIED EMPLOYMENT TRAINING PROGRAMS". WITH THE VARIETY OF WORKFORCE INVESTMENT SYSTEM TRAINING PROGRAMS AVAILABLE TODAY, EACH WITH THEIR OWN RESPECTIVE CLIENT FOCUS, THIS WILL SURELY LEAD TO CONFUSION IN SERVICE DELIVERY. UNDER THE EMPLOYMENT AND TRAINING FOUNDATION LAID BY THE WORKFORCE INVESTMENT ACT OF 1998, STATE AND LOCAL WORKFORCE BOARDS ARE GIVEN THE AUTHORITY AND RESPONSIBILITY TO DETERMINE HOW SERVICES ARE TO BE DELIVERED AND TRAINING DOLLARS SPENT BASED ON INDIVIDUAL NEEDS AND LOCAL ENVIRONES. WITHIN WIA, SECTION 168 PROVIDES A VETERANS ONLY TRAINING PROGRAM. UNFORTUNATELY, THE LEVEL OF FUNDING FOR THIS PROGRAM HAS BEEN AUSTERE IN COMPARISON TO THE OTHER PROGAMS. I SUGGEST, THAT ADDITIONAL FUNDING OF SECTION 168 PROGRAMS COULD WELL PROVIDE THE VEHICLE NECESSARY TO PROVIDE EMPHASIS ON TRAINING FOR VETERANS.

 

6. I AM CONCERNED ABOUT THE PROVISION CONTAINED IN THE BILL CALLING FOR INCLUSION OF A REPRESENTATIVE FROM THE VETERANS COMMUNITY ON COUNCILS, BOARDS OR ADVISORY BODIES. MUCH DISCUSSION HAS BEEN GENERATED CONCERNING BOARD MEMBERSHIP SINCE THE ENACTMENT OF WIA. WHILE EFFORTS WERE MADE TO INCLUDE AS MANY REPRESENTATIVES AS POSSIBLE, THE BOTTOM LINE IS THAT LARGE BOARDS ARE CUMBERSOME AND UNWIELDY. MOREOVER, TEXAS AND MANY OTHER STATES, HAVE BOARDS THAT HAVE BEEN GRANDFATHERED AND ANY CHANGE WILL REQUIRE STATE AND LOCAL WORKFORCE SYSTEMS TO RECONSTITUE THEIR BOARD STRUCTURES AND GO THROUGH THE APPROVAL PROCESS AGAIN. I WOULD LIKE TO POINT OUT THAT TEXAS AND SOME OTHER STATES ALREADY INCLUDE REPRESENTATION FROM THE APPROPRIATE STATE AGENCY THAT HAS RESPONSIBILITY FOR VETERANS EMPLOYMENT PROGRAMS.

 

7. I AM ALSO CONCERNED ABOUT THE PORTION THAT ESTABLISHES A COMPLAINT SYSTEM FOR VETEANS PRIORITY OF TRAINING SEPARATE FROM THE EXISTING COMPLAINT PROCESS EMBODIED IN WIA. I BELIEVE THE EXISTING STRUCTURE AND PROCESSES HAVE BEEN FORMULATED WITH THOUGHT AND FOCUS AND SHOULD BE UTILIZED RATHER THAN CREATE A SEPARATE/DUAL SYSTEM. I HOPE THAT ALL OF US CAN BEGIN TO VIEW THE WORKFORCE INVESTMENT SYSTEM IN ITS DESIGNED WHOLISTIC APPROACH, OPERATING FROM THE LOCAL LEVEL TO THE STATE, THEN TO THE FEDERAL LEVEL. I AM CONVINCED THAT THE SYSTEM NEEDS TIME TO GROW TO ITS FULL POTENTIAL. WE AS DECISION-MAKERS, MANAGERS, AND OPERATORS COULD DO WELL TO NUTURE IT ALONG, BUILDING ON ITS FOUNDATION SO THAT IT REACHES THAT PINACLE RAPIDLY.

 

8. THE LEGISLATION SEEMS TO HAVE REMOVED RECENTLY SEPARATED VETERANS AS A PRIORITY GROUP. THIS SEGEMENT OF THE VETERAN POPULATION HAS HISTORICALLY HAD THE HIGHEST RATE OF UNEMPLOYMENT AND MAKES UP A LARGE PORTION OF THOSE VETERANS THAT SEEK ASSISTANCE. I WOULD ALSO LIKE TO POINT OUT THAT THE BILL IS SOMEWHAT CONFUSING WITH REGARD TO WHICH VETERANS ACTUALLY DO HAVE PRIORITY. BY MY COUNT THERE ARE NO LESS THAT FIVE SEPARATE SECTIONS ADDRESSING WHAT VETERANS OR COVERED PERSONS WILL RECEIVE PRIORITY AND THE ACTUAL DEFINITION IN EACH OF THOSE SECTIONS VARIES SLIGHTLY. TO ADD TO THIS ALREADY CONFUSING STATE IS THAT WIA CONTAINS DEFINITIONS OF VETERANS THAT IS NOT THE SAME AS IN THIS PROPOSED LEGISLATION. I BELIEVE WE NEED TO TAKE A GOOD LOOK AT THIS AREA, BE CONSISTENT IN OUR APPROACH, AND COME UP WITH A COMMON DEFINTION FOR THE ENTIRE EMPLOYMENT AND TRAINING SYSTEM.

 

9. LASTLY, I WOULD BE REMISS IF IT DID NOT POINT OUT THAT FUNDING FOR THE VETERANS’ EMPLOYMENT AND TRAINING PROGRAMS HAS BEEN SIGNIFICANTLY BELOW THE STATUTORY FORMULA. I KNOW THIS BODY HAS ENCOURAGED OTHER CONGRESSONAL COMMITTEES TO INCREASE THE FUNDING LEVELS AND FOR THAT I AM GRATEFUL. STILL THE LEVELS REMAIN BELOW WHAT IS NEEDED. AS I APPLAUD YOUR EFFORTS IN DEVELOPING A 21^ST CENTURY VETERANS EMPLOYMENT AND TRAINING ACT, I ALSO ASK YOUR CONTINUED EMPHASIS AND ENDEAVORS TO OBTAIN ADEQUATE FUNDING FOR NOW AND THE FUTURE.

IN CLOSING LET ME EMPHASIZE THAT I AM STILL COMMITTED TO PROVIDING THE BEST WORKFORCE SOLUTIONS POSSIBLE TO VETERANS THROUGH THE SERVICES I OFFER TO GOVERNMENT/PRIVATE SECTOR CLIENTS. I RECOGNIZE THAT THE NEEDS OF EMPLOYERS AND THE NEEDS OF THE INDIVIDUAL VETERAN CLIENTS HAVE ALL CHANGED. OUTMODED AND OUTDATED SERVICE DELIVEY SYSTEMS MUST CHANGE IF WE TRULY WANT TO PROVIDE OUR CUSTOMERS WITH THE MOST EFFICIENT AND CONVENIENT SERVICES THAT FOCUS ON THEIR CURRENT AND FUTURE NEEDS. EFFORTS SUCH AS THIS BILL ARE THE ONLY MEANS TO KEEP PACE AND MOVE FORWARD. I APPRECIATE YOUR UNDERTAKING AND WELCOME THE OPPORTUNITY TO WORK WITH YOU.

I WILL BE HAPPY TO ANSWER ANY QUESTIONS.

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