Call to Order and Roll Call
The second meeting of the Interim Joint Committee on Local Government was held on Wednesday, August 26, 2015, at 10:00 AM, in Room 154 of the Capitol Annex. Senator Joe Bowen, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Joe Bowen, Co-Chair; Representative Steve Riggs, Co-Chair; Senators Julie Raque Adams, Denise Harper Angel, Stan Humphries, Christian McDaniel, Morgan McGarvey, Dorsey Ridley, Albert Robinson, and Dan "Malano" Seum; Representatives Linda Belcher, Ron Crimm, Mike Denham, Jim DuPlessis, Adam Koenig, Stan Lee, Brian Linder, Tom McKee, Michael Meredith, Russ A. Meyer, Phil Moffett, Jonathan Shell, Arnold Simpson, Rita Smart, James Tipton, and Susan Westrom.
Guests: Jiten Shah, Green River Area Development District; Jack Couch, KIPDA Area Development District; Rob Rothenburger, Shelby County Judge/Executive; Al Mattingly, Daviess County Judge/Executive; Beth Kuhn, Department of Workforce Development; Terry Martin, Hart County Judge/Executive; Eddie Rogers, Donna Draz, and Wendell Lawrence, Lincoln Trail Area Development District; Greg Terry, Vick Vineyard, and Jennifer Wallur, Purchase Area Development District; Casey Ellis, Owen County Judge/Executive; Mike Prior and David Duttberger, Bluegrass Area Development District; Darryl McGaha, Cumberlands Workforce Development; Reagan Taylor, Madison County Judge/Executive; Rodney Kirtley, Barren River Area Development District; Lisa Cooper, Northern Kentucky Area Development District; Ed Burtner, City of Winchester; Amy Kennedy, Craig Starfield, Todd Ruckel, Buffalo Trace Area Development District; Joe Pfeffer, Mason County Judge/Executive; Gabrielle Summe, Kenton County Clerk; David Cartmell, City of Maysville; Sherry McDavid, FIVCO Area Development District; Gail Wright, Gateway Area Development District; Mike Patrick, Green River Area Development District; Sandy Runyon, Big Sandy Area Development District; Darryl Link, Kentucky Council of Area Development Districts; Mike Buchanon, Warren County Development District; Shelley Hampton and Roger Recktenwald, Kentucky Association of Counties; Bert May, Kentucky League of Cities; and Vince Lang, Kentucky County Judge/Executives Association.
LRC Staff: Mark Mitchell, John Ryan, Joe Pinczewski-Lee, Tom Dorman, Brian Traugott, and Cheryl Walters.
Approval of Minutes
Upon the motion of Senator Humphries and second by Senator McDaniel, the minutes of the June 24, 2015 meeting were approved.
Role and Function of Area Development Districts
Mr. Jiten Shah, Executive Director of the Green River Area Development District (GRADD) thanked committee members the opportunity to talk about Area Development Districts (ADDs), and introduced the other speakers of the panel.
Mr. Jack Couch, Executive Director of Kentuckiana Regional Planning Development Area (KIPDA), presented background information and history of the ADDs. The U.S. Congress enacted the Intergovernmental Cooperation Act of 1968 after many public meetings. Local governments were thinking about, with leadership in the state, how to better improve services. The 15 area development districts were created in Kentucky in 1972. Over the past 50 plus-years, Kentucky’s 15 ADDs have evolved from conduits for regional and local economic development planning to catalysts of change in almost all aspects of life throughout the state and in the individual regions. ADDs have been integrally involved with the Governor’s 2020 Water Resource Plan. ADDs have also worked to map roads efficiently and economically for the Transportation Cabinet.
Judge Rob Rothenburger, Shelby County Judge/Executive, explained the role of the ADD’s Board of Directors. Meetings are open to the public. There is tremendous participation within the ADDs. A financial report is received once a month and reviewed thoroughly by the board. Questions are welcomed regarding the report.
Road updates are very important. When a road is accepted into the county road system, the map updates occur very quickly by the ADD and is then transmitted to the state. Lags in this system being updated cost millions of dollars throughout Kentucky.
ADDs assist greatly in administering grants at a fraction of the cost that other entities would charge.
KIPDA recently completed a regional land use plan for all the members of the district to help each government coordinate their individual land use plans. KIPDA also has an economic development component to build infrastructure which includes the provision of wastewater, water, and roadways on a regional basis, as well as plans that will operate to effectively reduce flood insurance costs for its citizens.
Judge Al Mattingly, Daviess County Judge/Executive, noted that the assistance of the Green River Area Development District (GRADD) is invaluable to his county. GRADD has been involved with delivering services to the elderly, young and disabled.
How GRADD provides well-trained employees for the 21st Century is a constantly moving target. At the beginning of the year, GRADD was tasked with putting the Workforce Innovation and Opportunity Act (WIOA) into place. GRADD settled on a plan, and prepared to implement it. The biggest change between WIOA and the former Workforce Investment Act (WIA) is local accountability. Education is the key for training in workforce development. WIOA is new and should be given a chance.
Mr. Shah stated that the support of local officials and persons involved in the ADDs. The ADDs learn from past experiences and are flexible. A brochure has been provided that shows how ADDs work.
Senator Bowen said that he appreciates the hard work that everyone involved in the ADDs provides and told the speakers that at some point there needs to be a discussion on funding, accountability, and what happens when things go wrong.
In response to a question from Senator Seum, Mr. Couch replied that southern Indiana was included in the KIPDA ADD because southern Indiana was part of the metropolitan planning organization structure affiliated with the federal highway plan.
In response to a question from Representative Tipton, Mr. Couch said that the majority of funding resources for KIPDA come from federal grants for aging and transportation. Eighty percent of the income is federal, overall, with a state match in some instances. About $17 million or $18 million dollars is spent per year for aging and disability programs. KIPDA board members are regularly informed and there is accountability. An audit and financial report are required every month. There is a monthly financial report that is shared with the public. ADDs want to be accountable and transparent.
Judge Rothenberger said that KIPDA has been hurt by federal cuts for senior citizen services, and advocated for increased money to be spent on these senior citizens on the federal level.
Mr. Shaw stated that the ADDs’ financials are monitored constantly by the respective grant agencies.
Judge Mattingly added that local governments contribute funds to the BRADD, and those local governments hold BRADD accountable for the expenditure of those funds.
Senator Humphries commented that county judges need to look for savings that do not hurt people, and wondered what would the Commonwealth look like without the ADDs that have helped with many areas throughout the years.
Representative Crimm commented that there will always be a “meals on wheels” program as long as the people return him to service. The legislature must continue to provide for senior citizens.
In response to a question from Representative Moffett, Judge Mattingly replied that federal money for ADDs does not come in as a block grant. The money comes in with strings attached.
Representative Shell commented that the Bluegrass ADD has been extremely helpful with getting grants for his district. Accountability and transparency must be present.
Representative Westrom commented that transparency has been a big issue with the Bluegrass ADD and that an audit was conducted by the State Auditor of Accounts on the misuse of funds. A bill that she sponsored last session would have required transparency, and she was very heartened by the panel of speakers’ remarks that they have no problem with transparency. Representative Westrom shared some key words and phrases from the Kentucky Auditor of Public Accounts’ examination of the Bluegrass ADD.
Representative Westrom stated that KIPDA board members are bonded, and protected against adverse financial judgements. ADD board members are culpable and may not all have bonds. Adverse judgments could affect the state. Every dollar that an ADD receives comes from taxpayers. Some fixes relative to ADD transparency and accountability will have to come from the General Assembly.
Representative Meyer commented that the Bluegrass ADD went through trying times, and trying times makes one better. ADDs’ teamwork provides cohesiveness. Representative Westrom’s points need to be looked at for the ADDs as well as any organization. The Bluegrass ADD has been fully committed. The Bluegrass ADD, as well as other ADDs, are committed to transparency. The legislature needs to get behind the ADDs and make them better.
Representative Riggs told the panel of speakers that the legislature needs solutions from them because they know which districts operate with the best practices. They need to tell the legislature what changes should be made so it a situation that led to the Bluegrass ADD audit report does not occur again. He wondered if the Department for Local Government should be more involved in the oversight and management of the districts, how to improve board members’ performances, and whether board members be bonded.
Judge Terry Martin, Hart County Judge/Executive said that he sees a problem regarding vocational education because there is no money being put into vocational education. There is a flood of students wanting to go to vocational school and there is no money to provide that education. Vocational education needs to be focused on in the future.
Workforce Innovation and Opportunity Act
Commissioner Beth Kuhn, Kentucky Department of Workforce Investment, said that the key ingredients that go into services in the workforce system are money (which is federal money), rules (which is the Workforce Innovation and Opportunity Act), and plans (which are completed by the locals). The workforce system consists of job-driven individual and employer/customer services, which leads to effectiveness and evaluation of plans. All funding comes from the federal government.
Commissioner Beth Kuhn explained the major differences between the Workforce Investment Act (WIA) and the Workforce Innovation and Opportunity Act (WIOA). Regional planning was permitted under WIA, and is required under WIOA, which is a key difference. WIA required a state annual report, and WIOA requires both state and local fiscal and performance reports. The technology of the future and the technology needs of the customer. WIOA makes accommodations for users of technology, such as in the job search, whereupon the previous act was silent.
System Transformation under WIOA is governance, quality service delivery, the customer at the center throughout, designation, and accountability, transparency and results. While the local physical geography did not change, the regions take into account the reach of the employer. In terms of accountability and governance, the local boards are being assembled. Fiscal procurement is in-process. Kentucky had a focus on career center certification before WIOA. The new act now requires it, so Kentucky is ahead of the game in that regard.
Responding to a question from Representative Denham, Commissioner Kuhn stated that she met with employers on the issue of employees’ drug usage, and they are moving the drug testing to random employees after they are hired. It has been too difficult to hire employees with the drug testing being performed beforehand. The agency is moving to ensure that people are employed and able to get appropriate drug intervention aid.
Responding to a question from Representative Shell, Commissioner Kuhn replied that 51 percent of the workforce board is made up of department and business representatives, and 20 percent represent the unions and industry. The board is the focal point for participation and involvement.
Responding to a question from Representative Meredith, Commissioner Kuhn said that under WIA, there is barely any mention of employer metrics, and under WIOA there is much more discussion.
Responding to a question from Representative Smart, Commissioner Kuhn stated that all workforce areas of the state have full service career centers.
Representative Westrom requested an update on how each region is doing and what the needs are on a periodic basis. Commissioner Kuhn said she would provide that information.
Responding to a question from Representative Belcher, Commissioner Kuhn said she would be able to discuss the issue of felons being able to get jobs.
There being no further business, the meeting was adjourned at 12:00 p.m.