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Supplemental Budget Addresses Regulation, Workforce Training

Posted on August 31, 2011

The Patrick administration filed a supplemental budget this week that contains two key provisions for employers – one that will require regulatory cost-benefit studies to be placed online and a second that will free up millions of dollars in workforce training funds current caught in an accounting transition.

Workforce TrainingThe $460 million spending bill, funded by surplus funds from the fiscal year that ended June 30, would send $300 million to the state’s rainy day fund, bringing that account’s balance to more than $1 billion for the first time since the recession. The remaining $160 million would be distributed among social safety net programs, workforce development programs and communities impacted by a December 2008 ice storm and June 2011 tornadoes

The measure would allow the commonwealth to move money earmarked earlier this year for the Workforce Training Fund Program (WTFP) into a new trust fund created when Governor Deval Patrick signed the Fiscal Year 2012 budget in August. Officials cannot currently apply money that was in the fund prior to the creation of the trust, meaning that companies receiving grants in July to train employees must wait to receive their money.

The Massachusetts Executive Office of Labor and Workforce Development says there is enough money in the trust to fund the backlog of applications to the WTFP Express program, which provides small grants.

“AIM strongly supports moving the Workforce Training Fund Program to a trust as a means of insulating the program from the uncertainties of the annual budget process. Moving money from the former structure to the new trust is really just an accounting issue,” said Richard C. Lord, President of AIM and Chair of the Workforce Training Fund Advisory Committee.

Lord said employers should know that applications for the WTFP will soon be accepted and approved on a monthly, rather than quarterly, basis.  State officials also say that a new WTFP application will be available Friday on the Labor and Workforce Development Web site.

The proposal to require state regulators to post the full text of cost-benefit studies of proposed new rules comes as welcome news to AIM. The association believes that online disclosure will lead to meaningful debates about the costs and potential consequences of regulations that may harm the Massachusetts economy.

The Massachusetts Legislature passed the cost-benefit study requirement in 2010, but the current law provides that only a summary of the analysis be posted online.  The full text is available at the Secretary of the Commonwealth’s office.

The cost-benefit reviews must include the following information about any new rule:

  • an estimate of the number of small businesses subject to the proposed regulation;
  • projected reporting, recordkeeping and other administrative costs required for compliance with the proposed regulation;
  • the appropriateness of performance standards versus design standards;
  • an identification of regulations of the promulgating agency, or of another agency or department of the commonwealth, which may duplicate or conflict with the proposed regulation; and
  • an analysis of whether the proposed regulation is likely to deter or encourage the formation of new businesses in the commonwealth.

“Employers appreciate the support of the Patrick Administration on these two important issues and look forward to working with the Legislature to ensure that both are addressed expeditiously,” Lord said.