FY 2013 WOTC state funding allotments

Accessible letter PDF: https://www.dol.gov/sites/dolgov/files/ETA/advisories/TEGL/2013/TEGL_30_12_Acc.pdf

CLASSIFICATION
  EMPLOYMENT AND TRAINING ADMINISTRATION                 WOTC
              ADVISORY SYSTEM                            CORRESPONDENCE SYMBOL
         U.S. DEPARTMENT OF LABOR                        OWI
            Washington, D.C. 20210                       DATE
                                                         May 15, 2013


ADVISORY:       TRAINING AND EMPLOYMENT GUIDANCE LETTER NO. 30-12

TO:             STATE WORKFORCE AGENCIES
                STATE WORKFORCE LIAISONS

FROM:           JANE OATES /s/
                Assistant Secretary

SUBJECT:        Work Opportunity Tax Credit (WOTC) Funding Allotments for Fiscal Year
                (FY) 2013

1. Purpose. To provide the State Workforce Agencies (SWAs) with final funding allotments
   for the administration of the WOTC program through September 30, 2013.

2. References.
   • The Consolidated and Further Continuing Appropriations Act, 2013, Division F, Title V,
      Labor, Health and Human Services, and Education, and Related Agencies (Pub. L. 113-6)
   • Sections 309 and 327 of the American Taxpayer Relief Act of 2012 (Pub. L. 112-240)
   • Section 261 of the VOW to Hire Heroes Act of 2011 (Pub. L. 112-56)
   • Section 51 of the Internal Revenue Code of 1986, as amended
   • Wagner-Peyser Act, Section 7(d)
   • ETA Handbook No. 408, November 2002, Third Edition (the Handbook)
   • August 2009 Addendum to the Handbook

3. Background. In November 2012 and January 2013, the Employment and Training
   Administration (ETA) issued to SWAs the program funds provided by Congress under Public
   Law 112-175, the then-enacted continuing resolution for FY 2013. On March 26, Public Law
   113-6, the Consolidated and Further Continuing Appropriations Act was enacted, which
   provides Department of Labor appropriations for the remainder of FY 2013.

   Sequestration is a set of automatic, largely across-the-board spending reductions. In August
   2011, as part of the Budget Control Act, bipartisan majorities in both the House of
   Representatives and Senate voted for sequestration as a mechanism to compel the Congress
   to act on deficit reduction. However, due to the failure to reach a deal on balanced deficit
   reduction to avoid sequestration, the President on March 1, 2013, was required by law to
   issue a sequestration order canceling approximately $85 billion in budgetary resources across
   the Federal Government for the remainder of the Federal fiscal year.


 RESCISSIONS                                             EXPIRATION DATE
 None                                                    Continuing

  Both defense and non-defense programs are subject to reductions under sequestration unless
  exempted by law. The sequestration order requires a 5.0 percent reduction in non-exempt FY
  2013 nondefense discretionary funding, which includes the Wagner-Peyser Employment
  Service program activities.

4. Funding. ETA is now issuing the balance of FY 2013 funding to the SWAs for WOTC
   program activities through September 30, 2013. The appropriated level for FY 2013 totals
   $18,484,997, the same funding level as FY 2012. Because Congress appropriates funds for a
   combination of Employment Service technical assistance and training functions, including
   WOTC, as a single activity rather than as separate programs, projects, and activities, the
   Department of Labor has flexibility in determining how to implement the sequestration, and
   has chosen to maintain the FY 2012 level of funds for WOTC state allotments in FY 2013.

   After allocating $20,000 for the Virgin Islands, ETA distributes funds to states by
   administrative formula with a $66,000 minimum allotment and a 95 percent stop-loss/120
   percent stop-gain from the prior year allotment share percentage. The FY 2013 formula
   allotment data factors and related percentages are as follows:

       (1) Fifty percent based on each state's relative share of total certifications issued from
           October 1, 2011 through September 30, 2012 for the WOTC program;

       (2) Thirty percent based on each state's relative share of the Civilian Labor Force,
           averages for the 12-month period, from October 1, 2011 through September 30, 2012;
           and

       (3) Twenty percent based on each state's relative share of adult recipients of Temporary
           Assistance for Needy Families, averages for the 12-month period, from October 1,
           2010 through September 30, 2011.

   Attachment I shows the distribution of full FY 2013 WOTC funding amounts by state
   according to this formula, including those funds for the fiscal year previously awarded.

5. General Administration. SWAs are responsible for administering the WOTC program,
   including the certification process, promoting the program to employers, reducing and
   eliminating existing backlogs, and reporting program data on a quarterly basis.

   In addition, SWAs must administer WOTC in accordance with the policies and procedural
   guidance set forth in the November 2002, Third Edition of ETA Handbook No. 408
   (Handbook); the August 2009 Addendum to this Handbook; and Section 51 of the Internal
   Revenue Code of 1986, as amended. Current Federal Regulations at 20 CFR 658.400
   Subpart E cover the complaint procedures. Other applicable requirements are listed in the
   Statement of Work (Attachment II).

6. Reporting. SWAs must report expenditures quarterly using ETA Financial Report (ETA
   Form 9130). These reports should cover all WOTC grant funds. Quarterly financial reports


   are due within 45 days following the end of each quarter. Timely submission of these reports
   is extremely important to ensure proper accounting of funds. ETA’s Regional Offices will
   conduct a financial reconciliation at the end of the fiscal year. Questions regarding financial
   management and reporting for FY 2013 or for existing prior year fund balances should be
   addressed to the appropriate Regional Office.

   SWAs should use the Web-based Enterprise Business Service System Tax Credit Reporting
   System to report quarterly program activities and outcomes using ETA Form 9058. Quarterly
   performance reports are due within 45 days following the end of each quarter. Timely
   submission of these reports is very important for program management purposes and to
   enable ETA to respond to inquiries about program activities. Please direct questions about
   quarterly reporting on program activities to the appropriate Regional Office.

7. Action Required. ETA requests that State Administrators promptly transmit this Training
   and Employment Guidance Letter to appropriate staff.

8. Inquiries. Please direct questions regarding these allotments to the appropriate Regional
   WOTC Coordinator listed on the WOTC program Web site at: http://www.doleta.gov/wotc.

9. Attachments.
   I. FY 2013 WOTC State Allotments
   II. WOTC Statement of Work

Attachment 1: https://www.dol.gov/sites/dolgov/files/ETA/advisories/TEGL/2013/TEGL_30_12_Att1.pdf

U. S. Department of Labor                       Attachment I
             Employment and Training Administration
              Work Opportunity Tax Credits
               FY 2013 State Allotments


              State                          Amount

Total                                            $18,484,997

Alabama                                                 310,418
Alaska                                                   66,000
Arizona                                                 420,807
Arkansas                                                199,993
California                                             2,018,297
Colorado                                                218,161
Connecticut                                             169,092
Delaware                                                 66,000
District of Columbia                                     66,000
Florida                                                 848,461
Georgia                                                 500,774
Hawaii                                                   66,000
Idaho                                                    82,950
Illinois                                                723,412
Indiana                                                 430,161
Iowa                                                    252,668
Kansas                                                  186,763
Kentucky                                                300,111
Louisiana                                               363,237
Maine                                                   108,872
Maryland                                                300,211
Massachusetts                                           295,709
Michigan                                                629,182
Minnesota                                               236,332
Mississippi                                             179,267
Missouri                                                414,641
Montana                                                  66,000
Nebraska                                                139,612
Nevada                                                  117,727
New Hampshire                                            66,000
New Jersey                                              391,690
New Mexico                                              128,149
New York                                                936,599
North Carolina                                           536,473
North Dakota                                              66,000
Ohio                                                   1,024,940
Oklahoma                                                 270,646
Oregon                                                   229,276
Pennsylvania                                             804,589
Puerto Rico                                               88,799
Rhode Island                                              66,000
South Carolina                                           274,213
South Dakota                                              66,000
Tennessee                                                767,168
Texas                                                  1,314,742
Utah                                                     160,238
Vermont                                                   66,000
Virginia                                                 424,710
Washington                                               429,781
West Virginia                                            173,927
Wisconsin                                                336,199
Wyoming                                                   66,000
  State Total                                         18,464,997
Virgin Islands                                            20,000

Attachment 2: https://www.dol.gov/sites/dolgov/files/ETA/advisories/TEGL/2013/TEGL_30_12_Att2.pdf

Work Opportunity Tax Credit Program
                                  Statement of Work


State Workforce Agencies (SWAs) are to use Fiscal Year 2013 funds announced herein for:

    1. Determining eligibility of individuals as members of targeted groups, on a timely basis,
      and performing a “quality review” by a second staff person for each determination within
      48 hours of receipt.

    2. Issuing employer certifications, denials, or notices of invalidation for tax credits on a
      timely basis and in accordance with the policies and procedures set forth in the ETA
      Handbook No. 408, Third Edition, November 2002 (the Handbook) and the August 2009
      Addendum to the Handbook.

    3. Developing working agreements with partner agencies in the American Job Center
      network (also known as the One-Stop Career Center system) and coordinating efforts to
      promote WOTC to employers and job seekers and other Workforce Investment Act
      (WIA) partners.

    4. Establishing and implementing an Appeals Resolution and Policy Clarification System in
      accordance with the guidelines provided in the Handbook (Chapter VIII, Section F,
      pp.VIII-5-8).

    5. Establishing and maintaining appropriate forms review, record keeping, and reporting
      capability related to the orderly management of WOTC certification requests.

    6. Establishing and maintaining an orderly system for regularly verifying the eligibility of a
      random sample of individuals certified under the WOTC Program and initiating effective
      corrective action when appropriate as indicated by results of such activities.

    7. Negotiating formal cooperative agreements with local WIA areas, State Vocational
      Rehabilitation Agencies, Veterans Administration and related groups, Employment
      Networks and other state and local agencies, and organizations for the purposes of issuing
      Conditional Certifications where appropriate, and/or augmenting WOTC outreach
      activities.

    8. Negotiating formal cooperative agreements with appropriate state agencies, including the
      Departments of Health and Human Services, Agriculture, Housing and Urban
      Development and the Social Security Administration to expedite verification of
      information provided to the SWA by participating target group members.


    9. Training state and participating agency staff, and providing monitoring and technical
      assistance to these agencies, as appropriate, for conducting target group preliminary
      eligibility determinations and issuing Conditional Certifications.

    10. Cooperating with employment and training organizations already working with the
       private sector such as: veteran organizations, employer committees, and workforce
       investment boards to inform employers about the tax benefits to be derived from
       participation and the eligibility requirements under the WOTC Program.

Grant Agreement Conditions.

By entering into this agreement, the SWA agrees to the following conditions:

    1. The SWA must adhere to provisions of the Internal Revenue Code of 1986, Section 51, as
      amended, in conducting the program. By law, the SWAs are designated as the only
      agencies that can issue a Certification. The SWAs can enter into cooperative agreements
      with certain participating agencies and together provide other WOTC related program
      services (e.g., issuing Conditional Certifications, outreach activities).

    2. The most current edition of the WOTC program Handbook and its updated August 2009
      Addendum shall guide conditions and standards of performance for administration and
      operation of the program. The SWA shall maintain a verification and quality control
      process in accordance with guidance in this Handbook

    3. ETA will review funding utilization against the quarterly spending plan and when
      expenditures are substantially below plan. ETA may de-obligate funds for redistribution.