FISCAL NOTE

Date Requested: February 11, 2021
Time Requested: 02:39 PM
Agency: Rehabilitation Services, WV Division of
CBD Number: Version: Bill Number: Resolution Number:
1394 Introduced HB2290
CBD Subject:


FUND(S):

General Revenue

Sources of Revenue:

General Fund

Legislation creates:

Creates New Expense



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


Under HB 2902, the estimated cots to the State is $2.64 million. The estimated cumulative revenue to the State is $-164,736.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2021
Increase/Decrease
(use"-")
2022
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 528,000 528,000 528,000
Personal Services 0 0 0
Current Expenses 528,000 528,000 528,000
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues -32,947 -32,947 -32,947


Explanation of above estimates (including long-range effect):


The purpose of HB 2902, in part, is to provide for fair pay and maximized employment of disabled persons; create a state “Employment First” policy that encourages agencies to facilitate employment of disabled persons; and remove current exemption for paying minimum wages to persons in nonprofit workshops. To this end, the WV Division of Rehabilitation Services (DRS) is already conducting activities of this nature in its mission to enable and empower individuals with disabilities to work and to live independently by providing individualized services to consumers and employers, consistent with consumers’ informed choice. DRS uses an “Employment First” approach with consumers, actively moving with them toward a goal of competitive, integrated employment. Likewise, DRS is in compliance with the Workforce Innovation and Opportunity Act (WIOA) regarding efforts to minimize Sheltered Workshop employment for individuals with disabilities by providing the individuals employed at such Workshops with information regarding competitive, integrated employment and vocational rehabilitation (VR) services. As of July 2018, 264 individuals with disabilities were employed at Sheltered Workshops in the State of West Virginia. DRS estimates that the cost of providing VR services, including training, to these individuals until all of them achieved the goal of competitive integrated employment would be approximately $2.64 million over the course of approximately 5 years, assuming a cost of $10,000 in services to each of these individuals. Because of this potential shift in allocation of funds, DRS would be unable to serve other individuals that the agency would have been able to otherwise serve, without additional State funds to cover the costs. To establish a taskforce for the purpose of developing recommendations on implementation of an Employment First Policy, the Director of the Division of Rehabilitation Services will be expected to spend zero dollars over the course of two months. The financial impact for agencies, including DRS, of the implementation of a joint Employment First Policy and plan would be determined following the establishment of the taskforce, pursuant to HB 2902. The State of West Virginia would see an estimated reduction of $164,736 of revenue over the 5-year period, due to the loss of income tax gained by Sheltered Workshop employees. This estimation assumes, for the 264 individuals employed at Sheltered Workshops, an average hourly wage of $4.00, for an average of 20 hours per week, for 52 weeks per year, with a State income tax rate of 3%.



Memorandum


Note that this PARTIAL Fiscal Note highlights the projected costs to DRS following the passage of HB 2902. Additional costs to other agencies and contributors to the proposed taskforce cannot be ascertained by DRS at this time.



    Person submitting Fiscal Note: Michelle D. James
    Email Address: Michelle.D.James@wv.gov