Senate Bill No. 471
(By Senators Manchin, Oliverio, Craigo, Sharpe,
Schoonover, Wiedebusch and Bailey)
[Introduced February 20, 1995; referred to the Committee
on Health and Human Resources; and then to the Committee
A BILL to amend chapter thirty-one of the code of West Virginia,
one thousand nine hundred thirty-one, as amended, by adding
thereto a new article, designated article five-a, relating
to the "wagefare" act; definitions; declarations of intent
and purpose; governor and department of health and human
resources to work together to obtain exemptions from federal
statutes to implement program; wagefare advisory board;
wagefare implementation councils; wagefare program special
fund; duties of department of health and human resources;
implementation of program; payments of benefits; approval
required for cash in lieu of food stamps; evaluation of
wagefare program; appointment of board; and establishment of council to take place sixty days from effective date.
Be it enacted by the Legislature of West Virginia:
That chapter thirty-one of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, be amended by
adding thereto a new article, designated article five-a, to read
ARTICLE 5A. WAGEFARE.
The following terms mean as follows:
(a) "Board" means the wagefare advisory board;
(b) "Department" means the department of health and human
(c) "Wagefare" or "program" means the wagefare program.
§31-5A-2. Declarations of legislative intent and purpose.
(a) In establishing and implementing a pilot program to be
known as the wagefare program, it is the intent of the
Legislature to promote greater economic self-sufficiency among
West Virginia families and workers by:
(1) Increasing the employability of unemployed and
underemployed West Virginians through on-the-job training;
(2) Invigorating the public-private work force partnership
through development of jobs with both private for-profit and
public employers; and
(3) Insuring that program participants through their
employment development plans have opportunities to improve work
skills, education and employability and establish recent work
histories with work site training, mentoring, individual
education accounts and provisions of necessary support service
benefits that include child care, workers' compensation, job
placement and a guarantee that participation in the wagefare
program does not result in reduction of net income to
(b) The wagefare program is created as a three-year pilot
program in which residents in participating counties in the state
of West Virginia shall, in lieu of receiving coupons under the
food stamp program and payments from the aid to dependent
children program, be provided jobs and paid in a way that
promotes self-sufficiency and encourages unemployed West
Virginians to improve their position in the work force.
Recipients of unemployment insurance in the pilot counties also shall be offered employment under the program.
§31-5A-3. Governor and department of health and human resources
to work together to obtain exemption.
(a) The governor and the department of health and human
resources shall work diligently to obtain all exemptions and
waivers from and amendments to federal statutes, rules and
regulations necessary to implement the program at the earliest
(b) Upon obtaining all such exemptions, waivers and
amendments the department of health and human resources, with the
advice of the wagefare advisory board, shall adopt such changes
to current rules as may be required to implement the program.
(c) The department, with the advice of the board, shall
amend the state plans for the aid to dependent children program,
the job opportunities and basic skills program and the food stamp
program to incorporate the programs into the wagefare program for
the pilot counties, and shall obtain federal approval of plan
(d) The department, with the advice of the board, shall
obtain any exemptions and waivers from federal statutes and
regulations necessary to qualify the program as a federally approved demonstration project under section 1115 (42 U.S.C.
1315) of the Social Security Act and section seventeen (7 U.S.C.
2026) of the Food Stamp Act.
(e) The purpose of this section is to facilitate
implementation of the program at the earliest possible date and
with maximum federal financial participation. Therefore, the
department is directed to expedite the acquisition of federal
waiver and amendment approvals, and the adoption of necessary
statutory amendments in close and continuous coordination with
appropriate federal officials, and to prepare and submit
completely and in a timely manner all forms and data required by
those officials. The department, with the advice of the board,
is authorized to make such changes to the program as are
necessary to achieve federal waiver approval. Any changes should
be, in the judgment of the director of the department of health
and human resources, the fewest necessary to achieve federal
approval for the program. The changes must maintain the intent
and purpose of the program, as set forth in section four of this
article. If changes to the program required to gain waiver
approval would be too extensive to maintain the purpose and intent of the program, the department, with the advice of the
board, shall seek the amendments to federal statutes that are
required for implementation of the program.
(f) Any county may opt to participate in the pilot program
with a majority of the county's county commission voting to do
§31-5A-4. Wagefare advisory board; members; terms; and annual
(a) The wagefare advisory board is established to advise the
department in the direction and administration of the program.
The board consists of nine members, five to be appointed by the
governor and, two to be appointed by the speaker of the House of
Delegates and two to be appointed by the president of the Senate.
Members shall serve three-year terms.
(b) The board shall meet monthly with the director of the
department of health and human resources.
(c) The board shall report annually to the governor and the
Legislature on the status and progress of the program. A
chairperson to be selected among the members of the board shall
have the additional duty to work with and coordinate the local
councils created in this article.
§31-5A-5. Wagefare implementation councils.
A wagefare implementation council shall be established in
each pilot county to assist the wagefare advisory board and the
department of health and human resources in the administration of
the wagefare program and to allow local flexibility in dealing
with the particular needs of each pilot county. Each council
shall be primarily responsible for recruiting and encouraging
participation of employment providers in the county. Each
council shall be composed of seven members who shall be appointed
by the county commissioners in each pilot county. Council
members shall be residents of the pilot county in which they are
appointed and shall serve three-year terms. At least two members
shall be current or former recipients of the aid to dependent
children program and the food stamp program.
§31-5A-6. Wagefare program special fund.
(a) There is created a wagefare program special fund,
separate and distinct from the general revenue fund. All moneys
in the fund are continuously appropriated for and shall be used
exclusively to meet the necessary expenditures of the program,
including program wage reimbursements to participating employers,
aid to dependent children cash grants, food stamp allotments, wagefare payments and employment-related day care payments to
eligible residents of the pilot counties and administrative costs
directly associated with the operation of the program. At the
end of the three-year pilot program, expenditures from the fund
shall not exceed accruals to the fund. No less than quarterly,
the department shall meet with the board to review the cost
effectiveness of the program and shall take any necessary action
to modify or suspend the program to maintain cost neutrality.
(b) The individual education account is established in the
wagefare program special fund in order to improve the position of
wagefare participants in the workforce by increasing their access
to continuing education. Employer contributions to the account
as provided for in this article shall be used to pay for further
education as set forth in this article.
(c) All funds appropriated for expenditure by or apportioned
to the department for operation of the aid to dependent children
program, the job opportunities and basic skills program, the food
stamp program and employment-related day care in the pilot
counties shall accrue to the fund.
(d) The fund shall be held and administered by the state treasurer. All income earned on moneys in the fund shall be
credited to and deposited in the fund to the extent permitted by
state and federal law.
(e) There is hereby created the wagefare unemployment wage
fund. The fund shall consist of moneys collected or received by
the department of health and human resources pursuant to this
The wagefare unemployment wage fund shall be held and
administered by the state treasurer.
All income earned on moneys in the wagefare unemployment
wage fund invested by the state treasurer shall accrue to the
fund. Any balance in the fund shall not lapse at any time. All
moneys in the fund are appropriated continuously to the
department of health and human resources for the payment of wages
and wage-related expenses of participants in the wagefare program
who were otherwise eligible to receive unemployment insurance
benefits. Such payments shall be made in the form of a
reimbursement to the department, which shall be the central
disbursement point for all employer-related financial
transactions under the provisions of this article.
(f) Notwithstanding the rates of contribution in article
five, chapter twenty-one-a, et.seq., for wages paid during
calendar year one thousand nine hundred ninety-six, the rate
assigned each employer subject to provisions contained in this
article shall be determined in accordance with the schedule as
set forth in this article as follows:
Fund Adequacy Percentage Ratio I D
200% and Over
Contribution Rate Cumulative Payroll Limits
(Percentage of Total Taxable Payroll)
0.00% but less than 15.00%
15.00% but less than 20.00%
20.00% but less than 25.00%
25.00% but less than 30.00%
0.36%30.00% but less than 35.00%
35.00% but less than 40.00%
40.00% but less than 45.00%
45.00% but less than 50.00%
50.00% but less than 55.00%
55.00% but less than 60.00%
60.00% but less than 65.00%
65.00% but less than 69.00%
69.00% but less than 73.00%
73.00% but less than 77.00%
1.36%77.00% but less than 80.00%
80.00% but less than 83.00%
83.00% but less than 86.00%
86.00% but less than 89.00%
89.00% but less than 91.00%
91.00% but less than 93.00%
93.00% but less than 95.00%
95.00% but less than 96.00%
96.00% but less than 96.90%
96.90% but less than 97.70%
2.36%97.70% but less than 98.40%
98.40% but less than 98.90%
98.90% but less than 99.30%
99.30% but less than 99.54%
99.54% but less than 99.63%
but less than 99.92%
5.40% 99.92% to 100.00%
(g) All moneys shall be paid and collected in the same
manner and at the same time as unemployment compensation
contributions, unless the commissioner of the bureau of
employment programs in conjunction with the secretary of the
department of health and human resources prescribes otherwise.
After deduction of the actual shared costs of the department in
collecting the amounts under this subsection, all such moneys shall be paid into the wagefare unemployment wage fund, which
shall be separate and distinct from the general revenue fund.
Moneys due pursuant to this section but not received by the
department for payment into the wagefare unemployment wage fund
by the thirtieth day of June, one thousand nine hundred
ninety-six, shall be paid into the unemployment compensation
(h) The department is authorized to continue to make
reimbursements as necessary from the wagefare unemployment wage
fund for a period not to exceed six months following the end of
the three-year pilot program authorized under this article. Any
unexpended and unobligated moneys remaining in the wagefare
unemployment wage fund six months following the end of the
three-year pilot program are appropriated and transferred to the
unemployment compensation trust fund on that date.
(i) All payments by participating employers to the
department for specially skilled program participants as provided
for in this article shall accrue to the fund.
(j) In administering the fund, and consistent with other
provisions of the program and to the extent permitted by federal law , the department shall maximize the use of federal grants and
apportionments of the aid to dependent children program, the job
opportunities and basic skills program, the food stamp program
and employment-related day care.
(k) To the extent that additional moneys may be obtained for
the program from sources other than state tax revenues, the
additional moneys shall be appropriated to the fund.
§31-5A-6. Duties of department of health and human resources;
implementation of program; payments of benefits.
(a) The department of health and human resources shall adopt
by a rule a method to determine which employers, including public
and private sector employers, within this state may have the
opportunity to utilize program participants. The department
shall give priority in assigning program participants to those
employers located in the six pilot counties set forth in this
article. No employer is required to participate in the wagefare
program. In the event that there are unassigned participants
whom no employer desires to utilize, they may be assigned to work
for a public agency.
No business or organization primarily engaged in activities
which are political or religious in nature may employ any person under the authority of the wagefare program: Provided, That
nothing may prohibit the employment of an individual or
individuals by a religious or political business or organization
under the authority of the wagefare program in the event the
employment offered does not involve religious or political
Any charitable organization, as the term is defined by
chapter twenty-nine, article nineteen, section two of this code
shall also be eligible to employ persons under the authority of
the wagefare program.
(b) The maximum number of program participants that any
employer is authorized to receive at any one time shall not
exceed ten percent of the total number of the employer's
employees. However, each employer may receive one participant.
The director of the department of health and human resources may
waive the limit in special circumstances.
(c) The department by rule may:
(1) Establish criteria for excluding employers from
participation for failure to abide by program requirements or
other demonstrated unwillingness to comply with the stated intent of the program.
(2) Provide that employers that have shown a pattern of
terminating participants prior to the completion of training or
of not offering unsubsidized employment to participants who have
successfully completed training with that employer shall be
ineligible to receive additional participants.
(d) The department shall insure that jobs made available to
program participants shall:
(1) Not require work in excess of forty hours per week;
(2) Be in conformity with section 3304(a)(5) of the Federal
Unemployment Tax Act;
(3) Not be used to displace regular employees nor to fill
unfilled positions previously established; and
(4) Not pay a wage that is substantially less than the wage
paid for similar jobs in the local economy with appropriate
adjustments for experience and training.
(e) Individuals eligible for the program shall be limited to
pilot county residents who are:
(1) Adults and caretaker relatives who are receiving aid to
dependent children benefits;
(2) Adult food stamp program recipients except as described
in subsection (g), subdivision four of this section;
(3) Unemployment compensation recipients; and
(4) Unemployed noncaretaker parents of children who are
receiving aid to dependent children benefits.
(f) Individuals desiring work through the program shall
contact the nearest office of the department of health and human
resources serving the pilot county in which they reside if they
are aid to dependent children program or food stamp program
applicants or recipients. Unemployment compensation applicants
or recipients may gain access to the program through the nearest
office of the division of employment security.
With input from the participant, case workers shall prepare
an employment development plan designed to assist the participant
in removing barriers to employment, acquiring work skills and
obtaining unsubsidized employment. The case worker shall
periodically review the employment development plan and assess
participant progress in accordance with rules for the wagefare
With the assistance of the local council and the wagefare advisory board, the department shall develop a job inventory of
sufficient size to accommodate all of the participants who desire
to work in the program. In consultation with the participant,
the department shall try to match the profile of a participant
with the needs of an employer when assigning a participant to
work with the employer.
Either the employer or the participant may terminate the
assignment by contacting the appropriate department office. In
such event, the department shall reassess the needs of the
participant and assign the participant to another wagefare
placement or another wagefare program component and, at the
employer's request, provide the employer with another
The department shall pay placement and barrier removal
payments from the wagefare program special fund as necessary to
enable participation in wagefare.
If after six months in a placement, a participant has not
been hired for an unsubsidized position, the employer shall allow
the worker to undertake eight hours of job search per week.
Participating employers shall consider such time as hours worked for the purposes of paying wages.
If after nine months in a placement, a participant has not
been hired for an unsubsidized position, the placement shall be
terminated, and the case worker shall reassess the participant's
employment development plan.
The department shall accept eligible volunteers into the
program prior to mandating program participation by eligible
Assignment of participants to available jobs shall be made
on the basis of a preference schedule developed by the department
with priority given to employing nonworking parents of children
receiving aid to dependent children, food stamp recipients or
unemployment compensation recipients, in that order.
(g) Program jobs shall not be offered to the following
groups, irrespective of the priority referred to in this section:
(1) Teenage custodial parents working to receive their
general education development certificate or high school diploma;
(2) Persons determined to require substance abuse treatment
prior to job placement;
(3) Persons determined to be permanently or temporarily incapacitated and persons who are primary caregivers to such
(4) Food stamp applicants or recipients who are employed
full-time or are food stamp eligible college students enrolled
full-time in an institution of higher education or enrolled
half-time in an institution of higher education and working at
least twenty hours per week;
(5) Aid to dependent children recipients who have not
completed both a life skills class and requirements for a general
education development certificate or high school diploma, except
when approved programs to provide life skills and a general
education development certificate are provided to the participant
at the worksite;
(6) Teenage persons who have not received a general
education development certificate or high school diploma;
(7) Food stamp recipients in the pilot counties who are
eligible for supplemental security income benefits or other
ongoing state or federal maintenance benefits based on age or
(8) Persons for whom suitable child care arrangements are necessary but not available; and
(9) Person for whom transportation is not available, persons
who live in remote areas or persons who would be required to
commute for more than one hour each way, in accordance with
wagefare program rules.
(h) Unemployment compensation recipients may be referred to
available work through the workfare program if the qualifying
base year wages used to establish the claim do not exceed ten
thousand dollars. If referred, unemployment compensation
recipients shall be referred to the workfare program in
accordance with the job referral process used to refer applicants
to available work. When a program job is offered to an
unemployment compensation recipient and the job is refused, the
division of employment security shall investigate the refusal and
identify and decide all issues arising therefrom, including
suspension of benefits, in accordance with the provisions of
article six-a, chapter twenty-one-a of this code.
(i) Aid to dependent children and food stamp benefits shall
be suspended at the end of the calendar month in which an
employer makes the first wage payment to a participant who is a custodial parent in a family that receives aid to dependent
children or to any adult member of a household receiving food
stamps. Failure of the participant to cooperate with the
requirements of the wagefare program shall result in the
participant's removal from the program and the removal of the
needs of the adult or adults from the grant in accordance with
program rules. Rules governing sanctions, hearings or
conciliations for participants in the program shall be made by
the director of the department of health and human resources.
(j) Employers shall pay all participating individuals at
least an hourly rate no less than the federal minimum wage.
Sick leave, holiday and vacation absences shall conform to
the individual employer's rules for new employees.
Group health insurance benefits shall be provided by the
employer to program participants if, and to the extent that,
state or federal law requires the employer to provide such
All persons participating in the workfare program shall be
considered to be temporary employees of the individual employer
providing the work and shall be entitled only to benefits required by state or federal law.
Employers shall provide workers' compensation coverage for
each workfare participant.
In the event that the net monthly full-time wage paid to a
participant would be less than the level of income from the aid
to dependent children program and the food stamp benefit amount
equivalent that the participant would otherwise receive, the
department shall determine and pay a supplemental payment as
necessary to provide the participant with that level of net
income. The department by rule shall adopt an equivalency scale
to be adjusted for household size and other factors. The purpose
of this equivalency scale is to insure that participants are not
economically disadvantaged, in terms of net income, by accepting
a job under the program. The department shall determine and pay
in advance supplemental payments to participants on a monthly
basis as necessary to insure equivalent net program wages.
Participants shall be compensated only for time worked.
(k) In addition to, and not in lieu of the payments provided
for under subsection (j) of this section, participants shall be
entitled to retain the full child support payments collected by the department.
(l) After the participant has participated in the wagefare
program for thirty days, in addition to the participant wage, the
employer shall pay one dollar for each participant hour worked
into the participant's individual education account.
Contributions to such an account shall be tax deferred or tax
exempt to the extent permitted by federal and state law. This
contribution shall not be reimbursed by the wagefare plus program
special fund except as follows:
If the employer hires a participant in an unsubsidized
position for at least thirty days, the wagefare program special
fund shall reimburse one half of the employers contribution to
the individual education account to the employer.
(m) Any participant for whom an individual education account
contribution is made shall be eligible for access to education
benefits from that participant's individual education account at
any time after the participant has left the wagefare program and
has held a full-time, unsubsidized job for at least thirty days.
(n) When any participant has qualified for use of that
participant's individual education account, an amount equal to that participant's individual education account balance shall be
transferred to a fund to be administered by the chancellor or
community colleges pursuant to his or her duties as set forth in
section one, article four, chapter eighteen-b for that
participant's use. Only one individual education account shall
be created for any participant. Each account shall be
administered by the chancellor of community colleges and shall be
used for continuing education and training in any of the state's
community colleges or institutions of higher education for the
participant and the participant's immediate family.
(o) Program participants who are eligible for federally and
state funded medical assistance at the time they enter the
program shall remain eligible as long as they continue to
participate in the program. In conformity with existing state
employment-related day care program regulations, child day care
shall be provided for all program participants who require it.
(p) Wagefare program employers shall:
(1) Endeavor to make wagefare program placements positive
learning and training experiences;
(2) Maintain health, safety and working conditions at or above levels generally acceptable in the industry and no less
than that of comparable jobs of the employer;
(3) Provide on-the-job training to the degree necessary for
the participants to perform their duties;
(4) Recruit volunteer mentors from among their regular
employees to assist the participants in becoming oriented to work
and the workplace; and
(5) Sign an agreement for each placement outlining the
specific job offered to the participant and agreeing to abide by
all requirements of the program, including the requirement that
the program not supplant existing jobs. All agreements shall
include provisions noting the employer's responsibility to repay
reimbursements in the event the employer violates program rules.
(q) Program participant wages shall be subject to federal
and state income taxes, social security taxes and unemployment
compensation contributions which shall be withheld and paid in
accordance with state and federal law. Supplemental payments
made pursuant to subsection (j) of this section shall not be
subject to state income taxes and, to the extent allowed by
federal law, shall not be subject to federal income taxes and social security taxes.
(r) The department shall reimburse employers for the
employer share of social security, unemployment compensation
contributions and workers' compensation premiums paid on behalf
of program participants, as well as the minimum wage earnings
paid to program participants by the employer from the wagefare
program special fund.
(s) If the department finds that an employer has violated
any of the rules of the wagefare program the department:
(1) Shall withhold any amounts due to employers under
subsection (r) of this section;
(2) May seek repayment of any amounts paid to employers
under subsection (r) of this section.
§31-5A-7. Approval required for cash in lieu of food stamps.
If approval is obtained from the federal government during
the three-year pilot program established in this article, the
department of health and human resources may distribute food
stamp program benefits to any eligible person in the six pilot
counties in the form of cash rather than coupons.
§31-5A-8. Evaluation of wagefare program.
(a) Six months prior to the completion date of the three-year test period of the pilot program, the department shall
submit a written report to the Legislature and the governor
containing a full and complete analysis of the program. The
report shall include recommendations from the department and the
wagefare advisory board regarding appropriate revisions to the
program and the potential for its permanent implementation for
the entire state.
(b) The evaluation of the program shall be conducted by an
independent evaluator using a combination of group comparison,
survey and individualized event and attitude recording
techniques. Performance in attaining program goals in each pilot
county shall be matched against performance using the traditional
welfare and employment characteristics. In addition, the
composite performance of the six pilot counties shall be compared
to the rest of the state. The evaluation shall include
measurements of whether program participation has improved the
quality of life of program participants. In addition, as a part
of the evaluation of the wagefare program, the commissioner of
commerce pursuant to his duties as chairman of the economic
development authority pursuant to the provisions of section five, article fifteen, chapter thirty-one of this code shall determine
whether the program has displaced unsubsidized employment
opportunities that would otherwise have been available and
whether the program has had any discernible impact on the
economies or wage levels in individual pilot counties.
(c) The target goals for the program are to reduce the
wagefare program eligible aid to dependent children, food stamp
and unemployment compensation caseloads in the pilot counties by
fifty percent by the end of the third year of the pilot program,
and to reduce the costs associated with these caseloads by
twenty-five percent over the three-year pilot period.
(d) Twelve months after the beginning of the wagefare
program, the department shall present to the Legislature a report
on the cost neutrality projections of the program. If it appears
that the program is not likely to achieve cost neutrality over
the course of the three-year pilot period, the department shall
also present a plan for the early termination of the program.
§31-5A-9. Sunset provision.
In the event that the department of health and human
resources is not able to obtain the necessary exemptions, waivers
or amendments referred to in section three of this article prior to the first day of January, one thousand nine hundred
ninety-eight, this article is repealed on that date and shall
have no further force or effect. Any unexpended and unobligated
moneys remaining in the wagefare unemployment wage fund on that
date are appropriated and transferred to the unemployment
compensation fund on that date.
§31-5A-10. Appointment of board and establishment of council
to take place in sixty days of effective date of
The appointment of the members of the wagefare advisory
board and the establishment of the council shall occur within
sixty days after the effective date of this article.
NOTE: The purpose of this bill is to create the "Wagefare"
program designed to employ persons in lieu of allowing them to
continue to receive public assistance. The bill sets the program
up on a pilot project basis with six participating counties while
allowing other counties to opt into the program. The program
encourages the governor and the director of the department of
health and human resources to work together to obtain exemptions
from federal statutory requirements that would hamper the
program. It further creates an advisory board to advise the
governor in implementing the program. The bill also contains the
following: Wagefare implementation councils that are set up to
assist implementation on the local levels; a wagefare program
special fund; a plan for the payment of benefits; cash to be paid
in lieu of food stamps for persons who obtain work through
workfare; evaluation procedure for determining efficiency of the program; and, a sunset provision.
This section is new; therefore, strike-throughs and
underscoring have been omitted.