WORKFORCE SOLUTIONS NORTHEAST TEXAS CHIEF ELECTED OFFICIALS MEETING AGENDA

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1 WORKFORCE SOLUTIONS NORTHEAST TEXAS CHIEF ELECTED OFFICIALS MEETING AGENDA Thursday, April 26, 2018 Titus County Extension Office 1708 Industrial Road Mount Pleasant, Texas 10:30 a.m. or immediately following the regular meeting of the Ark-Tex Council of Governments 1. Call To Order 2. Determination of a Quorum 3. Declaration of Conflict of Interest 4. Consider approval of the Workforce Solutions Northeast Texas Chief Elected Officials Meeting Minutes of January 25, 2018* 5. Review and discussion of the financial statements for Workforce Solutions Northeast Texas as of March 31, 2018* 6. Review and discussion of the FY 2018 Quarterly Financial Evaluation for the First Quarter* 7. Review and discussion regarding the Fiscal Year 2018 contracted performance measures* 8. Report and update by the Executive Director and/or staff regarding administrative matters, including internal policies and procedures, customer service issues, status of project assignments, organizational matters, and responsibilities of the Board s departments. Update on Audit of Financial Statements and Supplemental Information for the year ended September 30, 2017 Update on the TWC Commissioners Regional Roundtable Meeting Northeast Texas Regional Alliance Workforce and Economic Prosperity Summit 9. Consider discussion of future agenda items 10. Announcements 11. Adjourn

2 WORKFORCE SOLUTIONS NORTHEAST TEXAS CHIEF ELECTED OFFICIALS MEETING MINUTES Thursday, January 25, 2018 Titus County Extension Office 1708 Industrial Road Mount Pleasant, TX 10:30 a.m. or immediately following the Ark-Tex Council of Governments (ATCOG) Meeting 1. Call To Order. Honorable M.C. Superville, Lead Chief Elected Official for Workforce Solutions Northeast Texas, called the meeting to order at 11:32 a.m. 2. Determination of a Quorum A quorum was determined to be present. 3. Declaration of Conflict of Interest No conflicts of interest declared. 4. Approval of the Chief Elected Official Meeting Minutes of August 31, 2017 Honorable L.D. Williamson made a motion to approve the Chief Elected Official meeting minutes of August 31, Honorable Lynda Munkres seconded the motion. All were in favor. None opposed. Motion carried. 5. Review and discussion of the financial statements as of December 31, 2017 Ms. KiAnn Richardson, Finance Director, reported that as of December 31, 2017, end of first quarter in FY2018, the Board is $9,923 over budget. Those contributing factors are: January 25, 2018 Personnel - $8,741 over budget. The Information Technology (IT) department serves the board office, child care operations, and the workforce operations. At the beginning of the budget cycle, an estimation of how much time the IT staff is spending for projects for each entity is made and the board receives a credit to the personnel costs for the amount of time charged to child care and workforce operations. The IT staff were asked to complete another analysis at the beginning of October which showed that IT staff are spending more time on board projects than originally anticipated; therefore the credit is lower. Strategic Initiatives - $1,620 over budget. This overrun is due to the youth career fair activity. Originally, there was not any funding available for youth career fairs. Therefore expenditures for this activity was not in the original budget. However, since the original budget was prepared and approved, the Texas Workforce Commission (TWC) has provided $50,000 for those initiatives. Contracted Services - $5,619 over budget. This overrun is contributed to a late invoice for the fiscal review prepared by Ed Taylor & Associates. This invoice should have been booked in FY2017, but the invoice was not received and booked until FY2018. The budget revision will correct these variances. Mr. Randy Reed, Executive Director, stated that it may seem strange the board is incurring costs in an item where there was a $0 budget before the CEOs authorize the amendment to the budget, but when those funds are received from the state, there are milestones that have to be met in those funding contracts; therefore, the variances will occur until the budget amendment is approved. The CEO s received the monthly financial report as of December 31, 2017, as presented.

3 WORKFORCE SOLUTIONS NORTHEAST TEXAS CHIEF ELECTED OFFICIALS MEETING MINUTES 6. Review, discussion, and action regarding the FY 2018 amended budget Ms. Richardson reported that for FY2018, there is $1,817,047 more in revenue than originally projected. Those budget changes include: $75,000 for the child care performance award, which was received at the Texas Workforce Commission Annual Conference in November. Re-Employment Services Assessment is a new funding stream to serve long-term Unemployment Insurance (UI) claimants. The National Dislocated Worker grant for Oil and Gas increased $308,762 to serve the Luminant employees, Texas Industry Partnership is $100,000 for a special project grant to provide incumbent worker training at International Paper (IP), Trade Act Services are two large increases of $297,000 and $153,000 for training and education to those trade affected layoffs (US Steel). Finally, Workforce Initiatives increased $52,107 to fund the youth career fairs and Careers in Texas Industry events. The board increased the FY2018 budget from $1,159,114 to $1,252,748 which is an increase of $93,634. The explanation of variance: Personnel increased $62,134 to reinstate performance awards, increase the board s share of IT services, and forecasted 20% increase in health insurance, Strategic Initiatives increase $30,000 for the youth career fairs and Careers in Texas Industry events (the remaining $20,000 out of $50,000 received will be used to cover staff and travel time). Contracted Services increased $4,000 to cover the late invoice from Ed Taylor & Associates. The Workforce Operations increase to $4,399,008. Child Care Operations & Direct Care increased to $6,043,677, and Quality Child Care Initiatives increased to $266,100. The total Operating and Service Delivery budget is $10,708,785, an increase of $1,601,677. The total Northeast Texas budget increase from $10,421,222 to $12,238,269. Mr. Reed stated the revised budget was presented to the full board and recommended for approval to the CEO s at the meeting of the board held on January 24, Honorable Munkres made a motion to approve the FY2018 amended budget. Honorable Brian Lee seconded the motion. All were in favor. None opposed. Motion carried. 7. Review and discussion of the FY2017 Quarterly Financial Evaluation for the Fourth Quarter The FY2017 Quarterly Financial Evaluation for the Fourth Quarter, prepared by Ed Taylor & Associates (the external fiscal monitor), shows no findings or recommendations. The CEOs received the FY2017 Quarterly Financial Evaluation for the Fourth Quarter as presented. 8. Review and discussion regarding the FY 2018 contracted performance measures Mr. Reed reported the most current information regarding the performance measures is through November This report reflects only two months in the current FY2018. Northeast is exceeding performance on two measures, meeting 15 measures, and missing two measures. Based upon the future numbers and staffs analysis, those measures will be met by the end of the fiscal year. The CEOs received the FY2018 contracted performance measures as presented. 9. Review and discussion of the Workforce Solutions Northeast Texas annual report for FY 2017 (October 1, 2016 September 30, 2017) The FY2017 annual report was presented to the CEOs. The report highlights the accomplishments, yearend board level expenditures, year-end contracted performance measures, customer statistics per county, success stories, and much more information that can be reviewed here. The CEOs received the Workforce Solutions Northeast Texas annual report for FY2017. January 25, 2018

4 WORKFORCE SOLUTIONS NORTHEAST TEXAS CHIEF ELECTED OFFICIALS MEETING MINUTES 10. Review, discussion, and action regarding apportionment of board members seats among the counties of the Northeast Texas Workforce Development Area The apportionment of board member seats among the counties is based upon the following criteria: Population, 2017 estimates Population, 2010 estimates base Population, percent change (April 2010 to January 2017) Percent of Regional Population Seats available for representation on the board Based upon the update of the demographics, there is no change from the current allocations. Honorable Robert Newsom made a motion to approve the apportionment of board member seats among the counties of the Northeast Texas Workforce Development Area for FY2018 as presented. Honorable Munkres seconded the motion. All were in favor. None opposed. Motion carried. 11. Review and discussion regarding the CEO meeting schedule for FY 2018 The CEOs received the CEO meeting schedule for FY Election of Lead CEO and Alternate Lead CEO Honorable Superville called for nominations for the election of Lead CEO and Alternate Lead CEO. Honorable Williamson made a motion to elect Honorable Superville as the Lead CEO and Honorable Munkres as the Alternate Lead CEO. With no other nominations, all were in favor. None opposed. Motion carried. 13. Report and update by the Executive Director and/or staff regarding administrative matters, including internal policies and procedures, customer service issues, status of project assignments, organizational matters, and responsibilities of the Board s departments. Mr. Reed reported on the following items: Texas Workforce Commission (TWC) acceptance and closure of FY16 Audit Letter received and dated November 10, 2017 from TWC regarding the final acceptance and closure for the FY2016 audit. TWC closure of FY 16 Monitoring Report Letter received and dated November 14, 2017 from TWC regarding the final acceptance and closure of the # monitoring report. The corrective actions taken adequately resolve the findings. TWC Annul Conference The TWC Annual Conference was very successful. Five members of the board staff and five board members attended the event in Dallas. Northeast was presented with the Quality Child Care award and a check for $75, Consider discussion of future agenda items None. 15. Announcements Learning Endorsements And Professions (LEAP) Expo is scheduled for April 26 th in Paris, TX at the Love Civic Center at 9:00 a.m. 16. Adjourn Honorable Superville adjourned the meeting at 12:02 p.m. January 25, 2018

5 WORKFORCE SOLUTIONS NORTHEAST TEXAS CHIEF ELECTED OFFICIALS MEETING MINUTES Chief Elected Officials Present Honorable M.C. Superville Lead CEO/Lamar County Honorable Lynda Munkres Alternate Lead CEO/Morris County Honorable Brian Lee Titus County Honorable Robert Newsom Hopkins County Honorable L.D Williamson Red River County Staff Present Randy Reed, Executive Director KiAnn Richardson/Finance Director April Corbit/Board Relations Coordinator Board Members Jennifer Harland January 25, 2018

6 Workforce Solutions Northeast Texas Board Expenditures For the Month Ending March 31, 2018 Board Operating Costs FY 2018 MARCH 2018 YTD 2018 Budget Budget Actual Variance Budget Actual Variance Personnel $ 927,939 $ 76,827 $ 76,873 $ (46) $ 443,852 $ 447,976 $ (4,124) Facilities 85,200 7,100 7,100-42,600 42,600 - Utilities 12,000 1,000 2,251 (1,251) 6,000 6,242 (242) Telecommunications 24,500 2,042 1, ,252 11, Repairs & Maintenance Janitorial/Lawn/Security 7, (37) 3,978 4,389 (411) Insurance 18,500 1,542 1, ,252 7,862 1,390 Postage & Shipping (40) (267) Advertising, Marketing & Promotions 1, (20) Community Relations 1, ,121 (1,371) Supplies 2, ,374 1, Information Technology 20, ,846 (1,899) 5,682 5, Board Member Expenses 10, ,248 2,220 4,028 Development & Training 8, (33) 4,002 2,592 1,410 Dues, Fees & Subscriptions 7, , Printing & Reproduction 2, ,002 1,364 (362) Travel - Board Staff 30,210 2,518 1,353 1,165 15,106 12,514 2,592 Equipment - Leased 7, ,750 2,514 1,236 Strategic Initiatives 30,000 2,500-2,500 15,000 8,250 6,750 Contracted Services 24,000 5,000 3,060 1,940 14,000 17,643 (3,643) Audit & Legal Expense 31,000 2,583 3,111 (528) 15,498 14,293 1,205 Total Board Funding Available for FY 2018 $ 1,252,748 $ 105,005 $ 101,962 $ 3,043 $ 602,228 $ 592,926 $ 9,302 5% 1% 12% 1% 6% Current Month Expense Employee Cost Facility Cost Operational Cost 11% 4% 2% 2% 5% YTD Expense 75% Travel Cost 76% Equipment Cost Contracted Services

7 Report on the Quarterly Financial Evaluation of In its capacity of Workforce Development Board for the Northeast Texas Workforce Development Area and fiscal agent for its Workforce and Childcare Contractor Principle Concepts, LLC Issued February 2,

8 eport Demographics Report Number: NETWDB Report Type: Final Report Issue Date: February 2, 2018 Review Type: Financial Evaluation of the 1 st Quarter ended December 31, 2017 Review Period: October 1, 2017 through December 31, 2017 Entities Reviewed: Principle Concepts, LLC Childcare Contractor and Workforce Center Operator (Contractor) and Workforce Solutions Northeast Texas (the Board) as its fiscal agent. Review Conducted by:. aylor and ssociates Sujuane Smith Edward Taylor Dates of Fieldwork: Off-site desk review 2

9 pplicable Definitions Board: The Northeast Texas Workforce Development Board created pursuant to Texas Government Code and certified by the Governor pursuant to Texas Government Code Commission: The Texas Workforce Commission (TWC) Department of Labor or DOL: The United States Department of Labor, including its agencies and organizational units. Determination: A weakness in internal controls and/or an instance of non-compliance with applicable policies, laws and regulations. Disallowed Costs: Those charges to an award that are determined to be unallowable, in accordance with the applicable Federal cost principles, applicable State rules, regulations, policies or other terms and conditions contained in the award. Finding: An item (s) of noncompliance and /or a deficiency that is required to be reported pursuant to the applicable promulgations for the funding source(s) being monitored. Prompt and immediate corrective actions are required in accord with the policy(s) of the funding source(s) entity. FMGC: Texas Workforce Commission Financial Manual for Grants and Contracts Observation: A reportable condition that does not currently have a material effect on internal controls and the accuracy of the financial information. An observation, if not addressed, presents the possibility of a future circumstance of non-compliance and/or internal control weaknesses. OMB: The United States Office of Management and Budget. Questioned Cost: A cost that is questioned by the monitor because of a monitoring finding (1) that resulted from a violation or possible violation of a provision of a law, regulation, contract, grant, cooperative agreement, or other agreement or document governing the use of Federal funds, including funds used to match Federal funds; (2) where the costs, at the time of the monitoring review, are not supported by adequate documentation; or (3) where the costs incurred appear unreasonable and do not reflect the actions a prudent person would take in the circumstances. Recommendation: Suggested corrective action(s) for a finding and/or observation identified in a monitoring report. The recommendation, where and when appropriate, should address the cause of the problem, not the problem itself. 3

10 eview Scope This quarterly financial review evaluated Principle Concepts, LLC Childcare Contractor and Workforce Center Operator (Contractor) and Workforce Solutions Northeast Texas (the Board) as the Workforce Board and fiscal agent for Principle Concepts, LLC. The review was performed to assess the reliability of current fiscal data, the degree of compliance with applicable policies, laws, regulations and the adequacy of internal controls. The following areas/items were examined: 1. Bank Statements and Reconciliations: For the period October 1, 2017 through December 31, 2017 for the Boards general account. The review included an examination of the reconciliations, collateral agreements, and affiliated internal controls. 2. Board Payroll: Payroll records for four (4) Board employees for the six (6) pay periods ending: October 20, 2017 November 3, 2017 November 17, 2017 December 1, 2017 December 15, 2017 December 29, 2017 Documents reviewed included employee I-9 and W-4 forms, pay authorization documentation and time sheets. 3. Workforce Center Payroll: Payroll records for ten (10) Contractor/Workforce Center employees for the six (6) pay periods ending: October 20, 2017 November 3, 2017 November 17, 2017 December 1, 2017 December 15, 2017 December 29, 2017 Documents reviewed included employee I-9 and W-4 forms, pay authorization documentation and time sheets. 4. Disbursements: Supporting documentation for forty-two (42) judgmentally sampled Board and/or Workforce Center Operator disbursement transactions occurring during the review period of October 1, 2017 through December 31, Because of inherent limitations in any system of internal accounting and administrative controls used in administering federal financial assistance programs, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the systems to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the degree of compliance with the procedures may deteriorate. The workpapers and source documents resultant from this review are maintained by E. Taylor and Associates and are available for inspection with approval by the Northeast Texas Workforce Development Board (the Board). 4

11 eview Findings and Observations Our financial review of Principle Concepts, LLC Childcare Contractor and Workforce Center Operator and Workforce Solutions Northeast Texas (the Board) as the Board and fiscal agent evaluated a representative sample of the areas as outlined in the Review Scope section of this report. Our review did not determine any reportable instances of material financial noncompliance and/or significant weaknesses in internal financial controls. Accordingly, no findings and/or observations are presented. 5

12 BOARD SUMMARY REPORT - CONTRACTED MEASURES FINAL RELEASE Rolling Performance Periods* As Originally Published 3/30/2018 BOARD NAME: NORTH EAST TEXAS FEBRUARY 2018 REPORT Source Notes Status Summary Contracted Measures With Positive Performance (+P): Meeting Performance (MP): With Negative Performance (-P): % +P & MP % Measure Status % Current Current EOY Current One Year Two Years YTD Num Target Target Target Perf. Earlier Earlier QTR 1 QTR 2 QTR 3 QTR 4 YTD Den From Reemployment and Employer Engagement Measures TWC TWC Claimant Reemployment within 10 Weeks 2,398 MP % 57.37% 54.79% 58.80% 55.69% 58.48% 59.86% 58.93% 61.63% 54.13% 12/16 11/17 4,078 # of Employers Receiving Workforce Assistance Program Participation Measures TWC TWC P 93.52% 1,805 1,848 1,688 1,664 1, To 3/17 2/18 Choices Full Work Rate - All Family Total 33 MP % 54.25% 50.00% 54.64% 56.63% 48.95% 54.14% 59.71% 55.35% 49.37% 3/17 2/18 59 Avg # Children Served Per Day - Combined 317,674 MP % 1,199 1,202 1,217 1,083 1,192 1,188 1,184 1,273 1,224 3/17 2/ BCY18 targets were set prior to reaching the 1st year anniversary reauthorization. We are planning to adjust the targets after we have 3 months of BCY18 data to analyze. WIOA Outcome Measures LBB-K LBB-K TWC LBB-K Employed/Enrolled Q2 Post Exit C&T 12,545 MP % 66.64% 64.00% 69.76% 68.95% 69.35% Participants 17, % 69.43% 70.06% 70.43% 1/16 12/16 Employed/Enrolled Q2-Q4 Post Exit C&T 11,374 MP % 81.85% 80.00% 83.76% 83.63% 83.70% Participants 13, % 83.14% 83.48% 84.04% 7/15 6/16 Median Earnings Q2 Post Exit C&T n/a +P % $4, $3, $4, $4, $4, Participants 10,809 $4, $4, $4, $3, /16 12/16 Credential Rate C&T Participants +P % % 48.00% 57.79% 57.89% 49.52% % 57.89% 54.55% 59.09% 7/15 6/16 Employed Q2 Post Exit Adult 46 MP 99.67% 90.50% 86.00% 90.20% 83.61% 69.77% % 90.00% 81.82% % 1/16 12/16 51 Employed Q4 Post Exit Adult 49 MP % 86.95% 83.20% 89.09% 68.09% 81.48% 86.67% 94.74% 90.91% 80.00% 7/15 6/16 55 Median Earnings Q2 Post Exit Adult n/a +P % $4, $4, $6, $4, $4, $4, $6, $8, $7, /16 12/16 45 Credential Rate Adult 42 +P % 82.75% 76.30% 89.36% 73.91% 63.33% 90.91% 87.50% 90.00% 90.00% 7/15 6/16 47 Employed Q2 Post Exit DW 60 MP 99.73% 89.79% 90.10% 89.55% 88.28% 79.12% 78.95% % 86.36% % 1/16 12/16 67 Employed Q4 Post Exit DW 81 MP 97.32% 85.81% 85.50% 83.51% 79.35% 79.94% 80.56% 91.67% 68.42% 94.44% 7/15 6/16 97 Median Earnings Q2 Post Exit DW n/a -P 89.46% $7, $6, $6, $6, $7, $10, $6, $6, $6, /16 12/16 59 Credential Rate DW 16 -P 88.68% 78.45% 76.90% 69.57% 71.93% 45.61% % 60.00% % 25.00% 7/15 6/16 23 Employed/Enrolled Q2 Post Exit Youth 57 MP 98.10% 84.21% 82.80% 82.61% 87.50% 93.44% 82.35% 88.89% 83.33% 76.92% 1/16 12/16 69 Note: In some cases historic data not available at time of original publication (such as when a new measure is created) has been added to the MPR retroactively to allow trend analysis. Operational Insight - MPR 4.0 Page 1 of 2

13 BOARD SUMMARY REPORT - CONTRACTED MEASURES FINAL RELEASE Rolling Performance Periods* As Originally Published 3/30/2018 BOARD NAME: NORTH EAST TEXAS FEBRUARY 2018 REPORT Source Notes WIOA Outcome Measures 3 2, Measure Status % Current Current EOY Current One Year Two Years YTD Num Target Target Target Perf. Earlier Earlier QTR 1 QTR 2 QTR 3 QTR 4 YTD Den From Employed/Enrolled Q4 Post Exit Youth 72 +P % 82.64% 77.50% 88.89% 79.59% 94.55% 89.47% 86.11% 88.24% % 7/15 6/16 81 Credential Rate Youth 41 +P % 72.76% 65.10% 78.85% 86.05% 80.49% 90.00% 70.83% 70.00% % 7/15 6/16 52 TWC is working to implement final guidance regarding who is included in the Credential Rate denominators. These changes will likely result in substantial reductions in the denominators of all but the Youth Credential Rate measure and thus increases in performance. We will republish all Credential Rate data as soon as these changes are made. TWC is working to correct an issue in who is counted as a Youth Participant (ensuring that the WIOA Youth Participation Elements are all met). We will republish Youth measure data when this correction is made. To Note: In some cases historic data not available at time of original publication (such as when a new measure is created) has been added to the MPR retroactively to allow trend analysis. Operational Insight - MPR 4.0 Page 2 of 2