Storm Lake Times Pilot

Counties to state: Take this job and shove it

Red tape makes local workforce efforts unfeasible, officials contend


A help wanted sign rests in the window of a Storm Lake business.

A group of Western Iowa counties that receives federal workforce development funds is expected to dissolve by late June because its relationship with Iowa Workforce Development has become “disastrous” over the past two years. 

The groups that contain Buena Vista and Cherokee counties voted in January and February on resolutions that terminate 28E agreements with IWD effective June 30. Others are expected to follow, according to county supervisors who have worked with the state agency.  The consortia claimed IWD’s interpretation of federal labor rules made operating the regional boards financially unfeasible. They’ve also claimed IWD has misrepresented its intentions when it began enforcing the rules in 2019. 

Craig Anderson, a Plymouth County supervisor who has sat on the Western Iowa Workforce Development Board since 2005, claimed the state agency is effectively seizing power from counties through its interpretation of federal rules. 

“The state is gonna hurt everyone through this. The counties, the community colleges, the service providers are about to lose a bunch of money because the state wants to reorganize from the top down,” Anderson said. “So we just threw our hands up. They can do it.”

Jesse Dougherty, a spokesman for IWD, claimed the state agency is only enforcing federal rules that flow from the Workforce Innovation and Opportunity Act of 2014. A statement from IWD noted the state agency can’t administer federal funds allocated to the workforce investment boards, as Anderson was claiming, because the practice is barred by federal law. 

The boards receive around $950,000 annually to address a raft of workforce issues in their respective regions. Buena Vista County Supervisor Kelly Snyder said the board helped rehire hundreds of displaced workers laid off by Rembrandt Enterprises during the height of avian influenza last spring. The region also administers funding for sectors that suffer from chronic labor shortages, like welding. Workers in target industries receive stipends and clothing allowances that are paid for by the boards, Snyder explained. The region also operates a “ticket to work” program that offers transportation to workers that can’t get to their jobs. 

The boards can no longer offer those services, Snyder said, because IWD saddled them with expensive compliance measures.

Per the federal legislation, the boards had to hire an oversight administrator — or a fiscal agent. Previously the boards sent their money to the service provider, typically a community college, Anderson explained. The measure was intended to prevent misappropriation, according to IWD, and the Department of Labor insisted on the arrangement. But the boards suffered an effective 35% cut in their overall budgets; they had to pay for what the counties described as consultants that were forced on them. 

And the community colleges received less money from the boards. 

“We were a really well-organized group until the state got involved,” Anderson said. “We had (Western Iowa Tech) furnish everything. We operated around the vo-tech colleges and then it all changed.”

Dougherty acknowledged the counties are frustrated about the oversight costs. 

“IWD certainly understands the cost attributed to proper oversight of the expenditure of federal dollars is difficult given the budgets involved,” Dougherty wrote in a statement on Wednesday. “However, we also understand these requirements stem from the accountability that comes with accepting federal dollars and that such steps are necessary to safeguard taxpayer money.”

The state’s response to the increased oversight costs, Anderson claimed, was for the counties to pitch in their own funds to make the community colleges whole. Or to save money, the state suggested using their own county auditors to serve as fiscal agents, essentially forcing elected officials new job duties without the financial capabilities or training capacities to do so. 

“We can’t just waltz into the county auditor’s office and say: ‘here’s a bunch of new things for you to do,’” Anderson said. “The people won’t like it. And it might be against federal labor law. (IWD) should be first to know that.”

The relationship between the consortium and IWD soured for years not just because IWD overburdened them with directives, Anderson explained. 

He claimed it was impossible to predict when the board would receive new guidance. And when they wanted it, they wouldn’t get it. IWD allegedly told each of the boards to rewrite their plans so they could keep receiving job training funding under the 2014 legislation. The problem was the state didn’t offer a template for what the plans should look like. IWD countered the state agency only has discretion to review the plans. The state agency offered guidance in addition to submitting plans on the boards’ behalf to the department of labor, according to IWD. Agency spokesmen stressed the importance of safeguarding federal job assistance money, not a plan to assert the state’s control, as local officials were claiming.

“Many state entities (not just IWD) worked collaboratively to provide extensive training and technical assistance to the local areas,” reads an IWD statement. “In six of the nine cases, this assistance stretched through more than one version of the plans.”

Anderson claimed the state agency rejected eight of the 10 board plans that were submitted. 

“They set us up to fail,” Anderson said. 

So the counties were left without a plan to administer the federal money. And one was needed to set out what the rules were for companies and workers to get the money they were owed. And if the rules were violated — or worse yet, the counties were misappropiating the money — the counties could be held liable for the missing funds. 

“Sending back money to the feds isn’t a risk I’m willing to take,” Anderson continued. 

The dispute will come to a head by June 30, or the end of the fiscal year. The 28E agreements between the consortium and IWD allow for the consortiums to dissolve by the end of the fiscal year. Each county board of supervisors is required to pass a resolution ending the consortium as an entity and revoking the 28E. 

Buena Vista and Cherokee counties have passed those resolutions. 

But it isn’t clear whether the consortium can permanently stop administering federal money. The Department of Labor has told to the state and the boards that the 2014 legislation requires the federal government to send the money to localities, according to Snyder and IWD. 

Anderson believes the only way forward is reducing the number of boards, a goal he claims IWD is trying to accomplish. The money will be sent to consortiums that will contain dozens of counties — the Western Iowa consortium already has 18. And the consortiums, Anderson claimed, will have the consultants of IWD’s choice. Essentially, federal money that’s intended for local workforces will no longer be locally controlled as the federal legislation intends. 

A statement from IWD on Wednesday acknowledged the Western Iowa board’s funding will be administered by IWD or another larger board. But the agency asserts Anderson’s assertion isn’t true. 

“Once the disbanding of the Western Iowa (board) officially occurs, federal officials will expect Iowa Workforce Development to maintain the current level of job training services in this 18-county area,” IWD’s statement reads. “… Any post-disbanding scenario will involve the end of local elected leaders setting workforce training priorities in the area, because the board will no longer exist.”

Correction: A previous version of this story included erroneous information on IWD’s guidance to the consortia. IWD offered online guidance and a template offered through its website. 

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