LePage welfare privatization bid puts 51 state jobs on chopping block

Posted Sept. 12, 2016, at 5:42 p.m.
Last modified Sept. 12, 2016, at 7:30 p.m.

AUGUSTA, Maine — Gov. Paul LePage’s bid to privatize a work training program for welfare recipients is moving forward with up to 51 state jobs to be cut by the end of this year.

LePage and his administration have been discussing privatizing the state’s ASPIRE program for months and are nearing approval of a $62.5 million contract with New York City-based Fedcap Rehabilitation Services, according to a report over the weekend by The Associated Press.

ASPIRE helps welfare recipients — specifically those receiving Temporary Assistance for Needy Families, which provides cash benefits to Mainers who meet income guidelines — find job training, employment and volunteer opportunities.

Ramona Welton, president of MSEA-SEIU Local 1989, which represents the majority of state workers, said Monday that 51 state jobs are on the line out of 81 positions in the ASPIRE program. The remaining 30 positions are unfilled because of retirements and resignations and have been left empty for weeks or months.

Welton said queries from the union about whether those employees could be moved to other positions within state government or secure jobs with the private contractor who will take over ASPIRE have not been answered by the LePage administration.

“Our members have decades worth of experience with the communities they’re based in,” said Welton. “They know the resources available for TANF recipients from transportation to volunteer work or training or education opportunities.”

Neither the Department of Health and Human Services nor officials in the governor’s office responded to questions from the Bangor Daily News on Monday.

DHHS announced the pending changes in January, stating in a news release that the ASPIRE program would be privatized and streamlined through the use of technology, innovation and collaboration with already established business and community partners.

If the contract is signed, Fedcap would likely subcontract with nonprofits and community organizations to provide ASPIRE benefits. Currently, those benefits are offered in DHHS service centers, where ASPIRE employees are spread across Maine.

The LePage administration has argued that the current program is faulty because it fails to achieve federal targets for work participation rates. The point of TANF is to provide cash support for individuals and families temporarily, until they can find the means to support themselves.

Since 2007, the federal government has notified the state periodically of accruing fines, which now total some $29 million, for failure to meet those goals. Maine has never had to pay any of those fines.

Advocates for welfare recipients, including Christine Hastedt of Maine Equal Justice Partners and Liz Schott, a TANF expert with the Washington, D.C.-based Center on Budget and Policy Priorities, said the state likely won’t have to pay federal fines as long as it continues to make adequate progress meeting the work thresholds. For example, the state can make a case to the federal government that it is satisfying the requirements with “maintenance of effort” spending on other programs that benefit low-income residents, but that the state has not gone that route under LePage.

“We don’t yet know what the program is going to look like under this contractor,” said Hastedt. “We hope it’s going to result in a program that provides real opportunities to people so they can get out of poverty.”

During a February town hall meeting in Farmingdale, LePage said letting the fines accrue is fiscally irresponsible, and he blamed the Legislature for defeating his proposals — twice — to eliminate exemptions that exist in Maine’s ASPIRE rules, which would have created more rigid work requirements for welfare recipients.

“We’ve been asking and asking the Legislature to change the law since we’ve been here,” LePage said in February in response to a question from an ASPIRE employee. “They’re not doing it.”

Earlier this year, LePage submitted a bill, LD 1631, which sought to appropriate $1 million to pay fines that the administration said are coming due. However, the bill was amended by lawmakers to place a moratorium on the privatization of the program and launch a study into the issue. The bill died in the Republican-controlled Senate.

LePage has argued consistently that taxpayer resources should be spent where they are most needed — not for “able-bodied adults” in the TANF program. Under LePage, Maine’s TANF program enacted a lifetime five-year cap in 2012.

As of May, there were about 5,200 Mainers receiving TANF, which was down from more than 13,000 receiving the benefits before the lifetime limit took effect. LePage has touted reductions in people served by the program as one of the major achievements in a wider effort to reform welfare in Maine.

The federal government provides about $78 million per year to fund TANF, and the state had an accrued balance in its TANF account of about $110 million as of June 2015. The BDN reported in June 2016 that at least $7.8 million in TANF funds have been spent in ways that run afoul of federal law.

Welton said a chief concern for the union is whether Fedcap or any other private company can provide the services better or more cheaply than the established government program can.

“It’s the control, the oversight that we’ll lose,” she said. “When you contract out you lose that direct control.”

Welton said, and The Associated Press reported, that Fedcap has been the subject of numerous lawsuits since 2013 and has paid more than $400,000 in settlements for violations of workplace discrimination rules, disability and wage complaints.

Welton said the affected employees have been receiving notices that their jobs will be cut since February. She said the latest notices have indicated that the cuts would take place “by winter of 2016.”

Related to the new contract is a proposal by DHHS to implement sweeping new rules in the ASPIRE program. Those proposed changes are contained in a 149-page document that will be discussed during a public hearing scheduled for noon Wednesday at DHHS headquarters in Augusta.

 

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