Enterprise Zone Reform Improving the Enterprise Zone Program

Agenda Why make a regulatory change? What were HCD’s objectives in crafting regulatory change? What are the key regulatory changes? Where can you get more information about the Rulemaking Process? –

Why make a regulatory change? To respond to industry feedback and 3 rd party reports identifying problems with the current program.

Feedback - 3 rd Party Reports PPIC Report: Current EZ Program fails to increase level of employment in Zones. Hiring credits, intended as incentive for hiring decisions, can be claimed long after-the-fact. Supporting voucher documents need to be updated.

Rapidly Rising Program Costs

What HCD values were considered in undertaking a rulemaking change?  Increase efficiency and accountability.  Focus tax credits on activities incentivized by the program.  Streamline process for program participants.

How are we making it easier to Voucher? Expanding & clarifying qualifying criteria for:  Veterans  The Economically Disadvantaged  Disabled Individuals  Those on Public Assistance

Veteran Demonstration S8466(1-B) Vet categories - any one of the following documents can be used to demonstrate veterans status: Report of separation or discharge from the Armed Forces, National Guard, or Coast Guard Veterans Administration documentation Written verification by State veterans agency DD Form 214, Certificate of Release or Discharge from Active Duty Letter from the National Personnel Records Center (NPRC)

Economically Disadvantaged S8466(2)  Eliminate the Income Verification Form  Eliminate proof of age  Establish 3 rd party document list to verify

Economically Disadvantaged Documentation CalFresh or Supplemental Nutrition Assistance Program (SNAP) Medicaid/Medi-Cal Infants and Children Program Healthy Families A & B Temporary Assistance for Needy Families National School Lunch’s Free Lunch Program (NSL) Head Start Income Eligible Supplemental Security Income (SSI) Bureau of Indian Affairs General Assistance Tribal Temporary Assistance for Needy Families Low Income Home Energy Assistance Program Medical Baseline Energy Billing Receives publicly subsidized affordable housing

Disabled Individual S8466(12) Consistent with statute – if eligible for a State rehabilitation plan, then also eligible for a voucher. Provide documents that are required to participate in a state rehab program, but state rehab participation is not required.

Disability Documentation (B) To demonstrate that an employee is disabled and is eligible for, enrolled in, or has completed a state rehabilitation plan, the Voucher Applicant shall submit a document to that effect from the following list: Physician's statement State Rehabilitation plan Medical records Vocational rehabilitation letter Verification by state or federal rehabilitation counselor Letter from a state drug or alcohol rehabilitation agency Social Security Administration disability records Social Service records/referral Valid “Ticket to Work”

Closing Voucher Loopholes Minimize self-certification Ensure integrity of program

TEA S8466(18) Require documents to be from verifiable third parties. No longer acceptable: I-9 & W-4 Rental Agreements Landlord Statements

Acceptable TEA Documentation Valid driver's license or other local, State or Federal ID card issued within the past 5 years Utility bill Valid Passport* Mortgage Statement County Property Tax statement Credit card bill or statements Voter registration confirmation documents

TEA Certification Statute requires redrawing TEA boundaries 180 days after publication of new census data. Census data is now published annually, therefore each TEA must be redrawn annually.

Date of Hire “New hire” vs. “rehire” test based on a 12-month window. Date of hire is evidenced exclusively by the W-4 form.

Eliminating Retroactivity 30% of vouchers are issued retroactively Limited to 1 year from the date of hire 1 year grace period for hires made prior to regulatory change taking effect

How do we ensure Zones succeed ? Measuring performance and ensuring MOU accountability through: o Data collection o Reporting o Auditing o Regulatory consequences for failure

Measuring Performance Biennial Report  Enterprise Zone MOU commitments  Boundaries and street ranges  Copies of annual reports

Accountability Clarify auditing standards Outlining consequences Accountability = good performance

Data Collection Annual Voucher Statistics Biennial Report Digital Maps

Voucher Data Collection EZ Name # of Vouchers Issued # of Companies Receiving Vouchers New Job? Existing Job? Avg. Hourly Wage CalworksVeterans Public Assistance Recipient TEA Fresno Merced

Regulatory Process 45-Day Public Notice & Comment period Public Hearings in Los Angeles, San Diego, Oakland, and Sacramento - February, 2013 Details on comment submission or hearings

What is the Expected Impact of Regulatory Change? Eliminate retroactive vouchering. Streamline vouchering for vets and recipients of public assistance. Improvement in Program clarity and accountability.