The 2023-24 Budget: California Volunteers Proposed Program Expansions

2023-24 BUDGET The 2023-24 Budget: California Volunteers Proposed Program Expansions GABRIEL PETEK | LEGISLATIVE ANALYST | MARCH 2023 SUMMARY The Governor has two significant new proposals for California (CA) Volunteers beginning in 2023-24. Both would convert limited-term funding and efforts to permanent and ongoing programs using General Fund. These include (1) $78.1 million ongoing to continue the Youth Jobs Corps program that was established as a 2.5-year program using federal funds, and (2) $4.7 million annually through 2025-26 and $9.3 million ongoing thereafter to double and extend the Climate Action Corps program that was established as five-year pilot effort. We recommend the Legislature reject both proposals. We find the proposed funding augmentations and ongoing commitments to be premature given that neither program can yet present comprehensive data that it is a more cost-effective approach to achieving its goals than other existing or alternative approaches. This lack of evidence is particularly problematic given that, because of the budget problem, both proposals come at the expense of other existing General Fund-supported commitments. Given the state budget problem, we also recommend the Legislature approve the Governor’s proposal to reduce $25 million General Fund previously provided for the Youth Jobs Corps program to augment its services in summer 2023. INTRODUCTION to establish and support the Youth Jobs Corps program). The Governor proposes a total of CA Volunteers Operates Programs to $154 million for CA Volunteers in 2023-24, which is Encourage Volunteering Service Projects. only slightly less than the $160 million it received in CA Volunteers, housed under the Governor’s Office 2022-23. However, the Governor’s proposal reflects of Planning and Research, operates programs a notable change in funding sources. Specifically, it and initiatives to engage Californians in service, includes a drop in federal funds (from $81 million in volunteering, and civic action. It is supported by 2022-23 to $28 million in 2023-24) due to expiration a 25-member board of commissioners. One of of limited-term monies and a significant (62 percent) CA Volunteers’ primary responsibilities is to receive increase in General Fund support (from $75 million and coordinate federal AmeriCorps funds on behalf in 2022-23 to $123 million in 2023-24). of the state. Other programs and initiatives run by CA Volunteers include the College Corps (which This Brief Discusses Two Governor’s Budget provides college students with opportunities Proposals. The Governor’s proposed increase to support and learn from community-based in General Fund support is primarily to support organizations), volunteer programs organized to two significant new proposals for CA Volunteers support disaster response, and the two programs beginning in 2023-24. Both would convert discussed in this brief—Youth Jobs Corps and limited-term funding and efforts to permanent and Climate Action Corps. ongoing General Fund-supported programs. These include (1) $78.1 million ongoing to continue the Governor’s Budget Proposes $154 Million Youth Jobs Corps program that was established for CA Volunteers, Big Increase in General as a 2.5-year program using federal funds, and Fund Support. The budget for CA Volunteers (2) $4.7 million annually through 2025-26 and has varied somewhat over the past several years $9.3 million ongoing thereafter to double and due to limited-term funding, in particular from extend the Climate Action Corps program that was federal COVID-19 fiscal recovery funds (from established as five-year pilot effort. which it received $237 million in 2021-22, largely www.lao.ca.gov 1 2023-24 BUDGET YOUTH JOBS CORPS out of school, justice-involved, transitioning from foster care, and/or engaged with the mental health Background or substance abuse systems. While CA Volunteers Youth Jobs Corps Focuses on Providing provides some broad guidelines for how funds Employment Opportunities for Underserved can be used, the selected cities and counties also Youth. CA Volunteers provides Youth Jobs Corps have some latitude for designing their services funding directly to cities and other jurisdictions at the local level, including what specific job to employ and support underserved youth. responsibilities the youth would fulfill. In addition The program has three stated goals: (1) to increase to wages, grantees could use funding to provide employment for underserved youth across wraparound services (no more than 40 percent California; (2) to develop meaningful public service of each allocation) and for administrative costs career pathways; and (3) to enhance the capacity (no more than 10 percent of each allocation). of local governments to address challenges in the Wraparound services could include job or interview key areas of food insecurity, climate action, and preparation, childcare, healthcare, transportation, COVID-19 recovery. and other nonwage benefits to help the youth gain stable employment. CA Volunteers estimates that Program Created With One-Time Federal across the state, roughly 2,000 youth currently are Funds in 2021-22. California chose to dedicate enrolled in or have completed the program. $185 million from its federal COVID-19 relief funds— the majority of the $237 million noted earlier that Governor’s Proposal went to CA Volunteers—to establish the Youth Provides General Fund to Continue Activities Jobs Corps program. CA Volunteers spread those and Establish Ongoing State-Funded Program. funds across portions of 2022, 2023, and 2024 The Governor proposes $78.1 million ongoing to fund the program for two and a half years. General Fund to continue the Youth Jobs Corps The 2022-23 budget package supplemented these program once the temporary federal funds that funds with an additional $25 million on a one-time established the program have been expended. basis from the General Fund for the program to CA Volunteers indicates that this represents roughly augment services during the summer of 2023. the same amount that the program has spent on Different cities and counties began their programs an annual basis from its large one-time allocation, at varying times, but all are currently scheduled so it would maintain about the same level of annual to end by May 2024 when the existing funds run grants under the Governor’s proposal. Annually, out. CA Volunteers allocated 80 percent of the this would equate to about $62 million of the funds $185 million to the largest 13 cities in the state being allocated on a formula basis to the 13 largest using a population-based formula ($148 million), cities in the state; about $15 million being awarded and granted 19 percent on a competitive basis to other cities, counties, or tribal communities to 14 other cities and counties ($35 million). through a competitive grant process; and roughly CA Volunteers is using the remaining $2 million to $1 million being used for state administrative costs. administer and oversee the program. The proposal also would expand participation to Cities Use Funding to Hire Underserved undocumented youth with work authorizations. Youth as Temporary Municipal Employees. Although the current funding is scheduled to last The Youth Jobs Corps program provides funding until May 2024, CA Volunteers indicates that it to participating cities and counties to hire youth is requesting additional funding for 2023-24 to to work as their employees (or to contract with allow time to solicit grant applications and arrange local community-based organizations to do so), funding agreements with sufficient time to avoid with a requirement to pay them hourly wages of at creating a gap in services. least $15.50. The program focuses on hiring youth ages 16 to 30 who may not have had access to traditional career-building resources, and prioritizes individuals who are lower-income, unemployed or 2 LEGISLATIVE ANALYST’S OFFICE 2023-24 BUDGET Reverts $25 Million General Fund From is supported in California by about $80 million 2022-23. The Governor also proposes reverting annually in combined public and private funding); the $25 million provided in the 2022-23 budget to the state California Conservation Corps program augment the Youth Jobs Corps in summer 2023. (proposed to receive $174 million in 2023-24); (3) the The administration includes this as one of its CA Volunteers’ College Corps program (for which budget solutions. (This proposal would partially the 2021-22 budget provided $146 million on a offset the impact of the proposed new spending one-time basis, mostly from federal funds, for a in 2023-24, resulting in a net of $53 million—not pilot program to last through 2023-24, scheduled $78 million—in new spending in the budget year.) to continue with $73 million from the General Local jurisdictions still would be able to offer some Fund annually thereafter); and (4) the Dreamer services during summer 2023 using their original Service Incentive Grant ($7.5 million annually) allocations from federal funding but not at the and Learning-Aligned Employment Program augmented levels they may have planned. ($500 million in one-time funds to be spent between 2021-22 and 2030-31), both run by the California Assessment Student Aid Commission for students attending While Supporting Locally Based Youth college. While none of these programs provides the Employment Has Value, It Is Not a Core State exact same structure, services, or compensation as Responsibility. Efforts to support underserved the Youth Jobs Corps, many also have an emphasis youth in gaining skills and employment are on underserved youth, building work skills, and/or worthwhile and can yield long-term benefits for community service. In addition, local governments both the individuals and their local communities— and nongovernmental agencies also operate some particularly when the youth are engaged in youth employment programs. providing public services. However, supporting Premature to Provide Ongoing State local municipalities to hire youth does not represent Funding Before More Data Are Available About a core state responsibility. If cities and counties Program’s Effectiveness. The Youth Jobs Corps have found value in the Youth Jobs Corps model, program is still in its first year of operation, so they can continue providing such services and comprehensive data are not yet available as to how employing youth using their local funding. well it is achieving its intended goals. For instance, Numerous Other Programs Already Exist to it is too early to have a full picture of how successful Support Youth Workforce Development. Even if the program is at (1) consistently recruiting the state decided to not continue funding the Youth participants from the targeted populations, Jobs Corps, a number of other state and federal (2) retaining youth participants for their full intended programs already exist to support youth workforce employment period with the program, (3) helping development. These include the federal Workforce youth attain and maintain jobs after they complete Innovation and Opportunity Act Youth Program, for the program, or (4) integrating the program within which California received $142 million in 2022-23 local jurisdictions to meaningfully contribute to their that was distributed via formula to local workforce existing public services. Moreover, CA Volunteers development boards. Federal law requires that has not collected data showing how well the Youth 75 percent of these funds go to programs targeting Jobs Corps achieves such outcomes compared out-of-school youth ages 16- to 24-years old— to the numerous other existing youth workforce including individuals who have dropped out of development programs. Without such information, school, who have been justice-involved, who are the Legislature cannot determine whether or have been in the foster care system, or who are continuing the Youth Jobs Corps represents the homeless—and that 20 percent be used specifically best investment of state funds, or if other program to support work experience, such as for stipends, structures or activities are a more effective way to paid internships, and wages. Additionally, California pursue youth workforce development. As such, youth seeking job experiences have access we view the Governor’s proposal to commit to: (1) the federal AmeriCorps program (which ongoing state funds to maintain this program on www.lao.ca.gov 3 2023-24 BUDGET a permanent basis to be premature. Should the Proposed Reversion of Summer 2023 Legislature be interested in continuing to support Funding Reasonable Given Budget Shortfall. locally based youth employment opportunities in The Governor’s proposal to revert the $25 million the future, it could require CA Volunteers to evaluate 2022-23 General Fund appropriation will result in the outcomes of the Youth Jobs Corps program, a lower level of Youth Jobs Corps services than particularly compared to other youth workforce otherwise would have been provided in summer development programs. Such data could help 2023. However, given the state budget problem, we inform future budget decisions and provide the find the proposal to have cities and counties rely on Legislature more certainty that state funds would be their existing federal funds to continue operating used effectively before it commits to this program the program without an additional summer on a long-term basis. augmentation to be reasonable. Continuing This Program With State Recommendation Funds Would Come at the Expense of Existing Commitments. The state currently is Reject Governor’s Proposal to Provide experiencing a budget problem where General $78 Million Ongoing General Fund to Continue Fund revenues already are insufficient to fund Youth Job Corps Program. We recommend the Legislature reject the Governor’s proposed ongoing existing commitments. In this context, every dollar augmentation to make the Youth Jobs Corps a of new spending in the budget year comes at the permanent, state-funded program. Supporting expense of a previously identified priority and youth employment by municipalities is not a requires finding a commensurate level of solution core state responsibility and other programs to somewhere within the budget. The Governor support similar objectives already exist. Even if “makes room” for the Youth Jobs Corps and other the Legislature did want to invest more state funds proposed new spending by making reductions to towards youth workforce development, funding funds committed for other programs, including this program on an ongoing basis before data are many in the climate, natural resources, and available about its effectiveness is premature. transportation areas. Moreover, because making Given the state’s current budget shortfall, the Youth Jobs Corps program permanent we also do not find a compelling rationale for would have ongoing costs, this proposal would prioritizing this program at the expense of existing contribute to projected future budget deficits and state commitments. would require finding additional solutions in the coming years. We therefore think the Legislature Adopt Governor’s Proposed $25 Million will want to apply a higher bar to its review of new Reduction. We recommend the Legislature adopt spending proposals such as this than it might the Governor’s proposal to revert $25 million in in a year in which the General Fund had more General Fund. This will result in fewer services capacity to support new commitments, as it will being offered by the Youth Jobs Corps program need to weigh the importance and value of the in summer 2023. However, given the state budget proposed new activities against the activities to shortfall, existing funding that grantees still have which it has already committed. Essentially, the remaining from their original allocations of federal Legislature will want to consider whether it wants funds for the Youth Jobs Corps, and other existing to make reductions—either those proposed by available youth workforce development programs, the Governor or equivalent alternatives—to free we find this proposal to have merit. up resources for continuing the Youth Jobs Corps program using state funds. In our view, given this program has only just begun on a limited-term basis and its effectiveness and outcomes are therefore still uncertain, this proposal does not meet that higher bar. 4 LEGISLATIVE ANALYST’S OFFICE 2023-24 BUDGET CALIFORNIA CLIMATE to other AmeriCorps funds that CA Volunteers helps to administer for activities that may not be ACTION CORPS specifically focused on climate change. These Background federal funds are not contingent on the state funding; that is, California would continue to receive Program Pays Stipends to Youth Fellows these funds even if it did not provide a like amount to Help Organize Community-Based of General Fund. Climate-Related Volunteer Activities. The state initiated the Climate Action Corps program Governor’s Proposal beginning in 2021-22. The program provides Doubles Program, Converts to Ongoing. funding to local “host partner” agencies—including The Governor proposes to (1) double funding for this cities, universities, tribes, and community-based program and (2) make the program ongoing rather organizations—to hire individuals ages 18 and than limited term. As such, the proposal includes over to serve as fellows for either an 11-month an additional $4.7 million from the General Fund full-time or a two-month summer term of service. from 2023-24 through 2025-26 (supplementing the CA Volunteers indicates that full-time fellows $4.7 million in existing limited-term funding) and most often are recent college graduates looking then $9.3 million ongoing annual General Fund in to engage in climate action and begin a climate 2026-27 and thereafter. career, while summer fellows tend to be incoming or current college students. These fellows organize Assessment opportunities for community members to volunteer Expanding Climate Action Corps Program in activities related to mitigating and responding Not Justified. We have identified several concerns to climate change. Such volunteer activities might with the Governor’s proposal. First, we find the include planting trees, clearing vegetation to reduce proposed program expansion to be premature. wildfire risk, and recovering and redistributing Given the program only began in 2021-22, sufficient edible food to divert it from landfills. The funding data are not yet available on the effectiveness of provides the fellows with a stipend, educational the current pilot program to justify the Governor’s benefits to attend school or repay existing student proposal to double its existing funding or make loans, and training and professional development. it ongoing. Specifically, the program has not In 2022-23, the program provided grants to 42 host collected conclusive and comparative information partners which in turn engaged two to three fellows as to whether the Climate Action Corps program’s each. CA Volunteers indicates that applications for approach of funding fellows to organize local funding significantly exceeded available funds. volunteer efforts is more effective than other types Established as a Three-Year Pilot in of activities at mitigating the causes and impacts 2021-22, Then Extended for Two More Years. of climate change. Such information is critical CA Volunteers currently receives $4.7 million to determining whether this program should be annually from the General Fund through 2025-26 prioritized above other activities the state could for the Climate Action Corps program, including pursue to achieve these same goals. Second, $3.9 million for local assistance grants to support the program could continue operating at existing the fellows and their activities, and $823,000 for levels even without the proposed expansion, state-level program administration. The program given the existing $4.7 million in General Fund was first funded in 2021-22 on a three-year basis. currently is planned through 2025-26 along with The 2022-23 budget agreement committed to the $3 million in annual federal AmeriCorps funds. extending this same amount of annual funding for As such, current activities could continue without an additional two years. interruption while providing the state time to Program Also Supported by Federal Funds. gather additional information on the program’s In addition to state funds, the Climate Action Corps effectiveness before making future budget is supplemented by $3 million annually in federal commitments. The Legislature could consider AmeriCorps funding. These funds are in addition requiring CA Volunteers to collect and submit www.lao.ca.gov 5 2023-24 BUDGET detailed data on program outcomes—and how they Recommendation compare to other climate-focused programs—to Reject Governor’s Proposal to Expand and help inform those decisions. Third, as discussed Extend the Climate Action Corps Program. above, given the state’s existing budget problem, We recommend the Legislature reject the providing $4.7 million in additional General Fund Governor’s proposal to double the funding for resources for this program necessitates making the Climate Action Corps in 2023-24, and also to an equal amount of reductions from other existing reject the proposal to make the program ongoing spending commitments, which the Governor does beginning in 2026-27. We find augmenting support through his package of budget solutions. Given the and committing permanent funding for this program lack of information regarding program outcomes, is premature before the state has evidence that we do not find that this program meets the higher this volunteer-based approach is more effective bar for justifying new spending—particularly on an than other programs at yielding meaningful results ongoing basis. This is especially true against the in the state’s efforts to mitigate the causes and backdrop of the Governor simultaneously proposing impacts of climate change. Because the program to reduce programs that have a more proven history currently is scheduled to receive state funding of directly reducing climate change impacts. (Please through 2025-26, along with existing federal funds, see our recent report, The 2023-24 Budget: program services would continue even without the Crafting Climate, Resources, and Environmental proposed augmentation, allowing the state time Budget Solutions, for a detailed discussion of the to collect additional information. Moreover, given Governor’s proposed reductions.) the state’s current budget shortfall, we do not find a compelling rationale for prioritizing this program at the expense of existing state commitments. The Legislature could consider requiring CA Volunteers to collect and submit detailed data on program outcomes—and how they compare to other climate-focused programs—to help inform future funding decisions. 6 LEGISLATIVE ANALYST’S OFFICE 2023-24 BUDGET www.lao.ca.gov 7 2023-24 BUDGET LAO PUBLICATIONS This report was prepared by Rachel Ehlers and reviewed by Anthony Simbol. The Legislative Analyst’s Office (LAO) is a nonpartisan office that provides fiscal and policy information and advice to the Legislature. To request publications call (916) 445-4656. This report and others, as well as an e-mail subscription service, are available on the LAO’s website at www.lao.ca.gov. The LAO is located at 925 L Street, Suite 1000, Sacramento, California 95814. 8 LEGISLATIVE ANALYST’S OFFICE