Council of State Administrators of Vocational Rehabilitation’s
Recommendation for the FY 2003 Appropriation for the Public Vocational Rehabilitation (VR) Program
The Public Vocational Rehabilitation (VR) Program is one of the most cost effective programs ever created by Congress. It enables hundreds of thousands of individuals with disabilities to go to work each year and become tax-paying citizens. Each year, the Program assists over 1.2 million individuals with disabilities to go to work by providing services and supports to eliminate barriers to employment. Of those served each year, over 230,000 enter competitive employment. The basic funding mechanism for the Program, which requires a state match of 21.3 percent, creates a state-federal partnership that has worked well for over 80 years.
The Rehabilitation Act mandates that the annual Federal appropriation for the Public VR Program grow at a rate at least equal to the change in the Consumer Price Index (CPI) over the previous fiscal year. While this mandate was intended to create a floor for the VR appropriation, Congress has not appropriated funds above the mandated CPI increase during the last 6 years. This is particularly problematic because the formula used to distribute these funds, which is based on a state’s per capita income and population, results in significant variations in the increases in individual state allotments. When the increase is limited to the CPI increase and the formula is applied, not all states receive increases that are equal to the annual rate of inflation.
Over the last ten years the Public VR Program has faced a number of challenges that have been compounded by minimal increases in Federal funding. Welfare-to-Work programs for TANF recipients are increasingly turning to State VR agencies for employment and training services because of the high percentage of people with disabilities who remain on the welfare rolls. The work incentives provisions and the Ticket-to-Work Program in the Ticket to Work and Work Incentives Improvement Act of 1999 are intended to encourage millions of Americans who receive Social Security disability benefits to seek assistance in entering or re-entering the workforce. Many of these individuals will turn to State VR agencies for services, potentially placing an enormous burden on the Public VR Program. Implementation of the Workforce Investment Act of 1998 and of the Supreme Court’s Olmstead decision which calls for the movement of people with disabilities from institutions to community living will increase the demand for VR services leading to employment.
The Public VR Program is severely under-funded to meet the mandates in the Rehabilitation Act and the challenges facing the Program. Under the current appropriation, the Program can meet the needs of only a small percentage of eligible individuals (i.e., approximately one in twenty who could potentially benefit from services). As a result, many State VR agencies have been forced to implement an order of selection, a mandated system of prioritization whereby only those eligible individuals with the most significant disabilities receive VR services.
The FY 2002 appropriation for the Public VR Program was $2.48 billion, an increase of 3.4 percent over the FY 2001 appropriation. The President’s request for FY 2003 would combine the funding for four discretionary programs (Projects with Industry, Supported Employment State Grants, Recreation Projects, and Migrant Farm Worker Projects) into the appropriation for the Public VR Program. While this would provide an increase above the mandated CPI increase for VR (i.e., 2.1 percent for FY 2003), the consolidation of these funding streams does not result in any new funding being available to serve individuals with disabilities who are seeking to become gainfully employed. CSAVR does not support the President’s proposal to consolidate these funding streams. For FY 2003, CSAVR recommends an increase of $245 million above the FY 2002 appropriation for the Public VR Program. This represents an increase of 10 percent above the FY 2002 appropriation and a 7.1 increase above the President’s request for FY 2003.
Challenges Facing the Public VR Program
Special Education: The federal appropriation for special education increased by approximately 140 percent between 1997 and 2002, with the increase in FY 2002 being over $1 billion. Increases in special education funding have increased the demand for VR services as special education students leave school and seek adult services. Many of these students expect VR to be there to pick-up where special education left off. State VR agencies currently do not have the resources to meet these growing demands.
Impact of the Ticket to Work and Work Incentives Improvement Act of 1999 (TWWIIA): TWWIIA was designed to address disincentives to work found in the SSDI and SSI programs and to increase employment opportunities for individuals enrolled in these programs. Research has shown that less than one percent of these individuals leave the Social Security disability rolls each year as a result of paid employment. Provisions in TWWIIA that provide extended Medicare and Medicaid coverage to such individuals when they enter or return to the workforce will encourage more beneficiaries to seek employment. As the Ticket to Work Program is implemented nationwide over the next two years, many people receiving tickets will go to the Public VR Program for information and assistance. With a key feature of the Ticket Program being an outcome payment system and with private providers who are approved to function as employment networks under the program having the ability to choose who they serve, SSDI and SSI recipients with the most significant disabilities and most costly service needs will be referred to the Public VR Program where they are presumptively eligible for services. With only minimal increases in VR funding over the last decade, this situation creates yet another challenge for the VR Program whose resources are already inadequate to meet its legislative mandates.
Temporary Assistance for Needy Families (TANF): Most states have had significant success in reducing their TANF or welfare to work caseloads, with a reduction of as much as 40 percent in some states. While welfare caseloads have been shrinking, the composition of the remaining caseload has changed. A recent General Accounting Office (GAO) report found that individuals with disabilities represent approximately 44 percent of the remaining TANF population. Many of these individuals have previously unidentified or undisclosed disabilities. Many have multiple and significant barriers to employment. State welfare agencies are increasingly turning to State VR agencies for assistance in meeting the needs of individuals with disabilities who are left on the TANF caseloads. With such minimal increase in funding, State VR agencies are not equipped to deal with the increase in referrals from State welfare agencies.
Impact of Assistive Technology: During the past decade,
assistive technology has become a fundamental tool, making it
possible for individuals with disabilities, including
individuals with the most significant disabilities, to
participate in training and employment programs and seek
employment opportunities in the competitive labor market.
Some State VR agencies report that the number of customers
benefiting from the use of assistive technology has doubled in
the last 5 years. While the cost of some assistive
technology has fallen, specialized products needed by relatively
small groups of individuals with disabilities remain costly.
Additional costs are incurred because products used by
individuals with disabilities need to be maintained, repaired
and updated. In addition, individuals receiving assistive
technology from State VR agencies often need to be trained on
how to use that technology. As a result of these factors,
the overall expenditure of VR funds on assistive technology has
risen each year.
Impact of the Workforce Investment Act of 1998 (WIA): As states implement WIA’s One-Stop approach to employment services, increasing numbers of individuals with disabilities are being referred from generic employment and training programs to State VR agencies for services. In addition, many states are asking State VR agencies to provide financial assistance with expenses that are not authorized expenditures for the Public VR Program (e.g., setting up resource rooms for potential job hunters and providing accommodations for people that have not been determined eligible for VR services). While VR’s involvement in State Workforce Investment Systems is critically important, WIA has placed yet another financial burden on an already strained program, reducing the percentage of VR funds that are available to provide services and supports to eligible individuals with disabilities.
Impact of the Olmstead Decision: Many states are focusing
on implementing the Supreme Court’s Olmstead decision, which
mandates that individuals with disabilities who are residing in
institutions be moved into the community whenever possible.
The Bush Administration has pledged to enforce this decision
vigorously. As individuals with disabilities are moved out
of institutions, the Public VR Program will be playing a major
role in assisting them in obtaining work.
Attracting and Retaining Qualified Counselors: The role of the vocational rehabilitation counselor is the cornerstone of the Public VR Program. As the key professional in the system, the VR counselor is responsible for interacting with individuals with disabilities who are seeking or receiving VR services to assist them in entering the workforce and becoming economically independent. During the last reauthorizations of the Rehabilitation Act, Congress mandated that in order to be qualified to serve persons with disabilities under the Public VR Program, rehabilitation counselors must meet the highest state standard for persons in that profession (in most cases, requiring a masters degree). In many states, from one third to one half of the incumbent counselors do not meet the state standard as now required by law. Consequently, these counselors must be provided with additional education and training, often at a cost of as much as $30,000 per counselor. As a result, State VR agencies are finding it more and more difficult to attract and retain qualified individuals to serve as VR counselors.
