BRUNSWICK

While still recovering from a grueling legal battle with the governor over the distribution of allocated federal funding, Coastal Counties Workforce Inc. learned this week that it will likely face cuts in its federal funding in the next fiscal year.

The nonprofit is one of three workforce boards in Maine that provides resources and services to help Mainers enter the workforce. The organization is financed largely through federal funding, although it does receive some grant funding as well.

It serves six counties along the coast, from York to Waldo, and is located in Brunswick.

According to Executive Director Antoinette Mancusi, Maine’s workforce boards are going to see a $650,000 cut in federal funding in the next fiscal year, which begins July 1.

“How that gets translated to the local areas, we don’t know yet. It has to go through a formula,” said Mancusi. “In my conversations with Department of Labor folks, they haven’t run the numbers yet.”

Lawsuit

News of the cuts comes after a legal battle with the LePage administration that crippled the organization for months as part of his efforts to eliminate the three workforce boards and replace them with a single state board. The administration argued that funding three separate workforce boards was wasteful.

However, last fall the Department of Labor rejected the governor’s request to implement those changes, and in response he announced he told the department he would reject the funding that supports the workforce boards. Maine’s Department of Labor decided to withhold some $8 million in already allocated federal funding from the three workforce boards, forcing them to rely on what federal funding they had received and grant funds.

Coastal Counties Workforce Inc. sued the administration, ultimately prevailing in January when a judge ordered the governor to release the federal funding to the three workforce board. Though victorious, Mancusi said that their services were devastated.

“We had to shut down operations, pretty much,” said Mancusi. “The services that were provided were really, really cut back. Individuals were getting just a sliver of money spent on them.

“During the lawsuit … our service provider — Workforce Solutions out of Goodwill Industries — had to lay off or otherwise reposition staff. So we lost approximately 70 percent of all staff,” she added.

Following the lawsuit, that staff was rehired.

Still, the board was able to stretch their funding to last throughout the ordeal, and in the aftermath they have worked to reconstruct their staff and services.

“Post-lawsuit, how are we doing? I would say we’re back to business,” said Mancusi. “Our centers are open. We are serving people, and we are now fully staffed. So the reconstruction has occurred despite what was in fact a destruction last year.”

Federal cuts

But just as the organization has recovered, it’s facing further cuts in federal funding.

Federal funding for the organization has decreased annually since 2013, when the organization was awarded a little more than $3 million. With last year’s $500,000 cut, the organization’s funding has dipped to about $2 million and is approximately at the same level as 2000, according to numbers provided by Mancusi.

Grant funding has helped offset some of those cuts, but the organization has had to adapt to less funding. In reaction to the $500,000 cut last year, Coastal Counties Workforce Inc. moved to provide services from adult education partner sites, said Mancusi. That allowed them to save money on infrastructure, which they could then spend directly on training.

A contributing problem is that the organization gets no state funding, according to Mancusi, which leaves them more vulnerable to swings in federal funding.

“Obviously what doesn’t help is the fact that our system is not in any way financed by state funding,” she said. “Other states do provide money for our systems (but) Maine does not. So that compounds the fact that we’re now seeing a cut one more time to our funding.”

Mancusi said that the group has decreased the number of people they serve in the region due to cuts. With federal funding in the $2.6-2.9 million range, Mancusi estimated the organization could serve approximately 900 participants. But with fewer grants and federal funding dropping to about $2 million, she said they’d be lucky to serve 600 participants.

Unemployment

According to Mancusi, the reason Maine is getting less federal funding is because of Maine’s low unemployment rate, which the federal government uses in part to assess need for workforce training funding.

In April, Maine’s unemployment rate was the fourth lowest in the country at 2.7 percent. But according to Mancusi, the unemployment rate doesn’t reflect how many people in Maine need job training.

Philip Trostel, a professor in the University of Maine School of Economics, agreed that the low unemployment rate was “almost completely unrelated” from the need for workforce training.

“I do agree that just because the unemployment rate is lower doesn’t mean that the need for job training has evaporated,” said Trostel. “That’s just not the case.

“The job creation and destruction process in the labor market is always fluid,” he added, “and people are switching jobs and so forth.”

According to Mancusi, Maine’s low employment rate is actually a sign that they need more funding, because instead of working with those who have been actively seeking employment, they’re dealing with folks who have given up on rejoining the workforce.

“(The unemployment rate doesn’t count) those who are missing from the workforce, people who have really just disassociated, detached,” said Mancusi. “They’ve given up. There’s a lot of them.

“These individuals that come might need twice as much funding spent on them in order to get them into the workforce,” she added.

But according to Trostel, the evidence is mixed on whether job training is cost effective for those populations.

“It certainly appears that when you can reach a motivated group, job training is very effective and cost effective in terms of getting people into better jobs,” said Trostel. “You can’t extrapolate that and say that job training is always going to pay off. There the evidence is more mixed.”

Still, he agreed that in a state with an older population like Maine, job training is essential.

“Retraining is probably more important in a state like Maine than in a state with a younger population,” said Trostel.

Regardless, Mancusi maintains that the organization needs more funding, not less, especially since it’s federal funding has been cut by a third in a five-year period.

“It’s not a time to curtail spending on this population,” she said. “If Maine needs workers, we need to take these unemployed workers and provide them with the services to enter the workforce — and it’s going to cost.”

nstrout@timesrecord.com