After years of often acrimonious relations with Macon City Council, the Macon-Bibb County Office of Workforce Development is about to break away.
The job-training organization got IRS approval to become a 501(c)3 nonprofit agency in December, Workforce Development Executive Director Kathy Thompson said. That will allow it to cut city ties before July, she said.
The organization will become the Macon-Bibb County Workforce Investment Board Inc. until a new name is selected, Thompson said.
She noted that some City Council members seem pleased by the prospect. The council’s often hostile relationship with the group was on display Tuesday at the council’s Community Resources and Development Committee meeting.
Continuing an argument that has gone on for months, if not years, council members reacted angrily to the agency’s refusal to submit its contracts for city approval.
“We have a history of Workforce Development not wanting to submit themselves to any oversight by the city of Macon,” committee Chairwoman Lauren Benedict said.
One of 44 problems noted in the city’s audit for the past fiscal year was the lack of city Finance Department oversight, which could lead to undetected fraud, the audit said. If the money Workforce Development receives is misspent, the city could be held legally liable, Benedict said.
But Thompson, Internal Affairs Director Keith Moffett and Assistant City Attorney Stuart Morelli all say that since the money that Workforce Development receives is federal funding just passed through the city, the city doesn’t have the right to approve or reject the agency’s contracting decisions. Workforce Development uses the city as its fiscal agent, but it isn’t actually a city department, Morelli said.
“They can go out and make their own procedures, as long as they comply with federal law,” he said.
The November 2009 agreement between the city and Workforce Development says the agency’s board has that contracting authority, Morelli said.
Nevertheless, the council committee asked him to draft a letter to the Workforce Development board requesting that its contracts be subjected to council scrutiny, he said. Federal law says that although the city has no real control over Workforce Development’s spending, the city could be required to make up for any misspent funds, Morelli said.
Another sore point has been the cost of providing administrative help to Workforce Development. The city manages the agency’s payroll and several other functions.
“Up until this fiscal year, we have never sought reimbursement for those expenses,” Benedict said.
In June 2011, four council members sponsored an ordinance to charge Workforce Development a 5 percent administrative fee for that work.
It took months to get estimates of how much that work is worth, since much of it is done piecemeal. The council passed the requirement in July, but Mayor Robert Reichert vetoed it. The council overrode him in a 12-1 vote in August.
Councilman Rick Hutto, one of the ordinance’s sponsors, said the actual value of those services is 11.01 percent of Workforce Development’s total funding. He sought a 10 percent fee, but the final ordinance demands only 5 percent.
“To date, they have refused to pay even that, saying they are waiting for an approval from Atlanta,” Hutto said.
The state has now accepted a formula for calculating those indirect administrative costs, so the first big payment should be made by the end of this month, Moffett said.
Benedict said that payment will be for about $69,000, covering administrative services from July 2011 through March 2012, followed by monthly payments for any future services from city departments.
Thompson said the agency will keep using the city for administrative help until Workforce Development hires its own personnel for those functions, which will take several months.
As it becomes an independent nonprofit, Workforce Development is starting many new efforts to connect with youth, provide education and job training, including entry-level certifications for specific local employers, she said. An additional benefit of its new status will be the ability to seek funding from private foundations and other sorts of grants, not just the uncertain Congress-approved funds that flow through the city, Thompson said.
“My goal is to do that, and to not be so dependent on the federal dollars,” she said.
To contact writer Jim Gaines, call 744-4489.