LEGISLATIVE FISCAL ESTIMATE

[First Reprint]

SENATE, No. 4004

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: SEPTEMBER 26, 2025

 

 

SUMMARY

 

Synopsis:

Revises law on extended employment programs for persons with disabilities.

Type of Impact:

Annual State expenditure increase from the Workforce Development Partnership Fund.

Agencies Affected:

Department of Labor and Workforce Development.

 

 

Office of Legislative Services Estimate

Fiscal Impact

Annual

 

State Expenditure Increase

Indeterminate

 

 

 

 

·         The Office of Legislative Services (OLS) determines that the bill will result in an indeterminate increase in annual State expenditures related to extended employment programs for persons with disabilities.

 

·         The bill sets minimum funding levels for these programs based on funding provided in the FY 2024 New Jersey State Budget and establishes a formula for the annual growth rate of expenditures related to vocational rehabilitation.  The OLS is unable to predict future funding levels.

 

·         The bill repeals certain regulatory and labeling requirements related to products manufactured by disabled workers.  The OLS notes that this may result in a small indeterminate annual reduction in administrative spending by the department.

 

 

BILL DESCRIPTION

 

      This bill modifies State statutes regarding extended employment programs that provide rehabilitation and employment for persons with significant disabilities.

      The bill eliminates the role of the New Jersey Commission for the Blind and Visually Impaired in determining the eligibility of individuals to be served by an extended employment program; setting standards for staff, facilities, and services of the programs; and requiring documentation of services.

      The bill clarifies the desired program outcomes of the extended employment program.  The bill also sets requirements for baseline funding for the extended employment funding and parameters for minimum increases based on the funding provided in the FY 2024 New Jersey State Budget combined with the consumer price index for all urban wage earners and clerical workers (CPI-W) or 80 percent of expenses outlined in a functional expense report to be submitted by providers of extended employment services each fiscal year, whichever of the two is greater.  Increased funding for the program is to be appropriated from the Workforce Development Partnership Fund when available.

      The bill clarifies that the Division of Vocational Rehabilitation Services is responsible for informing and referring individuals to the extended employment program and requires consultation with ACCSES New Jersey and the New Jersey Council on Developmental Disabilities on major policy and leadership changes within the division that would impact the program.

      The bill repeals the provisions of P.L.1975, c.350 concerning the sale of products produced in extended employment facilities, including specific labeling requirements, requirements regarding the minimum percentage of work to be done in the facilities, and penalties for misrepresentation regarding the disability status of the workers.

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

 

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS determines that the bill will result in an indeterminate increase in annual State expenditures related to extended employment programs for persons with disabilities. 

      The bill sets requirements for baseline funding for the extended employment funding and parameters for minimum increases based on the funding provided in the FY 2024 New Jersey State Budget combined with the consumer price index for all urban wage earners and clerical workers (CPI-W) or 80 percent of expenses outlined in a functional expense report to be submitted by providers of extended employment services each fiscal year, whichever of the two is greater. 

      The OLS is unable to predict future funding levels, but provides the following example for illustrative purposes.  According to data published by the United States Bureau of Labor Statistics, over the last 10 years, the CPI-W index has averaged a 2.9 percent annual increase, with calendar year 2024 also showing an increase of 2.9 percent.  At the FY 2024 funding level for vocational rehabilitation of $41.9 million, and assuming a 2.9 percent increase in the CPI-W based on both the 2024 index and the 10-year average, the annual increase would be approximately $1.2 million.  The bill provides an alternate calculation of 80 percent of functional expenses, which could drive the annual increase above the rate of inflation.  Increased funding for the program is to be appropriated from the Workforce Development Partnership Fund when available.

      The bill repeals certain regulatory and labeling requirements related to products manufactured by disabled workers.  The OLS notes that this may result in a small indeterminate annual reduction in administrative spending by the department.

 

 

Section:

Commerce, Labor and Industry

Analyst:

John Gaudioso

Associate Fiscal Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).