S1841

An Act creating the "New Jersey Workplace Skills Savings Program," supplementing Title 34 of the New Jersey Statutes, and making an appropriation.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. As used in this act:

"Account" means the job training account set up by an employee through the program.

"Department" means the Department of Labor and Workforce Development.

"Employee" means any individual who is 18 years of age or older, who lives in this State or is employed by an employer in this State, and whose wages are subject to withholding as provided in the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.

"Enrollee" means any individual who is enrolled in the program.

"Program" means the New Jersey Workplace Skills Savings Program established pursuant to this act.

"Trust" means the New Jersey Workplace Skills Savings Trust, managed by the Office of the Treasurer, which holds and manages the individual accounts established pursuant to this act.

2. There is created within the Department of Labor and Workforce Development a savings program known as the "New Jersey Workplace Skills Savings Program," to provide a means for employees to create a self-directed employment training fund to promote engagement in additional job training and skills development.

3. The New Jersey Workplace Skills Savings Trust, managed by the Department of the Treasury, is established as a special fund outside of the General Fund, separate and apart from all public moneys or funds of this State. The trust shall provide a mechanism through which the department, as trustee, holds accounts established and maintained pursuant to the provisions of this act to finance the cost of self-directed worker training.

4. The Department of Labor and Workforce Development shall administer the “New Jersey Workplace Skills Savings Program.” The department shall have the power to:

a. serve as trustee of the trust;

b. adopt rules and regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), necessary to carry out the provisions of this act;

c. prescribe and provide appropriate forms and processes for participation in the program;

d. establish a process by which an enrollee is able to contribute monies to the individual account created by the program;

e. select an investment manager and any other contractors needed to manage and market the program;

f. monitor the investment manager and any other contractors by audits and other reports;

g. assess and collect reasonable administrative fees in connection with any account, contract, or transaction relating to the program;

h. impose penalties for nonqualified withdrawals;

i. take all actions required so that the program complies with federal regulations and Internal Revenue Service Codes; and

j. perform any other actions which may be necessary to carry out the purposes of this act.

5. a. The program shall be operated as a trust through the use of individual accounts established for individual employees. An account may be opened by any employee who desires to participate in the program to pay for employment-related training services as described in section 6 of this act, and that employee shall be the beneficiary of the account.

b. Contributions to accounts shall be made in a manner to be determined by the department, subject to a maximum contribution of $1,000 to an individual account during any calendar year period.

c. Deposits made to an individual account shall be eligible for a dollar-for-dollar match up by the State to the maximum allowable annual contribution of $1,000.

d. There shall be no interest earned on any individual account.

e. Balances in any individual account shall be exempt from any creditor claims.

f. In the case of any nonqualified withdrawal, a penalty level shall be established by the department.

g. In the case of an individual wishing to cease participation in the program, the department shall establish a procedure to return all monies deposited in a manner to be determined by the department to the individual within 60 days; however, in no circumstances shall the State matching funds established pursuant to subsection c. of this section be considered a part of the refundable balance of any individual account.

6. The monies placed into an account may be used by the beneficiary to pay for:

a. any costs associated with an apprenticeship;

b. licensing exams or certification fees for any employment related purpose, including, but not limited to: commercial driver exams, fees associated with any profession listed under Title 45 of the Revised Statutes (C.45:1-1 et seq.), additional certifications related to an existing professional license, required exams for certification for a registered apprenticeship program, public school teacher license exams;

c. retraining programs for any unemployed worker;

d. formal classroom education related to job training as offered by a vocational school, technical school, union training program, or community college; or

e. any worker training-related expenses as provided for by regulation by the department.

7. There is appropriated from the General Fund to the Department of Labor and Workforce Development the sum of $25 million to effectuate the provisions of this act, including the provision of matching funds pursuant to subsection c. of section 5 of this act.

8. The department shall annually submit to the Governor and the Legislature pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1):

a. an audited financial report, prepared in accordance with generally accepted accounting principles, on the operations of the program for each calendar year, to be submitted no later than July 1 of the following year; and

b. a report that provides a summary of the benefits provided under the program, including, but not limited to, the number of enrollees in the program, the total dollars deposited in each calendar year, the total State matching funds provided in each calendar year, the total amount of training expenses approved by the program, and the total number of individuals who withdrew from the program. This report shall be provided based on activity in the program for each calendar year, to be submitted no later than July 1 of the following year.

9. This act shall take effect January 1, 2027, except that the Commissioner of Labor and Workforce Development and the Treasurer may take any anticipatory administrative action in advance as shall be necessary for the implementation of this act.

STATEMENT

The bill creates the "New Jersey Workplace Skills Savings Program", enabling workers to make annual investments in job training and makes a $25 million appropriation.

Under the bill, residents or employees of businesses in the State will be able to set up an individual savings account which can be used to pay for job training, license fees, or other career development activities. Enrollees can deposit up to $1,000 in any calendar year in the account, and the State will match contributions on a dollar-for-dollar basis. The Department of Labor and Workforce Development will administer the program and the Department of the Treasury will manage financial responsibilities related to the trust fund and associated individual savings accounts.

The department will produce an annual financial report and summary of the benefits supplied under the program to provide the status of key measurement metrics related to the program.

The bill appropriates $25 million to effectuate the provisions of the bill, including the provision of matching funds.