Perry balking at jobless funds
Several Democratic legislators are asking Gov. Rick Perry to accept changes in Texas' unemployment system to qualify an estimated 45,000 more people for jobless benefits from $555.7 million in federal stimulus money, and to declare it an emergency.
Perry has criticized the federal stimulus, while grudgingly informing the White House Texas would accept most of it. He may realize he might be hunted down with dogs if he actually refused much of the estimated $17 billion earmarked for Texas.
Like Louisiana's Republican Gov. Bobby Jindal, Perry has said Texas may not accept the expanded unemployment insurance if strings are attached - and they are.
The Democratic legislators think it would be crazy to refuse the money and see it go to other states.
"I've heard the concerns that the unemployment funding in the federal stimulus package comes with 'strings attached', and I don't care," said state Sen. Rodney Ellis, D-Houston. "To a Texan who has lost a job and worries how they are going to keep their home and pay their bills, that aid isn't a string, it's a lifeline -- one which will help their family get through hard times."
Ellis and several others say Texans would be taxed with other Americans to help pay off the stimulus debt. Any money Texas turns down would go to other states.
"I don't pay my income taxes for it to go to Wisconsin," said Rep. Jim Dunnam, D-Waco, joining several other Democrats at a press conference Tuesday, March 3. Dunnam chairs a special House committee analyzing the stimulus money and its potential distribution.
Ellis and Dunnam joined with Sens. Leticia Van de Putte of San Antonio, Eddie Lucio of Brownsville, Kirk Watson of Austin, Mario Gallegos of Houston, Eliot Shapleigh of El Paso and Rep. Joe Deshotel of Beaumont in backing bills to pave the way for accepting the money. All are Democrats.
Several wrote Perry on Feb. 24, asking that he declare it an emergency so the Legislature can deal with it immediately rather than wait until after the 60th day of the legislative session.
"There are no plans to designate this an emergency item," responded Perry spokeswoman Allison Castle. Perry's office is reviewing the stimulus package "to determine what strings and stipulations are attached and the long-term economic impact to Texas taxpayers."
The legislators say reasons Texas must take the money include:
• Despite Perry's boasting about the state's economy, the recession is taking its toll. As of December 2008, more than 670,000 Texans were unemployed, or 6 percent, up from 4.4 percent in June.
• The Texas Comptroller estimates Texas will lose 111,000 jobs in 2009, hiking unemployment to 8.2 percent.
• The Texas Workforce Commission paid $59 million in unemployement in a recent week, up from $30 million for the same week a year earlier.
The legislators said the changes needed to qualify for the federal stimulus aid include:
• Joining 21 other states in calculating unemployment benefits in a more up-to-date fashion. Current Texas practice is to disregard the most recent three to six months of a worker's earnings when calculating eligibility. But since claims now are processed electronically rather than manually, more recent information is readily available.
• Joining almost half the states in making part-time workers eligible for pro-rated benefits. Currently benefits only go to full-time workers.
• Allow benefits for "trailing spouses" who leave jobs because their spouse is transferred to another city. The Legislature already does so for military spouses.
The Workforce Commission projects a deficit of $750 million in the state's unemployment trust fund by October.
To refill it, the replenishment tax employers pay could go up, a deficit tax could be levied, or federal interest-free loans could be used.
Watson said Perry's appointee as chairman of the Workforce Commission, former state Republican Chairman Tom Pauken, recently said Texas must accept the unemployment stimulus.
Making the changes to the state's unemployment insurance system would cost about $80 million, but could save Texas employers almost $500 million in unemployment taxes in 2010, while helping almost 45,000 jobless Texans, the legislators said.
Watson likened the unemployment changes to a pilot program - funded by the federal government. The Legislature can re-evaluate it when the money runs out, he said.
The prediction here is that Perry, after some more posturing likely aimed at his 2010 reelection race against U.S. Sen. Kay Bailey Hutchison, will take the money.
If he doesn't, the Legislature may do it for him.