May 15, 2009
More unemployment funds available

The bad news is that Texas' rate of unemployment continues to rise. The good news is that this means more federal funds for unemployment insurance are available, and these come with no conditions on them.

Texas now qualifies, thanks to the state's steadily rising unemployment rate, for $250 million of string-free federal money. That money would provide another 13 weeks of unemployment benefits -- at no cost to the state -- for some 70,000 workers whose benefits are set to expire beginning in July, according to the Center for Public Policy Priorities.

There is a catch, however. The Legislature needs to make a technical tweak to state law and the only bill that would be germane and appears to be moving is Senate Bill 1569.

That bill would enact the necessary changes for Texas to access $555 million of federal money to expand unemployment eligibility. But that money comes with strings that Gov. Rick Perry has said are unacceptable.

The bill passed out of the Senate weeks ago and is lingering in the House Calendars Committee. It could come up early next week -- and likely pass. But that would not be soon enough to allow time for a veto override should Perry choose to exercise that authority.

Rep. Mark Strama, D-Austin, said House members intend to attach the tweak to SB 1569 when it comes to the floor. The additional $250 million -- and the tens of thousands of unemployed workers that would get extended benefits -- might just change the dynamic for the governor, said the bill's proponents.

Bill author Sen. Kevin Eltife, R-Tyler, said he has long kept hope alive that Perry would not veto the bill and this money has stoked his hope.

I had hoped that SB1569 would have been taken up in time to try to override a veto, but apparently that won't happen. Burka says the votes weren't there for the override anyway, and thought the bill was dead as a result. I certainly hope it passes regardless; even without this extra incentive, I say make Perry veto it if that's what he intends to do. Given the way some other Republican governors have folded on the issue, it's not out of the question that this was all just a bluff. Given the extra funds that are now available and the fact that the unemployment trust fund will be depleted as of July, I don't see how the Lege can't force the issue.

And if more incentive is needed, here's the CPPP with some hard figures.

As of May 5, more than 353,000 Texans were receiving unemployment benefits, more than triple the number of Texans receiving UI benefits a year ago. Currently pending in House Calendars, SB 1569 strengthens our UI system to protect unemployed Texans and qualifies Texas for $555 million in federal funding through the American Recovery and Reinvestment Act (ARRA) for our UI Trust Fund. But the Legislature has overlooked an entirely separate pot of money in the ARRA that is equally important. About 70,000 Texans are expected to exhaust their federal Emergency Unemployment Compensation (EUC) beginning in July. The ARRA will pick up the 100 percent of the costs to extend UI for these Texans, delivering more than $250 million in federal funds into the Texas economy without any state costs. In order to qualify, Texas must change its extended benefits statutory trigger to activate the program; the change can expire when the full federal funding phases out in 2010.

Emphasis in original. The CPPP has put together this chart (PDF) showing how many people per House district stand to lose EUC funds, and how much money is at stake, if SB1569 doesn't pass. I say if that's really what Rick Perry wants, let's give him the chance to take it. As this is a bill that has already received Senate approval, it has until May 26 to pass. Let's get it done, please.

Posted by Charles Kuffner on May 15, 2009 to Budget ballyhoo
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