Funding fracas between Senate GOP, Gov. Wolf intensifies

Harrisburg – It’s been nearly two weeks since the Pennsylvania Senate decided to not push to the governor’s desk a one-year extension of funds to the unemployment compensation system under the Service and Improvement Infrastructure Fund, and standoff shows few signs of ending anytime soon.

In the latest episode, Senate GOP leaders sent a sharply worded letter to the governor urging him to reconsider furloughing nearly 600 workers in the Department of Labor and Industry, which the governor alleged is the unavoidable result of the failure to extend the funding.

In a letter dated Nov. 28, signed by Senate President Pro Tempore Joe Scarnati (R-Jefferson), Senate Majority Leader Jake Corman (R-Centre), and Senate Labor and Industry Committee Majority Chairman Lisa Baker (R-Luzerne), the leaders argued that the end of the four-year sunset under Act 34 of 2013 (the legislation originally providing the funding) was not a surprise and called the governor out for politicizing the issue by issuing furlough notices.

“We find your recent comments on this issue concerning as it is difficult to see how politicizing the unemployment compensation funding situation achieves any constructive purpose,” they wrote.

“The administration's willingness to furlough employees and close unemployment compensation centers without a plan for the future is disappointing. Publicizing the threat and leveraging jobs is an insult to the individuals who work hard every day on behalf of our Commonwealth.”

They also relayed that the reason the Senate did not take up the bill was due to a lack of justification for its need from the administration and a plan for additional accountability should the funds be approved, something they said was repeatedly asked for, but never received.

“If the administration assumed that the Senate would just extend and increase the funding without additional accountability, that was a serious misjudgment,” they wrote. “Our members have consistently shown a high commitment to greater public accountability when considering spending requests; they want to see what has been done with existing dollars in weighing requests for additional money.”

Additionally, the Senate Republicans asked for a rationale behind the threatened closure of the call centers chosen by the governor, arguing that without sufficient justification, the closing of the centers – which are all located in Republican districts – is merely political posturing.

The Senate GOP missive comes on the heels of a mid-month email blast from Sen. Scott Wagner (R-York), who also took Wolf to task over what he said was a failure to provide funding accountability for Act 34, justification for future funding and the threatened closure of UC call centers in Republican districts.

“I have been in Harrisburg since April of 2014 and I have witnessed first-hand the financial games being played by Gov. Wolf and his administration,” he wrote. "Trust me when I tell you this – Gov. Wolf and his Budget Secretary know where to find money to continue to fund the call centers.”

The York Daily Record, Sen. Wagner’s hometown newspaper, took him to task in an editorial Tuesday over his position on the funding and what it called his “grandstanding” over the issue.

Speaking to the issue of justifying the need for extending Act 34 for another year, Gov. Wolf’s press secretary, Jeff Sheridan, noted a 10-page memo was shared with the Legislature. The memo pointed out efficiencies created within the Department of Labor and Industry in the UC system over the last four years despite a decline in federal funding.

“This unemployment compensation system has lost state and federal funding, and has seen its staff reduced by a third in the past five years,” he said. “Under Gov. Wolf’s leadership, call wait times have decreased by more than an hour in the past year, and in 2016, the system met goals set by the federal Department of Labor that it had failed under the previous administration.

“This is a well-managed program,” he added, “but it simply cannot run without the funding that the Senate Republicans cut. Every single unemployment insurance payment that is delayed and call that is not answered is unfortunately due to the lack of action by the Republican Senate and those who failed to pass this bill before the Legislature broke for the holidays.” 

Wolf responded to Senate GOP leaders in a letter Wednesday.

“It is regrettable that we must even engage in correspondence on this matter at this time,” he wrote. “Even more regrettable is the fact that the Department of Labor and Industry is left with no alternative but to furlough more than 500 employees next month due to the Senate’s inaction on reauthorizing SIIF (the Service and Infrastructure Improvement Fund).”  

The letter cites 12 different exchanges between administration officials and legislators, including Senate Republican members and staff, on the need for the funding reauthorization contained in House Bill 2375 and similar legislation.

“All told, countless meetings were held with members and staff of your Caucus, and significant documentation justifying reauthorization as well as the ramifications of letting SIIF sunset was provided,” the governor stated.

Despite the urging of the Wolf administration and the labor union representing UC call center employees, the Senate did not return to voting session before the constitutional end of session on Wednesday.

Senate GOP leaders continued to state through a spokesperson that all requested documentation regarding SIIF funding has not been received, including a report promised by Labor and Industry Sec. Kathy Manderino.

However, not all hope was lost for potential action early in the 2017-2018 legislative term. In their letter to the governor, the Senate leaders said if additional justification and rationale was provided for the extension of the funding, they would continue to analyze the issue in advance of returning to session in January.

“However, in order for this to occur, the administration’s public accounting should include specific projects, expenditures, and timelines, as well as a detailed plan outlining future transfers, and a timeframe for elimination of extraordinary funding. In addition, a third-party audit of the program is appropriate and necessary,” the Senate GOP letter states.

The General Assembly will hold its first session day of the new term on Jan. 3, 2017, where members will be sworn into office. The first full voting session day is not scheduled until Jan. 23, 2017.

Jason Gottesman is the Harrisburg bureau chief for The PLS Reporter, a non-partisan, online news site devoted to covering Pennsylvania government.