***Weekly Update***
From Legislative Committee Chair: Todd Kolden, Aberdeen Central Office
Week of April 10, 2006
HOUSE BUDGET STALLS DUE TO DISPUTE OVER DOMESTIC SPENDING LIMITS
• This week the House was unable to reach agreement on a Budget resolution, postponing further consideration until after its two-week Easter recess. House majority leaders were unable to bring together three intra-party factions to compile the necessary votes to pass the resolution. A major hurdle is agreement on the domestic discretionary spending cap, which includes funding for health, education and other social programs including workforce programs. Moderates and most Members of the House Committee on Appropriations in the Majority want to increase the cap on spending while conservatives want to keep it at the level proposed in the Bush Administration's FY 2007 Budget request. House Minority Members are expected to vote en masse against any Majority sponsored budget.
• Negotiations between these intra-party groups have yielded some progress. Moderates have said they would agree to an increase to the discretionary spending cap if funds are moved from defense and the international affairs portions of the budget. Although such a move might offend appropriators because it would make their decision-making more difficult in these areas, they likely could make up funding shortfalls later in the fiscal year by appropriating emergency supplemental funding. Emergency supplemental funding is not counted against the caps established in the budget. If House moderates prevail in their effort to increase the caps on domestic spending and the budget bill passes the House, it would make negotiations with the Senate easier. The Senate approved its budget resolution (S. Con. Res. 83) the week of March 13, including an amendment that would increase by $7 billion above the Bush Administration's FY 2007 Budget request the total amount appropriators could spend on health, education and other social programs.
• Although approval by the Congress of a budget resolution that includes an increase in the overall spending cap would be a positive event for the workforce system, it does not guarantee more spending. The budget process simply establishes the overall ceiling on total spending appropriators must stay below when determining spending for individual programs. Some believe already the House and Senate will not be able to reach agreement on a concurrent budget resolution this year. Given this prospect, decisions on what will actually be appropriated for the workforce system in FY 2007 will be decided by the House and Senate Committees on Appropriations.
IMMIRGRATION REFORM ON HOLD AFTER SENATE NEGOTIATIONS FALTER
• The Congressional march toward reforming national immigration policy will take a two-week Spring break as the House and Senate begin a recess through April 30 without an agreement. The Senate yesterday was close to reaching a bi-partisan compromise on its reform legislation (S. 2454), but some lawmakers in the Majority felt left out wanting assurance amendments could be offered on the Senate floor when the compromise bill would be debated. Minority members balked to opening the legislation to amendments, fearing they would, if approved, break apart the agreement. This gamesmanship over procedural maneuvers underscores the political sensitivity of immigration reform between and within both parties.
• Political sensitivity over immigration reform centers primarily on two issues: (1) legalization of existing illegal immigrants; and (2) border security. After September 11, 2001, these two issues became inexorably linked with the lines of debate centered on balancing both. The House immigration reform bill (H.R. 4437) focuses largely on improving border security and enforcement of immigration law. Lack of broader opportunities for illegal immigrants to live legally in the United States has motivated pro-immigration groups to rally against it. With the latest Senate compromise leaning toward opening the way for increased immigrant legalization, some believe the House may be forced to broaden its plan.
• Some also speculate with the mid-term election less than 8 months away that motivation to approve a compromise bill will diminish. History shows speedy reform can be difficult. According to a report on the last immigration reform bill to pass Congress in 1996, it took about five years to pass a law to legalize nearly 3 million immigrants. Now under debate is how to legalize four times this number. Further, critics of the 1996 reforms say it did very little to mitigate immigration concerns and might be promoting further growth in the illegal immigrant population.
HOUSE WAYS AND MEANS SUBCOMMITTEE HOLDS HEARING ON USE OF TECHNOLOGY TO IMPROVE PUBLIC PROGRAMS
• The House Ways and Means Subcommittee on Human Resources invited witnesses this week to testify on the use of technology to improve public benefit programs. In announcing the hearing, Subcommittee Chairman Wally Herger (R-CA) said it "will explore how programs and agencies are using these new technologies to better serve beneficiaries and taxpayers alike." Further, Chairman stated the hearing will "provide an opportunity to review what can be done to further improve services, which is what the American people rightfully expect." Ms. Diane Rath, Chair and Commissioner Representing the Public for the Texas Workforce Commission (TWC) appeared before the Subcommittee to highlight the advances her agency has made as a result of the use of technology.
• Commissioner Rath testified on technological advancements in the Unemployment Insurance (UI) program including the agency's use of telecenters to improve services for workers and businesses, the transition from paper checks to direct deposit and debit card for UI benefit payments and movement toward the integration of UI and Employment Service (ES) programs. She highlighted her state's website (WorkInTexas.com) for its ease of use, flexibility and unique approach to recruitment and employment services. Commissioner Rath also highlighted her state's use of technology to meet the demand for services brought by Hurricanes Katrina and Rita, noting the Texas telecenters processed nearly half of the 2.6 million calls routed to the agency during post-disaster recovery.
• Chairman Herger asked Commissioner Rath what she and her agency learned as it related to service delivery following the hurricanes. Ms. Rath said the issue of scalability, or the ability of the agency to manage large increases in demand for services in a short time period is essential. Dennis Fecci, former Chief Information Officer for the New York City Human Resources Administration agreed, noting the demand for services following the terrorist attacks of September 11, 2001 exceeded administrator expectations. He said agencies must include in their emergency preparedness plans the latitude to manage fluctuations in demand and have in place contingency plans when standard operations must be altered.
SECRETARY CHAO PROMOTES CAA'S AND WIA REFORM BEFORE HOUSE EDUCATION AND THE WORKFORCE COMMITTEE
• The House Committee on Education and the Workforce listened to U.S. Department of Labor Secretary Elaine Chao and U.S. Department of Education Secretary Margaret Spellings to discuss the Administration's "competitiveness agenda." Secretary Chao used the opportunity to advance the Administration's Career Advancement Account proposal and encourage the Congress to move forward on the reauthorization of the Workforce Investment Act. Secretary Spellings discussed the academic and technological challenges faced by U.S. students and workers as global competition intensifies. Secretary Chao stated "many of the fastest growing jobs of the future will need to be filled by 'knowledge workers' who have specialized skills and training. These are the jobs that will drive innovation in the world economy and increase living standards. Aligning the workforce investment system with new economic realities facing the United States is among the critical factors in the success of the American Competitiveness Initiative.
MARCH NATIONAL EMPLOYMENT RATE AT 4.7 PERCENT
• Nonfarm payroll employment grew by 211,000 in March, and the unemployment rate was little changed at 4.7 percent. A year earlier, the jobless rate was 5.1 percent. Nonfarm payroll employment for February was adjusted slightly downward from 243,000 to 225,000. March's employment gains reflected gains largely in the service sector, including retail trade (+29,000), professional and business services (+52,000), education and health fields (+33,000) and leisure and hospitality (+42,000). The goods producing sectors were mixed with construction adding jobs (+7,000) and manufacturing declining (-5,000).
• The same report showed about 1.0 million persons age 16 and over had evacuated from their homes in August 2005 because of Hurricane Katrina. In March, just over half had returned to where they were living in August 2005. Nearly fifty-four percent were in the labor force. Their overall unemployment rate was 16.5 percent. For the evacuees who have returned home, their unemployment rate was at 5.3 percent. However, for those who were not living in their former homes, their unemployment rate was 34.7 percent.
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Week of April 24, 2006
CONGRESS RETURNS TO WASHINGTON FOR FIVE-WEEKS OF WORK
Members of Congress are scheduled to return to Washington early next week to begin a five-week work period. Preliminary session agendas do not call for either chamber to work on issues of interest to the workforce system in the near-term, but consideration of a FY 2007 concurrent budget resolution and FY 2007 appropriations looms. The House adjourned for its Easter recess just over two-weeks ago without reaching agreement on its budget resolution. House majority leaders were unable to bring together intra-party factions to garner the necessary votes to pass the resolution. A major hurdle is agreement on the domestic discretionary spending cap, which includes funding for health, education and other social programs including workforce programs.
House Majority Leader John Boehner will not schedule consideration of a budget resolution until he is assured he has the necessary votes. One way he may get the votes of moderate Members in his party is to move funds from the defense and international affairs sections of the budget to labor, health and education related programs. Negotiations over the last two-weeks have purportedly yielded some progress in reaching a compromise to move approximately $4 billion from defense and international affairs to domestic programs to appease moderates. If Members in the House reach agreement on this move, the House bill would differ by only $3 billion from the Senate's budget resolution - which would cap the ceiling on spending at levels $7 billion higher for domestic programs. House approval of a budget resolution with caps close to Senate levels increases the probability the two chambers can reach agreement on a concurrent resolution. But if the House fails to approve a resolution or one with widely divergent caps, the process is likely to break down.
The House Labor, Health and Human Services (HHS) and Education Appropriations Subcommittee is expected to consider its FY 2007 appropriations bill in June. This leaves less than two-months for states to request their funding levels in the bill before it is approved. Once the bill is approved by the Subcommittee it will move quickly to the House Appropriations Committee and then the House. The Senate is not expected to begin consideration of its FY 2007 Labor, HHS and Education spending bill until later in the summer.
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