Jobless will not lose benefits lifeline

AUSTIN (KXAN/AP) - Unemployment claimants will continue to be paid as the Texas Workforce Commission borrows $643 million from the federal government to cover claims.

Currently, more than 350,000 out-of-work Texans rely on unemployment benefits. State funding was set to run out soon, threatening the availability of assistance for the unemployed.

Toni Turnipseed of Austin spends most of her days at Workforce Solutions, looking for a job. Turnipseed said she has been worried her unemployment will not be extended.

"I don't know if I'll get it," said Turnipseed

Like many of the 350,000 other Texans on unemployment, Turnipseed depends on unemployment to pay her bills and the uncertainty is gut wrentching.

"It's horrible you can call all day long several times and you can't get through," said Turnipseed.

The concerns come after news broke the state did not have the money to pay out. Now Texas is borrowing $650 million from the federal government.

In March, Governor Rick Perry rejected $555 million in federal stimulus money that would have expanded unemployment benefits for Texans.

"The best way to address unemployment is by creating jobs, rather than discouraging job creation by raising taxes on employers through federal mandates tied to stimulus dollars.," said Perry. "Those Texans eligible for unemployment today will continue to receive unemployment benefits under the current system. The position we find ourselves in today with the state’s UI trust fund is similar to where we were in 2003, and we will use similar tools we had then to continue providing unemployed Texans with the benefits for which they qualify. Even had we accepted the unemployment stimulus dollars, the state would have still had to borrow money to meet the unemployment benefit needs in Texas.

Meanwhile, the Governor's critics say the move backfired.

"$555 million we don't have to pay back nor payback interest which is another 100 million dollars on top of that," said Representative Mark Strama of Austin. "That would have saved business taxpayers in Texas real money right now during a recession."

Senator Kirk Watson added, "Here are the consequences when political posturing trumps efforts to help unemployed Texans. Just weeks ago, Governor Perry publicly rejected more than a half-billion dollars in unemployment aid. He turned this money into a political football, and he fumbled it. Now, the state will have to go more than $640 million into debt to continue helping Texans in the literally tragic situation of losing a job through no fault of their own. That debt will fall on Texas employers at a time when we should be working to help job creators, not piling more debt on top of them."

Regardless of how the state gets the money, the Texas Workforce Commission says it will be there for those on unemployment who need it.

"Anyone who has already qualified for unemployment insurance, they are going to receive their deposit every two weeks they are going to receive their benefits," said Ann Hatchitt, Texas workforce Commission.

Because of new legislation 15,000 Texans will have their unemployment benefits extended past 59 weeks. The last time those extended benefits were made available was in 1980.

State officials also said they are overwhelmed by people applying for assistance. About 15,000 long-term unemployment claimants who have received benefits for more than a year are being advised there will be a delay in receiving the newly-enacted 13 weeks of state extended benefits.

At the end of May, the Texas legislature approved the changes which allow for state extended benefits. This 13-week state extension is completely federally funded and is available to claimants that have exhausted 59 weeks of unemployment benefits.

Those who qualify for the extension will receive payments retroactive to the date their current benefits end. The delay in the 13-week state benefit extension stems from complex federal requirements that must be programmed into TWC’s computer system.

The requirements for federally-funded state-extended benefits are significantly more stringent than the requirements for the previous federal extended benefit programs. All possible effort has been directed at addressing the necessary transition of the system to accommodate the stringent federal requirements. TWC is committed to implementing the newly enacted state extended benefits as soon as possible.

Benefits are paid through the Texas Unemployment Compensation Trust Fund. During periods of high unemployment claim volume, interest-free loans are available to states from the federal government. Similar loans were utilized by TWC in 2003 resulting in uninterrupted payment of benefits.

Almost 350 new staff members have been added to Texas Workforce Commission centers across the state, bringing the number of TWC employment services staff to nearly 1,000. TWC has hired the temporary employment services workers through funding provided by the American Recovery and Reinvestment Act of 2009.

Employment services staff provide job seekers help with services including job referrals, career counseling, training and support, and other employment services. In addition, the staff works with employers to post job openings and train their existing workforce.