Senator Eliot Shapleigh - El Paso, Texas

Pauken

AUSTIN — Gov. Rick Perry’s top appointee to the Texas Workforce Commission has been working with state legislators to try to fashion a bipartisan compromise that would enable the state to accept $555 million in stimulus money from Washington for unemployment benefits without long-term federal strings attached.

Last week, Perry rejected the stimulus money for jobless benefits, contending that it would require the state to permanently expand its unemployment insurance program and subject Texas employers to millions of dollars in tax increases that would ultimately stifle the economy.

But under a proposal by commission Chairman Tom Pauken, Texas would make the mandated changes to accept the money and then revert to current law after the federal dollars run out. Pauken floated the idea at his nomination hearing in February and has since met with lawmakers in both parties to further discuss the plan.

Pauken’s efforts were made independently of Perry’s office and reflect an apparent difference of opinion between the two men.

A bipartisan group of lawmakers is advancing a similar plan in legislation gaining ground in the Senate. Pauken has also been praised by lawmakers who want to overturn Perry’s rejection of the money.

The federally mandated changes include extending unemployment compensation to part-time employees and to employees forced to leave their jobs when their spouses get work elsewhere.

Democrats have vowed to press ahead with legislation to obtain the money despite a veto threat by Perry. House Speaker Joe Straus, R-San Antonio, while staying out of the dispute, has suggested an option similar to that advanced by Pauken, saying that legislation could include a provision to dissolve the extra benefits when the stimulus money runs out, according to the Houston Chronicle.

'Different ideas’

In an interview in his office on Tuesday, followed by a phone interview later in the day, Pauken echoed predictions from the Federal Reserve Bank of Dallas that the state’s jobless rate could rise to 8 percent this year.

Pauken said he shares Perry’s disdain over federal attempts to dictate state policy through mandated changes required before the stimulus money is distributed.

"I agree with Gov. Perry that there should be no strings attached to the additional federal funds made available to Texas. I laid out a legislative approach which would allow us to get the money with no strings attached, and that’s still on the table."

But, Pauken said, "It’s not my position to get in a political squabble. I was just trying to talk about different ideas that might get the support of all concerned.

"I’ve really pulled back because it’s out of my hands. It’s in the hands of the Legislature, and it’s in the hands of the governor."

Pauken is a former Texas GOP chairman whom Perry appointed to lead the Workforce Commission in March 2008. He is still awaiting Senate confirmation.

Legislation proposed

Claims to the workforce commission, which administers state unemployment benefits, have increased 120 percent in the past year as Texas begins to feel the full impact of the recession.

Saying “it’s getting to be rough,” Pauken said that layoffs and job cuts are reaching “across-the-board” into most economic sectors throughout the state, including North Texas. His agency is beefing up staff, paying overtime and bolstering telehone service to handle the increased load, he said.

Sen. Kevin Eltife, R-Tyler, is sponsoring a bill that would have Texas accept the money with a provision that the federal terms would not extend after the stimulus assistance "has been exhausted."

Eltife said he began working with Pauken three or four weeks ago "to try to come up with a way to obtain federal stimulus money" that wouldn’t subject Texas employers to long-term tax burdens. The bill has drawn at least three Democratic co-sponsors since it was introduced last week.

Allison Castle, a Perry spokeswoman, said that the federal stimulus legislation prohibits what has been described as a "sunset" provision to withdraw from the mandates after the money expires. She cited Department of Labor guidelines requiring that state applications for stimulus money "contain a certification that the provision is permanent . . . and is not subject to discontinuation under any circumstance other than repeal by the Legislature."

'Difference of opinion’

Pauken met with about a dozen Democratic senators on Monday in what participants called a constructive meeting to discuss the stimulus package as well as other challenges facing the commission. Commission member Andres Alcantar met with the senators separately.

Sen. Rodney Ellis, D-Houston, and Sen. Leticia Van de Putte, D-San Antonio, who were both present at the meeting, joined Eltife in commending Pauken for trying to find a bipartisan consensus to obtain the federal dollars.

"There has been a difference of opinion between Chairman Pauken’s approach to the stimulus and Gov. Perry’s approach," said Van de Putte, the Senate Democratic leader. "Chairman Pauken is trying to find some middle ground. I respect him greatly."

Ellis, one of the Democratic co-sponsors of Eltife’s bill, said his office is exploring options to try to get around Perry’s rejection of the money and is working with Democratic members of Texas’ congressional delegation to find an opening.