The Herald, Sharon, PA Published Saturday, April 5, 2003

Out of work, out of luck


What happened
to retraining money?

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By Michael Roknick
Herald Business Editor

After losing his job when Damascus-Bishop Tube Co. closed its Reynolds plant at the end of 2002, 60-year-old Leroy Truax was looking forward to attending culinary school.

A 34-year worker at the pipe and tube mill, Truax was told he qualified for federal Trade Adjustment Assistance benefits that would pay for his schooling. Funds are given to each state to pay for workers' tuitions. He signed up to attend Winner Institute of Arts & Sciences in Transfer and thought he was on his way to realizing his goal.

"I've always wanted to be able to cook for a lot of people," Truax said.

But on Wednesday, the West Salem Township resident was told by Pennsylvania Department of Labor and Industry officials he had to put his schooling on hold because there is no money to pay for it.

At least six other workers in Mercer County are in the same position.

That has prompted U.S. Rep. Phil English of Erie, R-3rd District, to demand federal and state investigations of what happened to $11.5 million Pennsylvania received last week specifically earmarked for retraining benefits.

Officials in Gov. Ed Rendell's administration, who took office in January, say the Ridge and Schweiker administrations created the mess and they're trying to resolve the problem.

English said the funds apparently were seized by the state for other purposes.

"It is unfair and unjust to punish our neediest because of bungled administration by the Commonwealth,'' English said. "The TAA program is critical to help our workers who have been displaced by trade, and Pennsylvania is one of the largest recipients of those benefits. This investigation will uncover who made the decisions that led to this mess and just what we can do about it."

English has formally asked federal and Pennsylvania inspectors general to investigate.

"The Pennsylvania government is holding displaced workers' benefits hostage,'' English said.

Under the program, the U.S. Department of Labor determines eligibility based on whether a worker was laid off because of international trade. Benefits include increased unemployment benefits, unemployment insurance, income support, job training and job search and relocation allowances. States administer the program with allotted federal funds.

Based on conversations English said he and his staff have had with state Department of Labor officials, the congressman said the state may have overspent the retraining funds in the past. Faced with a budget deficit this year, those funds were easy targets for state officials.

"It appears that the Pennsylvania administration has chosen to balance the state budget on the backs of displaced workers," English said. "Despite the federal transference of $11.5 million to the Pennsylvania administration, our workers who are entitled to get TAA benefits are being told that there is no money and that the TAA program has been suspended. The question then is: What did they do with the $11.5 million?"

That money, said John Currie, spokesman for the state Department of Labor, was used to pay off debts in the program racked up by the Ridge and Schweiker administrations. Policies and procedures of those administrations resulted in a TAA deficit in excess of $40 million, including training already provided in 2002 and training obligated for this year.

"We are still owed for federal fiscal year 2002 about $16 million that was already spent," Currie said. "The prior administration also obligated about $35 million for training for fiscal 2003. We just received $11.5 million from the federal government -- that's only enough to cover one-third of the $35 million already obligated.''

It doesn't make any sense to go deeper in debt, Currie said.

"We have been working and will continue to work with the U.S. Department of Labor and members of our congressional delegation to solve the situation,'' he said.

However, anyone scheduled to get TAA-funded training after March 24 has seen his or her application deferred. New training applications will be deferred until the federal government comes up with more money, Currie said.

Those affected will be told to go to their local CareerLink office.

"Right now we don't have the money and we'll work with those people until we do get the money,'' Currie said.

Werner Co. in Sugar Grove Township recently announced it would lay off 500 workers. An application has been filed for those employees to get TAA benefits, but a decision on whether they qualify hasn't been made.

Pennsylvania's explanation didn't sit well with Bob Holste, English's chief of staff.

"I don't see how the state makes a mistake and the beneficiaries get punished," Holste said. "If they're $16 million in the hole, why are we only hearing about it now?"

Truax hopes the funding woes get resolved -- quickly. The Winner Institute is allowing him to attend school for free over the next month in hopes the job retraining money will be flowing by then.

"I just want to get on with my new career,'' Truax said.



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