Wagner questions labor secretary at Senate hearing

• Sen. Scott Wagner said he led the charge against holding a vote to provide funding to Labor and Industry.
• Lack of funding led the department to close 3 centers and furlough nearly 500 workers.

The Senate Appropriations chairman had to interrupt a heated discussion about the state's unemployment compensation system between a local senator and the head of the Department of Labor and Industry during Tuesday's hearing.

The system has been a main focus in the Capitol since late last session, when Senate Republicans refused to vote on legislation authorizing $57.5 million in additional funding to the department.

When that bill failed to pass, the department closed three unemployment compensation offices and furloughed nearly 500 employees. The result has been drastically increased call wait times at the remaining centers.

Sen. Scott Wagner, R-Spring Garden Township, said he led the charge against holding a vote on the bill, which would have extended a fund that provided about $178 million to the department from 2013 to 2016.

Wagner, who plans to run for governor in 2018, has argued the furloughs were a political move by Gov. Tom Wolf.

After Labor Secretary Kathy Manderino told him Tuesday that the furloughs were a fiscal decision, Wagner pointed to a video he received via a Right-to-Know request that showed Wolf telling the departing employees "elections have consequences" and asked her what she thought he meant.

Wagner, amidst criticism, seeks investigation into call-center layoffs

Manderino said she wouldn't want to speak for Wolf, but she went on to describe her frustration with people who run for public office who don't value public services, adding that she was "appalled" to read about lawmakers "gloating" in local newspapers about their role in what ultimately ended in layoffs.

At that point, Appropriations Chairman Sen. Pat Browne, R-Lehigh County, interrupted Manderino and asked that she not make assumptions about committee members' motivations.

Manderino later apologized to Wagner, who added that he feels bad she is dealing with difficulties that appeared to start before she stepped into her current position.

Wagner went on to criticize the unions representing the department's workers, which have organized several protests outside Wagner's offices since the furloughs.

Number breakdown: Manderino had met last week with the House Appropriations Committee and answered many of the same questions regarding the struggling unemployment compensation system.

Numerous Republican lawmakers have questioned her decision about which call centers to close, particularly Altoona because it was operating out of a state-owned facility.

Manderino said she had no good choices regarding center closures and chose the Altoona office because it would allow the department an easier option to ramp up employment if the Legislature does choose to reauthorize additional funding.

She provided the House Appropriations Committee with a breakdown of the projected annual savings from the closed centers, and the projections show more than $28.6 million saved from the three closures.

An additional $26.3 million in projected savings is attained through furloughs in other parts of the department for a total projected savings of $54.9 million, though Manderino has said multiple times that she made decisions to cut $57.5 million from her budget.

Department spokeswoman Sara Goulet said the remaining $2.6 million was made up through improvements to processes that didn't require additional cuts to staff or infrastructure.

Manderino also said during Tuesday's hearing that the department was likely going to close the Lancaster call center regardless of additional funding, but they would have transferred as many of those employees as possible to Harrisburg.

Next steps: Bills have been introduced in the House and Senate to provide one year of additional funding to the department, though Manderino has said she wants to ensure a long-term solution is reached.

She also has said getting employees back in a timely manner is important because the department is expecting a spike in new claims in mid-April.

However, numerous lawmakers have expressed a desire to wait on the results of an audit being conducted by the Auditor General's Office before moving forward on any legislation. The office expects results of the audit to be released this spring.

Manderino is set to appear at 10 a.m. Wednesday before the House Labor and Industry Committee to specifically discuss the unemployment compensation service issues.

— Reach David Weissman at dweissman@yorkdispatch.com or on Twitter at @DispatchDavid.

Note: The York Dispatch has previously reported that 521 employees were furloughed, but Manderino said Tuesday that the number was 499 after several employees moved into other open positions in the department.