Labor Department seeks $105 million; requests $104 million boost for service and infrastructure fund as call-wait times fall

The Pennsylvania Department of Labor and Industry told the House Appropriations Committee on Feb. 24 that the governor's proposed budget raises the department's operating appropriation from about $94'$95 million to $105 million and seeks a large boost for the Service and Infrastructure Improvement Fund (SIF).

Chairman Mark Struzzi laid out the figures as testimony began, saying the proposed operating increase is roughly $10 million, or about 10 percent, and that the SIF request would rise from about $68 million to $104 million, roughly a 53 percent increase. "I lay that out so that as we go into the questioning, you're prepared to answer those questions and address . . . requested increases," Struzzi said.

Madam Secretary Walker and senior deputies said the additional SIF request supports ongoing modernization of the unemployment compensation (UC) system, staffing to reduce call wait times, and infrastructure changes to improve service. Secretary Walker told representatives the administration has used SIF investments and staff changes to shorten UC call wait times dramatically: from an average of about 1 hour 8 minutes two years ago to about 16 minutes as of Feb. 13. The department said its UC call centers handled about 1,117,000 calls in the prior year and that UC staff are working in-person through the UC Connect program in 62 CareerLinks across Pennsylvania, serving nearly 75,000 people.

Walker also described the department's authorized and funded complement: the agency requested an authorized complement of 5,208 positions (up from 5,193), and said that many positions across the department are federally funded. "Less than 7 percent of our budget are state dollars," Walker said, noting that 3,979 positions are 100 percent federally funded and 358 are partially federally funded. "So all told, 4,337 people of the Department of Labor and Industry are in whole or in part federally funded."

Committee members probed contract line items and procurement counts; Representative Young pressed a contract for 10,000 lanyards for the Unemployment Compensation office and asked whether the quantity matched agency needs. Deputy secretaries replied that lanyards were procured to meet an IRS/Federal Tax Information display requirement and were purchased through the usual procurement process.

Why it matters: Department leaders argued the SIF increase and operating request would sustain recent operational gains and preserve access to UC services while federal funding levels remain unpredictable. Committee members repeatedly raised questions about sustained federal funding, staffing levels at UC service centers and referees for appeal hearings, and whether the proposed SIF increase will be sufficient if federal allocations decline.

The hearing record shows discussion and requests for follow-up documentation from the department; there were no formal votes during the hearing.

Ending: Department leaders asked the committee to consider the proposed increases as part of the governor's broader workforce and service modernization plan. Lawmakers expressed appreciation for improved UC performance while signaling further scrutiny of SIF and operating requests as the budget process continues.