Senator Eddie Lucio, Jr.

TEXAS SENATE COMMITTEE
ON INTERNATIONAL RELATIONS AND TRADE

FOR IMMEDIATE RELEASE
Wednesday, January 26, 2005

Chairman Lucio Comments on Gov. Perry's State-of-the-State Address

"The Governor's goals in his State-of-the-State address are admirable, but only a starting point in terms of the needs of the Border region. Clearly we are thankful that he has recommitted to his promise of two years ago to support increased funding for the Irma Rangel School of Pharmacy and the Medical School in El Paso," said Sen. Eddie Lucio, Jr., Chairman of the Senate Committee on International Relations and Trade (IRT).

"The needs of the Border deserve greater funding and attention by those in Austin. I will work with Lt. Governor David Dewhurst and with the senior member of the Border Delegation, Sen. Judith Zaffirini, to comprehensively address the needs of the Border region," added Sen. Lucio.

Border Health Education

"Texas' goals should include establishing a Border-wide Health Education Initiative that builds on the findings and recommendations of IRT. In doing so, we should replicate the success that Senator Zaffirini and I saw in 1995, when we authored the South Texas/Border Health Initiatives," said Sen. Lucio.

Chairman Lucio will work with the Texas Senate to obtain $30 million for the Regional Academic Health Center (RAHC) for the Lower Rio Grande Valley, an addition $30 million for the Middle Rio Grande Valley and also $30 million for the El Paso/West Texas region. As part of the Border Health Initiative package, corresponding tuition revenue bond packages for Border health institutions will be pursued to build the region's health infrastructure.

"The fruit of our work will have a great impact on our local stagnant economies," reported Sen. Lucio. He went on to say, "Recently, the Office of the Comptroller reported to my office that a minimal increase in appropriations to the RAHC by $47.5 million over its existing funding level would have an immense economic impact on the region and the state. Specifically, this increased funding, serving the four-county region of Cameron, Hidalgo, Starr and Willacy Counties would:

Statewide, this minimal increase in funding would mean a total of 1,450 jobs, an increase in gross state product of $77.2 million, and increased personal income of $35.3 million.

An increase in the amount of funding invested in our Border's Health Education Initiatives, such as the RAHC, would have a greater economic impact on our Border region and the state of Texas. (See attached information for corresponding economic impact.)

"Clearly, helping the Border helps Texas. Helping the entire Border-region, including our friends in Laredo, would greatly benefit the entire state!" said Sen. Lucio.

ECONOMICALLY DISTRESSED AREAS PROGRAM Historically, IRT's findings indicate that Governor Perry supports an increase in the Economically Distressed Areas Program (EDAP).

"I'm somewhat concerned that the Governor failed to include this program as one of his goals. This is especially true since the federal government has reduced the amount of funds available for such water programs and since only a fraction of monies is left in EDAP to bring needed water services for our distressed communities. Members of the IRT Committee and I will work with the leadership in Austin to significantly increase the funds available for the EDAP program," said Sen. Lucio.

JOB CREATION THROUGH SKILLS DEVELOPMENT Texas should be alarmed that other states spend far greater sums on job training & economic development expenditures. In October, the Governor's Office informed IRT that Texas ranked sixth behind Illinois, Pennsylvania, Ohio, Michigan, and California, with more than $200 million in total expenditures for economic development. Also, in 2002, Texas spent $0.56 per person on job training skills development funds, in contrast, New York spent $2.06, California $2.37, Louisiana $4.17 on job training.

Currently, Texas funds the Skills Development Fund at $12.5 million annually. However, in 2004 alone, the Texas Workforce Commission (TWC) received $43 million in Skills requests. This means that the TWC receives $4 in requests for every $1 of available skills funding. Because of these limited funds, local entities are hampered in their ability to include state job training incentives in their packet when recruiting new companies to their area.

"As workforce leaders testified at IRT hearings, the quality of a local workforce is often the single most crucial determinant of whether a company will locate in an area or whether growing businesses have a labor pool with needed skills sets," said Sen. Lucio. "That is why we should fund the Skills Development Fund to the tune of $100 million. Appropriating nearly $100 million will train an estimated 95,000 Texans."

Although we have seen many job gains, as our IRT Report documents, since the implementation of NAFTA, more than 115,000 workers in Texas have been certified as trade-affected workers, having been displaced due to trade pacts. During the same period, more than one-third of trade-affected workers were found in the Border area.

"By helping workers upgrade their skills, we make them more productive and competitive in the labor market and in return that makes the employers more competitive in the global market. If Texas is to have a competitive edge over other states, Texas workers must have the skills that employers need. The Border needs an influx of job-training dollars to address these needs," said Sen. Lucio.

TEXAS ENTERPRISE FUND "All of us support increasing the Enterprise Fund (TEF). However, regions of the state which are in dire need of economic initiatives, i.e., distressed areas like the Border region, have not been the main recipients of the TEF," said Sen. Lucio.

Unlike other states, Texas does not reward companies that move into strategic regions, such as rural areas or distressed communities. Consequently, the TEF needs to be strengthened and reformed to benefit all.

Chairman Lucio is joined by Senators Zaffirini and Shapleigh in authoring SB 277 in reforming the TEF. SB 277 would give the Governor the authority to maximize the use of the fund in conjunction with money from the Skills Development Fund, to better recruit new businesses to this state, expand existing businesses in Texas and maximize the state's efforts in creating new jobs.

SB 277 would also allow the Governor to develop a mechanism that provides greater consideration to TEF recipients who commit to locating a new business or expanding an existing business, or who have located a new business or expanded an existing business, in an area that is economically distressed, the Border region and rural Texas.

"TEF needs to be strengthened and improved to benefit all of Texas," added Sen. Lucio.

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For additional Information Contact: Mr. Dan Esparza, JD, IRT Director 512-463-0385

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