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H-2B Program likely to be Under More Stress in 2018

12/6/2017

By Timothy Herrick

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In early November, representatives of the Outdoor Amusement Business Association (OABA) conducted their second Washington D.C. fly-in of the year. The fly-in that those representatives of the fair and mobile amusement industry participated in was arranged by the H-2B Workforce coalition - a group of about 40 industries who rely on seasonal workers - including seafood processing, amusement parks and hospitality.

The fly-in had two objectives, one short-term and one long term. The long term -and more elusive goal - was to obtain a more permanent fix to the H -2B system. There are two bills posted in the Senate and Congress - S. 792 and HR 2004, respectively - but they have yet to be introduced at the committee level. According to Michael Wood of Wood Entertainment, and chairman of the Government Affairs Committee of the OABA, the only positive sign was that one of the congressmen supporting H-2B legislation - Billy Long (R-MO), whose congressional district includes Branson, a high user of H-2B workers, told Wood he spoke with President Donald J. Trump on Airforce One and that if a bill would reach his desk, he "would sign it."

Of course, in the volatile political climate in Washington D.C., reaching that stage is a long way off. So, the more immediate short term goal was to avoid the snarls in the system that happened last year when relief of the 66,000 cap was critically delayed during the height of the fair season, causing hardship to most carnival companies. In addition, there is new pressure on the H-2B worker systems because of an expected shutdown of one program - J-1 Workers - causing employers using that system to switch to H-2B workers, further thinning the pool of workers for which carnival companies are struggling to compete. 

Right now, the system is working under a frustrating and confusing cap-system - only 66,000 workers are allowed guest-worker visas and those visas are split in half, distributed twice a year. The new pressures are now affecting both halves of the distribution, where in 2017 only the second half was threatened, due to a new blip where cap relief in terms of a returning worker exemption was delayed because the Department of Homeland Security (DHS) - who had to approve the legislated exemption - took more than half the Summer to make a decisions. 
Of course, complicating the H-2B legislation has been the inability for the public, politicians and media to separate the issue from the stew of immigration laws and anti-immigration sentiments now gaining popularity. 

Anti-Immigration Rhetoric
 Wood pointed out in spite of Donald Trump's anti-immigration rhetoric in both his campaign and as president, that the Trump family businesses use the guest worker visa program, stating that his famous Mar-A-Logo resort in Palm Beach uses 80 H-2b workers. "The bottom line is that congress is continuing to do what congress does which is to kick the can down the road to the next congress."

According to Wood, "the fly-in was fairly successful; we've picked up two members of congress. The main difference between the fly-in is that we are now used  to the administration, and we've come to grips with the fact Trump will continue to be president."

The H-2B issue is essentially a bipartisan issue - and Wood said that the latest fly-in resulted in an estimated 30 - to 40 congressmen who "are pro-small business and pro-H-2B" and may be interested in a permanent fix and short term cap relief.  But the reality is "it's a political football, there is a tremendous amount of common ground, but it's difficult to get people to realize that the H-2B visas are not a path to citizenship, it's not an immigration issue."

Wood says that the efforts are often sidetracked from opponents on the far right and the far left. The right wing wants to link H-2B issues with the now volatile immigration issues, including new travel bans and the lifting of protections  for individuals covered by DACA(Deferred Action for Childhood Arrival) and the Dream Act (acronym for Development, Relief, and Education for Alien Minors). The left looks at H-2B purely as American worker rights issue. The fact that H-2B neither is a path to citizenship - workers come in then return to their home country -  or a workers rights debate - the program requires a good-faith effort be made to recruit American workers as well as other requirements ensuring that no jobs are being taken from American workers.

But the facts of the issues seem to have little impact on the political realities of contemporary American politics. "There's a tremendous amount of common ground between the right and the left on the issue, but it's become a political football," he said. 

While the labor issues impeded the program during the latter years of the Obama administration, it's the anti-immigration fervor creating the biggest obstacles for progress. "We did try to get something going with the national Hispanic caucus in Congress, but the fact is nothing that is remotely related to immigration will move forward."

J-1 Threat
The main reason for the fly-in was due a new wrinkle - exactly what this ongoing saga didn't need.  A rumor sprang up that another guest worker program - the J-1 Visa program, which allows individuals to study and work while traveling in the U.S, and the program mainly used by ski resorts was going away.  The Trump administration has signaled they are looking to shut down the J-1 Visa Program, which meant that there will be more industries vying for the H-2B workers.  As a result of that action, Ski resorts that normally use the J-1 visa program are now jumping over to the H-2B visa program, increasing competition for visas, forcing the cap to be reached sooner in the year.   "It has become toxic, and there are insufficient numbers of visas to reach this new demand," said Wood.

There may be some cap relief for another source, according to Wood. One version of a bill providing funds for disaster relief and reconstruction due to extreme weather events in Texas, Florida and Puerto Rico does contain a provision for additional H-2B workers, but like the new J-1 Worker controversy, nothing has been decided nor has there been any timeline suggested for the decision.

There are only 66,000 total visas for all employers in all job categories, 33,000 for the first half of the fiscal year (Oct to Mar), and the balance for the second half (Apr to Sep). The majority of H-2B employers are seasonal businesses - such as carnival companies, but also seafood processing, landscaping, golf resorts, hotels and restaurants who typically operate when the weather is favorable - and the first half of the cap is rarely met. But "with the entry of the ski industry back into H-2B in large numbers, the cap will likely be met in early December, and those with a date of need beyond Feb 1 will likely be shut out," said Wood, who said that this situation is "putting further pressure on the second half of the cap, those with dates of need beginning on Apr 1 or later. This cap has always been met in recent years, and those with a date of need beyond Apr will likely be shut out. Whereas in the past, a date of need in May was usually ok, and early June a long shot to get in under the cap."

Carnival companies and other members of the Outdoor Amusement industry typically utilize 5,500 visas, with nearly all of them falling into the second half of the cap -  In FY' 2017 a reported 74,000 visa applications with dates of need being Apr 1 were  submitted to DHS-in other words, nearly 10,000 more workers are needed than allowed for under the cap, and some leeway was made possible with the Returning Worker Exemption, or RWE, which allowed foreigners who had previously worked in the US on a H-2B visa for any the previous 3 fiscal years, be considered a returning worker,  exempting them from the cap of 66,000.

In 2017, the form of cap relief that came via the RFE was included in appropriations bill, which Woods was a strategy that H-2B legislative proponents have used "multiple times in the past.  In 2017 this strategy failed, mostly because Legislators do not like to legislate via the appropriations process, and twice before they had already accommodated us. However our efforts did yield a onetime increase via the DHS funding bill."

Sole discretion was granted to the Secretary of Homeland Security, John Kelly at the time (Kelly is now White House Chief of Staff), who after reportedly much debate decided in July to increase the cap by 15,000 workers, two months after being granted authority, a period of interaction during a critical time for  employing H-2B workers. When the workers finally came, it was too little too late.  

Delays, Cancellations, Lost Revenue
Peter Joseph, President of Jolly Shows, says that he had been using guest visa workers for a decade, and while "it was always uncertain, it wasn't too bad, up until 2017."

As Joseph explains, his season was short staffed when his season opened in March, without any H2-B workers. It wasn't until  June that he received his first allotment of employees - six, and then because of delay in processing by the Department of Homeland Security, it was until early August he received an additional 10. He originally requested 25, the amount he received last year. 

Like other carnival companies, Joseph claims he would rather hire American workers, but they are just not enough of them interested carnival work, not to mention able to pass background and drug tests. Joseph said that as usual, he got some bites, but nothing panned out. He wound up cancelling an early event and at subsequent locations, he hired local temp workers, which resulted in similar problems. "I hired about 20, and the next day. I had one guy left," he said. "I used a temp service for ride operators, but that was a nightmare too. You wind up training different guys every day, it's time consuming."

In addition to cancellations, he delayed some midway openings by a day or day and a half because the manpower shortage extended the set up time. By the end of the summer, with the H-2B workers finally onsite, he was able to salvage the season. But it was a very difficult year, not to mention frustrating. "We are not taking away jobs, we are keeping jobs, because without the foreign workers we cannot keep the American workers we do have," he said. "It is just the opposite, because American workers are taking these jobs."

He added, "We finally did get some of the workers we needed. I like to be optimistic about everything, but I would like for it to not happen next year, but I don't see it getting better."

"I hope and pray every day that  congress sees the need to fix the system because with the way the H-2B workers are now, I doubt that our business can continue to survive and thrive into another generation, " said Lisa Weiland, Manager, of Mr. Ed's Magical Midways. The company did wind up with 27 H-2B workers, but because of the DHS delay in approving cap relief, they didn't arrive until August 10th, barely in time for the midway provider to salvage the season.

Mr. Ed's Magical Midways is a fifth generation carnival company, and Weiland said it was the worst labor year in the company's history. The midway provider did not cancel any events, but she did scale back, meaning about a third less rides and/or concessions at some fairs.  There were some American workers, but they mainly worked only a fair or two, and were not on board  for the long haul. "They do not want to travel, or give up nights and weekends. It was very frustrating." 

Luckily, the fairs were understanding and supportive of their long-term midway partner, mainly because they were under similar constraints. "The fairs were having a hard time finding workers, so they were going through struggle with labor," she said. "Unemployment is low; you see help wanted signs in all the windows when you drive around. They were very understanding, but both our revenues were down." 

Clearly H-2B problems are not going away any time soon. It is unclear if there will be the same returning worker exemption next year, and if it is somehow added to another appropriations or spending bill, will a similar DHS delay occur? 

Future Uncertain
Well, no one is certain, but the H-2B coalition and the fair industry have learned to endure frustration and celebrate even minor victories and the slightest glimmers of hope.  "But we are really in need of a permanent fix; we are running out of other avenues," said Mick Brajevich of Butler Amusements, who went on the fly-in. "We need a real bill."

But getting a real bill requires successfully isolating guest workers from immigration issues. "This is not an immigration issue and we've been trying to explain our case for the last 10 years," said Brajevich. "It has become a hot button issue and people don't want to pick a side, and until we can separate us from the immigration issue, they are going to be labeling this immigration."

Separating it from immigration requires one-on-one meetings between coalition members. But more importantly, the OABA - which claims 25 percent of its operating funds and staff time are now consumed with H-2B lobbying efforts  - has been emphasizing that the individual members and their fair partners and other stake holders in the fair and outdoor amusement industry make their voices known at the local level and meeting with the congressional and senatorial representatives. "We are doing what we can to spread the word, but I can't say that I've yet to see large enough numbers of rank and file OABA members and fairs writing letters and meeting with representatives to make a difference." 



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