Jobless benefits jeopardized by stimulus fight

By Bobby Harrison/NEMS Daily Journal

JACKSON – Questions surround the future of a program designed to help Mississippi’s laid-off workers.
Legislation that gives the state the authority to administer the program, which provides benefits for people who lose their jobs through no fault of their own, died last week.
The program, which will expire July 1, got caught up in the ongoing debate about whether the state should accept an additional $56 million in federal stimulus funds for unemployed workers.
Republican Gov. Haley Barbour has refused to accept the funds. He says changes to state law that would be required to accept the money would put an additional burden on employers once the stimulus funds are gone.
Employers are levied a tax to pay for the unemployment compensation program, which last year provided benefits for more than 105,000 Mississippians.
Supporters of the program acknowledge that changes to state law would be needed. But after the stimulus funds are gone, they argue, the law could be changed back and employers wouldn’t be hurt.
Until the funds run out, however, they say struggling laid-off workers would receive a boost – as would the sagging state economy, with an infusion of an additional $56 million that research shows would be spent and turned over several times.
Rep. Jim Ellington, R-Jackson, expressed confidence that a two-thirds majority of both chambers of the Legislature would suspend the rules to allow the program to continue without use of the stimulus funds.
Another option would be for Barbour to call a special session to deal with the issue.
A third possibility, according to Rep. Bob Evans, D-Monticello, a supporter of changing state law to accept the $56 million, is for the federal government to run the program for Mississippi.
That is what will happen, he said, if the Legislature does not extend the state program. It also means Mississippi employers would be hit with a sizable tax increase, and the amount of unemployment compensation state workers receive would jump to the national average.
“Those who thought they won today (when the bill was killed) might have actually lost” if the federal government takes over the program, Evans said.
Asked what the national average for unemployment benefits is, Evans said, “I don’t know, but whatever it is, it is a heck of a lot more than Mississippi.”
The national average was not available, but the most an unemployed worker can receive in Mississippi is $235 per week, which is the lowest in the nation, according to the Department of Labor web site.
Benefits are paid based on earnings. To qualify for the full $235 per week in Mississippi, a person would have to earn roughly $24,000 per year.
Currently, employers in Mississippi are taxed at .7 percent of the first $7,000 pay for each employee, or $49 per employee annually. If the program is administered by the federal government, employers would pay $378 annually for each worker.
In addition, Rep. Cecil Brown, D-Jackson, said that if the program is not reauthorized, WIN Job Centers, which are located throughout the state and help people find work, would be shut down, costing about 700 state employees their jobs.
The legislation that reauthorized the program received a majority 63-58 vote, but needed a three-fifths majority, or 73 votes, to pass.
Those who voted no did so because it not only reauthorized the program paying unemployment benefits, but also changed the law to put the state in position to accept the stimulus funds.
One of the mandated changes would result in calculating the amount of unemployment benefits a person receives based on a more recent pay period for the person.
According to information compiled by the NAACP, that would benefit 7,000 mainly low-wage earners, costing the state program about $7.3 million annually.
Other changes in the bill would have allowed people to receive benefits if they were seeking only part-time re-employment; allow people to receive benefits while being retrained; and allow people to receive benefits because of family issues, such as leaving a job to move away from an abusive spouse.
According to the NAACP’s information, the changes would cost less than $13 million annually and benefit about 11,000 people. Brown, like other supporters, pointed out the law could be changed back when stimulus funds are exhausted. And that way the state never would have to provide the enhanced benefits out of its funds.
But Barbour has argued that once a benefit is provided, it is difficult for it to be taken away in the legislative process. Plus, he opposes allowing people to receive benefits when they are not willing to seek and accept full-time employment.
Some argue that the provision allowing people to seek part-time employment is needed in the current environment because most families have two wage-earners and one might need to work part-time to allow for child-care responsibilities.
Rep. Scott Bounds, D-Philadelphia, said he has sympathy for those who lose their jobs, but opposed expanding the program. He said he does not want to give people a financial incentive not to work.
But, said Evans, people cannot receive the benefits if they quit their jobs or are fired for cause. No one, he said, is talking about changing that.

Contact Bobby Harrison at (601) 353-3119 or bobby.

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