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Missouri passes extension of jobless benefits

Missouri passes extension of jobless benefits

April 12th, 2011 in News

Missouri lawmakers gave final approval Tuesday to a bill that could reinstate federally funded jobless payments for thousands of people who lost their benefits because of a protest against federal spending by several Republican state senators.

The House sent the legislation to Democrat Gov. Jay Nixon on a bipartisan 138-13 vote. The Senate passed the bill a day earlier, but only after amending it to reduce state-funded jobless benefits for people laid off in the future. As part of a deal to end a filibuster, Republican Senate leaders also pledged to identify up to $250 million of cuts to federal stimulus programs in Missouri.

Nixon, who had urged lawmakers to reauthorize the federally funded jobless benefits, has not said whether he will sign or veto the legislation now that it also includes the cut in state benefits.

Missouri's participation ended April 2 in a federal program that provides 20 additional weeks of benefits to people who already have been unemployed for a year and half. A coalition of four Republican senators had delayed a vote on the reauthorization legislation, arguing the state should reject an estimated $105 million in federal benefits in a symbolic stand against the growth of government spending and deficits.

If Nixon signs the legislation, it would take effect immediately, allowing benefits to be paid retroactively to about 10,000 who were cut off the program when Missouri's eligibility lapsed. It also would allow benefits to flow to an additional 24,000 Missouri residents projected to become eligible for the extended federal benefits during the next nine months.

However, a financial analysis of the legislation projects that Missouri would pay out $108 million less annually in state-funded benefits as a result of a reduction in eligibility to a maximum of 20 weeks instead of the current 26 weeks.

Some House members expressed reservations about the tradeoff but backed the bill anyway because of the extension of benefits to the long-term unemployed.

"We're asking people for future unemployment to bite the bullet for those who have been drawing unemployment up until this point," said Rep. Bert Atkins, D-Florissant.

House Minority Leader Mike Talboy, D-Kansas City, derided the Republican senators who had filibustered the legislation as "the lunatic fringe" but urged people to support their compromise nonetheless.

"We need to make sure the folks who are hurting in our society and are looking for work have the ability for the benefits to still exist," he said.

About three dozen states are participating in the federally funded extended benefits program. Seven other states with unemployment rates high enough to be eligible have not passed legislation allowing them to participate. But until Missouri's eligibility ended because of the filibuster, no state that joined the federal program had later voluntarily quit it.

States have, however, been looking at their own unemployment benefits as a means of cost-savings. Michigan recently became the first state to cut its maximum state jobless benefits from 26 weeks to 20 weeks. Arkansas has passed legislation to shave a week of its state jobless benefits. And the Florida House also has voted to cut state jobless benefits by six weeks.

By reducing the length of time people can receive state unemployment benefits, states are effectively reducing the amount of money that businesses must pay into unemployment insurance trust funds. The state benefit cuts also have the effect of reducing the amount of time that people can receive federal benefits, which are calculated as a percentage of state benefits.

The Missouri House had previously passed an extension of the federal jobless benefits without the corresponding cut in state benefits. But the bill's sponsor, Rep. Barney Fisher, R-Richards, urged colleagues to accept the Senate changes.

"I think 26 weeks is very generous. I think 20 weeks is generous" for state benefits, Fisher said. "It's either that or we can kiss the help for everybody goodbye."