Scramble on to revive jobless benefits

Scramble on to revive jobless benefits

May 15th, 2011 by Andy Sher in News

NASHVILLE - Extended unemployment benefits ran out last month for 28,000 jobless Tennesseans after state officials failed to adjust state law to meet new federal standards.

Now legislative Democrats are pushing to reinstate the benefits, with House and Senate committees scheduled to meet Monday to consider last-minute bills to resurrect the program.

Success would bring nearly $60 million in federal funds to pay up to 20 more weeks of benefits for Tennesseans unable to find jobs in a still-fragile economy. But it's unclear whether Republican Gov. Bill Haslam and the Republican-controlled General Assembly will go along.

Accounts vary on why the program lapsed April 16 and whether it had to happen at all. Two dozen states, including Georgia, made the adjustment in time.

House Minority Leader Craig Fitzhugh, D-Ripley, who is pushing to reinstate the program, said it might have fallen through the cracks in the gubernatorial transition from Democrat Phil Bredesen to Haslam.

"Maybe the ball didn't get dropped, but maybe nobody saw the ball to pick it up," Fitzhugh said.

Asked whether Haslam will oppose restoring the program, spokesman David Smith said in an email Friday that the governor hasn't seen the legislation.

Republican Senate Speaker Ron Ramsey had no comment on the legislation, an aide said Friday. Efforts to reach House Speaker Beth Harwell, R-Nashville, were unsuccessful.

HOW IT HAPPENED

Under current law, jobless workers can get up to $275 per week in state unemployment benefits. The federal government provides up to 53 weeks of emergency benefits.

President Barack Obama signed the 20-week extension in mid-December as the nation struggled to recover from the Great Recession.

One part of the new law increased the "look-back period" for proof of high state unemployment from two years to three years.

To keep the benefits flowing, legislators needed to change state law to conform to the new look-back period, but they didn't.

Smith said Tennessee was notified in late March that it no longer qualified for the extended benefit program because the state's unemployment rate had stabilized.

About 28,000 jobless Tennesseans initially lost extended benefitsn and untold thousands more will do so in coming weeks. The jobless rate continues at 9.5 percent.

Legislative analysts say the bill sponsored by Fitzhugh and Senate Democratic Caucus Chairman Lowe Finney, D-Jackson, would draw down $59.8 million in federal funds.

It would cost the state about $396,000 and local governments about $1.8 million.

TAKEN BY SURPRISE

Asked Friday why state officials didn't act sooner, Employment Security Administrator Don Ingram said they spoke to the U.S. Labor Department and other representatives early and were told not to worry.

"According to the statistics and everything, we were in good shape," Ingram said. "We thought we were right that we would not trigger off [the extended benefits program]. That was pretty much the consensus of our partners with [Department of Labor].

By the time the letter arrived March 28, "there was real concern whether this legislation had real time to get in at that late date," Ingram said.

Reminded that lawmakers are still in session a month and a half later, Ingram said, "We provided information to the representatives up there. Anyone who wants to carry the bill. We've provided the fiscal note [cost estimates] so that they could make a decision in the legislature."

As to why the Haslam administration did not push a bill, Ingram said, "Well again, it's the fiscal impact to these state and local governments that are financially strapped and could possibly result again in more layoffs. The budget is already tight."

EASY TO SEE

Mike Evangelist with the National Employment Law Project, which advocates for lower-income workers, was skeptical of Ingram's assertions the state thought no action was needed.

"I would say the person didn't understand what the DOL [U.S. Labor Department] was telling them or they just don't understand the program," Evangelist said. "This is something they should have seen coming."

He said he prepared an analysis in October projecting that Tennessee's benefits would end as early as February unless lawmakers acted.

"While I wasn't spot on, I certainly was able to figure out that Tennessee would be one of the first states to experience this problem," Evangelist said.

State officials appear to be offering excuses, he said.

Ingram insisted later that the state performed due diligence.

"We had conference calls in December with folks around the region. Even folks in DOL didn't anticipate this."