U.S. Rep. Kendrick B. Meek (D-FL) Urges Lawmakers to Pass Legislation Putting Florida in Compliance with Unemployment Insurance Modernization Provision of the Economic Recovery Bill – Florida Employers Would Save $105.6 Million in Taxes

WASHINGTON, DC – Congressman Kendrick B. Meek (D-FL) wrote Florida Governor Charlie Crist urging him to work with the Florida legislature to enact legislation putting Florida in compliance with the Unemployment Insurance Modernization Provision of the recently enacted American Recovery and Reinvestment Act (the economic recovery package).   

"The economic recovery bill was meant to jumpstart Florida's economy by providing critical federal dollars to state and local governments.  These funds will only be available to Florida if the state is in compliance with the federal government's guidelines.  Leaving money that is due to Florida on the table cannot happen and leaders in the state must act now to reap the full benefits of the economic recovery package," said Congressman Kendrick Meek. 

The American Recovery and Reinvestment Act (ARRA) provides up to $7 billion in modernization grants for states that already have enacted or will enact legislation implementing specific reforms to increase access to Unemployment Insurance benefits for jobless workers.  This provision in the ARRA will provide approximately $444.3 million to Florida to boost their unemployment programs.  If Florida enacted the necessary reforms, Florida would be able to immediately draw down the $444.3 million in the federal UI incentive funds.

In order to be compliant, the State must implement two of a possible four reforms: (1) Extended UI while in Training; (2) Part-Time Worker Coverage; (3) Weekly $15 Dependent Allowance; (4) Compelling Family Reasons for Leaving Work (includes ALL 3 of the following provisions: Domestic Violence, Spouse Relocation; and Illness & Disability) and affirmatively take these steps:

(1)To receive 1/3 of the funding, the State must enact an alternative base period, which ensures that the last completed quarter of a worker's employment is counted when determining eligibility for unemployment benefits.  The Florida Agency for Workforce Innovation estimates that this will cost $51.3 million per year

(2)To receive the remainder of the funding, a State must enact 2 of 4 other provisions.  The Florida bills SB 516/HB 1333 reflect that Florida has chosen

(1)The provision to permit former part-time workers to seek part-time work.  This is estimated to cost nothing.

(2)The provision to permit voluntary separations from employment for compelling family reasons.  The estimate for this is $22.4 million per year.

SB 516/HB 133 cost estimates are $74 million per year estimates the Florida Agency for Workforce Innovation.

The $444.3 million grant would cover more than 6 years of these costs

During a Ways and Means Committee hearing held in Congress yesterday, Congress Meek asked Ray Uhalde, Senior Advisor to the Secretary of the US Dept of Labor if these provisions can later be repealed by the state.  Mr. Uhalde testified that states are expected to make a good faith effort to comply with UI provisions.  Florida can repeal these provisions if they would like and would not have to pay back the $444.3 million.

The National Employment Law Project (NELP) calculates that the added UI Modernization funding could have the effect of slashing the potential tax increase on impacted employers by $105.6 million.  This is a 20% reduction from the expected $528 million increase in taxes. According to the National Employment Law Project, the projected infusion of federal money into the state's unemployment insurance trust fund would lower expected increases to UI taxes by $105.6 million.

To date, 27 States have adopted these modifications and the Department of Labor expects that these states will soon complete the process and become fully compliant. Florida is not one of these 27 States, despite its high unemployment rate.

A copy of Congressman Meek's letter to Governor Crist appears below:

 

April 22, 1009

The Honorable Charlie Crist

Governor, State of Florida
The Capitol
400 S. Monroe Street
Tallahassee, FL 32399-0001

Dear Governor Crist:

I am writing to urge the Florida Legislature to enact legislation necessary to put Florida in compliance with the Unemployment Insurance modernization provision in the recently enacted American Recovery and Reinvestment Act (ARRA).  As you know, this provision in the ARRA will provide approximately $444.3 million to Florida to use to increase access to UI benefits for jobless Floridians.

The ARRA provides up to $7 billion in modernization grants for States that already have or that enact legislation implementing specific reforms to increase access to UI benefits for jobless workers, such as counting a worker's most recent wages when determining his or her eligibility.  Reforms of the sort found in SB 516/HB1333 or similar would qualify Florida for these grants, specifically geared to helping low-wage, women and part-time workers that are largely left out of the safety net. 

Dozens of States are already compliant with various provisions of the legislation, demonstrating that these policies are practical and effective.  To date, despite Florida's now 9.4 percent unemployment rate, Florida is not compliant.  Therefore, I strongly urge you to enact legislation so that Florida will be able to receive all of the money available to it in 2009.

Please do not hesitate to call me if you have any questions.
    

Sincerely,

KENDRICK B. MEEK

Member of Congress

CC: The Honorable Jeff Atwater, President, Florida State Senate
The Honorable Jeff Cretul, Speaker, Florida House of Representatives

U.S. Rep. Kendrick B. Meek represents the 17^th Congressional District of Florida which includes parts of Miami-Dade and Broward Counties. He serves as the lone Florida Democrat sitting on the House Committee on Ways and Means.

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