Monday, May 4, 2009

Meek Urges Crist to Call Legislature into Special Session if $444 Million in Recovery Dollars for Unemployment Insurance is Left on the Table‏

I am writing again regarding Florida’s non-compliance with the Unemployment Insurance (UI) modernization provision of the recently enacted American Recovery and Reinvestment Act, this time to urge you to, should it become necessary, call the Florida Legislature back into Special Session to reconsider and enact the necessary legislation.

As the ranks of the unemployed continue to swell around the country with monthly job losses exceeding 600,000, there are now nearly four jobless workers for every job opening in today’s labor market. Florida’s unemployment rate for March, 2009 has surged to 9.7 percent, the highest unemployment rate since 1976. This alarming figure represents 893,000 jobless out of a workforce of 9,210,000, nearly 1 in 10.

The Federal Government is willing to give Florida $444.3 million to use to help this situation, paying for nearly six years of benefits for struggling Floridians who are currently not covered under Florida unemployment law. Yet the Florida Legislature continues to leave this money on the table by their refusal to enact the necessary legislation that would make Florida compliant with the UI modernization provision. Inaction harms not just hard-working taxpayers who fall through the cracks of the unemployment system, including part-time workers, parents with spouses deployed overseas, and the long-term unemployed, but also struggling state employers when they need the help most.

With unemployment rising, the projected balance in the Unemployment Compensation Trust Fund on June 30, 2009 will trigger a tax rate increase that will become effective January 1, 2010. Yet, the National Employment Law Project (NELP) and the Florida Center for Fiscal & Economic Policy projects that if Florida acts quickly and is able to add funds to the trust fund before June 30th, it would reduce the shortfall between the fund balance and the trigger amount. This would significantly curtail the tax increase required in Florida to help replenish the fund in 2010. NELP calculates that the added UI modernization funding could have the effect of reducing the potential tax increase on impacted employers by $105.6 million. This is a 20 percent reduction from the expected $528 million increase in taxes.

While Florida is expected to make a good faith effort to comply with the UI provisions, the Florida Legislature has the option to repeal these provisions in the future if they should so choose, and Florida would not have to pay back the $444.3 million. I personally solicited this information from Mr. Ray Uhalde, Senior Advisor to the Secretary, United States Department of Labor and, separately, from Mr. Michael L. Thurmond, Commissioner, Georgia Department of Labor during the April 23rd Ways and Means Committee hearing on the subject (Video logs of this testimony are viewable on my Congressional website at ).

If the Florida legislature is unwilling to reconsider and act in accordance with ARRA provisions before the end of the extended legislative session ending May 8, 2009, I urge you to call for a special legislative session and include within that call reconsideration of this important issue before the June 30th trigger. Florida taxpayers and businesses are suffering now. The Florida legislature must act now. For members of the legislature to put ideology over the people of Florida in their time of need is objectionable.

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