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@NCCapitol

Efforts to change unemployment overhaul fail in House

Posted February 4, 2013
Updated February 5, 2013

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— House Democrats came up short Monday night in several efforts to soften legislation that would slash jobless benefits as part of an overhaul of the state unemployment system.

The House voted 78-41 to give tentative approval to House Bill 4. A final vote is expected Tuesday before it moves to the Senate.

The bill cuts the maximum weekly unemployment benefit from $535 to $350 and replaces 26 weeks of state-paid benefits with a sliding cap of 12 to 20 weeks, based on the health of North Carolina's economy. It also slightly raises unemployment insurance taxes on employers.

Analysts said the changes, which would take effect July 1, would help the state repay $2.5 billion to the federal government three years faster than leaving the system unchanged. North Carolina borrowed the money to pay jobless benefits during the recession when state taxes paid by employers couldn't keep up with demand for benefits.

Rep. Paul Luebke, D-Durham, called the bill unbalanced, saying workers would lose $2.7 billion in benefits over the next four years while employers would pay only $24 million in extra unemployment taxes.

"Workers are taking a major hit," Luebke said, calling the benefit cuts "indefensible."

Rep. John Blust, R-Guilford, said that comparison fails to note that the federal unemployment taxes continue to rise on North Carolina employers until the debt is paid off.

"If you want to create more unemployed in the future, just try not addressing this problem some more," Blust said, calling the bill "the best solution out of a bunch of bad solutions."

The Republican majority was able to defeat amendments by Luebke that would retain a 26-week cap on benefits, by Rep. Paul Tine, D-Dare, that would raise slightly more in taxes to set the maximum weekly benefit at $425, by Rep. Kelly Alexander, D-Mecklenburg, and Rep. Deborah Ross, D-Wake, to revise the formulas for determining benefits and by Rep. Duane Hall, D-Wake, to restore benefit levels once the federal debt is repaid. House votes on unemployment House gives tentative OK to unemployment cuts

Bill sponsor Rep. Julia Howard rebuffed each attempt to change the bill, saying that the issue comes down to allowing employers to use their money to create jobs or having them pay taxes with it.

"If you who campaigned on creating jobs in the state of North Carolina, this is the No. 1 bill that you're going to have this year," said Howard, R-Davie.

"To say this is a jobs bill when all it does is cut unemployment benefits is a bit disingenuous," said Rep. Joe Sam Queen, D-Haywood.

Rep. Winkie Wilkins, D-Person, asked to delay the changes to the system until January so that people who have been out of work for months wouldn't lose their federal unemployment benefits.

A bill Congress passed on New Year's Day to avert the so-called "fiscal cliff" extends the federal benefits through the end of 2013, but changing the state unemployment program voids that provision of the federal law.

Luebke noted that the state stands to lose more than $600 million by ending the benefits early to an estimated 80,000 families, adding that most of that money would go directly back into the local economy. The Wrap @NCCapitol (Feb. 4) The Wrap @NCCapitol (Feb. 4)

Blust said people still have five months to find jobs before those benefits end, and Rep. Robert Brawley, R-Iredell, said it's time "to stop worrying about the downside of everything."

Although Wilkins' proposal generated the most debate of the night, it failed like all of the others the Democrats offered.

Earlier Monday, worker advocates and members of the Legislative Black Caucus railed against the proposal, saying it would devastate families dealing with job loss and would end up costing the state money.

"People on unemployment are not lazy," said Beth Messersmith, campaign director of North Carolina MomsRising. "(They include) parents trying to care for kids who need those benefits."

A majority of North Carolina's unemployed are out of work longer than 26 weeks, so cutting the length of state benefits to 20 weeks doesn't make sense, Messersmith said.

Doug Dickerson, state director for AARP, said older workers take 13 months on average to find a job after being laid off. He called for lawmakers to make more "reasoned decisions" instead of taking "draconian steps" too hastily.

The Legislative Black Caucus also criticized the quick movement of the bill, saying the changes under consideration need more debate.

"Let’s slow this train down. It’s moving too fast," said Rep. Garland Pierce, D-Scotland. "The consequences because of this legislation are going to be dire, especially in our communities where people are already having a hard time with no jobs."

Noting the loss of federal jobless benefits, Rep. Rodney Moore, D-Mecklenburg, said, "It’s a travesty that we’re cutting this lifeline so drastically at a time when we’re just beginning to recover."

Fourth District Congressman David Price even weighed in on the debate, sending a letter to the General Assembly asking them to delay the bill so that federal benefits could continue through the end of the year.

"Now is not the time to abandon tens of thousands of North Carolinians who have lost their jobs through no fault of their own and who stand to benefit from federal policy if their state government does not stand in the way," Price said in the letter. "Nor can our state, with an unemployment rate of 9.2 percent, afford to remove the projected $650 million in economic activity that would result from these benefits this year."

347 Comments

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  • junkmail5 Feb 6, 8:31 a.m.

    Nitwit Perdue borrowed and borrowed to keep these people on unemployment.- ellengraham5660

    No, there were simply a lot more people unemployed all of a sudden, and they had to borrow to cover the fact that the business owners had been underpaying based on the idea unemployment would never, ever, spike upward.

    Once it did they needed $ to cover the standard benefits.

    The -extended- unemployment benefits were all federally paid, not state funded.

    It may be a state program, but I know that in NY, if you apply for Food Stamps, and meet certain qualifications, you receive a free cell phone with 250 free minutes per month, for as long as you meet the requirements.- aetius476

    No, you don't... from the government anyway.

    A private company might give you one so that they get your service business though.

    http://www.vosizneias.com/27398/2009/02/14/new-york-company-offers-free-cell-phone-service-for-low-income-families/

    Govt pays for the SERVICE. Cell company gives you free phone.

  • junkmail5 Feb 6, 8:25 a.m.

    Actually Junkmail, the only "free" phone you get with the Lifeline program comes from an actual service provider. Just like regular customers can get a free phone when you sign up for service- Gravy Pig

    Yeah, I know that.

    That's why I kept having to correct the Obamaphone people who think the _government_ is giving out free phones.

    You appear to have missed the context of the discussion being about what the government gives away.

    So their thought is to continue giving them free money week after week (on my tax dollar- ellengraham5660

    Your tax dollar does not fund unemployment unless you run a business that hires workers. It's paid for with unemployment taxes on employers.

    Rather than raise that tax to cover the fact they've been underpaying for years they decided to just shaft future unemployed workers instead. It's the republican way!

  • Crumps Br0ther Feb 6, 8:15 a.m.

    Actually Junkmail, the only "free" phone you get with the Lifeline program comes from an actual service provider. Just like regular customers can get a free phone when you sign up for service. Verizon, T-Mobile, ATT, all of them offer the phone on their own dime though. This seems to confuse these folks who can't wrap their little heads around a URL or follow a link to read what is what.
    GravyPig

    They give me phones but not IDs? Where is the sense in that?

  • Crumps Br0ther Feb 6, 8:14 a.m.

    It's a fact. One of my wife's friends she works with is responsible for recruiting and hiring at their company and they are always sorting through the applicants that are "over qualified".
    kornfan2448

    Then they need to dumb down their resume'. I read an article a few years ago that people were doing that so they would at least get a phone call.

  • Sumo Vita Feb 5, 9:20 p.m.

    "I know for a FACT the phone is paid for in full by the government"

    Capitalizing the word "fact" doesn't make your statement factual. It's merely anecdotal. Backing up your CLAIM with factual EVIDENCE and actual REFERENCES, now that would make it a fact.

  • kornfan2448 Feb 5, 5:57 p.m.

    "I've heard it all...people don't look for jobs because they fear they will not get the job because they are over qualified..."

    It's a fact. One of my wife's friends she works with is responsible for recruiting and hiring at their company and they are always sorting through the applicants that are "over qualified".

  • lessismore Feb 5, 5:29 p.m.

    I've heard it all...people don't look for jobs because they fear they will not get the job because they are over qualified.....funny....so, just collect unemployment benefits until it runs out, then what?

  • Terkel Feb 5, 5:15 p.m.

    No one ever answered me as to which three companies had "Hiring" signs in the windows.

  • GravyPig Feb 5, 5:09 p.m.

    "No free phones.

    Only a discount on service.

    That has nothing to do with Obama.

    That isn't paid for with income tax either.

    Literally every single thing you have said is factually wrong."

    Actually Junkmail, the only "free" phone you get with the Lifeline program comes from an actual service provider. Just like regular customers can get a free phone when you sign up for service. Verizon, T-Mobile, ATT, all of them offer the phone on their own dime though. This seems to confuse these folks who can't wrap their little heads around a URL or follow a link to read what is what.

  • BigSteamnTurd Feb 5, 4:41 p.m.

    "House Democrats came up short"

    Get very used to hearing that, printing it, living it. The years of the Dem Dummies are over.

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