Much of the recent media attention has been on the federal stimulus package passed by Congress and the President.
While the economic bill includes provisions to return money to the states it does so with strings attached.
This week Governor Rick Perry announced that Texas will resist unemployment insurance stimulus dollars. Accepting these funds would require drastic changes in Texas unemployment laws which would greatly increase the tax burden borne by Texas employers.
According to the Texas Workforce Commission changes to Texas law must include at least two of the following:
• Granting unemployment benefits to part-time workers and those searching for part-time work;
• Allowing unemployment benefits to individuals who leave employment for compelling family reasons;"
• Extend unemployment benefits to those enrolled in job-training programs; and
• Provide dependents allowances" of at least $15 per week per dependent to individuals with one or more dependents.
Completing two of the four changes outlined above would have made Texas only eligible for two-thirds of the funding available to the state. The final third of funding would require Texas to amend its Unemployment Insurance law to allow for an Alternative Base Period calculation that includes the most recent calendar quarter.
Expanding eligibility for Unemployment Insurance would increase the cost of the program in future years which would affect our States finances when federal stimulus funding is no longer available (after fiscal year 2011).
In 2007 House Bill 580 (80R) proposed the creation of an Alternative Base Period similar to that contemplated by the new federal standard. The Legislative Budget Board estimated that HB 580 would have required an additional expenditure from the Unemployment Trust Fund of $35 million in fiscal year 2008 and $45 million in fiscal year 2012.
The strings attached to the unemployment insurance stimulus dollars would impact Texas employers and ultimately affect their employees thus negating the primary objective of promoting job creation by companies who would likely be forced to limit hiring and raise prices on their products. Accepting these dollars would undoubtedly hinder our States ability to overcome the economic crisis and ultimately limit growth.
Those opposed to accepting these funds are quick to point out that these provisions are a clear overreach of federal authority.
The Tenth Amendment to the United States Constitution declares that the powers not delegated to the United States by the Constitution nor prohibited by it to the States are reserved to the States respectively or to the people."
However the provisions of the American Recovery and Reinvestment Act of 2009 overstep these bounds by granting the federal government authority to withhold funds from the states based exclusively on whether state law meets an arbitrary and highly questionable federal standard.
Texas does and should provide unemployment benefits to people in our state who have lost their jobs as a result of the recent downturn in our economy. By creating a favorable business climate in our state individuals who have recently experienced lay-offs will have a better chance of finding employment.
Instead of giving into the demands in Washington Texas should focus on promoting policies that allow businesses to thrive without additional financial burdens that lead to job loss and increased prices.
Much of the recent media attention has been on the federal stimulus package passed by Congress and the President.
While the economic bill includes provisions to return money to the states it does so with strings attached.
This week Governor Rick Perry announced that Texas will resist unemployment insurance stimulus dollars. Accepting these funds would require drastic changes in Texas unemployment laws which would greatly increase the tax burden borne by Texas employers.
According to the Texas Workforce Commission changes to Texas law must include at least two of the following:
• Granting unemployment benefits to part-time workers and those searching for part-time work;
• Allowing unemployment benefits to individuals who leave employment for compelling family reasons;"
• Extend unemployment benefits to those enrolled in job-training programs; and
• Provide dependents allowances" of at least $15 per week per dependent to individuals with one or more dependents.
Completing two of the four changes outlined above would have made Texas only eligible for two-thirds of the funding available to the state. The final third of funding would require Texas to amend its Unemployment Insurance law to allow for an Alternative Base Period calculation that includes the most recent calendar quarter.
Expanding eligibility for Unemployment Insurance would increase the cost of the program in future years which would affect our States finances when federal stimulus funding is no longer available (after fiscal year 2011).
In 2007 House Bill 580 (80R) proposed the creation of an Alternative Base Period similar to that contemplated by the new federal standard. The Legislative Budget Board estimated that HB 580 would have required an additional expenditure from the Unemployment Trust Fund of $35 million in fiscal year 2008 and $45 million in fiscal year 2012.
The strings attached to the unemployment insurance stimulus dollars would impact Texas employers and ultimately affect their employees thus negating the primary objective of promoting job creation by companies who would likely be forced to limit hiring and raise prices on their products. Accepting these dollars would undoubtedly hinder our States ability to overcome the economic crisis and ultimately limit growth.
Those opposed to accepting these funds are quick to point out that these provisions are a clear overreach of federal authority.
The Tenth Amendment to the United States Constitution declares that the powers not delegated to the United States by the Constitution nor prohibited by it to the States are reserved to the States respectively or to the people."
However the provisions of the American Recovery and Reinvestment Act of 2009 overstep these bounds by granting the federal government authority to withhold funds from the states based exclusively on whether state law meets an arbitrary and highly questionable federal standard.
Texas does and should provide unemployment benefits to people in our state who have lost their jobs as a result of the recent downturn in our economy. By creating a favorable business climate in our state individuals who have recently experienced lay-offs will have a better chance of finding employment.
Instead of giving into the demands in Washington Texas should focus on promoting policies that allow businesses to thrive without additional financial burdens that lead to job loss and increased prices.
