State Rep. aims to make unemployment more efficient

Wednesday, July 8, 2015

Fitzpatrick: Missouri the worst at running out of money

State Rep. Scott Fitzpatrick, R-Shell Knob, was successful in passing a bill that modifies the duration of unemployment compensation, the method to pay federal advances and raises the fund trigger causing contribution rate reductions.

The bill, HB 150, would also tie unemployment benefits to the state's average rate of unemployment.

"I sponsored a bill that passed that would have indexed the number of weeks unemployment would pay," Fitzpatrick said. "The reason is because every time we've had a recess, Missouri is the only state that has run out money every time. We're the worst at that. "

The governor vetoed the bill, but Fitzpatrick said the State House overrode the veto, and the State Senate is likely to override the veto in September.

"When you run out of money, you have to continue to pay unemployment benefits, so you have to go out into the market to issue credit, or you borrow money from the federal government," Fitzpatrick said. "And, they basically tax businesses to repay that loan. When we run out of money in the trust fund, the government increases taxes in a recession. So, that is not a recipe for keeping government out of businesses so they can recover from a recession.

"We indexed the number of weeks, so if times are good, it would be easier to get a new job. That's when the unemployment rate goes from 13-20 weeks. When the rate is low, under 6 percent, the number of weeks received is less.

Fitzpatrick said as the unemployment rate gets higher, a half percent at a time, a week is added at a time.

"Nine percent is the highest rate which weeks can continue to get added," he said. "If it gets to nine percent and keeps going, the benefit goes up to a maximum of 20 weeks.

"Once the trust fund gets to $600 million, businesses get a decreased rate. What we did is we increased it by $120 million. We're not trying to balance this problem on the backs of the workers, we're making the employers take part in the solution, too. The unemployment system is fully paid for by the employer. It's a tax on the employer."

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