Senate lawmakers today perfected Senate Bill 673, legislation that makes changes to Missouri’s unemployment insurance system to ensure solvency of this important safety net for unemployed workers. The base bill, sponsored by Sen. Mike Kehoe, would tie the number of weeks jobless Missourians can receive unemployment benefits to the unemployment insurance rate. Kehoe is a Republican from Jefferson City.
Following the recession, Missouri’s unemployment insurance system became insolvent and had to borrow money from the federal government to cover claims. Missouri has borrowed more than $1 billion since then to continue paying unemployment benefits. Employers have paid millions in interest alone on the borrowed funds.
“Shortening the number of weeks employees can draw unemployment benefits would provide significant savings to the trust fund. When the economy is tough and unemployment is higher, more funds would be available,” said Dan Mehan, Missouri Chamber president and CEO.
Both Georgia and Florida have passed legislation that ties unemployment benefit weeks to the unemployment rate.
Under Senate Bill 673, unemployed Missourians would be eligible for:
• 20 weeks of benefits if the Missouri average unemployment rate is nine percent or higher;
• 19 weeks of benefits if the Missouri average unemployment rate is between 8.5 percent and 9 percent;
• 18 weeks of benefits if the Missouri average unemployment rate is 8 percent up to and including 8.5 percent;
• 17 weeks if the Missouri average unemployment rate is between 7 .5 percent and 8 percent;
• 16 weeks of benefits if the Missouri average unemployment rate is 7 percent up to and including 7.5 percent;
• 15 weeks of benefits if the Missouri average unemployment rate is between 6.5 percent and 7 percent;
• 14 weeks of benefits if the Missouri average unemployment rate is 6 percent up to and including 6.5 percent;
• 13 weeks of unemployment benefits if the Missouri average unemployment rate is below 6 percent
During Senate debate, SB 673 was amended to increase the cap on the fund that triggers employer rate decreases. Sen. Scott Sifton’s amendment would raise the cap from $600 million to $720 million. This provision also would improve fund solvency in the future. Sifton is a Democrat from Afton.
“During each of the last five recessions, Missouri has been the only state in the nation that has had to borrow money from the federal government in order to pay its unemployment insurance claims,” Mehan said. “We owe it to our employers to establish systemic reforms that will better protect the fund so that we don’t have this problem arise the next time the economy dips.”
The Missouri Chamber of Commerce and Industry (www.mochamber.com) was founded in 1923 and is the largest business organization in Missouri, representing almost 3,000 employers, providing more than 425,000 jobs for Missourians.