Federal authorities question whether the state legislature complied with the regulations required to access $133 million dollars in unemployment money. A business groups says the legislature shouldn’t have been grasping for the money anyway.
President Jim Kistler with Associated Builders and Contractors says the legislature lost focus during the session, working hard to draw down the federal funds, rather than addressing a mounting deficit in Missouri’s unemployment trust fund.
"Our group said from day one, beginning in October, that we need to address the insolvency first and as soon as we have the trust fund solvent, we’ll (be) more than happy to sit down and talk about increasing benefit levels as long as those benefits are directed at the people who truly need them," Kistler told the Missourinet.
Congress approved within the $787 billion economic stimulus package a provision that allowed states to access additional unemployment compensation funds. There was a catch, though. To access the funds, states had to agree to make permanent changes in their laws which would expand unemployment compensation to workers who previously wouldn’t have qualified. The Missouri legislature made provisions within HB 1075 passed this year temporary, promising to revisit the issue next year and consider making them permanent.
Kistler said the legislature shouldn’t even be considering any expansion of benefits, temporary or not.
"We said, number one, let’s use alternative financing to the maximum. Number two, let’s not increase benefits while we’re insolvent and then, number three, let’s take a look at how we can refocus the benefits we’re paying," Kistler said.
A spokesman for Governor Nixon, Scott Holste, cautioned that it’s too early to assert that the bill passed this session won’t comply with federal law.
"It’s important to remember the U.S. Department of Labor has not issued any kind of ruling on the Missouri unemployment benefits, which is actually expanding those benefits to workers who had not previously been eligible," Holste said. "We have already succeeded in extending benefits for workers using stimulus package money as well as enhancing some benefits."
Holste added that the legislation does carry the option for the legislature to make the changes permanent next year.