Members of the House Finance Committee narrowly advanced a bill that will reduce the amount of checks to unemployed people over time while also increasing the amount paid by employers into the state’s unemployment trust fund.
The committee advanced S. B. 841 on a 14-9 vote after three and a half hours of discussion. The bill now goes to the House floor during the final week of the regular legislative session.
Comments by Delegate John Hardy, vice chairman of the Finance Committee, demonstrated the conflict — calling the bill “a hot mess” but also saying he would vote to advance it to the floor.
Hardy said the Senate had rolled out the unemployment bill recently and abruptly. And Hardy said he would have to explain to employers in his Martinsburg district that, even with current low unemployment rates, the amount they pay into the unemployment trust fund will increase from $8,000 in state code now to $10,000.
But Hardy concluded the bill would make the unemployment trust fund more stable over the long haul.
“I think this is a long-term solution to the pressure we are seeing on the fund,” said Hardy, a Republican. “I’m not going to let the perfect be the enemy of the good to get this done and make sure we are securing our long-term plan.
“So I’m going to put my arm floaties on and hold my nose and jump into the deep end and support this piece of legislation.”
State officials said the bill could add stability to the unemployment trust fund, which has a current balance of about $390 million.
West Virginia labor organizations blasted advancement of the bill.
“These hard-working people should be able to rely on a consistent unemployment benefit, one they earned just like healthcare and retirement, and this legislation would not only cut the number of weeks it’s available, but also would decrease the benefit over time,” said Josh Sword, president of the West Virginia AFL-CIO in a statement distributed after the committee vote.
“We cannot understand why this bill, which will also raise taxes on employers, is being pushed in the final week of the legislative session, particularly when the fund is perfectly healthy, and could sustain crisis-level unemployment for multiple years.”
The bill would allow a maximum 24 weeks of unemployment eligibility. Right now, West Virginia has a 26-week maximum.
The bill would lower the amount of the benefit over time.
The new proposal would start at 70% of average weekly wages — higher than the current rate — over the first four-week period of unemployment.
From there, the benefit would gradually go lower. So for the second four-week period, the benefit rate would be 65% of the worker’s weekly wage. That would continue through the sixth four-week period when the benefit rate would be 45%.
Officials from Workforce West Virginia testified again in the House Finance Committee that the changes could stabilize the unemployment fund. They cited modeling that showed if West Virginia averaged 10 percent unemployment then the trust fund could be wiped out in 91 weeks — which is just shy of two years.
Delegate Larry Rowe, D-Kanawha, was incredulous. “That’s a pretty good fund if you can hit 10 percent unemployment for 91 weeks and not run out of money,” Rowe said.
The unemployment bill was first introduced in the Senate Finance Committee on Feb. 24, right up against a deadline to move bills out of committee. The bill then passed the Senate, dramatically altered from how it was first introduced, on the final day to move bills from one chamber to the other.
The first version of the Senate unemployment bill received criticism for being introduced up against the backdrop of hundreds of job losses at Cleveland-Cliffs in Weirton and Allegheny Wood Products at locations around the state.
This version would not take effect until Jan. 1, 2025.
“The recent announcements are very unfortunate,” said Delegate Bob Fehrenbacher, R-Wood, “but this puts the state in a sound position. The stability and predictability of the fund, and as it relates to employers, is significant and it also takes care of those that are unemployed.”
Delegate Clay Riley, R-Harrison, agreed.
“It restores stability to our unemployment system, it makes sure that West Virginians who lost their job have a safety net to get back on their feet, and it provides stability and predictability toward the state’s employees and the employers,” Riley said.