Members of the Missouri House gave final approval to a bill meant to protect the state's unemployment system from insolvency in the event there is another economic downturn. Supporters say the bill is necessary because Missouri is the only state that has been forced to borrow money from the federal government to pay for unemployment benefits during each of the last five economic downturns. They also say businesses are negatively impacted because borrowing federal dollars causes employers to lose a portion of a federal tax credit they normally receive.
The legislation is designed to make sure the state has enough money in its unemployment trust fund so that businesses don't have to pay a penalty. Specifically, it would increase the minimum amount of money in the fund by $120 million before employers' contribution rates decrease. For example, Missouri businesses would see their contribution rates decrease by 7 percent if the fund has a balance greater than $720 million. Rates would drop by 12 percent if the fund sees a balance in excess of $870 million.
The bill would also tie unemployment benefits to the average unemployment rate so that more benefits are available when unemployment is high. If the state were in a position of high unemployment (9 percent or higher), benefits would be available for 20 weeks. In periods of low unemployment (lower than 6 percent), benefits would be available for 13 weeks. Supporters note that similar systems are already in place in states like Georgia and Florida. They call the change an important step toward ensuring Missouri can afford to help its citizens during times when they are without work. Supporters also note that the average period of unemployment in Missouri is 12.1 weeks so the 13-week benefit period would be sufficient in most cases.
The legislation now moves to the Senate for consideration. The House and Senate approved similar legislation in 2015 only to see then Governor Nixon veto the bill. The House approved a veto override during the regular session that year, and the Senate then completed the override during the annual Veto Session. The law was later struck down by the Supreme Court because of the fact the veto was not overridden in the same session.
As always, it is an honor to serve the good folks of the 153rd District. If you would like to discuss any issue, please call 573-751-1066 or you can e-mail me at steve.cookson@house.mo.gov .