MDES reauthorization bill misses deadline

JACKSON — The Mississippi Department of Employment Security (MDES) was in jeopardy after a bill reauthorizing the agency died under a deadline yesterday amid a fight to force Gov. Haley Barbour to accept $56 million in stimulus funding.

House Labor Committee Chairman Rufus Straughter, D-Belzoni, didn’t bring the bill out for a vote in time to meet a legislative deadline for the House and Senate to act on bills originating in the opposite chamber.

The Senate bill was amended by his committee to insert changes to the agency that would allow Mississippi to become eligible for unemployment compensation from the economic stimulus. Straughter said he didn’t present the amended bill because the changes would have been challenged on a technicality on the House floor.

Barbour had initially refused the stimulus money because it would require the state to change its policy on providing benefits to people seeking part-time jobs. He also said it could lead to a tax increase on the businesses that pay into a fund to cover the benefits after the stimulus money is gone.

The bill’s proponents, however, say the state already provides benefits to part-time workers if they are willing to apply for full-time jobs.

The Republican governor critized House Democrats.

“House leaders have jeopardized the continued payments of unemployment benefits and put Mississippi at risk of being noncompliant with a multitude of federal guidelines, which will necessarily result in higher taxes,” Barbour said in a statement.

Straughter said over a four-year period some 40,000 additional unemployed Mississippians could be covered under the proposed federal changes. Straughter said Barbour’s refusal is disingenuous since he’s “already spent $832 million in recovery funding.”

The unemployment insurance in Mississippi is funded by a tax on employers.

Barbour spokesman Dan Turner said the governor’s position remains the same.

“Gov. Barbour has said repeatedly that changing our regulations to allow benefits to part-time workers would force a tax increase on businesses once the stimulus money runs out,” Turner said Wednesday. “A tax increase is certainly not an incentive for businesses to start or expand and hire new employees.”

Straughter said there’s no other bill alive with the code sections needed to reauthorize MDES, which is responsible for administering the state’s unemployment insurance.

Senate Finance Committee Chairman Dean Kirby, R-Pearl, also said he didn’t know of a bill still alive with the needed code sections.

Les Range, MDES executive director, said he was disappointed in the agency hasn’t been reauthorized. He said the agency is federally-funded and not an expense to the state’s general fund. He said over 400,000 residents are served each year.

“In fact, we pay over $3.2 million dollars annually to the state’s general fund for services provided to us by other state agencies,” Range said in a statement. “In the midst of the worst recession since the Great Depression, Mississippi needs to have an authorized, functioning State Workforce Agency.”

Straughter said if the federal government takes over Mississippi’s unemployment insurance, then the state’s employers will lose federal credit that could result in a $413 million tax increase each year.

Barbour said that’s the reason the agency should be reauthorized.

“Some people may be in favor of raising taxes on businesses some $400 million if MDES is not reauthorized, but I’m not one of them,” Barbour said. “Clearly, in these economic times, the last thing Mississippi should do is increase taxes on the very people who create jobs: our employers.”

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2 Responses to “MDES reauthorization bill misses deadline”

  1. MDES reauthorization bill misses deadline | Insurance News & Info Says:

    [...] more on Mississippi Business Journal Share and [...]

  2. Beverly Says:

    What is Haley Barbour refering to when he says employers will have to pay a higher tax on part-time employees once the stimulus dollars that provide 100% federal funding for emergency unemployment insurance run out? I thought the provision under the ARRA states that once the federal government no longer provides this funding there is a provision that all states revert back to their specific guidelines and rules. My understanding is that it is only while the federal gov’t is providing full reimbursement for this program that part-time workers, dislocated workers due to domestic abuse etc are required to be eligible for benefits. That once the program is no longer fully funded by the federal governemt a sunset clause allows states to revert back to the current state laws on the books.

    Haley Barbour states “when the stimulus dollars run out” but in the case of the emergency unemployment being paid wholly with federal dollars, when the federal government phases out the EUC program then they no longer dictate how individuals in each state qualify for benefits.

    So I guess my question is, in what way will federal emergency unemployment compensation cause taxes of MS employers to be raised. If the emergency funds are being paid for in total by the federal government and is not affecting claims against the business or businesses that laid off these employees how does that constituent added future taxes on MS businesses?

    Could someone please clear this up for me? I’ve heard many times Governor Barbour make the higher taxes issue as an explanation for not accepting these funds but have yet to hear an explanation on how this would come about.

    I was reading an article in a New York paper and it mentioned that Mississippi is not eligible for these additional unemployment benefits because Haley Barbour continues to playing political games. Again can anyone tell me what games are they refering to if this is indeed true.

    Any input to enlighten me in this area would be helpful. I have not been able to get much information from local media outlets that explains the details of Haley Barbours refusal to accept these funds to benefit this state’s unemployed worker.

    Sincerely Beverly Johnson

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