Jun 26, 2009
Senate Republicans slap Michigan workers in the face and address a problem that does not exist
LANSING – Less than 24 hours after voting against Michigan’s unemployed workers and leaving $140 million in federal funds that would have gone directly to Michigan workers who cannot feed their families on the table, Senate Republicans again voted against Michigan workers on Thursday by addressing a problem that doesn’t exist.
Senate Bills 612-615 were approved along primarily party lines that address fraud in the unemployment benefits system and penalizes the unemployed who received benefits by mistake. Senate Democrats were upset for a number of reasons, and the bills did not receive a single committee hearing. They were introduced in late May and forgotten until passed by the majority on Thursday as the Legislature took two-week summer break.
“This shows that our priorities are clearly out of step with the needs of people who are struggling out there in Michigan,” said Sen. Hansen Clarke, D-Detroit.” While we are cozy in this air-conditioned chamber, there are people who are struggling just to barely make it. This is another example of how this Legislature is totally out of touch with the needs of people.”
Specifically, the bills would allow the recovery of interest on the amount of improperly paid unemployment benefits, double the amount of damages that may be recovered for fraud and create the "Special Fraud Control Fund" and require amounts recovered for fraud violations to be deposited into this Fund.
Senate Democrats said they support going after fraud, but there is no provision for the state making a mistake, or even the worker thinking he is eligible and receives benefits that later turns out he was not eligible for. It also didn’t address employers who fraudulently try to stop a worker from collecting benefits.
“I didn’t see anything in those bills that was aimed at employers who are fraudulently denying workers unemployment insurance,” said Sen. Ray Basham, D-Taylor. “I had a trucking company in my office the other day in their fight with Treasury over taxes that they were charged. In fact, there was an $80,000 dispute in Treasury who is admitting that they are wrong, but they don’t want to give the money back to the trucking company.
“So if the trucking wants to continue to litigate this, they will have to put up one hundred and something thousand dollar bonds to go after $80,000,” he said.
The bills would also put Michigan out of conformity with federal rules and put us at risk of about $70 million in federal sanctions. But Senate Democrats were more incensed that the bills were rushed out without a single committee hearing just 24 hours after refusing to consider House Bills 4785 and 4786 that would provide unemployment benefits to individuals who are only available for and seeking part-time work and those in an approved job training program who have exhausted their regular benefits. That would make Michigan one of only about five other misguided states to say no to those funds.
“When we are at 14.1 percent unemployment here in the state of Michigan, and we leave $140 million sitting on the table in Washington that we could be using to benefit working families and people who have lost their jobs here in Michigan, I think that is a travesty of what we are sent here to do,” said Senate Minority Leader Mike Prusi, D-Ishpeming.
Because Michigan's largest employer, the auto industry, is losing market share in the national recession, it has the highest unemployment rate in the nation. But, only about half of Michigan’s unemployed workers are currently receiving benefits, according to a report by the Michigan League for Human Services, because they have exhausted benefits without finding a job, they are working part-time or they lost a part-tine job. It’s also estimated that for every $1 of unemployment benefits spent by workers and their families, there is an estimated $2.15 in economic growth.
Prusi said he is angry that he has to go home to the UP during the Legislature’s two-week break where unemployment is even higher than the rest of the state and tell them the only thing the Legislature did was penalize them if a mistake is made. Instead of helping 20 percent of the people, they are going after 2 percent of the people.
“You could have brought home that we are extending your unemployment benefits. You could have brought home we are going to help you get retrained for a job because your job has left and is not coming back. But all you are going to do is say we ended fraud in the unemployment system,” he said. “The very bulk of the people and the very number that is shown 2.5 percent of the people are overpaid in their unemployment benefits, and you are going to go after that 2.5 percent and claim you saved $100 million. That is fraudulent in itself.”