Senators Announce Agreement to Extend EUC for Five Months

Mar 14, 2014

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On Thursday, March 13, a group of 10 U.S. Senators led by Jack Reed (D-RI) and Dean Heller (R-NV) announced an agreement to reauthorize the Emergency Unemployment Compensation (EUC) program for five months.  The bill, the Emergency Unemployment Compensation Extension Act of 2014 (S. 2148), would allow for retroactive payments to eligible beneficiaries to when the program expired on December 28, 2013.  The bill is also cosponsored by Senators Susan Collins (R-ME), Rob Portman (R-OH), Lisa Murkowski (R-AK), Mark Kirk (R-IL), Jeff Merkley (D-OR), Cory Booker (D-NJ), Sherrod Brown (D-OH), and Dick Durbin (D-IL).

The agreement between the Senators of the Majority and Minority came as both sides agreed on the length of the extension and the budget offsets to pay for the estimated $9.7 billion extension.  According to a press release issued by Senator Heller and Senator Reed, the proposal is “fully paid-for using a combination of offsets that includes extending ‘pension smoothing’ provisions from the 2012 highway bill (MAP-21), which were set to phase out this year, and extending customs user fees through 2024.  The bill also includes an additional offset allowing single-employer pension plans to prepay their flat rate premiums to the Pension Benefit Guaranty Corporation (PBGC).

S. 2148 would provide a retroactive extension of EUC from December 29, 2013, through June 1, 2014.  The legislation maintains the current tier structure that was in place before EUC expired and extends the Reemployment and Eligibility Assessments (REAs) and Reemployment Services that all states implemented under EUC before its expiration. 

However, the legislation contains a provision prohibiting individuals whose adjusted gross income is above $1 million from receiving EUC benefits. The provision would also prohibit the use of federal funds in determining the income eligibility requirement of a EUC claimant, but allows self-attestation.

The bill will likely cause implementation delays and increased administrative problems for state unemployment insurance programs if it bill becomes law.  On January 30th, NASWA sent a letter to Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY) outlining the potential administrative problems that would come from requiring states to conduct income-based means testing for individuals, indicating these changes could take at least two to three months for states to implement.

Further, the retroactive nature of the extension will be a huge administrative hurdle for most states and will likely result in delays.  Many states will require between one and three months to configure their antiquated computer systems to meet the requirements in S. 2148.  The legislation also creates an issue of verifying work-search requirements after-the-fact for individuals eligible for EUC after December 29, 2013 under S. 2148

Congress is scheduled to be on its St. Patrick’s Day recess next week; however Senate Majority Leader Reid is expected to bring the bill to the Senate floor soon after Senators return the week of March 24.  While the bill has been introduced, it must pass a 60-vote threshold to overcome a filibuster.  Senators Reed and Heller expressed confidence they “would have more than enough votes to advance the measure in the U.S. Senate.

NASWA is analyzing the legislation and will send a letter next week to the Senate leadership outlining the administrative burden on the states.