The Obfuscation Report

Jobless Angry at Possibility of No Benefits

By MICHAEL LUO

As governors in nine states, mostly in the South, consider rejecting millions of dollars in federal stimulus money for increased unemployment insurance, there is growing anger among the ranks of the jobless in those states that they could be left out of a significant government benefit.

The stimulus bill recently passed by Congress includes incentives to states to expand benefits to many more jobless people, including part-time workers and those who have cycled in and out of the work force, who are not covered in many states.

The Republican governors of Alabama, Georgia, Louisiana, Mississippi, South Carolina and Texas, along with Alaska and Idaho, have raised protests, saying that expansion could eventually require them to raise taxes.

On Wednesday, Gov. Phil Bredesen of Tennessee became the first Democratic governor to express reservations on the issue.

For people like Henry Kight, 59, of Austin, Tex., the possibility that the money might be turned down is a deeply personal issue.

Mr. Kight, who worked for more than three decades as an engineering technician, discovered in September that because of complex state rules, he was not eligible for unemployment insurance after losing a job at a major electronics manufacturer he had landed at the beginning of the year.

Unable to draw jobless benefits, he and his wife have taken on thousands of dollars in credit-card debt to help make ends meet.

It is precisely these kind of regulations, involving such matters as the length of a person’s work history or reason for leaving a job, that the federal government is trying to get the states to change. Such a move could extend benefits to an estimated half-million more people, according to the National Employment Law Project, a liberal group in New York that supports the changes.

Mr. Kight and other unemployed workers said they were incensed to learn they were living in one of a handful of states — many of them among the poorest in the nation — that might not provide the expanded benefits.

“It just seems unreasonable,” Mr. Kight said, “that when people probably need the help the most, that because of partisan activity, or partisan feelings, against the current new administration, that Perry is willing to sacrifice the lives of so many Texans that have been out of work in the last year.”

He was referring to Gov. Rick Perry of Texas, who has said he may decline the extra money rather than change state policy.

“I remain opposed to using these funds to expand existing government programs, burdening the state with ongoing expenditures long after the funding has dried up,” Mr. Perry wrote in a letter to Mr. Obama last week.

The governors contend that once the federal money ran out, they would have to continue providing the new benefits, which they say would force them to raise taxes on businesses. The federal money will end in two or three years in some states, or much later in others, depending on the size of the state allocation.

Proponents say that nothing would prevent states from changing the laws back at that time.

The anger at the governors’ positions goes beyond just the unemployed workers who could directly benefit from the changes. Because eligibility rules for unemployment insurance are complicated and vary by state, many unemployed people do not even know whether they would be affected.

There is also confusion over what parts of the stimulus money are in danger. The governors have mostly said they do not object to the stimulus bill’s $25 per week increase in unemployment benefits, or a new federal extension of benefits.

As a result, many laid-off workers across the South have been fretting over precisely what they might lose out on, even as they express astonishment that they might not receive the help that jobless people in other states will get.

“I don’t understand the whole thing,” said Kelley Joyce, 43, of Myrtle Beach, S.C., about indications from Gov. Mark Sanford that he may reject some of the stimulus financing in that state. “Apparently because he has money and he doesn’t have to worry about everybody else who doesn’t have money.”

South Carolina, which has the nation’s third-highest unemployment rate at 9.5 percent, ruled Ms. Joyce was ineligible for benefits for the same reason as Mr. Kight after she lost her job as a marketing assistant in November.

The first third of the $7 billion available to states to expand unemployment benefits is contingent on the states’ changing eligibility rules in such a way that Mr. Kight and Ms. Joyce would receive benefits. It requires states to consider an “alternative base period” when determining someone’s eligibility.

Currently, when considering a person’s work history, most states do not include his wages in the current or preceding quarter. Instead, they look to see what the person earned in the four quarters before that, which can often hurt low-wage workers, women and others just entering or returning to the work force.

In Mr. Kight’s case, he was unemployed for the second half of 2007, after losing an earlier job he had at a different electronics manufacturer in a downsizing. As a result, when he applied for unemployment benefits, he did not have enough immediate work history to qualify.

“I have worked for so many years, a total of probably 30 years, contributing to the support system that helps people when they get in a tough spot like I’m in,” Mr. Kight said. “I haven’t needed it too much in the past, but I sure could use it right now.”

About 40 percent of applicants who are now disqualified from receiving benefits because they do not earn enough would qualify if states offered an alternative base period, according to the National Employment Law Project.

To be eligible for the other two-thirds of the money set aside for unemployment benefits, states would have to provide benefits to at least two of these four groups of unemployed people: those only available to work part-time; workers who left their jobs for a compelling family reason, like a spouse moving to take another job, to take care of a sick child, or in cases of domestic violence; workers with dependent children seeking additional benefits; and workers who need additional benefits to last them through re-training.

On Tuesday, Erica Greer, 32, and her mother, Candace Foss, 59, who lost her job as a data management specialist at Home Depot in late January, went to the State Capitol in downtown Atlanta from Kennesaw, Ga., a suburb where they live, to deliver a message to Gov. Sonny Perdue not to reject any of the stimulus money.

Mr. Perdue has said he fears the long-term consequences of accepting the money.

Ms. Foss got a severance package from Home Depot, so she has not yet applied for unemployment benefits. It appears she would be eligible for benefits, but she and her daughter said they wanted to stand up for unemployed Georgians and fight for their benefits. They wound up speaking to an aide to the governor for about 10 minutes and submitted a letter to Mr. Perdue.

“I don’t think he truly understands the plight of his citizens,” Ms. Foss said. “He’s surrounded by people with good jobs, who make good salaries. He’s not surrounded by people like me.”

Robbie Brown contributed reporting.