Berger, Tillis Statement on Hagan’s Attempt to Shirk Responsibility for Federal Cutoff of Unemployment Benefits | Eastern NC Now

    Berger, Tillis Statement on Hagan's Attempt to Shirk Responsibility for Federal Cutoff of Unemployment Benefits

    Raleigh, N.C.     Senate Leader Phil Berger (R-Rockingham) and House Speaker Thom Tillis (R-Mecklenburg) issued the following joint statement Monday in response to Sen. Kay Hagan's attempt to shirk responsibility for her failure to grandfather North Carolina's unemployment insurance reforms during the 2012 federal fiscal cliff negotiations.

    "It's about time Kay Hagan finally admitted she could have helped North Carolina's long-term unemployed, but the fact is she's a year late and $600 million worth of benefits short. If she truly cared about these North Carolinians, she would have done what the General Assembly called on her to do more than a year ago. But she dropped the ball and is now desperately trying to spin her way out of the damage she created."

    Background

    During good economic times, previous Democratic leaders, including former state Senate Appropriations Chairwoman Kay Hagan, made irresponsible decisions that hurt the solvency of our state's unemployment insurance system. When the recession hit, North Carolina was completely unprepared to pay the flood of new unemployment claims and was forced to borrow more than $2 billion from the federal government. In fact, our state had the 4th highest UI debt in the country behind only California, Pennsylvania and New York. House Bill 4 included a prudent plan to pay it off by 2016.

    If the General Assembly had failed to act, the state's debt would not be paid off until 2019. By that time, North Carolina employers would pay a federal tax of $718.2 million per year rather than the standard $79.8 million per year  -  threatening existing jobs and making it harder to create and recruit new jobs.

    The General Assembly worked closely with the U.S. Department of Labor when crafting the bill, incorporated their feedback and had them review the bill for compliance with federal law.

    Federal fiscal cliff negotiations threw a wrench into the plan by failing to grandfather our unemployment insurance reforms (set to begin July 1, 2013) into an extension of federal emergency unemployment benefits. A condition of the fiscal cliff deal was that North Carolina maintain its current benefit levels in order to accept a one year extension of federal benefits.

    General Assembly leaders called on Sen. Hagan (whose party in the U.S. Senate led fiscal cliff negotiations) and the rest of the N.C. Congressional delegation to grandfather in the unemployment insurance reforms into the final fiscal cliff package, so North Carolinians could be eligible for extended benefits. Because of their failure to act, an extension of federally funded payments for those unemployed longer than 26 weeks did not happen.

    Four other states (Pennsylvania, Arkansas, Indiana, Rhode Island) had changes to their UI programs grandfathered in to a previous round of federal unemployment benefit extension negotiations in February 2012. North Carolina was the only state with a UI reform bill ready to go when federal fiscal cliff negotiations were taking place in December 2012, so we were the only state with the potential to be grandfathered.

    President Pro Tempore Senator Phil Berger

    2007 Legislative Building
    Raleigh, N.C. 27601

    (919) 733-5708


    Contacts:

     Amy Auth, (919) 301-1737  •  Shelly Carver (919) 301-1744