Alabama Governor Bob Riley joins several other southern republican governors who claim they intend to refuse that part of the stimulus package which would provide additional unemployment benefits for Alabama citizens. If Riley follows through in his threat, the state will lose out $100,000,000 in funds. Governor Riley claims that he is refusing that money because it would require changes in Alabama’s unemployment laws.
The biggest complaint seems to be that these changes would include using a different measuring period for calculating benefits – the “alternate base period.” As the law presently stands, the State does not count an unemployment applicant’s last two quarters of work in determining benefits. This goes back to the days when all of these calculations were done by hand and the information was not available. With the advancement of technology, that is no longer the case. It certainly seems unfair an unemployed person that if they have found a better job in the last 6 months, it does not count. At least 19 states have figured this out and remedied the situation.
In addition, Governor Riley says that Alabama can’t afford to provide unemployment for part-time employees who have lost work and employees who have left work because of domestic violence, family illnesses or arm services relocation. Some people disagree. Stephen Stetson, a policy analyst for Alabama Arise, the only lobbying group in Alabama that caters to the downtrodden, is one of them:
This doomsaying contradicts the governor’s public comments about Alabama’s low unemployment rate relative to the national rate. If our unemployment rates are low, the cost of unemployment payments will be low.
Further, the economy will eventually swing upward again. When that happens, not only will there be fewer unemployment payments, but we’ll be able to afford them because there’ll be more money in the pot.
Further, unemployment insurance funds are a quick way to boost the state’s economy. For every $1 paid in jobless benefits, the economy grows by $2.15. And if it does turn out that the end of the stimulus money will hurt the state’s pocketbook in a few years, we can always change the law back.
Taking the money is a win-win — one of the rare political opportunities with no real downside. Any hypothetical fiscal harm can easily be headed off before it occurs.
According to the National Employment Law Project, the federal money will fully fund the legislative changes for over five years. Concerns that small businesses may have to pay higher unemployment insurance costs are unfounded, at least for that long.
Given the dire straits the economic meltdown has put good, hard working people in, turning down the money is just not right. If you agree with me, let them hear you in Montgomery. If you disagree, can you think of a way that both viewpoints can be satisfied?
Cum Laude graduate of Cumberland School of Law, Pet Mackey is a civil trial litigation expert who represents plaintiffs in business and consumer tort, contracts and construction, employment disputes and insurance. He is board certified as a Civil Trial Advocate by the National Board of Trial Advocacy, a Certified Alabama Mediator, and an “AV” rated lawyer by Martindale-Hubbell.