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NYS to Extend Unemployment Benefits

POSTED on May 21, 2009

ALBANY - Governor David Paterson, NY Senate Majority Leader Malcolm Smith and Assembly Speaker Sheldon Silver announced the enactment of critical legislation that will extend unemployment insurance (UI) benefits for more than 120,000 New Yorkers, including approximately 56,000 individuals whose benefits were set to expire next week. The legislation allows New York to access an estimated $645 million in additional federal aid available through the American Recovery and Reinvestment Act (ARRA), which will contribute to the State unemployment system and provide an additional 13 weeks of UI benefits.

"New Yorkers need employment and it is critical that the State take every action possible to offer help in this unprecedented time of fiscal crisis," Governor Paterson said. "These benefits allow unemployed New Yorkers to pay for their homes and buy food for their families while also searching for jobs. This bill is an important step towards fulfilling that obligation. I want to express my gratitude to President Obama, Senator Schumer, Senator Gillibrand, Congressman Rangel and the New York Congressional Delegation, for their quick and decisive action to address our economic crisis, and for providing direct assistance to those in economic distress."

Senate Majority Leader Malcolm A. Smith said: "As we work to restore the economy we inherited, it is sound economic investment programs like this that will make the greatest difference in getting New York's economy back on track. I am pleased that this federal stimulus money will be going to the New Yorkers who need it the most, and believe that it will serve as an efficient and effective means to expedite economic recovery."

Assembly Speaker Sheldon Silver said: "This legislation delivers much needed assistance for the 56,000 New Yorkers whose unemployment benefits would have run out next week. These federal funds will alleviate some of the suffering and the fear that comes with the loss of a paycheck and the inability to find a job. I commend the Chair of the Assembly's Committee on Labor, Assembly Member Susan John, as well as the sponsor of this legislation in our House, Assembly Member Grace Meng."

This legislation will ensure that New York can tap into additional ARRA funds. Individuals become eligible for federal funds to cover an extended 13 weeks of unemployment when one of two statewide benchmarks has been reached: the "Insured Unemployment Rate" (IUR) or the "Total Unemployment Rate" (TUR). The IUR is calculated by dividing the average number of workers receiving state unemployment benefits in the past 13 weeks by the total number of employed workers in the state. The TUR is calculated by dividing the overall number of unemployed workers by the total civilian labor force in the state. If the TUR exceeds 6.5 percent over a three-month period, the extended UI benefits are triggered.

Prior to this legislation, New York State only used the IUR and will unlikely meet that threshold this year. The law enacted today allows New York State to use the TUR, which has already been met, in cases where benefits are fully federally funded. Without today's action, New York's UI recipients would miss out on millions of dollars of federal aid.

The bill also makes certain clarifying changes in New York law to ensure that New York meets the federal requirements to receive ARRA funds for UI modernization. These amendments make clear that individuals who leave work because of compelling family circumstances, such as the illness of an immediate family member, domestic violence or the need to accompany a spouse who must move to take on new employment, will be eligible for UI. The bill also recognizes that part-time workers cannot be disqualified for UI benefits because they seek similar part-time work.

The inclusion of the Unemployment Insurance funding in the ARRA legislation succeeded in large part due to Governor Paterson's national leadership and advocacy for unemployed workers. Last October, the Governor sent a letter to both presidential candidates, urging them to make the Unemployment Modernization Act a top priority. In November, Governor Paterson led a coalition of 18 governors who urged that the House and Senate leadership include the Unemployment Insurance Modernization Act as part of the economic recovery legislation. Following these efforts, the Governor wrote in December to then President-elect Obama and Vice President-elect Biden, to emphasize the need to adopt Unemployment Insurance Modernization in any future stimulus package.

As part of the $645 million in ARRA funds that this bill enables New York to access, these enactments ensure that New York meets the conditions for $275 million in additional federal UI modernization aid, which will be used to support benefit payments and will help to address a shortfall in New York's UI Trust Fund.