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Cedar Rapids, Iowa 52401
DES MOINES — Iowans who lose their jobs would have to wait one week before they would start receiving unemployment benefits under a bill that won initial Senate approval Wednesday despite complaints it would be a “kick in the teeth” for Iowans in crisis.
Members of the state Senate Ways and Means Committee voted 10-5 to approve Senate Study Bill 1273, which would delay the first week of jobless benefits starting in July 2022 along with making other changes impacting plant closings, road construction lulls and employment issues.
Sen. Waylon Brown, R-St. Ansgar, said Iowa has a “delicate” unemployment insurance benefits system that needs to balance the interests of the individuals who are receiving the aid with the employers who are paying into the fund.
However, representatives of trade unions and other worker organizations told a subcommittee earlier in the day that Iowans who lose jobs through no fault of their own deserve benefits they earned and should not have to wait a week for money they need to pay bills and support their families.
“That one-week delay would put tremendous stress on those families that just found out they were laid off,” said Felicia Hilton, a carpenters’ union official who worried the setback could force some Iowans onto state assistance temporarily if they’ve lost their income and insurance. “It’s a hardship for workers, especially lower-income workers.”
Union representatives also said the delay did not seem like a fair way to achieve savings of up to $23 million when the state’s unemployment trust fund is solvent.
J.D. Davis of the Iowa Association of Business & Industry told subcommittee members Iowa needs to “modernize” its jobless benefits system, including implementing the one-week waiting period that would make Iowa consistent with 41 other states and the same of its neighboring states in the Midwest. He also said the delayed start would give Iowa Workforce Development officials time to check for fraud and other details of legitimate claims.
He said going through a pandemic where businesses were paying people not to work for health and safety reasons “taught us many lessons” about administering the state’s unemployment insurance trust fund and keeping it solvent.
Normally, Davis said, Iowa employers would disburse about $400 million annually in jobless benefits. But that amount grew “10-fold” since COVID-19 hit Iowa with about $4 million in federal and state claims passing through the system, with $1.2 billion being state funds that included the $490 million in federal CARES Act supplements.
SSB 1273 would achieve two goals, Davis said, by ensuring trust fund solvency going forward — with money generated by businesses employment taxes — and preserving Iowa’s reputation “as one of the most generous states in the nation for the provision of benefits to claimants. No state has a higher level of benefits and a lower cost of living than Iowa. Nothing in this will change that,” he said.
Sen. Joe Bolkcom, D-Iowa City, called the bill “mean-spirited” and “coldhearted” in berating Republican senators for advancing it.
“If you were actually on the side of workers you would not be kicking them in the teeth during the most difficult time of their life,” said Bolkcom, calling the measure a way to “stiff” workers “so the bosses get their bonuses.”
Sen. Janet Petersen, D-Des Moines, called the bill “heartless” in recalling a time during Iowa’s 1993 flood when she temporarily lost her job and worried about meeting her financial obligations. A lot of Iowans who live paycheck to paycheck face those same worries in the current COVID-19 pandemic, she noted.
“This seems like a silver-spoon bill. There aren’t a lot of silver spoon Iowans out there,” said Petersen. “When you lose your job, you don’t lose your expenses.”
The bill now moves to the full Senate for consideration.
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