Lawmakers Eye Taxes to Keep Jobless Benefits Flowing

As expected, the Senate Judiciary Committee has included an additional tax-like increase to Gov. Joe Manchin's proposal for keeping solvent the unemployment compensation trust fund, The Associated Press reports.

As amended, the bill would increase the wage base on which employers now provide revenues for the fund, from the first $8,000 of a worker's pay to the first $12,000. While that base would recede to $10,000 once the fund balance reaches $220 million, it would remain indexed to state wage levels.

"The full hike is expected to yield $70 million annually," AP reports, while "another $77.7 million would come from the temporary special assessments on wages."

Triggered if the fund falls below $180 million, these assessments would hit both employers and workers -- but at half the rate that Manchin had proposed. AP explains that "as amended, those would collect $23.12 from a worker earning the state’s per-capita income of $30,831 a year, and $38.54 from the employer."

AP provides context for the legislation:

West Virginia provided jobless benefits to more than 30,800 people during the first week of March, the latest figures show. Not since January 1996 have so many relied on unemployment, and officials expect the number to rise as the recession continues.

The fund paid out $53 million during the first two months of the year, and expects to devote another $32 million to benefits this month... If claims continue to outpace revenues, officials fear a return to the 1980s, when the fund went bankrupt. Insolvency has already forced at least 14 other states to seek federal loans totaling $5.5 billion since early December, according to the National Conference of State Legislatures.

The Chamber of Commerce successfully pushed for an amendment that includes the definition of a strike, " in a bid to deny claims in such cases," AP reports. But the article adds that "state figures show that less than 8 percent of the 17,772 cases heard by the Unemployment Compensation Board of Review in the last four years involved labor disputes, including strikes."

The Charleston Gazette focuses on the strike language, while the Charleston Daily Mail highlights the potential impact on business. Others with coverage include MetroNews, The Register-Herald of Beckley and The State Journal.