The economic picture for state and local governments could worsen in coming months, teachers across the country are being handed their pink slips working families are struggling and all experts agree that unemployment rates will not dramatically decrease anytime soon. Meanwhile, legislation providing needed assistance is languishing in Congress.
ASK SENATORS TO VOTE FOR THE AMERICAN JOBS AND CLOSING TAX LOOPHOLES ACT IN ORDER TO:
- EXTEND UI/COBRA BENEFITS UNTIL THE END OF THE YEAR.
- EXTEND STATE FISCAL RELIEF (FMAP) FOR ANOTHER SIX MONTHS.
- FUND THE TANF EMERGENCY FUND THROUGH FY 2011.
The U.S. Senate will consider a bill that will extend Federal UI programs, extend increased federal Medicaid payments to states (FMAP) and give a much needed infusion of resources to the TANF Emergency Fund which has provided crucial support for low-income families and has led to the creation of over 180,000 jobs over the last year and half. However, due to a last-minute House compromise, the bill excludes extensions of COBRA health subsidies for the unemployed and much-needed aid to state governments through the Medicaid program (FMAP). We must ensure these necessary provisions are included in the final bill.
Background on FMAP
The new fiscal year for states begins on July 1, but the current Federal FMAP funding ends in December, the middle of their fiscal year. FMAP was squeezed out of the House bill and we must make a push to maintain the restored funding in a Senate substitute amendment
- 30 states are counting on receiving the additional Medicaid funds in their budgets. Without the additional $24 billion already approved by both the House and Senate, the states will have to close budget gaps with brutal cuts that could cost the economy 900,000 jobs in the near term and more than three million by 2012.
- Mark Zandi, Chief Economist of Moody’s Economy.com has warned that the deep state budget cuts in FY 2011 “will be a serious drag on the economy at just the wrong time.” He also asserts that every dollar of federal Medicaid relief results in $1.41 in increased economic activity, which translates into stronger economic growth.
Background on UI and COBRA
- Presently, eligibility for the federal UI programs expires on June 2nd, and eligibility for the COBRA subsidy expires on May 31. In the last 6 months, we have had to fight for 4 stop-gap extensions which has caused needless anxiety and stress for the long-term unemployed and unnecessary hardship for the already over-taxed state agencies that run the UI programs.
- These benefits are important life-lines for over 6 million workers and their families, and they provide much needed economic stimulus to communities throughout the country. Zandi tells us that every dollar spent on UI puts at least $1.63 back into the economy and that these benefits should be extended through at least the end of 2010, and not offset by tax increases or other spending cuts, which he says would be “counter-productive.”
Background on TANF Emergency Fund
- The TANF Emergency Fund is scheduled to expire on September 30, 2010. Without an extension, the 28 states and DC currently operating subsidized jobs programs will start winding down their programs in the next month. These programs have put over 180,000 people back to work at a very low cost per job and have helped businesses hire earlier than they otherwise would have.
- Many state budgets have assumed the extension of the Emergency Fund; if it is not extended, state budget shortfalls will likely force severe cuts in programs serving the most vulnerable families with children.
Timing is of the essence — This bill needs to clear the Senate and go to conference as soon as possible. There is no time to waste on being indecisive, on playing partisan games, or on misdirected worries about the deficit.
Call Congress NOW!