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Tell Congress to Finish the Job on State Aid, Unemployment insurance and COBRA Health Subsidies NOW

Despite the fact that the economic picture for state and local governments could worsen in coming months and that teachers across the country are being handed their pink slips, and in spite of continued job growth, all experts agree that unemployment rates will not dramatically decrease anytime soon, legislation providing needed assistance is languishing in Congress.

ASK HOUSE MEMBERS TO VOTE FOR HR 4213 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.

This week, the U.S. House of Representatives will consider a comprehensive bill that will extend Federal UI programs and COBRA subsidies until the end of the year, provide much needed aid to state governments through the Medicaid program (FMAP) through the end of the next state fiscal year, 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.

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.

  • Over 20 states are counting on receiving the additional Medicaid funds in their budgets. Without the additional $26 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 House and Senate before the Memorial Day recess and there is no time to waste on being indecisive, on playing partisan games, or on misdirected worries about the deficit.