H.R. 4213: Unemployment Compensation Extension Act

H.R. 4213

Unemployment Compensation Extension Act

Sponsor
Rep. Sander M. Levin

Date
July 23, 2010 (111th Congress, 2nd Session)

Staff Contact
Communications

Floor Situation

The Senate Amendment to the House Amendment to the Senate amendment to H.R. 4213, the Unemployment Compensation Extension Act, is scheduled to be considered on Thursday, July 22, 2010, and is expected to be subject to a rule.

Bill Summary

This bill would provide an extension of unemployment insurance through November 2010.  The bill will be declared as emergency spending and add $34 billion to the deficit.  This bill does not extend the payment of the $25 per week additional payment that was provided in the “stimulus.”  In addition, this bill would retroactively reinstate benefits back to June 2, 2010.

H.R. 4213 would extend through November, the emergency unemployment compensation program and 100 percent of the federal funding for the extended benefit program.  The provision would preserve the 99 weeks of state and federal unemployment benefits.

The bill would require states to maintain average weekly benefit amounts available as of June 2, 2010, or lose eligibility for federal unemployment benefits.

The bill modifies the federal extended benefit eligibility rules to effectively prevent a significant reduction in benefit payments due to earnings occurring after a worker started collecting UI benefits.

The bill provides that the $33 billion in spending is designated as emergency spending; and therefore, not subject to pay-go.

Background

Current federal unemployment benefits lapsed at the end of May 2010. The bill, H.R. 4213, the American Jobs and Closing Loopholes Act of 2010 originally contained a provision to extend unemployment benefits, as well as a number of expiring tax provisions, which passed through the House on May 28, 2010.  This bill will now be used as a vehicle for unemployment benefits only.

Member Concerns:  This legislation would increase spending by $33 billion and increase the deficit by $34 billion.  In addition, a number of economist have warned that prolonged unemployment benefits can theoretically increase unemployment duration by delaying individuals intensity to search for work;  economist have long recognized that the availability and value of UI benefits can lengthen the duration of unemployment.

Cost

The Congressional Budget Office estimates this bill to cost $33 billion over the next two years, including a net deficit increase of $34 billion over ten years.