Ducey’s unemployment proposal could delay increase for years – ABC15 Arizona

PHOENIX — As Arizona legislators consider Governor Doug Ducey’s $12 billion budget that dropped on Monday, an increase to the state’s unemployment insurance hangs in the balance.

The maximum amount an unemployed Arizonan can draw from the insurance is $240 per week. That amount was boosted by various federal programs during the coronavirus pandemic, but state House and Senate leaders introduced bills that would have permanently increased the weekly cap to $320.

Both bills passed their respective chambers then stalled. Now the unemployment increase is a part of Ducey’s budget bill with caveats that likely will not allow the increase to take effect for years according to Dave Wells, Research Director for the Grand Canyon Institute.

“My estimation is it won’t go into effect until at least September of 2023. So in other words, the cap will not raise for at least two years,” he told ABC15.

That’s because the increase would not happen until two things occurred:

  • The average unemployment tax rate for employers who pay into the insurance fund is at 1.4% and;
  • State unemployment is at 5% or less for a calendar quarter

“Currently, our state unemployment rate is 6.7%. Traditionally, unemployment rates go down, but they are slow,” he said.

Representative David Cook, R-Globe, whose unemployment insurance reform bill passed the House earlier in the legislative session, does not agree with the changes.

“We shouldn’t have to go through hoops and jumps and triggers. That information is lagging behind when Arizona families and people out of work need the help right then – today,” he told ABC15.

Cook’s bill HB2805 would have increased the weekly cap to $320, allowed $160 to be earned without penalty, and allowed 26 weeks of eligibility.

The budget bill allows the $160, but only once the unemployment rate and tax rate thresholds are met. Right now, state law allows for $30 to be earned below penalties.

The budget plan would also allow 24 weeks of eligibility if unemployment is less than 5% and 26 weeks if the unemployment is over 5%.

“Why do we need to cut the weeks at all?” Cook said. “That’s a question that I have, that no one has ever been able to sit down and answer.”

With a slim majority Republicans can’t afford to lose a vote. Cook said he is preparing amendments in hopes of a compromise.

“A hard $320 a week on July 1 of next year,” he told ABC15 “$160 disregard would go into effect immediately – 90 days after the governor signs the budget bill.”

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