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Thursday, April 7, 2011

A lengthly government shutdown, could impact jobless payments; Federal House members continue to be paid

Harry Reid (D-NV), United States Senator from ...Image via Wikipedia
Senator Majority Leader Harry
Reid insist a deal has been made
on the amount budgetary cuts
but, Tea Party demands on
other issues are stopping a
bi-partisan announcement
of a deal. 

As a government shutdown looms, lawmakers in Washington DC continue to debate non-budgetary issues  such as riders regarding women breast cancer screening preventions, Senator Majority Leader Harry Reid (R-NV) stated during a live press conference on MSNBC this afternoon.

Although Senator Reid insisted that an agreement between him and Speaker of the House John Boehner (R-OH) on fiscal budget cuts funding, thought the rest of 2011 Reid noted that Tea Party officials are holding up a complete agreement; by demanding partisan issues which have nothing to do with budgetary manners. 

Reid also replied that Conservative Tea Party members in Congress are stopping Speaker Boehner from announcing a deal has been made.

Regardless of the details in reaching a complete agreement, Federal lawmakers have until Friday, April 8th, to either agree on a deal to fund government operations for the entire year or, add a  stop-gap measure to continue programs for a time period until a deal is reached. 

If no deal is reached, federal funding for a number of essential programs, including Social Security payments and maintaining non-essential government workers on the job, would cease.

With up to 16 million job seekers nationwide, many are depending on Federal Emergency Unemployment Extension (EUC) program to fund benefits payments, beyond the normal 26 weeks of state based payments. But some state officials are unsure if the money will be available in a prolonged government shutdown, to pay unemployed job seekers. 
"We also expect that that money will be available, but we’re not quite as confident," said Benjamin Johnson, a spokesman for the Ohio Department of Job and Family Services. "If the shutdown lasted for a long enough time, there could be an issue where the state of Ohio needs to come up with payroll money”, he noted.
While the Senate official has reached a verbal agreement that if a shutdown occurs they will forgo their paychecks, all 435 House members will continue to their receive payroll, on time.

Unemployment program recipients are rightfully worried if a government shutdown could impact some of their only form of income. According to an article on Marketwatch, if lawmakers are unable to agree on a deal, a government shutdown possibly should not disrupt unemployment benefits
"Currently they anticipate being able to make benefit payments in event of a federal shutdown," said Melanie Brown, a spokeswoman for the Michigan Department of Energy, Labor & Economic Growth.  

Still it appears that an there is not established precedent to deal with a government shutdown on unemployment benefits payments. Federal officials hurrying to working out the entire details, if a shutdown happens.
"They're still establishing what exactly the scenario will look like as they head towards Friday," Ms. Brown stated.
The EUC program which funds up to 73 weeks of benefits in Michigan, borrows billions from the federal government to continue paying the 26 weeks of state-paid benefits, currently available in the state. 

Threats of an impending shutdown is disconcerting many cash-strapped states, in compared to the shutdown in 1995. States are still struggling in the aftermath of the recession and don't have as much cash on hand.
"Things are much different both at the federal and state level fiscally than in the last shutdown," said Cornelia Chebinou, Washington director of the National Association of State Auditors, Comptrollers and Treasurers. "At this point there are just a lot of unknowns”.

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