Wis. GOP proposes unemployment benefit changes

MADISON, Wis. (AP) -- Republican legislators have asked an advisory council to review a package of changes to Wisconsin's unemployment benefit rules, including linking eligibility to the state's unemployment rate, devoting millions in tax dollars to reducing federal debt and scaling back benefits during training in an effort to help the state recover from a surge of unemployment claims during the recession.

Rep. Dan Knodl, R-Germantown, chairman of the Assembly's labor and workforce development committees and one of the package's chief authors, said the reforms could save as much as $60 million a year and help bring the state's unemployment benefit trust fund back into solvency.

The Republicans sent the changes to the Wisconsin Unemployment Insurance Council on Monday and asked for feedback by May 2. The council is a group of labor and business leaders who advise legislators and the Department of Workforce Development on unemployment compensation policies.

DWD Executive Assistant Georgia Maxwell issued a statement Tuesday saying the agency would encourage the council to look at the changes. The council's chairwoman, Janell Knutson, didn't immediately return phone and email messages late Tuesday afternoon.

A spokeswoman for Assembly Minority Leader Peter Barca, D-Kenosha, referred questions to Rep. Christine Sinicki, D-Milwaukee, who sits on the labor committee. Sinicki issued a statement saying she believes using the council assures the best outcome. She didn't offer any evaluation of the Republicans' proposals beyond saying the Legislature's powerful finance committee should decide whether to use taxpayer money to offset debt as the panel contemplates the upcoming state budget.

Wisconsin ran out of money to meet skyrocketing demand for unemployment benefits during the recession and began borrowing from the federal government in 2009. Thirty-one other states were forced to do the same thing after their unemployment money ran out.

The Republicans wrote in a cover letter to the council that at one point the state owed the federal government nearly $1.5 billion. Knodl said the debt currently stands at around $875 million.

The plan would link the length of unemployment benefit payouts to the state's unemployment rate. If the state's overall unemployment rate hits or surpasses 8 percent, the unemployed would be eligible for up to the current maximum 26 weeks of state benefits. The length of eligibility would drop two weeks for roughly every half-percent rate drop. For example, if the state's rate falls somewhere between 7.5 percent and 7.99 percent, applicants would be eligible for up to 24 weeks. If the rate falls to between 7 percent and 7.49 percent, applicants would be eligible for up to 22 weeks.

The changes call for using $26 million in tax dollars to pay off the remaining interest the state owes the federal government. State businesses are currently covering the interest through special assessments.

The package also would repeal a program that lays out 26 additional weeks of state benefits for claimants who have exhausted the regular benefits but are enrolled in approved training. The Republicans said federal stimulus dollars that funded the program have stopped, shifting the costs to the state.

Other provisions include:

—Barring prisoners on work-release from collecting unemployment benefits.

—Performing random state audits of benefit recipients' job search claims, just as the federal government does.

—Prohibiting people from claiming state and federal legal holidays as days they're available for work if their employer is closed that day.