04/21/2008 GAAS:193:08 FOR IMMEDIATE RELEASE Print Version | Email / Share
Gov. Schwarzenegger Urges Congressional Leaders to Extend Unemployment Insurance Benefits
Governor Arnold Schwarzenegger today sent a letter to key
Congressional leaders urging them to enact a federally-funded emergency
extension of unemployment insurance benefits for people who have lost their
jobs in the economic downturn. The Governor also requested additional funding
for administration of the unemployment insurance program to address several
years of significant federal funding cuts.
The Governor has taken a number of actions to stimulate
various jobs sectors, provide extra assistance to unemployed individuals and protect
California's economy this year, including:
Construction:
- Announced $10.5 million to train workers displaced by the housing slump
Housing/Mortgages:
- Awarded $73 million for affordable housing projects in Proposition 1C and Proposition 46 funds to help more than 1,600 California families rent or purchase affordable housing
- Announced $69.5 million in permanent low-interest loans from the Proposition 1C housing bonds to jumpstart 14 affordable multi-family projects up and down the state, helping more than 1,000 California families and individuals realize the dream of an affordable rental home
- Led efforts urging Congress and the Bush Administration to raise federal loan mortgage limits. Last fall, the Governor sent a letter calling on Congress to increase those limits and sent a similar letter earlier this year. After Congress and the President approved a temporary increase, the Governor asked them to make the increase permanent. In February, the Governor met with U.S. Department of Housing and Urban Development Secretary Alphonso Jackson in Washington D.C. to reiterate the importance of a permanent loan limit increase.
- Announced an agreement with major loan servicers to streamline the loan modification process for subprime borrowers living in their homes
- Awarded $5.6 million to help displaced mortgage and banking workers find new jobs
Ports/Transit:
- Announced $394 million in Proposition 1B bond funding for 106 transit projects statewide
- Announced $40 million for port security from Proposition 1B bond funding
Veterans:
- Awarded more than $6 million in grants to help more than 1,500 newly discharged veterans as they return to the civilian workforce
Overall:
- On Friday, the Governor's Labor and Workforce Development Agency announced that $2.5 million in job training grants will be directed to regions of California that have been hardest hit by the economic downturn.
Text of the letter to Congressional leaders follows:
April 21, 2008
The Honorable Harry Reid The
Honorable Nancy Pelosi
Majority Leader Speaker
of the House
United States
Senate U. S.
House of Representatives
Washington, DC 20510 Washington, DC 20515
The Honorable Mitch McConnell The Honorable John A. Boehner
Minority Leader Minority
Leader
United States
Senate U. S.
House of Representatives
Washington, DC 20510 Washington, DC 20515
Dear Senator Reid, Senator McConnell, Madam Speaker, and Mr.
Boehner,
I am asking for your leadership in enacting an emergency
extension of unemployment insurance (UI) benefits for people who have lost their
jobs in the economic downturn, as well as in securing additional funding for
the administration of the UI program.
California
has been hit especially hard by the national housing slump and subprime crisis.
In the past year alone, we have lost
131,000 jobs in the construction and financial services sectors. California's
unemployment rate now stands at 6.2 percent, and it is clear that states cannot
fully address the consequences of the national housing downturn on their
own. It is critical that Congress enact
an extension of unemployment benefits as soon as possible to mitigate the
impact of the downturn and fully fund administrative expenses.
For the 12-month period ending March 2008, more than 444,000
unemployed workers had exhausted their regular UI benefits in California. Our state's benefits exhaustion rate is 45
percent, compared to the national rate of 35 percent. Nationwide, the percentage of UI
beneficiaries exhausting their benefits is already higher than at the beginning
of the 2001 and 1990-91 recessions.
There is widespread agreement among economists that
extending UI benefits is one of the most effective ways to stimulate a
distressed economy. The money will go
into the hands of unemployed workers, who will spend it immediately to meet
pressing needs. If legislation extending
UI benefits by 13 weeks were enacted today, those payments would infuse
approximately $1.7 billion into California's
economy.
While unemployment claims have soared, funding for
administration of the UI program is at historic lows and no longer adequately
supports the cost of program operations, including collecting taxes, paying
benefits and adjudicating claims.
Workers, employers and states bear the burden of this federal funding
shortfall through reduced access to services, higher taxes and delays in
processing claims.
Federal funding for unemployment insurance administration
has not been adjusted for inflation since 1995.
For the last three years alone, the federal funding shortfall to states
is approaching $1 billion. For fiscal year
2008, the national UI administrative funding appropriation has been reduced by
an estimated $110 million. Roughly $30
million would have come to serve unemployed workers in California.
I am committed to working with Congress to ensure that
unemployed workers receive assistance in a timely manner and for a sufficient
period as reflected by the national and local employment picture. Thank you in advance for your leadership, and
please let us know how we can be of assistance.
Sincerely,
Arnold Schwarzenegger
cc: The Honorable
Robert C. Byrd
The Honorable
Thad Cochran
The Honorable
David R. Obey
The Honorable
Jerry Lewis
Members
of the California
Congressional Delegation
