Labor and Public Employees Committee

JOINT FAVORABLE REPORT

Bill No.:

SB-258

Title:

AN ACT CONCERNING AN INCREASE IN THE MAXIMUM ALLOWABLE UNEMPLOYMENT COMPENSATION TRUST FUND BALANCE.

Vote Date:

3/15/2012

Vote Action:

Joint Favorable Substitute

PH Date:

3/8/2012

File No.:

155

SPONSORS OF BILL:

Labor and Public Employees Committee

REASONS FOR BILL:

This bill will help the Unemployment Compensation Trust Fund remain solvent during future economic downturns by increasing the amount of money that can be retained in the fund.

SUBSTITUTE LANGUAGE:

Removes “greater than or” on line 26 of the original bill.

RESPONSE FROM ADMINISTRATION/AGENCY:

Glenn Marshall, Commissioner, Department of Labor:

The Department of Labor fully supports this bill as a measure to keep the Unemployment Compensation Trust Fund solvent. This fund is used solely to pay unemployment benefits and can be quickly depleted during recessionary periods, causing employers to incur additional costs from borrowing funds to continue paying benefits. This bill will increase the amount of money that can be held in the fund, allowing it to remain solvent during times of economic downturn. It will also allow Connecticut to meet the criteria needed to borrow unemployment money without having to pay interest.

NATURE AND SOURCES OF SUPPORT:

Marshall Collins:

Marshall Collins supports this bill as a “painful and necessary” solution to restoring solvency to Connecticut's Unemployment Compensation Trust Fund. Marshall asks that SB 258 be amended to make changes to the Unemployment Fund's expenditures and not just its revenues.

Andy Markowski, Connecticut State Director, NFIB:

NFIB supports SB 258, but believes that significant changes need to be made to the eligibility and administrations of Connecticut's unemployment benefits system in order to maintain long-term solvency and to ensure the fiscal health of businesses in the state.

Matthew M. Santacroce, Connecticut Voices for Children:

Connecticut Voices for Children supports this bill as it will bring the state trust funds to a level that is recommended by federal labor officials. They also express concern that Connecticut's taxable wage base for Unemployment Insurance taxes has been capped at $15,000 since 1999, and feel that this cap should be raised.

Robin Wilson, President & CEO, Quinnipiac Chamber of Commerce:

Robin Wilson spoke in favor of this bill, but requested some amendments. Robin believes that Connecticut must tighten up the Unemployment System's eligibility standards and work search verification requirements. Robin also asked that Connecticut address issues regarding the eligibility of individuals who are terminated due to absenteeism or violation of drug and alcohol policies.

MetroHartford Alliance:

The MetroHartford Alliance supports increasing the Maximum Allowable Unemployment Compensation Trust Fund Balance, but requests that the bill be amended to make changes to the administration system and eligibility criteria. They also believe the bill must include lockbox safeguards to ensure that money in the trust fund is not used for any other state expenditure.

Connecticut Restaurant Association:

The Association supports this bill as a necessary change to better furnish the Unemployment Trust Fund in order to aid in withstanding any future economic downturn.

NATURE AND SOURCES OF OPPOSITION:

None Submitted

Reported by: Dan Doyle

3/26/12