346,000 Californians to lose federal unemployment benefits before year's end unless Congress acts

6:41 PM, Dec 13, 2012   |    comments
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By Raju Chebium, Gannett Washington Bureau

WASHINGTON - More than 346,000 jobless Californians may get lumps of coal from Congress for Christmas -- their federal unemployment benefits are scheduled to end by the end of the year.

Unless Congress agrees to an extension -- which is looking unlikely -- 346,353 Californians who qualified for extended federal benefits won't receive them in 2013.

The checks will stop even if recipients haven't exhausted all 47 weeks of additional unemployment benefits that Uncle Sam was paying for, according to California Employment Development Department.

Agency spokesman Dan Stephens said Californians who file for unemployment next year will only for qualify for state benefits, which last for a maximum of 26 weeks.

"The checks will stop and they would have to be referred to other programs within the state," Stephens said.

In the past, Congress allowed people to receive checks for the duration of the extended benefits. This year, however, Congress has decided to cut off federal unemployment assistance even if recipients haven't exhausted all 47 weeks of the extension, said Maurice Emsellem, a policy analyst at the National Employment Law Project's Oakland office.

The average weekly unemployment benefit in California is $295.

The precise number of Californians who may be affected isn't entirely clear. Though the state's latest county-by-county tally puts the total at 346,353, Stephens said the number is closer to 400,000.

Unemployment cutoff:

The number of Californians by county who would lose their federal unemployment benefits if an extension is not approved by Congress:

  • Riverside: 23,165
  • Sacramento: 14,472
  • Tulare: 5,296
  • Monterey: 3,869
  • Los Angeles County had the biggest number of residents in jeopardy of losing their federal benefits: 85,351
  • Alpine County had the least: 11

Source: California Employment Development Department

California has more residents facing the unemployment-benefit cliff than any other state.

Nationwide, 2.1 million people are scheduled to lose federal jobless benefits, according to a recent report by Democrats on the House Ways and Means Committee.

Brian Baker, a 47-year-old electrician from the Palm Springs area who lost his $75,000-a-year job in July, is among those Californians in line to lose his benefits after Christmas.

Though paying the mortgage will be a little more difficult if he stops receiving his weekly check of $490 ($410 after taxes), the La Quinta resident isn't in danger of losing his house. That's because his wife also earns $75,000 and she still has her job.

"But what about the . . . people that don't have a spouse to rely on, that are using this money to either make their house payment or to (pay) the electrical bill or to buy groceries?" Baker said. "What's going to happen to these people?"

President Barack Obama and congressional Democrats are pushing for an extension, but Republicans haven't committed to it.

Obama's $1.6 billion proposal to avert the fiscal cliff -- the combination of automatic tax increases and spending cuts -- calls for an extension of unemployment assistance. The $800 billion counter-offer from House Speaker John Boehner, R-Ohio, doesn't address jobless benefits.

Obama and Boehner have until Dec. 31 to reach a deal that would prevent taxes from going up for most people and federal programs from being cut by about 9 percent early in the new year.

The nonpartisan Congressional Budget Office says repeated unemployment extensions in the past five years have cost $520 billion.

In fiscal year 2007, when the average unemployment rate was 4.5 percent, the federal government paid out $33 billion in jobless claims, CBO said.

In fiscal 2012, which ended on Sept. 30, Uncle Sam's cost was $94 billion as more people were thrown out of work and the average unemployment rate reached 8.3 percent.

Republican lawmakers balk at the cost of another extension and some critics have argued that extending unemployment checks may discourage people from looking for work.

Democrats argue that extending unemployment benefits is the responsible thing to do.

California's Dianne Feinstein and Barbara Boxer were among 42 Democratic senators who wrote to Senate leaders earlier this month to press for an extension beyond Dec. 29, which marks the end of the last full week in 2012.

"Unemployment insurance is one of our best economic stabilizers and generates tremendous bang for the buck relative to other economic policies," the senators said. "Given the potency and efficiency of unemployment insurance there should be no reason to let it lapse or expire."

Californians who may lose their extended federal benefits are often surprised when they receive notices from the state, said Joyce Aldrich, interim assistant director of the Monterey County Workforce Investment Board.

"What they're doing is walking in and saying, 'What is this about me losing my extension?'" she said Thursday. "They're frustrated at this point. So they're trying to reach out to find out what they can do."

About 2,600 Monterey County residents lost their jobs this year due to layoffs at big employers like Hostess and CapitalOne Bank, Aldrich said.

The prospect of losing federal jobless benefits is a double-whammy for residents who rely on unemployment checks to make mortgage or rent payments and to buy food, she said.

California welfare programs like CalFresh, which distributes food stamps to the needy, and CalWORKS, which provides cash and free services, will be stretched, Aldrich said.

People on the verge of losing their federal unemployment benefits need the state to step up its efforts to help them find work quickly, said Emsellem of the National Employment Law Project.

California already grapples with one of the highest rates of long-term unemployment, he said, adding that 37 percent of the state's jobless population hasn't worked for at least a year.

"These are folks who need real training and they need to connect to new jobs. It's not easy because these are fairly disconnected," Emsellem said. "So it takes a lot of effort to make sure that those people get the help that they need."

By Raju Chebium, rchebium@gannett.com

Gannett Washington Bureau

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