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VOL. 128 | NO. 129 | Wednesday, July 3, 2013

Cut in Dependent Allowances for Unemployed Delayed

LUCAS L. JOHNSON II | Associated Press

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NASHVILLE (AP) – Tennesseans facing a cut in their unemployment benefits are getting a reprieve – thanks to the federal government.

The elimination of dependent allowances of up to $50 a week was supposed to take effect July 1 with the enactment of the state law.

Jeff Hentschel, a spokesman for the state Department of Labor and Workforce Development, told The Tennessean the cuts did not take effect because federal officials warned the action could cause a loss of federal funding for other benefits.

Hentschel did not immediately return a call to The Associated Press on Tuesday.

The legislation's main sponsor, Sen. Jack Johnson, said his office is talking with state officials to get details about why there's a delay in implementing the reduction because he thought the measure had federal clearance.

"Obviously as the sponsor of the bill I want to get an answer to where the breakdown was," said the Franklin Republican.

Hentschel told the newspaper federal officials initially told the state the benefits could be eliminated, but reversed that decision last week and warned the cut could jeopardize other federally-funded benefits.

"The department is seeking guidance from the U.S. Department of Labor regarding the removal of dependent benefits," Hentschel said in an email to the newspaper. "The benefits will stay in place until a decision has been made."

Under the program, those collecting unemployment can receive an additional $15 per child up to a $50 maximum each week.

According to the department's projections, ending the allowance in the budget year that began July 1 would save the state $40 million per year.

Lawmakers created the child allowance in 2009 in order to qualify for a nearly $142 million federal stimulus grant. Now that that money had been spent, the Republican-controlled Legislature earlier this year passed a bill to end the program. It was approved 66-23 in the House and 24-5 in the Senate.

Johnson acknowledged there's also the possibility of violating the law since the governor signed it and it was technically enacted on July 1, but there's now been a delay.

"If in fact we are not in compliance with the federal guidelines, and that puts our federal dollars in jeopardy, then the next step would be to see what can we do administratively to ... not enforce the implementation until we can get back in January and fix it," he said.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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