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Budget committee advances Republican bill to upgrade unemployment insurance system
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LEGISLATURE | UNEMPLOYMENT SYSTEM

Budget committee advances Republican bill to upgrade unemployment insurance system

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The Legislature’s Republican-controlled budget committee unanimously advanced a GOP bill on Wednesday that would begin to overhaul the state’s outdated unemployment insurance system, scrapping a plan put forward by Gov. Tony Evers.

The state Senate is poised to vote on the bill in special session Thursday.

The bill, introduced a day after Evers introduced his two-year budget bill, would require the state Department of Workforce Development to begin the process of updating the technology system used for processing unemployment claims that has been in use since the 1970s.

The committee advanced the legislation 15-0, with one absence.

In the budget proposal Evers introduced Tuesday, he included $79 million in spending to upgrade the system.

Evers’ administration has been under fire for almost a year due to the severe backlog of claims caused by skyrocketing unemployment during the COVID-19 pandemic. Evers announced his own plan to provide more than $5.3 million to immediately begin modernizing the unemployment system rather than waiting for additional spending approval in the upcoming 2021-23 budget, which likely won’t be passed until the summer.

Evers called lawmakers into special session to take up his plan.

But Republicans on the budget committee are scrapping that plan and instead preparing to pass their own, which would still need to be approved by the Republican-controlled Assembly and Senate, as well as Evers.

The plan by Republicans, which doesn’t provide any funding, would require the DWD to solicit bids within a month from contractors to upgrade the system, and would further require the upgrade project to commence by June 30, which could be extended by the GOP-controlled Joint Committee on Finance.

The bill would allow the DWD to eventually request funding for the project from the budget committee, but it would first require DWD to seek and exhaust any federal funding available for the project. It would also allow for DWD to finance the project through a master lease.

The bill includes a number of other provisions, including waiving the state’s one-week waiting period for unemployment benefits until March 14. The waiting period had been waived until Feb. 7.

Legal protection

The bill introduced Wednesday would also provide for unrelated business liability protections from lawsuits related to exposure to COVID-19 while on the grounds of the business, something that was included in a Republican COVID-19 response package that Evers vetoed. Evers had voiced support for that provision, but objected to other measures included in the COVID-19 bill.

Evers’ office did not respond to a request for comment on whether he supports the unemployment bill.

During testimony on the bill, DWD Secretary-designee Amy Pechacek called the timeline provided under the bill “aggressive,” and raised concerns the department would struggle to fund a request for bids to get the project going.

Republicans, however, underscored that the true cost of the project won’t be known until estimates are provided through the request for bids.

Waiting waiver?

Also on Wednesday, DWD announced it had taken the first step to create an emergency rule to allow the department to waive the one-week waiting requirement.

DWD issued a scope statement to the Legislature, which, if approved would allow the department to begin drafting a rule. However, DWD said the earliest a new rule could take effect is March 5.

Earlier this month, Evers vetoed GOP-authored COVID-19 relief legislation that included a measure to temporarily extend the waiting period waiver that was enacted back in April.

With the waiting period back in place, the state looks to miss out on more than $1 million in federal reimbursement funding for each week the requirement is in place — for a total of $6.5 million over five weeks, according to the nonpartisan Legislative Fiscal Bureau.

DWD already has taken steps to continue waiving the state’s requirement that unemployment recipients search for other employment while receiving benefits.

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