SPRINGFIELD — The clock is ticking on Illinois officials to avoid a potential mid-May cutoff in federal unemployment benefits for 32,000 out-of-work Illinoisans.
On Tuesday, a Senate panel unanimously endorsed legislation that would keep payments flowing to Illinois and repay a small portion of the estimated $3 billion the state has borrowed from the federal government to keep up with the flood of recession-related claims.
The package must be approved by the Senate and House and signed into law by the governor by Thursday in order to avert a looming delay in payments.
In addition to affecting 32,000 Illinoisans receiving jobless benefits beginning in mid-May, the Illinois Department of Employment Security estimates it would affect 12,000 additional claimants each month after that.
Business and labor groups told the Senate panel the number of people initially affected by the looming deadline could be 41,000.
“For the unemployed worker, these benefits are absolutely a lifeline,” said Tim Drea, secretary-treasurer of the Illinois AFL-CIO.
David Vite of the Illinois Retail Merchants Association said the measure is a “temporary solution” that will have to be addressed again this fall through talks with labor groups.
“This is just the first step,” said state Sen. John Jones, R-Mount Vernon.
Illinois is among 35 states that have borrowed money from the federal government to pay unemployment benefits after claims outpaced the amount of money that businesses paid into the fund.
To help begin restoring the fund, the legislation would reduce the number of weeks certain unemployed workers can receive benefits from 26 to 25, while increasing the amount many businesses must pay into the fund. Those changes wouldn’t go into effect until 2012.
At the federal level, U.S. Sen. Dick Durbin is proposing legislation that would give states an extra two years to pay back the interest.
The measure now heads to the full Senate for further debate.
The legislation is House Bill 1310.
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