House votes to waive federal unemployment overpayments, told Department of Labor will ‘call off the dogs’

      The Missouri House has voted to waive the biggest portion of unemployment overpayments that some 46,000 Missourians were being told to repay.  House members also heard that Governor Mike Parson (R) now supports the effort, and his Department of Labor will “pause” efforts to collect the federal portion of those overpayments while the legislation is moving.

      Legislators learned that many of the Missourians who applied for and received unemployment assistance last year were then told that the state erred in finding them eligible.  They were told they had to pay back the money, often months after it had already been spent on necessities.  Some Missourians owed more than $20,000.

      The bill that was passed on Thursday would waive the federal portion of those repayments, which amounts to roughly three quarters or more of what most owed.  The legislation was the product of a broad, bipartisan effort.

      “The amount that the folks will get to keep from the federal portion amounts to $668,000, on average, per House district.  So every one of our districts, on average, $668,000 will stay here in Missouri rather than going back to Washington, D.C., if we pass this,” said bill sponsor J. Eggleston (R-Maysville).

      Republic representative Jered Taylor (R) chaired the committee that held hearings with the Department of Labor about this issue.  He said waiving this portion is the right thing to do for Missourians who were and are struggling, and were encouraged to apply by the state and federal governments.

      “Now they’re being saddled with thousands of dollars of money that they have to repay when they don’t have the money.  They spent it.  We know that they spent it on important things – on food, on housing, on transportation, on clothing – to get through a difficult time when they didn’t have a job, and they still may not have a job and [the state has been] asking them to pay thousands of dollars back,” said Taylor.

      Democrats supported the bill, though some say Missouri should also waive repayment of state unemployment overpayments.  Republicans say to do that would jeopardize the integrity of the state’s unemployment trust, and lead to higher payments for the small businesses that pay into it – business which are also struggling due to the COVID crisis.

      St. Louis representative Ian Mackey (D) said some of those Missourians will be confused by hearing about this legislation and think they no longer owe anything.

      “Someone who got a bill for $5,000 from the state is going to see that we passed this legislation is going to take the letter and the bill they got from the state and tear it up and throw it away … and then a few weeks later they’re going to get a bill from the state for $800, and the same people who couldn’t afford the $5,000 bill are not going to be able to afford the $800  bill and the crisis is going to start all over again for them,” said Mackey.

      He and other Democrats say the state could use CARES Act money to waive the state’s share of these overpayments and keep small businesses from being impacted.  Shell Knob Republican Scott Cupps said he’d be good with that.

      “If this bill were to come back from the Senate with the state portion included and we were able to fund that with CARES Act funding, as opposed to it hurting the integrity of the unemployment fund system within the state, then that is something that I, personally, would be in favor of,” said Cupps.

      The House rejected an emergency clause – language that would make the bill effective immediately upon being signed by the governor.  Instead it would take effect August 28.  Eggleston said this was part of an effort that’s developed in the last few days to ensure the governor’s support.  He said the Department wants time for training and the creation of paperwork that would go into issuing up to 46,000 waivers.

       “Due to the work in the committee and due to our work the other day on the floor they have agreed to call off the dogs,” said Eggleston.

      He read from an email, “‘The Department of Labor is working to pause the collections processes as you requested,’ so this means that they will not be hassling folks for the federal portion.”

Eggleston continued, “For the 47,000 thousand folks in this the Department will not be hassling them from now until the end of August 28, including billing statements.  That’s the nasty letters folks were getting about, ‘We’re gonna be garnishing your wages and put a lien on your house.’  That’s stopping.”

      Taylor said he and Eggleston were skeptical, but he supports removing that emergency clause. 

      “This isn’t something that can be done overnight.  The concern is that if we do this quickly, if we do this as fast as what we’re asking that mistakes are going to be made and maybe people aren’t going to get the waiver that should deserve the waiver,” said Taylor.  “We want to make sure that the state isn’t going to mess up again, that these people aren’t going to be screwed another time by the state government, and we have been giving assurances in writing [and] in verbal communication.”

      Democrats maintained that the bill will be “pointless” without the emergency clause and most voted to keep it. 

      Cupps said since the House held hearings on the issue the Department has been working with him and other lawmakers, and the House’s actions Thursday are based on those discussions.

      “We just need to use this as an example to say, ‘The deal was made.  You better hold true to it.  If you don’t hold true to it, then I hesitate to say what we would do but I promise you, we’ll do something.’”

      The legislation was sent to the Senate with a vote of 157-3. 

Pronunciations:

Eggleston = (EGG-ull-stun)