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Missouri ‘overpayment forgiveness’ bill hits snag in Senate

Missouri State Capitol-112918
Missouri State Capitol building in Jefferson City Missouri (iStock photo)

Missouri ‘overpayment forgiveness’ bill hits snag in Senate

May 05, 12:00 PM May 05, 12:00 PM

Missouri overpaid about 46,000 people more than $150 million in federal and state unemployment benefits in 2020 and the state’s Department of Labor and Industrial Relations (DLIR), supported by Gov. Mike Parson, wanted to force recipients to return those excess payments.

But lawmakers balked and several “overpayment forgiveness” bills were filed during the 2021 session, including House Bill 1083, sponsored by Rep. John Eggleston, R-Maysville, which would prohibit the DLIR from recovering federal unemployment “benefits that were incorrectly but non-fraudulently distributed to claimants.”

Under the measure, those who received overpayments in state unemployment benefits would be required to pay the money back to the state.

HB 1083 was adopted by the House on March 4 in a 157-3 vote and appeared to enjoy similar bipartisan backing in the Senate, where there was mounting support for extending forgiveness to include overpayments in state unemployment benefits.

But a six-page amendment filed by Rep. Don Shaul, R-Imperial, that would revise how long people can collect unemployment has thrown a wrench in the measure’s momentum.

The Senate Monday tabled HB 1083 over the amendment’s proposed sliding scale for eligibility based on the state’s unemployment rate.

Under Shaul’s amendment, the state’s current 20-week eligibility span would be in effect when the unemployment rate is 9% or higher and be trimmed back to 12 weeks when the unemployment rate is at or below 5.5%.

“You took really what I would consider an easy bill and you injected a really contentious topic into there,” said Senate Minority Leader Sen. John Rizzo, D-Kansas City, who submitted a failed amendment to remove the sliding scale amendment and return HB 1083 to its original form,

Sen. Lauren Arthur, D-Kansas City, questioned why proponents want to tinker with the state’s unemployment system as Missouri emerges from the pandemic and said the sliding scale doesn’t account for differing unemployment rates in different areas of the state.

In “areas that are struggling to find work, it doesn’t matter” what the statewide unemployment rate is, she said.

Sen. Lincoln Hough, R-Springfield, agreed, calling on fellow senators not to “sidetrack something that can be impactful and actually do some good for a lot of people in the state” because of concerns over the proposed revision in the state’s unemployment system.

Sen. Bill Eigel, R-Weldon Spring, was among proponents of the sliding scale who argued Missouri employers are struggling to find workers because unemployment payments boosted by the federal pandemic unemployment assistance (PUA) have disincentivized some from seeking work.

“I don’t know of a small business owner that is not looking for more help right now,” Eigel said.

After initially resisting overpayment amnesty, the DLIR and Parson now support the proposed bill, although that was when HB 1083 and other similar measures only extended the forgiveness to federal PUA overpayments.

Those measures include a resolution, HCR 30, filed by Rep. Peter Merideth, D-St. Louis, that says Missourians who didn’t commit fraud should not have to repay money, because the state made the error.

During an April 13 hearing on HB 1035, filed by Rep. Doug Clemens, D-St. Ann – eventually substituted by HB 1083 – DLIR Director Anna Hui said Missouri paid out $236 million in unemployment benefits in 2019.

That number increased more than 20 times to $5.1 billion in 2020 because of the pandemic, including about $150 million in over-payments to about 46,000 Missourians, she said.

Hui said reimbursement for unemployment payments is standard procedure and that the LDIR will work with those who received overpayments on repayment plans.

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