Jobless benefits could be cut

Ford home catches fire

State Sen. Robert Ford (far right) walks out of his fire-damaged house on Barrett Road in West Ashley on Sunday with his insurance representative, Gene Murray.

COLUMBIA -- South Carolina workers would lose at least six weeks of jobless benefits and the state would use surplus cash to shield employers from higher unemployment taxes under a plan the South Carolina Senate considered Wednesday.

Senate Finance Committee Chairman Hugh Leatherman pitched the proposal as the Senate worked on a $5.8 billion spending plan for the fiscal year that begins July 1.

Leatherman, R-Florence, opposes Gov. Nikki Haley's proposal to issue bonds to help cover part of the $972 million in federal loans that kept the state's jobless receiving benefits amid chronically high unemployment and the economic downturn.

"I'm not going to do that," Leatherman said. "I'm not going to be willing to borrow money to pay a debt. ... I've never known anybody who can borrow money and borrow themselves out of the debt. It just doesn't work."

Haley's chief of staff defended the proposal last week by saying it was no different than a homeowner refinancing a home. On Wednesday, Haley spokesman Rob Godfrey said the governor is still backing the plan to sell revenue bonds.

Leatherman said that wasn't needed because the state will generate about $110 million that can cover payments and ease the repayment for employers who have complained about their soaring tax rates needed to cover the loans.

Leatherman's proposals would cut annual, per-employee payments by $206 to $922.

But doing that also involves reducing the number of weeks unemployed workers are eligible to receive from 26 to 20. It's a move that also would affect how much a jobless worker can receive through federal extended benefits.

Cutting six weeks of state-funded benefits would bring a corresponding cut of 17 weeks from expanded federally funded aid to the jobless, meaning the governor's plan would reduce the total number of weeks of unemployment help from 99 to 76, according to state officials.

Michigan and Missouri have reduced benefits to 20 weeks too.

Leatherman said that was necessary to lower rates.

Sen. Brad Hutto, an Orangeburg Democrat, said the system's problems are tied to past breaks that employers got on the tax rate.

"It's a bailout. We the government are bailing out the businesses that didn't fund the account properly," Hutto said. "This is pure and simple a bailout of the businesses of South Carolina."

Senate Minority Leader John Land, a Manning Democrat, said he would go along with using the extra state cash as a break for employers this year, but in the future he would want surpluses to go toward other state needs, particularly education.

Last year, South Carolina legislators overhauled the state's jobless benefits system.

They rolled out a repayment plan that increased taxes for some employers by hundreds of dollars per worker in what amounted to one of the largest tax increases on businesses in memory.

Businesses with the worst records for firing and laying workers off were told to pay $1,128 a year for each worker on their payroll, an increase of about $660.

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