Preserve a Vital Safety Net for Laid-Off Workers and Promote Economic Growth: Support H.R. 4213, The Promoting American Jobs and Closing Tax Loopholes Act of 2010

Recipient: U.S. Senate

Dear Senator,

On behalf of The Leadership Conference on Civil and Human Rights, a coalition charged by its diverse membership of more than 200 national organizations to promote and protect the rights of all persons in the United States, we urge you to support H.R. 4213, The Promoting American Jobs and Closing Tax Loopholes Act of 2010, with provisions to extend unemployment insurance and COBRA benefits through the end of the year, Temporary Assistance for Needy Families (TANF) emergency funding, and funding for the Federal Medical Assistance Percentage (FMAP). The version of the bill passed by the House last month did not include all of these provisions, which provide essential services for the most vulnerable Americans while also boosting the economy and creating jobs.

Extension of Unemployment Insurance and COBRA Benefits

The bill would continue the jobless aid provisions of the American Recovery and Reinvestment Act (ARRA) through the end of the year. The current extensions of these provisions expired June 2, 2010 for the unemployment programs and May 31, 2010 for COBRA.

Extending unemployment benefits will help the economy recover while providing badly needed assistance in today’s historic economic crisis. As recently documented by the Congressional Budget Office, the extension of jobless aid also provides the most significant boost to the economy and job growth of any policy option being debated by Congress, and has been responsible for creating or preserving 800,000 jobs this year alone. In addition to providing an urgent safety net for laid-off workers, the extension of unemployment benefits has a positive ripple effect on the economy at large because the money is quickly recycled through the economy. The Congressional Budget Office estimates that each dollar spent on unemployment benefits generates $1.90 in economic stimulus.

The need for these benefits is great. In May, up to 46 percent of the unemployed had been out of work for more than 27 weeks. But these problems are not affecting all communities equally; there are dramatic disparities by race, age, and single-parent households. As documented by the Bureau of Labor Statistics, while overall unemployment in May was unacceptably high at 9.7 percent, among African Americans the jobless rate was a staggering 15.5 percent, among Latinos 12.4 percent, among households headed by a single mother 11.6 percent, and among youth 26.4 percent.

TANF Emergency Fund

The Temporary Assistance for Needy Families (TANF) Emergency Fund, first funded in ARRA, provides funds to states to support a range of subsidized jobs for low-income families. The 35 states that are utilizing the program have plans to provide about 185,000 jobs by September 30, 2010, the current program deadline. Nearly all of these jobs will be eliminated if the program is not extended with additional funds.

Federal Medical Assistance Percentage

Finally, we urge you to restore provisions for much-needed aid to state governments through the Medicaid program (Federal Medical Assistance Percentage (“FMAP”)). Like unemployment insurance/COBRA and the TANF Emergency Fund, FMAP is temporary, emergency spending for job creation and combating the recession. FMAP received $87 billion in ARRA funding and is set to expire December 31, 2010. This infusion of federal funding is providing much-needed relief to states in order to meet the elevated demand for Medicaid services. More than 20 states are counting on receiving the additional Medicaid funds in their budgets. Failure to add funding for FMAP could force states to make severe cuts in services to beneficiaries and in payments to Medicaid providers or, if Medicaid is spared, to cut deeply into other state services. The Center on Budget and Policy Priorities estimated that without an extension of state fiscal relief, state spending cuts could mean job losses of up to 900,000 in both the public and private sectors nationwide.

We urge you to support the bill. These temporary, emergency spending provisions aimed at alleviating hardships for those most vulnerable, will foster job creation and economic growth. If you have any questions, please contact Corrine Yu, Senior Counsel, at 202-466-5670, or Nancy Zirkin at 202-263-2880.

Sincerely,

Wade Henderson
President & CEO

Nancy Zirkin
Executive Vice President