- Division of Unemployment InsuranceDivision of Unemployment Insurance
How will the Federal Stimulus package (American Recovery and Reinvestment Act of 2009 or ARRA) affect New Jersey’s Unemployment Insurance system?
- There will be an increase in the weekly unemployment insurance benefit amount of $25.00 for almost all unemployment insurance claimants. The first checks will be going out on March 9, 2009.
- ARRA continues the additional weeks of Extended Unemployment Compensation (EUC) benefits through 2009, thereby providing some claimants with up to 59 weeks of Unemployment Compensation benefits.
- If the state’s Extended Benefit program (EB) is triggered by continuing high unemployment levels, EB could provide a maximum of 13 additional weeks beyond EUC, for a maximum of 72 weeks of Unemployment Compensation benefits. The EB program will be 100% federally-funded rather than the traditional allocation of 50% state and 50% federal funding. LWD estimates that the amount of EB payments to be made for the period covered under the Stimulus bill is approximately $996 million. As a result of the temporary suspension of the 50% contribution required by the state, New Jersey’s savings is approximately $498 million.
- The stimulus package extends the end date for the Emergency Unemployment Compensation program from March 31, 2009 to December 31, 2009 and it ensures 100% federal funding for EUC for claim weeks beginning before January 1, 2010, placing less of a fiscal strain on New Jersey’s taxpayers.
- New Jersey’s potential share of the $7 billion Unemployment Insurance Modernization Act provisions in the stimulus package is expected to be around $207 million. These funds will help minimize required increases in employer unemployment compensation taxes, saving New Jersey businesses millions of dollars.
- Should a state require a federal loan advance prior to December 31, 2010 in order to pay unemployment benefits, the stimulus package waives the traditional interest payments on the loan. This will save New Jersey taxpayers approximately $37 million dollars in interest payments.
- Under the stimulus package, up to the first $2,400 of unemployment compensation benefits received during 2009 is free of federal income tax liability.
How will the Department employ the expected $14.8 million in administrative funds for Unemployment Insurance?
- The Department will hire and train additional part-time staff to handle the anticipated increase of cases caused by the economic crisis facing the nation. These workers will help take claims, adjudicate issues and handle claims adjustments for New Jerseyans in need of assistance.
- The funds will help cover printing and mailing costs for specific notifications to claimants affected by changes and for printing and mailing the weekly $25.00 supplemental checks.
- The funds will help in upgrading information technology services to provide better service to New Jersey residents through mainframe programming modifications, testing, and implementation.
- Division of Workforce DevelopmentDivision of Workforce Development
How will the Federal Stimulus package affect New Jersey’s Workforce Development system?
- Workforce Development will receive funds through the Workforce Investment Act (WIA) program for services to dislocated workers, older workers, disadvantaged youth and adults, and workers affected by international trade.
- The WIA program for Dislocated Workers will receive $32.7 million to provide increased training and employment opportunities through the state’s One-Stop Career Center network. These dollars will be distributed to local Workforce Investment Boards according to a federal formula. These funds will also be used to assist New Jersey’s Rapid Response Team to provide services to workers who are facing a plant closing or major layoff. The Rapid Response Team works to provide on-site services to workers prior to actual layoffs. Services include reemployment assistance, initial filing for unemployment insurance, and an overview of retraining and other programs available through the State One-Stop Career Center system.
- The WIA program for Disadvantaged Adults will receive $9.4 million to provide increased training and employment opportunities through the state’s One-Stop Career Center network. These dollars will be distributed to local Workforce Investment Boards according to a federal formula.
- The WIA program for Disadvantaged Youth will receive $20.8 million to provide increased training and employment opportunities through the state’s One-Stop Career Center network. These dollars will be distributed to local Workforce Investment Boards according to a federal formula. These dollars will also be used to provide summer job programs for youth.
- For the first time ever, the Trade Act program will be expanded to permit an expansive set of services including training and partial health insurance coverage for service-producing workers who have been impacted by international trade. Prior to the ARRA, these services were only available to goods producing-workers who had been impacted by international trade.
- The Work Opportunity Tax Credit program (WOTC) is expanded by the federal stimulus package to serve recently discharged veterans and at-risk youth. No additional funding is given to this program, but LWD will market these tax credits to employers in order to increase employment opportunities for veterans and youth.
- Division of Workforce Development TimelineDivision of Workforce Development Timeline
- Funds from the Federal Government are expected by mid-March 2009
- The ARRA requires that the funding must be spent by June 30, 2011. Federal guidance from the U.S. Department of Labor requires 80% of funds to be obligated by June 30, 2009. As required by the U.S. Department of Labor, New Jersey will submit a State Plan for the use of these ARRA funds to ensure the quickest and most effective use of these funds.
- Distribution of dollars from State to local areas should be accomplished by mid-April. Program operations for WIA Adult and Dislocated Workers may begin immediately.
- WIA Youth services, if they are tied to a summer program, can begin around mid-May and conclude by Labor Day, 2009. Non-summer specific programs (year-round) may begin immediately.
- Division of Vocational and Rehabilitation Services (DVRS)Division of Vocational and Rehabilitation Services (DVRS)
How much money will DVRS receive from the Federal Stimulus package?
- Overall, New Jersey will receive $9.45 million over a two-year period to fund Vocational Rehabilitation programs. The Commission for the Blind and Visually Impaired (CBVI) will receive 20% of the funding and DVRS will receive the remainder of approximately $7.56 million or an estimated $3.75 million per year. Due to the expected date that the Federal Government will release the funds, the earliest possible start date for programs is anticipated to be April 2009. Funding must be expended by December 31, 2010.
How does DVRS propose to use these funds?
- DVRS will use $561,000 to fund eight Disability Program Navigators (DPN) for the One-Stop Career Centers. The DPNs help individuals with disabilities to make better use of services and programs available at the One-Stop Career Centers with the goal of full employment.
- DVRS will use $1.4 million to continue funding for the DVRS worker cooperatives. There are currently 7 worker cooperative development grants throughout the state. This is a response to some demand by individuals with disabilities to become entrepreneurs by owning their own businesses. The worker cooperative model allows individuals to work in groups under the direction of a host agency to incubate the venture. Under the model, the participants are owners/employees of the venture under the guidance of an experienced agent. Decisions are to be made democratically by the owners/employees. By participating in all aspects of the business, individuals experience the range of responsibilities and functions in business ownership.
- The 7 existing worker cooperative programs are in Bergen (2), Essex, Mercer, Monmouth, Middlesex and Gloucester counties. Businesses include video production, food service, baking, printing, landscaping, and a commercial laundry facility.
- DVRS will use $1 million to create an aggressive on-the-job training program that will create new jobs that will train individuals with disabilities in the workforce.