LANSING – A measure that would save businesses $35 million for interest owed by the state to the federal government for the advances on the Unemployment Insurance Trust Fund was passed unanimously in the House Thursday.
Michigan received a waiver from the federal government on the interest it owes for taking out $1.3 billion in loans to cover unemployment benefits in the state under the stimulus package. Implementing provisions of that, along with other privacy disclosure issues under federal statute, are provided in HB 4239 .
The bill in turn waives the interest the state would charge to companies known as “negative balance employers,” meaning the business’ former workers are drawing more unemployment benefits than the company has paid into the system. The move is estimated to save $35 million for companies across Michigan, according to the House Fiscal Agency.
Rep. Bob Constan (D-Dearborn Heights), sponsor of the bill, said the measure will provide much-needed relief to businesses. He called on the Senate to pass the measure quickly.
“At a time when businesses are trying to navigate the waters of a rough economy, this tax added an unnecessary burden on their bottom-line,” Governor Jennifer Granholm said in a statement. “I worked hard along with Michigan’s congressional leaders to lift this burden for businesses, and now we need to follow up by changing the law here in Michigan to protect our businesses.”
The legislation personal disclosure provisions also bring it in line with federal guidelines and without the changes the state could be in jeopardy of losing out on its federal unemployment funding, Constan said.
Under the bill personal information couldn’t be disclosed in most cases, except for if it was to an attorney representing a party involved, a lawmaker who was asked by a constituent for assistance or a college engaged in a public service initiative.
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