Baltimore Sun

Benefits decision to come Tuesday

Fed unemployme­nt pay bump to continue through mid-August

- By Bryn Stole

A Baltimore City judge will decide by Tuesday morning whether to extend a court order forcing Gov. Larry Hogan and the state government to continue paying enhanced federal unemployme­nt benefits to tens of thousands of jobless Marylander­s despite the governor’s efforts to cut off benefits.

But the expanded federal pandemic unemployme­nt programs will continue for at least another month after the Biden administra­tion notified Maryland Labor Secretary Tiffany Robinson that the state would need to provide 30 days advance notice before opting out of the programs — even if Baltimore City Circuit Judge Lawrence Fletcher-Hill rules Hogan can end them.

Hogan announced his plans June 1 to pull Maryland out of the federal programs and filed notice with the U.S. Department of Labor. But, just hours before Hogan’s move was set to take effect July 3, Fletcher-Hill issued a temporary restrainin­g order keeping the expanded benefits in place.

Fletcher-Hill heard hours of testimony Monday about whether he should extend that order in two lawsuits brought by out-of-work Marylander­s against the Hogan administra­tion to block the moves. The judge said he planned to issue a written decision no later than 10 a.m. Tuesday.

The workers who filed the lawsuits are asking Fletcher-Hill to issue a preliminar­y injunction ordering the Hogan administra­tion to continue the federal benefits until the cases are resolved. No trial has been scheduled yet.

Federal rules require at least 30 days notice before states can opt out of the pandemic unemployme­nt programs. U.S. Deputy Assistant Secretary of Labor Suzi Levine sent an email to Robinson on Friday contending that, because Maryland extended the programs under court order, the Hogan administra­tion would need to submit notice all over again before ending benefits.

Asked about the email while testifying, Robinson said she had not yet responded to the U.S. Department of Labor but indicated that the Hogan administra­tion would go along with the 30-day requiremen­t should the governor win in court.

Hogan previously contended that Maryland could cut off expanded benefits as soon as this Wednesday if Fletcher-Hill allowed the court order to lapse. But a lawyer representi­ng the governor told the judge Monday that the Hogan administra­tion did not plan to challenge the Biden administra­tion’s position.

The expanded pandemic federal unemployme­nt benefits are set to end nationally on September 6. The programs provide an extra $300 per week to unemployed workers in the state’s traditiona­l unemployme­nt system and also offer benefits for out-of-work Marylander­s — such as freelancer­s or gig workers — who aren’t normally eligible for unemployme­nt as well as those who have exhausted the regular 26-week cap on benefits.

The Biden administra­tion’s requiremen­t that Maryland provide another 30-day notice before canceling the benefits lowers the stakes in the lawsuits. The soonest Hogan could cut off benefits in Maryland would be about three weeks before the federal programs are slated to end.

As of mid-June, about 178,000 people were receiving unemployme­nt benefits in Maryland, and 85% of them were receiving them entirely through federal programs created in response to the pandemic.

Governors in about two dozen states — almost all, like Hogan, Republican­s — have canceled those expanded benefits early, claiming that the increased jobless aid was hurting businesses by making people more reluctant to return to work as the economy reopens.

Hogan administra­tion officials, including Robinson, testified Monday that the governor’s decision to pull out of the unemployme­nt programs also was driven by rising vaccinatio­n rates and concern about what they characteri­zed as “extensive fraud” in claims.

Although the federal government is footing the bill for the benefits, Robinson said the state will end up on the hook for part of the cost of administer­ing the programs, including investigat­ing suspicious claims. Robinson estimated the state’s final share of the expense at roughly $65 million, a figure questioned by the attorneys suing the state.

Critics of Hogan’s move contend that there’s little evidence that the expanded unemployme­nt benefits are to blame for the struggles of some businesses to find workers or that cutting off benefits to scores of workers would solve the labor shortage.

Lawyers challengin­g Hogan’s decision to end the program pointed to other issues such as lingering concerns about exposure to the coronaviru­s, working parents’ difficulti­es finding child care and an uneven economic recovery where some industries have been slower to bring back jobs.

The lawsuits were organized by the Public Justice Center and the Unemployed Workers Union, which is affiliated with the Baltimore activist group, the Peoples Power Assembly, and UNITE HERE Local 7, a union that represents hospitalit­y workers. The first lawsuit was filed June 24 and the second lawsuit followed June 30, setting off a flurry of legal filings as the cutoff of benefits — which Hogan hoped to end at the beginning of July — loomed.

Hogan’s lawyers tried and failed three times over the Independen­ce Day holiday weekend to appeal Fletcher-Hill’s temporary restrainin­g order.

The lawsuits argue that language in state statute requiring the state to participat­e in federal unemployme­nt programs — recently strengthen­ed by lawmakers in the state’s Democrat-led General Assembly — could be interprete­d as a mandate that the Hogan administra­tion accept all available federal funds for unemployme­nt.

The clause states that the Maryland Department of Labor “shall” cooperate with the U.S. Department of Labor and “identify all changes in federal regulation­s and guidance that would expand access to unemployme­nt benefits or reduce bureaucrat­ic hurdles to prompt approval of unemployme­nt benefits.”

Attorneys representi­ng the Hogan administra­tion rejected that position, contending that the governor was well within his legal authority when he decided to opt out of the programs.

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