THE VIRGINIAN-PILOT
Copyright (c) 1997, Landmark Communications, Inc.
DATE: Monday, January 27, 1997 TAG: 9701250027
SECTION: FRONT PAGE: A10 EDITION: FINAL
TYPE: Editorial
LENGTH: 47 lines
Imagine a bank that specializes in loans to millionaires. If you qualify, you don't need the money. If you need the money, you don't qualify.
In a sense, that's the operating principle behind the fund that supports Virginians when they lose their jobs.
Certainly, many low-income wage-earners get unemployment benefits when they're laid off. But compared to other states, Virginia aims at helping only the unemployed who are best-equipped to help themselves.
The amount of money a Virginian has to earn before he or she can qualify for unemployment benefits is higher than in any other state. Not surprisingly, given that threshold, the percentage of unemployed workers getting help from the unemployment trust fund is the lowest of the 50 states.
Specifically, Virginians must earn at least $3,250 during a two-quarter base period in order to qualify for benefits. That may not be much, but in the next most stringent state, Maine, the threshold is $300 lower. And the national median of $1,580 is a full $1,670 less.
One result is that in 1995 only 18.8 percent of unemployed Virginians were getting trust fund compensation. The national average among states was 34.7 percent. In Maryland it was 32.6 percent and in North Carolina, 30.1 percent.
The discrepancy has come to light because of efforts to roll back the business tax that supports the trust fund. There's a surplus of some $900 million in the fund, and Gov. George F. Allen wants to revise the formula to give business owners a tax break. He claims they are now overpaying.
This seems like a great idea - until you consider that one reason the fund is doing so well is the state's relative stinginess in decreeing who can get help. The matter takes on an added dimension due to another Allen initiative, welfare reform.
Under the current setup, many part-time, minimum-wage earners would not qualify for benefits if their jobs were terminated. And yet, many of those moving off of welfare and into employment in the next few years almost certainly will fall into that low-wage, part-time category.
Virginia should be doing everything it can to help them succeed.
A bill introduced by Sen. Yvonne Miller, D-Norfolk, with backing from groups including the Catholic Diocese of Richmond and the Virginia Poverty Law Center, would lower the earnings threshold to the national median.
Before providing a tax cut that was actively sought by few businesses, lawmakers should first ensure that Virginia workers who find themselves unemployed are being treated on a par with those in other states.