April-27-2020

With Budget Cuts Looking Furloughed Public Workers may get Federal help in NJ Plan

Below is an article written by Terrence T. McDonald and published by North Jersey Record on April 21, 2020.

Public workers in New Jersey who have their hours reduced for three months would get a federally funded pay increase under a bipartisan plan backed by Senate President Stephen Sweeney, a plan his office says could save state, county and local governments more than $750 million.

A spokesman for Sweeney, D-Gloucester, says the Employee Job-Sharing Furlough Protection Act would ease the strain on state, county and municipal budgets, put more money in the hands of workers and help public entities avoid layoffs by using federal stimulus money earmarked in the CARES Act for people whose jobs were lost or hours curtailed because of the coronavirus pandemic.

The measure has not been introduced yet and it’s not clear when the Senate plans to meet next. Sen. Steven V. Oroho, R-Sussex, and Sen. Nellie Pou, D-Passaic, intend to cosponsor.

“The more money we’re able to put in people’s pockets, the greater opportunity they’ll have to spend that money in many of our local communities,” Pou said. “It’s really trying to help everyone.”

With many businesses closed entirely because of virus fears and state-at-home directives, the unemployment picture in New Jersey and nationwide is grim. In the last four weeks, New Jersey received close to 716,000 unemployment claims, almost 1 1/2 times what the state received in all of 2019. In the United States, 22 million people have sought jobless benefits since President Trump declared a national emergency in March.

Just as nearly every business sector has seen losses, the coronavirus pandemic, which has affected over 18,800 New Jerseysans and claimed the lives of 4,377 in the Garden State, has upended tax revenue projections and forced public officials to rethink their financial plans for 2020 and beyond.

Gov. Phil Murphy has floated a plan to borrow up to $9 billion to close the state budget gap, while county and local officials have said they fear they may have to slash services, raise taxes and layoff workers to offset revenue losses.

“Let me just tell you what the alternative will be, particularly if we can’t borrow money,” Murphy said Saturday at his daily news briefing. “We will have layoffs that will be historic in the history of our state, at the state level, at the county level, and at the local level. That’s what’s at stake. I don’t know how many, but it is big, big numbers.”

Murphy declined to say Monday if he was aware of any plans for furloughs or layoffs.

Sweeney’s office estimates there are 400,000 full-time state, county, municipal and school district workers in New Jersey. If 100,000 of them are furloughed — their hours cut to two days a week for three months — the savings could top $750 million, while the federal stimulus would allow the furloughed workers would collect an additional $350 million total, according to their projections.

Here’s how it works: A worker paid $50,000 would normally receive $12,500 for a three-month period. Under Sweeney’s plan, the worker would receive $15,800. That includes $5,000 in furlough pay, $3,000 in state unemployment funds paid by the stimulus and an extra $7,800 in federal unemployment benefits. The CARES Act allows for a $600 per week unemployment bonus on top of state unemployment benefits.

Private companies and nonprofits would benefit, too, with the plan allowing them to tap into federal unemployment reimbursement that they wouldn’t otherwise be eligible for.

Under Sweeney’s plan, pensions, health benefits and seniority would not be affected by furloughs.

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