Virginia Republicans look to end enhanced unemployment benefits, increase funding to prevent payroll tax hike

RICHMOND, Va. (WRIC) — In a long-shot effort to amend a multi-billion dollar spending package crafted by Democratic leaders, Republicans in the Virginia General Assembly are trying to end enhanced unemployment benefits early. 

When Congress passed the American Rescue Plan Act (ARPA), they extended the $300 boost to state unemployment benefits through Sept. 6. 

However, several Republican governors across the country have decided to cut them off early as many businesses struggle to hire back workers. Now, some members of the Virginia GOP are trying to do the same. 

It’s one of the dozens of amendments that were introduced on Tuesday during a special session partially dedicated to the spending of $4.3 billion in federal coronavirus relief funding.

”Before we had a pandemic problem with restaurants and hotels. Now, we have a government problem. The government is keeping people away from jobs,” said Sen. Steve Newman (R-Lynchburg). 

With Democrats in control of both chambers, the pitch faces an uphill battle. 

In a previous interview, Gov. Ralph Northam pledged that Virginians on unemployment could count on the $300 enhancement through the deadline set by Congress. 

“There are individuals in Virginia that are having difficulty finding employment and, until they do that, federal help is something that will help them pay their bills. So we don’t have any plans of eliminating that in Virginia,” Northam said back in June.

Del. Marcia Price (D-Newport News) agrees with that approach. Asked about this on Tuesday, she said, “The people I’m talking to in the 95th District absolutely want to work. They just don’t want to go back into dangerous work conditions.” 

Price is among the lawmakers who backed a proposal from advocates to use ARPA funding to give bonuses to those experiencing long wait times for unemployment benefits in more complex cases. That does not appear to be included in the current spending plan that advanced out of committee on Monday, based on a budget briefing given to legislators.

In a press conference last month, Price also criticized a proposal backed by Northam and other Democratic leaders to replenish the Unemployment Trust Fund. 

Supporters of the plan say the investment is needed to avoid a massive payroll tax hike on struggling businesses. 

“If we are up for amendments in order to increase the amount we are giving to small businesses, then I would hope we would also be available for a conversation to see what it is that we are doing to help the workers that have paid into that and still have not gotten the assistance they are eligible for because of a dysfunctional system,” Price said. 

Meanwhile, an additional amendment from Republican Sen. Ryan McDougle (R-Hanover) seeks to increase the investment going into the Unemployment Trust Fund as the National Federation of Independent Business fears the initial amount proposed by Democrats won’t be enough to completely eliminate a tax increase. 

McDougle’s proposal would increase the contribution from $862 million to $1.3 billion. 

That amendment and dozens of others will be taken up by the Senate on Wednesday. 

On Tuesday, that proposal was included in a package of proposed changes introduced by House Republicans that was rejected by Democrats. That package also would’ve made school construction funding more flexible, restricted the teaching of critical race theory and provided $5,000 bonuses for all law enforcement and correctional officers, among other things.