December 6, 2020

Fewer New Mexicans than estimated will qualify for one-time unemployment check

Debates among New Mexico lawmakers over the best way to use federal relief funds is likely far from over.

Last week, the state’s Legislative Finance Committee (LFC) learned that the estimated number of New Mexicans to receive a one time bump in their unemployment benefits will likely be anywhere from 20,000 to 50,000 fewer than expected. 

During the second special legislative session this year, which took place during the week of Thanksgiving, lawmakers passed a COVID-19 relief bill, allowing the state to use additional federal funds from the CARES Act. 

Part of the package that state lawmakers passed allocated $194 million to the state’s Department of Workforce Solutions in order to add a one time supplemental payment of $1,200 to those who qualify for unemployment benefits. Workforce Solutions originally estimated that 140,000 people would qualify for that extra payment. But according to an LFC activity report sent to committee members last week, the department now estimates that 110,000 to 140,000 will qualify for the payment.  

Workforce Solutions Secretary Bill McCamley said his department based the original estimation on how many people qualified for unemployment benefits in June.   

“We were saying, ‘Okay, if we have X amount of people get in that match where we were at our height, what would that be? And let’s make sure we have that amount in there,” McCamley said. “Let’s say, we would have said, ‘OK, we think we’re going to give money to 130,000 people,’ and then we ended up having 140,150, 160. We wouldn’t be able to pay them out and that’s not fair.”

McCamley said the state’s unemployment trust fund was depleted by September of this year after many people were out of work because of the COVID-19 pandemic. The state’s unemployment trust is funded by employers who pay into it on a quarterly basis. McCamley said that forced the state to borrow money from the federal government. Now, any of the money not spent, which could be between $24 million to $62 million, will revert back to the unemployment trust. 

In some sense, the lower estimate could be viewed as good news as it points to fewer people qualifying for unemployment, likely because they are working. 

But for at least one legislator, that extra money represents a possible missed opportunity. 

Rep. Rebecca Dow, R-Truth or Consequences, introduced an amendment that would have split the one-time payment of $1,200 in half in order to also pay front line or essential workers who make less than $15 per hour a one-time payment of $600. 

House Democrats, including Speaker of the House Brian Egolf of Santa Fe, argued that Dow’s amendment was too risky and had high potential to hurt the state’s unemployed population. 

“I agree with you 100 percent that we need to help and do more to support these essential workers, I agree with you,” Egolf said at the time. “I think everyone in the Legislature agrees with you. Generally, the problem is if you don’t get this program exactly right, you’re going to be taking $600 away from every unemployed claimant in the state, putting into a pot and hoping it makes it to the place where we want it to go.”

Dow argued that workers exposing themselves to COVID-19 for minimum wage deserved an extra financial boost as well. 

Last week, Dow told NM Political Report that while she was recently approached by a constituent who works at an assisted living facility, doing perineal care for $10.35 per hour. Dow said the woman was hoping to find help with her rent.  

“She would have received the $600, because she’s been a frontline worker caring for our vulnerable population this entire time,” Dow said. Had she said to her employer, ‘I am at risk, I feel like my health and safety is at risk,’ she could have quit and made much more money on unemployment with the state and federal stimulus, and now this additional bump that we’re getting.”

During the second special session, Rep. Javier Martínez, D-Albuquerque said Dow’s amendment was “well-intentioned,” but poorly timed. He, along with a few other House Democrats, said he hoped Dow would support bills to raise the minimum wage and mandate paid sick leave for workers. But Dow told NM Political Report that she sees those types of proposals as unfunded mandates. Instead, she said, a boost in pay to frontline workers should come from COVID-19 relief funds. 

“When you raise the minimum wage, you’re raising it on the backs of small businesses,” Dow said. 

Many discussions among lawmakers regarding how to appropriate the CARES Act money were about how to make sure any unspent money did not revert back to the federal government. And McCamley said any of the $194 million that is unspent by December 28 will go back to the unemployment trust, meaning the state will not have to borrow any more money to pay out claims.  

“It is money that will continue to go into New Mexican’s hands,” McCamley said.