@GovWhitmer just blocked another precedent-setting tax burden shift by the Michigan Legislature.

She vetoed $220M in general fund tax dollars lawmakers designated for the Unemployment Trust Fund, which is traditionally funded by a tax on employers. https://www.crainsdetroit.com/coronavirus/whitmer-signs-106-million-covid-19-relief-bill-extends-unemployment-benefits

GOP lawmakers wanted to make other areas of gov’t pay for a continued 6-week extension of unemployment benefits.

And, again, employers fund the trust fund, not average Joe who works on a 1099 & is ineligible got UI. Legislature wanted to make Joe pay in.

https://www.crainsdetroit.com/voices-chad-livengood/analysis-legislature-sitting-387-million-surplus-how-much-will-it-spend

Here’s the thing: Michigan’s Unemployment Trust doesn’t need the $220M bailout money the Legislature wanted to spend:

The trust fund’s $773M balance is one the healthiest in the country.

Other Great Lakes states have been borrowing billions this year.

At the beginning of the pandemic, Michigan had a $4.6B unemployment trust fund.

Main reasons why it was one of the best funded include:

1.) decade of economic growth
2.) Legislature paired back benefits from 26 to 20 weeks
3.) Max $362/weekly benefit locked in law since 2002

So Michigan had (and still has) the best funded unemployment trust fund in the Great Lakes. We also have the lowest weekly benefit that hasn’t increased in 18 years and is far below the national average of $468 per week.

My report on this from May 10: https://www.crainsdetroit.com/economy/46-billion-unemployment-fund-will-last-only-months-current-burn-rate

Legislature wasn’t borrowing from the general fund. This was a GF raid/fund shift to avoid eventually borrowing from the feds, which Mich. did a bunch of during the Great Recession. It also would have relieved businesses of a tax hike. Lawmakers sought to socialize unemployment. https://twitter.com/tamvandenberg/status/1344014042675998722

Some more unemployment insurance facts I've cobbled together...

Michigan UI Trust Fund had $1.265B on Oct. 7, $773.3M on Dec. 16.

That's a burn rate of $49.2 million per week over a 10-week period this fall.

Column on this subject coming this morning at https://www.crainsdetroit.com/voices-chad-livengood