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CONGRESSIONAL & INTERGOVERNMENTAL AFFAIRS
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Congressional Notifications

January 29, 2010

Dear Congressional Staff:

The U.S. Department of Labor today called on states to apply for more than $4 billion in unemployment insurance modernization funding made available through the American Recovery and Reinvestment Act of 2009 (Recovery Act). These funds can be used to pay unemployment insurance benefits and may be applied to other defined purposes if appropriated by your state legislature. Unemployment modernization funds can be used to pay unemployment compensation benefits and may lessen the need of states to borrow money from the federal government. Unemployment modernization payments are not loans and do not need to be paid back.

The Assistance for Unemployed Workers and Struggling Families Act — enacted as part of the Recovery Act — provides for a special distribution of $7 billion in unemployment compensation modernization incentive payments to states. Unemployment modernization provisions allow an expanded group of workers — including recent entrants to the labor force, low-wage workers, part-time workers and individuals unemployed as a result of family circumstances — to be eligible for unemployment benefits.

As of today, more than $2.8 billion in incentive payments has been disbursed to 32 states and your state has not applied for any of the $4 billion remaining in the fund. Please see the attached Training and Employment Notice for more details about your state's status and the unemployment insurance modernization program. This TEN will be sent to states today from the Department of Labor's Employment and Training Administration.

The Department is ready to work with your state to adopt these modernizations. For additional information please contact the Office of Congressional and Intergovernmental Affairs, Adri Jayaratne (Jayaratne.adri@dol.gov) and Aaron Ver (ver.aaron@dol.gov) are available to answer your questions.