Gov. David Ige vetoes additional unemployment insurance, hoping Congress acts

Gov. David Ige vetoed a spending plan that would have added $100 in state weekly unemployment benefits in the era of COVID-19, hoping that an embattled Congress will continue supplementing state benefits at something close to the current, weekly level of $600 in additional federal aid.

The state Legislature had included $230 million in Senate Bill 126 that was intended to help mitigate the potential loss of $600 in weekly federal unemployment payments — known as plus-up — that are scheduled to end today while weekly state unemployment benefits continue.

An unemployed worker in Hawaii receiving the maximum weekly benefit of $1,248 will see that payment drop to $648.

Ige said he hopes Congress comes up with a compromise to continue the $600-a-week federal benefit or something close to it. That would make the $230 million in added state money for unemployment benefits unnecessary.

“I am committed to supporting Hawai‘i residents who have been impacted by COVID-19. That includes continuing to provide standard UI benefits, even if the U.S. Congress fails to extend the plus up federal benefits,” Ige said in a statement. “We will need maximum flexibility to use the funds where they are needed most. It will not serve our community if the funds are designated for a specific purpose by the budget bill, and the funds are not used because they were not necessary or they were duplicated by potential federal support. These are unprecedented times when we are facing enormous budget challenges as a result of COVID-19. Difficult decisions will have to be made.”

The veto was one of eight spending cuts that Ige made to Senate Bill 126, which spelled out how the state would spend $635 million in federal CARES Act funding by the end of the year.

The bill, as passed by the Legislature, created a plan to provide “ongoing, immediate relief to residents and small businesses who are suffering from the devastating economic shutdown caused by the coronavirus pandemic,” House Speaker Scott Saiki said in a news release.

Ige’s veto of the state’s extra $100 in weekly unemployment benefits poses the most obvious impact on workers idled because of the COVID-19 pandemic.

But Ige also chopped a $100 million spending plan for housing and rental assistance and related costs, saying that $50 million is enough to launch a program by the end of the year.

“Unpaid rent will be the most pressing problem facing our residents,” Saiki said in his statement. “Our proposal specifically targeted assistance for the most vulnerable families to prevent evictions and homelessness. Even with this veto, we will work with the governor to reallocate funds to maximize rental assistance for our residents.”

Asked about the possibility of reconvening to consider overriding any of Ige’s vetoes in SB 126, Saiki told the Honolulu Star-Advertiser that House members need to meet with Senate leaders and Ige to discuss how the administration plans to use the funds that he vetoed.

“We have to review the governor’s veto message and then discuss with the House members and Senate leadership whether to consider an override,” Saiki wrote to the Star-Advertiser. “We will also meet with the governor to discuss the specific plan for the use of the vetoed funds.”

Lawmakers could override Ige’s vetoes with a two-thirds vote.

State Sen. Donovan Dela Cruz, chairman of the state Senate special committee on COVID-19, said Ige met with lawmakers before his announcement Thursday.

Deciding to eliminate the $230 million for $100 weekly supplemental unemployment benefits “makes sense” for now, Dela Cruz said.

There is little pressure in the Senate to try to override any of Ige’s eight vetoes in SB 126 at this point, Dela Cruz said, especially because the $230 million in unemployment benefits funding can still be spent by the end of the year, if necessary.

House Finance Chairwoman Sylvia Luke called the challenges facing Hawaii’s economy — especially with COVID-19 numbers escalating — “mind-boggling.”

The economic problems — couple with the expected demand for millions of dollars in social service support — are likely to be even worse than during the 18-month economic recession between 2007 and 2009, she said.

“Clearly, the state and the counties cannot take care of this on their own,” Luke said. “This is very concerning. It’s going to get worse before it gets better. The situation we’re in won’t evaporate by the end of the year. … Major decisions, and difficult decisions, will have to be made in the coming years.”