Senators Start Over on Unemployment-Insurance Extension

Because so much time has passed, Congress is unlikely to grant retroactive benefits. Continued House opposition isn't helping either.

A job seeker fills out an application during a career fair at the Southeast Community Facility Commission on May 21, 2014 in San Francisco, California. (National Journal)

Senate negotiators are back at the drawing board in trying to renew emergency unemployment-insurance benefits for more than 2 million Americans who have been out of work for at least six months.

Democratic Sen. Jack Reed of Rhode Island and Republican Sen. Dean Heller of Nevada have resumed negotiations to create new legislation that would extend the benefits.

The Senate passed a bill in April that would have extended the benefits through May and provided retroactive checks to those who had stopped receiving payments since the program expired on Dec. 28. But that legislation expired on May 31 with no action in the House, putting the onus on senators who favor the program to try again.

Reed and Heller have been working together on a new solution for at least two weeks and hope to extend the program through at least the end of this year. While the national unemployment rate is dropping, Reed said, the long-term unemployment rate is not. "We're finding a lot of people who are mid-career, have worked for 20 or 30 years, and are just finding it very, very hard to get back in. And these benefits are vital for them," he said.

But the two senators face a number of constraints that are hampering their negotiations. Because the benefits disappeared more than five months ago and they'll have to find some way to pay for every penny of the new bill, they warn that granting retroactive benefits to millions may not be possible this time around.

"That's hard to do at this point. It will probably be prospective," Heller said. "I'm guessing that we just go forward at this point. Five months of [retroactive] UI at this point, is a big, big bite of the apple. So that's not guaranteed, but I'm telling you that we realize that we are in a bind right now trying to make it retroactive."

Another concern is continued opposition from House Speaker John Boehner, who has said over and over since mid-December that the chamber will not take up an unemployment-insurance bill unless it includes a separate provision that addresses job creation.

Reed said they are not discussing that as an option in the Senate, and he called Boehner hypocritical after the House passed a tax-extenders bill last month that wasn't paid for at all. "[I] found it ironic that the House could pass an unfunded tax-extenders bill, and yet demand that our bill — you know, wasn't sufficient even though it was paid for and bipartisan," Reed said.

But Heller said that he agreed with Boehner and that the bill should include a jobs provision. The only problem is, it's not politically possible for him to include one in the Senate package. "If I could, I would," Heller said.

Instead, Heller is urging Boehner and other House Republicans to take up the new Senate bill (assuming it gets through the upper chamber first) and add their own jobs provision on the back end. Then the two chambers can go to conference and work out their differences, he said.

For the time being, Heller and Reed appear to be working on their own. Just over a week ago, Sen. Lisa Murkowski of Alaska, who was one of the six Republicans to help push the original unemployment-insurance extension package through the Senate in April, told National Journal that she was not involved in the new discussions.

Murkowski expressed concerns that the Senate was in a position of "starting over" on the legislation and that too much time may have passed to come up with a solution. "Without having a direct conversation with the two guys who are trying to breathe life into it, I can't say that it's completely dead. "¦ It's not looking good right now — I guess that's the best way to sum it up," she said.

Neither Reed nor Heller could speculate on a time frame for when they might introduce a new Senate package.

"We're working on it," Reed said. "It's not something we're ignoring. "¦ We have to look for a legislative path. We have to find the right sort of formula, literally and figuratively. And then we have to make sure that we have the necessary bipartisan support here."