N.C. bill proposes cutting unemployment benefits

by: Jim Bradley Updated:

CHARLOTTE, N.C. —

A legislative committee in the North Carolina General Assembly has accepted a draft bill that would make major cuts to unemployment benefits.

The bill would cut benefits for those out of work from the current 26 weeks to a maximum of 20 weeks. It would then use a sliding scale to cut the number to as low as 12 weeks depending on the state unemployment rate.

Republican state Sen. Bob Rucho of Mecklenburg County said the moves are necessary to keep the unemployment system solvent.

"We have to make some tough decisions. Otherwise, there won't be a viable system available," Rucho said.

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In addition to cutting benefits, businesses would also be required to pay more for unemployment insurance. The state is trying to find a way to repay $2.5 billion it borrowed from the federal government to pay unemployed workers since the recession began. Under the plan being proposed, the debt would be repaid by mid-2015.

Critics, however, call the cuts proposed "draconian." Alexandra Sirota of the advocacy group NC Justice Center says "to put the maximum number of weeks down to 20 weeks will effectively cut off a significant number of workers from benefits."

Legislators will meet to finalize the bill in early January before sending it to the full General Assembly. If passed, the cuts mentioned in the bill wouldn't take effect until July 1, 2013.