12 Days Until Tillis Unemployment Insurance Cuts Go Into Effect

Tillis’ Plan: Deep Cuts To Unemployment Insurance, 30% Interest Rate Hikes From Installment Lenders

Contact: Ben Ray
(919) 559-3811


** For Immediate Release **

RALEIGH-- One of Speaker Thom Tillis’ top legislative priorities is just days from going into effect.  Starting July 1st, job-seeking North Carolinians receiving unemployment will see their maximum benefits cut by one-third, or $200 per week. And, many face an even tougher deadline -- at the end of this month, 70,000 North Carolinians will lose their benefits entirely effective immediately, with a total of 170,000 individuals ultimately seeing their benefits disappear.

Instead of focusing on jobs and the economy, Tillis has instead prioritized paybacks to his special interest backers.  In addition to slashing unemployment insurance, Tillis pushed through a bill allowing installment lenders to raise interest rates by up to 30%.  Tillis received $30,000 as part of a $1.8 million lobbying campaign by the lenders, who presumably will be standing ready to offer loans to the North Carolinians affected by Tillis’ deep cuts to unemployment insurance as they come up short for cash.

“The Special Interest Speaker strikes again,” said Ben Ray, a spokesman for the North Carolina Democratic Party.  “Thom Tillis is leaving 170,000 unemployed North Carolinians out to dry and the only group who might benefit has put $30,000 in his campaign coffers. North Carolina deserves leaders focused on jobs and the economy, not paybacks for the special interests.”



Tillis Voted For The Law That “Sharply” Cut Unemployment Benefits From $535 To $350 Per Week, Which Republicans Pushed Through In Order To Pay Back Money North Carolina Owes The Federal Government. “Gov. Pat McCrory signed a law on Tuesday sharply cutting North Carolina’s unemployment benefits as agencies that deal with jobless workers predicted hard times to come. The law, which takes effect July 1, makes sweeping changes. It reduces the maximum unemployment benefit by one-third, from $535 to $350 per week. It reduces the length of benefits from 26 weeks to a sliding scale of 12 to 20 weeks, depending on the state unemployment rate. It also eliminates benefits for workers who have to leave a job for health or family reasons. North Carolina currently has the fifth-highest unemployment rate in the nation, at 9.2 percent, or more than 430,000 workers. The overhaul, pushed by Republicans in the General Assembly, is designed to repay $2.5 billion the state owes the federal government for past benefits.” [Charlotte Observer, 2/20/13; H.B. 4; voted 17 (Tillis – Y), 2/5/13; became law, 2/9/13]

U.S. Secretary Of Labor: Under North Carolina’s Unemployment Insurance Cuts, The State’s Economy Will Lose $780 Million In Federal Funds And 170,000 Unemployed North Carolinians Will Lose Their Benefits. “Acting Secretary of Labor Seth D. Harris today issued the following statement regarding North Carolina House of Representatives Bill 4: ‘The North Carolina legislature is considering legislation that would reduce state Unemployment Insurance benefits. If enacted, the legislation also would cut off all federally funded Emergency Unemployment Compensation — that is, benefits after 26 weeks of unemployment — to 170,000 unemployed North Carolinians. This cutoff is automatic under federal law. I have no discretion to stop it. As a result, families struggling to secure their place in the middle class will suffer a grievous blow, and the state's economy will lose $780 million in federal funds that are vital to reducing North Carolina's high unemployment rate.’” [Department of Labor, Press Release, 2/11/13]

  • 70,000 North Carolinians Will Lost Unemployment Benefits On July 1, With Up To 170,000 Ultimately Losing Their Benefits. “Unemployment insurance payments to more than 70,000 North Carolinians are set to run out in four weeks, one result of an overhaul in North Carolina’s unemployment system that takes effect on June 30. Those affected include anyone receiving federal extended unemployment payments, or most people who started drawing benefits before January 1. The N.C. Employment Security Commission has begun notifying people through its website and over the phone when they file required weekly claims. The state legislature’s unemployment system overhaul, which both raised taxes on employers and cut the length and amount of benefits, makes the state ineligible to receive federal unemployment funds intended for those unemployed longer than 26 weeks. Federal law cuts off aid to states that don’t maintain their current benefit system. The U.S. Department of Labor estimates 170,000 people in North Carolina could ultimately lose extended federal benefits for which they otherwise would have qualified.” [Charlotte Observer, 5/31/13]


Associated Press: Consumer Finance Lenders Spent More Than $1.8 Million On A Widespread Lobbying Campaign To Pass Legislation To Raise The Maximum Interest Rate They Can Charge. “Records show a group of consumer finance providers spent more than $1.8 million to hire at least 20 lobbyists and steer campaign contributions to North Carolina lawmakers to win passage of a bill raising the maximum interest rates they can charge borrowers. After sailing through the Republican-controlled General Assembly earlier this month, the bill now awaits the expected signature of Gov. Pat McCrory. Critics of the measure, including Attorney General Roy Cooper, say the fee increases and sky-high interest rates allowed by the bill will trap vulnerable low-income borrowers in a harmful cycle of taking on more debt just to cover the payments on prior loans.” [Associated Press, 6/13/13]

  • The Loan Bill Increased The Cap On Unsecured Loans To $15,000, And Raised The Interest Rate To 30% For The First $4,000 Borrowed. “A handful of Democrats also voted for the bill, which increases the cap on the unsecured loans to $15,000, up from $10,000. Interest rates for the loans will increase to 30-percent interest for the first $4,000 borrowed, 24 percent for the next $4,000 and 18 percent for the remainder of the principal. The bill also increases fees the lenders can charge. Records show that since 2010 the industry used two political action committees and individual donations from company executives and their family members to send more than $300,000 to the campaigns of key politicians. The bulk of the money went to Republicans, including Gov. McCrory, House Speaker Thom Tillis and Senate leader Phil Berger.” [Associated Press, 6/13/13]

Associated Press: “Records Show The Top Recipient” Of Consumer Lending Campaign Contributions “Was Tillis, Whose Campaign Got More Than $30,000 From The Industry.” “A review of public records by the Associated Press shows the owners of consumer finance firms, many located in small towns or clustered near military bases, spent heavily to overcome longstanding opposition to the bill boosting the industry's ability to make money. […] Records show that since 2010 the industry used two political action committees and individual donations from company executives and their family members to send more than $300,000 to the campaigns of key politicians. The bulk of the money went to Republicans, including Gov. McCrory, House Speaker Thom Tillis and Senate leader Phil Berger. Records show the top recipient was Tillis, whose campaign got more than $30,000 from the industry.” [Associated Press, 6/13/13]