Tag Archives: american recovery and reinvestment act

Diaries & Misc.

Recovery Act: Saving and Creating Jobs, Laying Foundation for Economic Growth

(An update on the Stimulus from Rep. Miller – promoted by Brian Leubitz)

One year ago, our nation was headed toward an economic collapse, shedding an average of 600,000 jobs a month. State and local budget cutbacks were putting teachers’ jobs – and our students’ education – in peril. Our economy was in need of emergency triage that would immediately begin to save and create jobs and lay the foundation for longer-term economic growth. One year after its enactment, it is clear that the American Recovery and Reinvestment Act is meeting these core goals.

Edit by Brian: See the flip for more…

To date, the law has already created or saved two million jobs and helped our economy grow at its fastest rate in years. It has funded more than 300,000 education jobs, keeping teachers in classrooms and children and students of all ages learning. It has helped minimize harmful cuts at public colleges and universities and provided students with larger Pell Grants to pay for college.

The Recovery Act has provided a much-needed lifeline for workers who lost their jobs – and their health insurance along with it. Millions of Americans have received extended or increased unemployment benefits and many got help paying for their COBRA premiums because of the Recovery Act. We can’t underestimate the difference this has made for laid-off workers struggling to put food on their tables, heat their homes, or pay for a visit to the doctor.

The Recovery Act is also making strategic investments in our future. Recovery programs are training displaced workers for high-growth jobs in our health care, biotech, clean energy and manufacturing sectors. The Race to the Top program is leveraging key education reforms that will better prepare our children for college, competitive jobs and a global economy.

The footprints of the Recovery Act run across my own district. It’s funding the construction of a dental clinic in Vacaville and a community health center in West County that will create 250 construction jobs immediately and longer-term health care jobs. It’s keeping teachers employed in Mt. Diablo, Martinez and West County school districts, or hiring new ones, like Jessica Pozos. It’s giving laid-off workers with families who depend on them, like Brandi Britt of Richmond, new hope by training her for a new career.

As President Obama and Congress have repeatedly said, the Recovery Act marked the beginning of our efforts to rebuild our economy and our middle class. Too many workers continue to lose their jobs or have trouble finding new ones. Our work will not be over until every American in need of a job can find one.

RECOVERY ACT: HELPING STUDENTS, WORKERS AND FAMILIES

  • 2 million: the number of jobs created or saved by Recovery dollars thus far, according to the Congressional Budget Office.
  • 300,000: the number of teaching and other education-related jobs saved or created.
  • $500: the increase in the Pell Grant scholarship eligible students received for the 2009-2010 year due to this law alone.
  • $2.4 billion: the amount of Federal support that helped colleges and universities keep teaching, even as enrollments grew, according to the State Higher Education Executive Officers.
Economy

Recovery: The Proof is in the Pudding at the Worksite

In my last post, I cited a New York Times story that indicated that most economists think the American Recovery and Reinvestment Act is helping to create jobs and stimulate our economy. Earlier this week, the non-partisan Congressional Budget Office confirmed the economists’ findings.  

According to the CBO, in the third quarter of this year alone, 600 thousand to 1.6 million jobs were directly created or saved by the American Recovery and Reinvestment Act, reducing our country’s unemployment rate by 0.3 to 0.9 percent. This is an especially important finding for my home state of California, which at 12.3 percent, suffers from the third worst unemployment rate in the nation.

Indeed, it’s worth noting that the CBO report does not measure indirect job creation. Jobs created through most sub-contractors and vendors are not included in the report nor are the jobs created at local businesses when 1.6 million Americans have sufficient wages to put their money back into the economy.

They say all politics is local, and that may or may not be true, but it’s certainly the case that all jobs are local. When I talk to constituents, I hear from understandably frustrated people who think the stimulus has been ineffective. I understand that 1.6 million jobs created is just a statistic when you are still unemployed, when your family is still struggling, when your phone is ringing off the hook from relentless creditors, when you’re falling behind in your rent or mortgage payments.

More solutions over the flip…

Even for these individuals, the stimulus passed by President Obama and Congressional Democrats back in February has improved things. When 1.6 million more people are gainfully employed, the challenging job climate for those still unemployed is a little bit easier. When 1.6 million more people are able to put food on the table from their own wages, the reduced usage of government and non-profit assistance means more resources are available for families still struggling in this difficult economy. When half the stimulus package has yet to be distributed, many families are not yet aware that help is on the way.

Nevertheless, when 15.7 million Americans are unemployed, including well over 30,000 people in the 10th Congressional District, I know our work in Congress is far from done. Yesterday, I joined my Democratic colleagues on the House Transportation and Infrastructure Committee to highlight the findings of a report by the American Association of State Highway and Transportation Officials (AASHTO) that identified 9,500 “ready-to-go” highway, bridge, transit, port, rail, and aviation projects worth more than $69 billion that would create hundreds of thousands of jobs if we funded them in Congress.

We know that in an economic downturn, governments are well advised to invest in their infrastructure, employing people in the present to lay down the building blocks for future economic growth. In California, AASHTO identified 120 projects worth more than $4 billion that, with federal approval, would get thousands of newly employed boots on the ground in 120 days or fewer.

Crumbling roads throughout my home state are delaying commutes, slowing down freight traffic, impeding the attractiveness of bus travel, and discouraging area residents from engaging in commerce. A more robust investment in our public transportation networks would also do much to reduce congestion, better integrate public transit, and help us reach our carbon emission goals. In the three town halls I will be hosting this Saturday in my district, I know the deteriorating status of our region’s transportation infrastructure will be a frequent topic of discussion from constituents.

Today, President Obama holds his jobs summit, and based on public reports, the importance of more investment in transportation will not go unnoticed. My Democratic colleagues in the Transportation and Infrastructure Committee have alerted the President of our desire to move ahead with many of AASHTO’s recommendations. Working together, we will produce a number of bills in the coming months that will continue our important work rebuilding an economy left in shatters following eight years of neglect and misguided priorities.

While you may not agree with every bill passed by Congress or every decision made by the President, when I say that we take our responsibility as incubators of a better economy seriously, I hope you’ll take me at my word. If not, the proof is in the pudding of the lunches of the 600 thousand to 1.6 million people now employed because of the American Recovery and Reinvestment Act.

Congressman John Garamendi (D-Walnut Creek) represents California’s 10th Congressional District. You can follow Congressman John Garamendi on his new Twitter and Facebook accounts.

Uncategorized

Because Recovery Works, 3.5 Million Americans to Work Too

In the months following the end of George W. Bush’s disastrous term as President, my Congressional colleagues and President Barack Obama worked tirelessly to create an economic recovery plan that could begin the difficult process of creating jobs and rebuilding our economy. Had I been in Congress at the time, I would have gladly voted for the American Recovery and Reinvestment Act, and as a recent New York Times article by Jackie Calmes and Michael Cooper reveals, “the accumulation of hard data and real-life experience has allowed more dispassionate analysts to reach a consensus that the stimulus package, messy as it is, is working.”

They continue: “The legislation, a variety of economists say, is helping an economy in free fall a year ago to grow again and shed fewer jobs than it otherwise would. Mr. Obama’s promise to “save or create” about 3.5 million jobs by the end of 2010 is roughly on track, though far more jobs are being saved than created, especially among states and cities using their money to avoid cutting teachers, police officers and other workers.”

“It was worth doing – it’s made a difference,” Nigel Gault, chief economist at IHS Global Insight, a financial forecasting and analysis group, explained in the article. “I don’t think it’s right to look at it by saying, ‘Well, the economy is still doing extremely badly, therefore the stimulus didn’t work.’ I’m afraid the answer is, yes, we did badly but we would have done even worse without the stimulus.”

So despite the consternation of some pundits, it turns out the President was right. Stimulus relief worked, and Democrats in Congress keep working. Since I joined Congress earlier this month, my House colleagues and I have backed a number of bills that will strengthen small businesses and create more jobs.

More over the flip…

For example, H.R. 3738 by Congressman Glenn Nye (D-Virginia) would offer $250 million in financing to help early-stage small businesses in technology sectors, and with loan returns, it’s self-financing. Another bill, H.R. 3014 by Congresswoman Kathleen Dahlkemper (D-Pennsylvania), would offer loan guarantees to small business health professionals to be used for the acquisition and installation of health information technology. Another good bill, H.R. 3737 by Congressman Brad Ellsworth (D-Indiana), would expand small business microloan eligibility and lending limits while lowering interest rates. When constituents ask me what I’ve done to help fix our economy at my three district town halls on December 5th, these are some of the bills I will highlight.

Like President Franklin D. Roosevelt and the New Deal Democrats before us, we’ve inherited a mess from a Republican administration, and we’re picking up the pieces to rebuild our economy, brick by brick, job by job, solar panel by solar panel. But if you listened to some of the pundits, you’d think President Obama and Congressional Democrats were responsible for our present economic downturn.

Some people seem to forget that President Bush turned President Bill Clinton’s $559 billion surplus into a $1.2 trillion deficit. Indeed, President Bush spent more taxpayer money than any of his six immediate predecessors, including President Lyndon B. Johnson. Under President Clinton, real discretionary spending increased by 0.1 percent. Under President Bush, real discretionary spending increased by 44 percent. To date, the Iraq War alone has cost the country more than $700 billion, and President Bush’s tax cuts for the wealthiest five percent of Americans cost more than $1.3 trillion.

The American people have made it clear that they prefer Democratic solutions to economic crisis. They want a proactive commitment to job creation, and they know that the federal government is able to provide some relief to local schools, job training programs, and senior centers devastated by state and local budget cuts.

Over the coming months, my colleagues and I will be back in Washington to try and bring some additional relief to American workers. There are plenty of good bills on the table that will improve the climate for small businesses, reinvest in jobs-creating infrastructure, provide incentives for research and the creation of green jobs, and offer targeted tax assistance for working and middle class Americans. We can’t afford to wait.

Congressman John Garamendi (D-Walnut Creek) represents California’s 10th Congressional District. You can follow Congressman John Garamendi on his new Twitter and Facebook accounts.

Uncategorized

FAQ: COBRA Premium Reduction (Health Coverage for the Unemployed)

Recession-related job losses are threatening health coverage for many families. To help workers maintain their health coverage while they are between jobs, the American Recovery and Reinvestment Act (ARRA) provides a 65% reduction in the premiums payable by involuntarily terminated workers and their families for health care continuation coverage under COBRA. This premium reduction will last for up to 9 months.  Workers who have been involuntarily terminated during the period from September 1, 2008 through December 31, 2009 and their families are eligible. This premium reduction also applies to health care continuation coverage that may be required by states for insurance policies sponsored by small employers (so called state mini-COBRAs) and public employees.  This provision will help 7 million people maintain their health insurance by providing a vital bridge for families when workers have been forced out of their jobs as a result of the recession.

1.    QUESTION: Who is eligible for the premium reduction?

  A.    To be eligible for the premium reduction, you must be a COBRA qualified beneficiary who meets all of the following requirements:

      •    Is eligible for COBRA continuation coverage as a result of Federal or State law at any time during the period beginning September 1, 2008 and ending December 31, 2009;

      •    Elects COBRA coverage (when first offered or during the additional election period); and

      •    Was involuntarily terminated during the period beginning September 1, 2008 and ending December 31, 2009.  

  If you are eligible for other group health coverage (such as through a spouse’s plan) or for Medicare, you are not eligible for the premium reduction.  In addition, your same year (2009 and/or 2010) modified adjusted gross income must not exceed $125,000 (or $250,000 for families).  If your income exceeds this limit, all or part of the amount of your premium reduction may be recaptured by an increase in your income tax liability for the year.  

2.    QUESTION:  How do I know whether or not I have been involuntarily terminated from employment?

  A.    Involuntary termination is a termination that is at the direction of the employer.  Note that termination for gross misconduct will generally disqualify an employee and his/her family from COBRA coverage.  For more information on whether your termination is involuntary please call the Department of Labor’s Employee Benefits Security Administration’s Benefits Advisors at 1-866-444-3272.

3.    QUESTION:  How does the premium reduction work?

  A.    It works the same way as standard COBRA coverage.  However, instead of paying the full premium to the former employer/insurer, you will pay 35% of the premium.  The former employer/insurer will be compensated for the other 65% of the premium by the federal government.  

  The premium reduction is available as of your first period of coverage beginning on or after February 17, 2009, the date of enactment of this law.  Some plans may have already sent out bills for the full premium.  If you get a bill for the full premium and pay it, you will either be reimbursed for the overpayment or receive a credit toward future premium payments.

4.    QUESTION:  How do I sign up for the premium reduction?  

  A.    To sign-up for the premium reduction, you must enroll in COBRA coverage and fill out the premium reduction enrollment forms provided by your health plan.  Generally, under COBRA the employer must notify your health plan that you are being terminated within 30 days.  After that, your health plan must notify you within 14 days regarding your COBRA eligibility and provide you with materials regarding enrollment.  After February 17, 2009, plans will also begin sending out information regarding the premium reduction.  If you have not yet received information from your health plan, you can contact your plan directly.  

5.    QUESTION:  I was involuntarily terminated after September 1, 2008 and am enrolled in COBRA now.  How do I get the premium reduction?

  A.    As of your first period of coverage beginning on or after February 17, 2008, you are only required to pay 35% of your total premium.  You should immediately contact the former employer/insurer that administers your COBRA to obtain the documents necessary to establish eligibility for the premium reduction and explain that you intend to take advantage of the premium reduction and pay 35% of your premium.  If you have already paid the full amount for the next pay period, your former employer or insurer is required to reimburse you or credit a future payment.

6.    QUESTION:  What if I was involuntarily terminated after September 1, 2008 but didn’t elect COBRA within 60 days as required by law?

  A.    If you were involuntarily terminated from September 1, 2008 through February 16, 2009, but failed to initially elect COBRA you will get a second chance to elect COBRA and receive the premium reduction. No later than April 18, 2009 health plans should notify individuals about the second election period, in addition to providing any forms and information needed to enroll.  You will have 60 days after receipt of that notice to enroll in COBRA and the premium reduction.  However, you can contact your former employer now and say you want to take advantage of the second chance election period.  In either case, your coverage begins with the first period of coverage beginning on or after February 17, 2009.  

7.    QUESTION:  What if I was involuntarily terminated after September 1, 2008, elected COBRA within 60 days as required by law, but dropped the coverage?

  A.    If you were involuntarily terminated during the period from September 1, 2008 through February 16, 2009 and initially elected COBRA, but dropped the coverage (for example, because it was unaffordable), you will get a second chance to elect COBRA and receive the premium reduction.  No later than April 18, 2009 your health plan should notify individuals about the second election period and should provide any forms and information needed to enroll.  You will have 60 days after receipt of that notice to enroll in COBRA and sign up for the premium reduction.  However, you can contact your former employer now and say you want to take advantage of the second chance election period.  In either case, your coverage begins with the first period of coverage beginning on or after February 17, 2009.    

8.    QUESTION:  Who can take advantage of the additional election period?

  A.    Only plans subject to the Federal COBRA provisions are required to provide an additional election period when certain involuntary terminations occurred from September 1, 2008 through February 16, 2009.  ARRA does not require coverage provided under state continuation coverage provisions (including state mini-COBRA coverage) to offer an additional election period.  States may choose but are not required to offer a second election period.

9.    QUESTION:  Is death considered an involuntary termination?

  A.    No.  While death of an employee can be a qualifying event for that person’s beneficiaries to be eligible for COBRA coverage, death is not an involuntary termination of employment.  The beneficiaries would be required to pay the full premium amount if they elected COBRA.  However, if an employee dies after an involuntary termination, the employee’s beneficiaries may be entitled to the premium reduction for the remainder of the 9 month period that would otherwise be available.  

10.    QUESTION:  How long can I receive the premium reduction?  

  A.    Generally, individuals who qualify can receive the 65% premium reduction for up to 9 months.  COBRA coverage is still available for up to 18 months and 36 months in some cases.  If you remain on COBRA after the premium reduction period expires, you may be responsible to pay the full premium amount.  

  In certain situations, however, you would not be eligible to receive the premium reduction for 9 months.  If one of the following events occurred, the premium reduction would end at the earliest occurring event:  

      •    your employer (which in this case includes any responsible related or successor employer) no longer offers any group health plan to employees;

      •    you fail to make your premium payment; or

      •    you become eligible to receive health care through Medicare or another group health plan (such as the plan of a new employer or a spouse’s employer).  

  It is important to note that if and when you become eligible for coverage through Medicare or another group health plan, you must notify the plan administrator immediately.  While you remain eligible for COBRA when offered new coverage, you will no longer be eligible to receive the premium reduction.  Continuing to receive the premium reduction after becoming eligible for other coverage could result in a penalty equal to 110 percent of the premium provided to you after your eligibility ends.

11.    QUESTION:  What do I do if I think I qualify for the COBRA premium reduction but my plan tells me I do not?

  A.    If your health plan finds that you are ineligible for the premium reduction, you can apply for review of that determination by the Secretary of Labor or by the Secretary of Health and Human Services depending on your type of plan (see following question).  The Secretary will review your application and make a determination within 15 business days.  

12.    QUESTION:  Where do I send my appeal?

  A.    The Departments of Labor (DOL) and Health and Human Services (HHS) are currently developing processes and an official form that will be required to be completed for applications for review.  

      •    DOL will handle appeals related to private sector employers who are subject to ERISA’s COBRA provisions.  For more information or assistance determining where to file your appeal, visit www.dol.gov/COBRA or contact DOL at 1-866-444-3272.

      •    HHS will handle appeals for all government employees (federal and non-federal) as well as for those individuals covered by so-called mini-COBRA (insurance policies offered by employers with fewer than 20 employees).  

13.    QUESTION:  How does the income cap work?

  A.    The income cap is designed to ensure that the premium reductions are going to people who most need the help.  If your income for the year in which you are receiving the premium reduction (2009 and/or 2010) is more than $125,000 (or $250,000 for married couples filing a joint federal income tax return) all or part of the premium reduction may be recaptured by an increase in your income tax liability for the year.  If you think that your income may exceed the amounts above, consult your tax preparer or contact the IRS at 1-800-829-1040.

14.    QUESTION:  If I elect COBRA and receive the premium reduction, can I change my coverage or do I have to retain the coverage I had while employed?

  A.    Group health plans are permitted, but not required, to allow qualified beneficiaries to enroll in coverage that is different than the coverage they had at the time of the qualifying event.  Changing coverage will not cause an individual to be ineligible for the COBRA premium reduction, provided that: the premium for the different coverage is the same or lower than the coverage the individual had at the time of the qualifying event; the different coverage is also offered to active employees; and the different coverage is not limited to only dental coverage, vision coverage, counseling coverage, a flexible spending account, or on-site medical clinic.  If the plan permits individuals to change coverage options, the plan must provide the individuals with a notice of their opportunity to change.  Individuals have 90 days to elect to change their coverage after the notice is provided.

15.    QUESTION:  What if I was laid off before September 1, 2008, can I receive the premium reduction?  

  A.    No.  To be eligible for the premium reduction you must have lost your job on a date between September 1, 2008 and December 31, 2009.  

16.    QUESTION:  What if my employer went out of business and did not continue the company health plan, can I receive COBRA coverage and the premium reduction?

  A.    If your employer terminates all its health plans, COBRA continuation coverage will generally not be available unless another related or successor employer sponsors a group health plan responsible under COBRA for providing coverage to you.  

17.    QUESTION:  As an employer, how can I get more information about how the premium reduction works and how I will report the reductions on my quarterly federal tax return Form 941?

  A.    Contact the IRS at 1-800-829-4933.  

18.    QUESTION:  Where can I get more information if I have additional questions about the COBRA premium reduction?

  A.    Contact the Department of Labor’s Employee Benefits Security Administration’s Benefits Advisors at 1-866-444-3272.  In addition, the Employee Benefits Security Administration has developed a dedicated COBRA web page www.dol.gov/COBRA that will contain information on the program as it is developed.  Subscribe to this page to get up to date fact sheets, FAQs, model notices and applications.

This FAQ was jointly released by several U.S. House committees, including the Committee on Education and Labor, and is cross-posted on the EdLabor Journal.