Essential employees who worked in-person throughout the pandemic could be cashing in on taxpayer-funded bonuses of up to $2,000 under a $3.65 billion plan by House lawmakers.
State workers who reported for duty amid coronavirus shutdowns stand to earn even more through a boost to their pensions proposed in a pair of bills working their way through the Legislature.
“We didn’t want to make it overly generous,” House Speaker Ronald Mariano, D-Quincy, said Monday, announcing the bonuses for essential workers that would cost $500 million total. “We wanted it to benefit the folks who stayed at their posts for the whole pandemic — the folks that worked in the nursing home, that drove the buses, that worked in the supermarket, that were out there every day servicing the economy when everything else around them was closing.”
Qualified public- and private-sector workers who earned up to 300% of the federal poverty limit — or $79,500 for a family of four — during the pandemic will be eligible for the essential worker bonuses. Checks will be cut for $500 to $2,000 depending on how many workers qualify for the payout, lawmakers said.
State workers could be in line for a second boost if lawmakers act on a pair of bills that would let them cash in on three extra years of service for their pensions when they retire if they worked — or volunteered to work — outside their home anytime between March 10 and Dec. 31 of last year.
Budget watchdogs say the proposal could cost billions. A new Pioneer Institute report says the bills would add up to $1.73 billion in pension liabilities to the State Employee Retirement System, but notes “total costs would likely be many times higher.”
“With Beacon Hill awash in billions of federal dollars, these bills, unfortunately, smack of a money grab,” Pioneer Institute Executive Director Jim Stergios said.
Lawmakers say they would pay for these and other proposals in the bill with a combination of $2.5 billion in American Rescue Plan Act funds and the $1.15 billion of surplus tax revenue.
The bill also seeks to cut a break for business owners who are on the hook to repay a $7 billion loan after the historic number of unemployment benefits claims paid out during the pandemic pushed its trust fund into insolvency, forking over $500 million to pay down the debt.
Workforce and economic development investments take the largest slice of the funding, totaling $1.7 billion — nearly half the entire House proposal.
The bill would spend another $600 million on homeownership aid, housing production and maintenance; $350 million for environmental infrastructure and development spending; $765 million on public health; and $130 million on schools.
Another $78 million would be earmarked to address food insecurity.
The much-anticipated COVID relief spending bill comes five months after the feds deposited nearly $5.3 billion in unrestricted coronavirus relief funds for Massachusetts and as Gov. Charlie Baker and administration officials have repeatedly pushed legislators to get the money out the door quickly.
The House’s bill includes many of the same spending priorities Baker previously proposed, but with significantly lower investments. Baker, for example, suggests $1 billion should go toward the UI debt.
Business industry advocates on Monday said employers “will be disappointed if this proves to be the only government step” to help cover the cost of the $7 billion of unemployment insurance debt, according to Jon Hurst of Retailers Association of Massachusetts.
“Additional investment to address government triggered COVID fraud, overpayments and layoffs, as well as real system reforms to curb the long term abuse and fill the eligibility loopholes, must be on the table in early 2022,” Hurst said.
Christopher Carlozzi of NFIB Massachusetts said the half billion is “nowhere near enough.”
“Not only will small businesses struggle to financially recover from the revenue lost during state-ordered shutdowns, they will also face 20 years of higher UI taxes for one simple reason: elected officials failed to take financial responsibility for a problem they helped create,” Carlozzi said.
