ARIZONA STATE SENATE
Phoenix, Arizona
Purpose
Indexes the amount of the
maximum weekly unemployment benefit to a percentage of the Arizona average weekly
wage.
Background
Under current law, the
maximum weekly benefit amount (MWBA) an individual can receive for unemployment
benefits is $205. This measure changes the benefit formula by indexing the MWBA
to the average weekly wage in Arizona from the prior year. The U.S. Department
of Labor determines the average weekly wage in Arizona.
Under this measure,
beginning July 1, 2001, an individual can receive up to 41 percent of the
average weekly wage. On July 1, 2002 the indexed percentage increases to 46
percent of the average weekly wage. And on July 1, 2003 and thereafter, the
index increases to 50 percent of the average weekly wage. Currently, these maximum amounts are capped
at a fixed amount ($205).
According to the Department
of Economic Security (DES), using the average weekly wage in Arizona in 1999
(the latest data available), the MWBA effective on July 1, 2001 would be $241.
The following year it would become $270 and, on July 1, 2003, the MWBA
increases to $294. Because the average weekly wage in Arizona for 2000 and 2001
is expected to be higher, DES expects the indexed amounts to be actually
higher.
Finally, DES is not yet
aware of the effect this measure will have on the unemployment insurance trust
fund or employer tax rates.
Provisions
1. Indexes the maximum amount of the weekly unemployment benefit to a percentage of the average weekly wage in Arizona during the previous calendar year.
2. Phases in the indexing over three years: 41 percent in FY 2001-2002, to 46 percent in FY 2002-2003, to 50 percent in FY 2003-2004 and thereafter.
3. Defines “average weekly wage” as the average weekly wage published by the United States Department of Labor, Bureau of Labor Statistics.
4. Provides for a general effective date.
Prepared by Senate Staff
January 16, 2001