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Gov. Ducey Disputes Jobless benefit suit

Howard Fischer
Capitol Media Services

By Howard Fischer 
Capitol Media Services 

PHOENIX -- An attorney for Gov. Doug Ducey is asking a judge to toss a bid by a labor group to order him to immediately seek to recoup extra federal jobless benefits that were denied to them when the governor pulled out of the program. 

Timothy Berg does not dispute that Arizona law requires the Department of Economic Security to pursue all possible avenues of unemployment compensation. And the federal government did make extra money -- initially $600 a week, later cut to $300 -- available to out-of-work people in Arizona and other states, a program that ran through August. 

It also is undisputed that Ducey unilaterally withdrew from the federal program and ended the extra cash as of July 10, a move he said was designed in part to get people to take jobs that restaurants and other employers could not fill. 

But in new legal filings, Berg told Maricopa County Superior Court Judge Katherine Cooper that it was Ducey and not DES who first accepted the federal funds. And he said the governor is not bound by the law that directs the activities of DES. 

Berg also disputes a separate argument that DES, on its own, is required to accept and distribute all funds that the U.S. Department of Labor makes available. He said that's because that agency is governed by existing state laws that cap unemployment benefits at no more than $240 a week. 

"DES cannot pay a weekly benefit greater than the $240 cap the Arizona Legislature prescribed in law,'' Berg said. And he said while another law authorized Ducey to receive and expend those extra federal funds -- what he had agreed to back in March 2020 -- "it does not require the governor to do so.'' 

Hanging in the balance is what attorney Paul Gattone said are the extra $300 a week in federal benefits that jobless Arizonans should have collected in the eight weeks between the time Ducey withdrew from the program and when it actually ended. That comes out to $240 per recipient. 

All that was made available through the Federal Pandemic Unemployment Compensation program authorized by Congress last year. It was designed to help address the high number of people out of work due to the COVID pandemic who could not find jobs. 
Ducey agreed to participate, initially meaning an extra $600 a week for jobless Arizonans. It later was cut to $300. 

But rather than wait for the federal program to expire, Ducey announced in May he would to curtail the extra cash as of July 10 to force some people back into the workforce. That was based on the governor's belief that the total benefits -- the $240 a week paid by the state plus the extra $300 in federal cash -- provided a disincentive for people to go out and find a job. 

That translates to $13.50 an hour, before taxes; the state's current minimum wage is $12.15. 
Ducey did add incentives, including a one-time $2,000 bonus for those who found full-time work by Sept. 6, some financial help with child care, and even a semester of tuition at community college for those who would go back to work. 

Gattone, representing Unemployed Workers United and several affected individuals, filed suit earlier this month. He wants Cooper to immediately order the state to retroactively rejoin the FPUC program and get the benefits to which he said out-of-work Arizonans are entitled. 

He said the early termination action, aside from being illegal, was ill-conceived, what with the cost of housing in the Tucson and Phoenix metro areas growing faster than the national average. And Gattone said the $240 a week maximum state benefit would put the individual plaintiffs at "imminent risk of eviction and other negative, dire consequences.'' 

Berg, in arguing there's no legal basis for the lawsuit, also told Cooper there's another flaw in the claim. He said Gattone waited too long before seeking legal relief. 

He said Ducey's plan became known on May 13 yet did not sue until nearly four months later. 
"Plaintiffs were aware of their alleged injuries as early as May 13, but they offer no justification for their delay in bringing suit,'' Berg said. 

And that delay, he said also weakens the heart of their claim. 

"This delay was especially unreasonable in view of plaintiffs' claim that they need immediate relief in the form of a preliminary injunction,'' Berg told Cooper. "Plaintiffs' unjustified delay in filing suit undermines the purported urgency of their request for a preliminary injunction.'' 

Berg also said if Gattone had filed suit before July 10 there might have been some opportunity for Ducey to rescind his decision to terminate the extra benefits. He said seeking relief now, after the federal program has ended, would require the governor to seek a new -- and retroactive -- agreement with the federal government, "a far greater undertaking requiring the involvement of numerous state and federal government agencies and officials and a great deal of administrative red tape.'' 

No date has been set for a hearing.