Unemployment insurance subcommittee orders interim study after department models show big cost and trust-fund impacts

Members of a legislative unemployment insurance subcommittee voted to pursue an interim study after Department of Employment Security staff presented scenario models showing that several proposed changes to weekly benefit amounts and benefit-duration rules could materially increase annual benefit payouts and prompt trust-fund balance reductions.

Commissioner Richard Levers of the Department of Employment Security told the subcommittee he had provided three court decisions (Wheeler, Royer and Pregent) that reinforce a constitutional property interest in unemployment benefits and the department’s obligation to provide due process before reducing an individual's monetary eligibility. "You need to give them due process — provide them an opportunity to be heard and evaluate the information being used to deny eligibility," Levers said, urging caution around any policy that would change a claimant’s monetary determination mid‑benefit year.

Levers walked lawmakers through a set of modelled scenarios intended to isolate the fiscal effect of specific proposals. Key results he summarized included: adding seven higher weekly-benefit tiers (a proposal tied to Representative McKenzie) would produce an estimated 19% increase in total annual benefits (about $9.9 million); shortening maximum duration to 20 weeks while allowing a compressed claimant to receive the higher weekly benefit produces an estimated 23% increase and would cause an earlier fund-balance reduction; a mixed/variable-duration approach with compressed-week higher WBAs produced a smaller 15% increase; and combining variable duration with the seven new tiers was the most expensive option — a modeled 36% increase with a near‑immediate fund-balance impact and an estimated $27 million effect across affected quarters.

Those fund-balance reductions matter because New Hampshire’s solvency mechanism ties employer tax-rate changes to prescribed fund thresholds. Levers said the department’s baseline forecast shows the trust fund bottoming near $359 million in 2027 Q4 (above the $350 million trigger), but some modeled changes would push the FBR (fund-balance reduction) into earlier quarters and increase employer tax exposure. The department’s economists (the Economic and Labor Market Information bureau, led by Brian Gotaut, with economist Greg David assisting) prepared the underlying forecasts.

Lawmakers pressed on implementation and equity. Several members raised concerns that compressing the same total maximum payout into fewer weeks would create winners and losers — claimants who file when 20 weeks are available could receive higher weekly checks than nearby filers who qualify under a 26‑week period. Members discussed alternate hybrids that remove the "555" compressed-week bump or cap rates to limit outliers, and they discussed phasing new benefit tiers over multiple years to blunt up‑front fiscal shocks. Levers noted the department can implement new tiers on a relatively short timeline (a 90‑day effective date was described as feasible) but that fundamental changes to duration or to how the system computes monetaries would require substantially more system redesign time (the department had suggested six months for more complex changes).

Members also discussed the federal review process: once the legislature drafts a firm bill, the department typically submits it to the U.S. Department of Labor for a conformity and compliance review; Levers cautioned that an adverse federal finding on conformity could affect employer credits and the state’s administrative funding.

After discussion, a subcommittee member moved to pursue an interim study to continue work, seek additional modeling, and hold work sessions through the summer and after crossover. Lawmakers voiced bipartisan support for continuing the work and asked the department to model an additional hybrid scenario (variable duration with new tiers but no compressed‑week bump) and to provide implementation timelines and draft statutory language that would limit legal and operational risk. "I'm going to make the motion for interim study," a member said; other members signaled support and the chair agreed to authorize the study.

Next steps: the department will provide the additional modeled scenario and supporting materials, the subcommittee agreed to schedule follow‑up work sessions and member briefings, and legislative staff will consider staggered or phased implementation options for any bill drafted for the next session.