Ducey canceled federal unemployment benefits and promised back-to-work bonuses instead. He’s only paid 222 of them.
Four months after Ducey announced $300 million in "return-to-work bonuses," the state is still sitting on more than $299.5 million.
When Gov. Doug Ducey announced in May that he was cutting Arizonans off from the federal government’s additional $300 per week in pandemic-related unemployment insurance, he promised a sweeping new program that would provide “return-to-work bonuses,” child care subsidies and education scholarships to incentivize people to get jobs.
But four months after Ducey announced the program, and more than two months after he cut off additional federal unemployment benefits, only 222 people have received a bonus for pulling themselves up by their bootstraps.
The state so far has doled out $422,000 in bonuses for people who got a job and got off unemployment, according to the Arizona Department of Economic Security, which is charged with administering the fund.
That’s less than 0.15% of the $300 million Ducey promised for the program. And it’s far less than the federal benefits would have paid out to needy Arizonans struggling through a worldwide pandemic that has stunted the economy, infected more than a million Arizonans and killed nearly 20,000.
The program came with an eye-popping price tag: Besides the $300 million for return-to-work bonuses ($1,000 for finding part-time work or $2,000 for full-time work) Ducey pledged nearly $14 million for community college scholarships and GED programs; and promised to pay three months of free childcare to any parents who qualified for the new program.
The Department of Economic Security had slightly more success delivering the promised child care subsidies — 740 of those were approved before the application period ended. But it hasn’t handed out any community college scholarships — the website says more information about that program is “coming soon.”
The cutoff to get a job passed last week, meaning while some people who have already found a job can still apply to receive a bonus, nobody who starts a new job from here on out will be eligible.
The Department of Economic Security is still hopeful that now that the window for getting a new job has elapsed, applications for the bonuses and other services will pick up in the coming weeks. And there’s another reason for the slow payments — new hires need to show that they have worked 10 consecutive weeks in order to qualify for the bonus.
Still, a mere 5,500 people have even applied for a bonus (most of them still need to submit their 10 consecutive weeks of pay stubs to claim their bonus). In addition, DES said, there are nearly 19,000 applications in progress that have not yet been completed.
Nearly a quarter-million Arizonans were receiving unemployment benefits during the weeks of May 8 or May 15, the key timeframe during which people had to be on unemployment to qualify for the bonus if they went back to work full- or part-time.
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At this rate, Ducey’s return-to-work program will never spend the $300 million that he pledged — that’s enough money to pay out bonuses between 150,000 and 300,000 Arizonans.
DES said it has tried to contact most of the people who would be eligible for a return-to-work bonus, but people are simply not taking advantage of the program.
When he announced the return-to-work bonuses, Ducey, his staff and his allies lauded the program as comprehensive and groundbreaking.
“In Arizona, we’re gonna use federal money to get people back to work, instead of paying people not to work,” Ducey said in a video announcing both the unemployment cuts and the new program.
Democrats argued Ducey was cutting off real money flowing into the pockets of people who desperately needed it to survive the pandemic. But chambers of commerce around the state praised the governor’s market-oriented solution. The program would simply shift those funds into the pockets of those who want to get back to work, the rational went.
It hasn’t worked out that way — at least not yet.
Ducey’s spokesman C.J. Karamargin said it’s far too early to determine if the program is a success or failure — DES will continue to accept applications for the bonuses through Nov. 15, and the number of applications could skyrocket in the next two months.
“Maybe the numbers will stay where they are. Maybe there will be a last minute rush. But that is yet to be seen, but I think it's premature to call it a failure,” he said.
More broadly, he said the goal of the program was never to hand out government funds in the form of a back-to-work bonus — it was to get people back to work. That’s happened, he said, noting that the state just announced it had recovered 100% of the jobs lost since April 2020.
“The overall goal of this incentive program is to essentially grease the wheels so people can get back into the workforce,” he said. “And people seem to be doing that without this incentive, anyway. And from our perspective, that's a good thing.”
He declined to say what will happen to the $300 million if Ducey doesn’t spend it on back-to-work bonuses, saying they’ll cross that bridge when and if they come to it.
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Many who applied have been denied, sometimes because of what seems like problems in the massively underfunded and crumbling unemployment insurance system.
John Bower, a 26-year-old Democratic organizer, was working for the Outlaw Dirty Money campaign in March 2020 when the pandemic hit. The campaign folded, saying the pandemic made it impossible to gather the signatures necessary to put an issue on the ballot. Bower suddenly found himself out of work.
He’s found short-term political gigs in the last year and has left the unemployment rolls multiple times. But finding steady work has been near impossible.
“I’m just an honest guy trying to make an honest living and trying to support myself. And I’d never been on welfare before. I didn’t know how the system worked. Believe it or not, I worked for all these Democrats and I had never once been on welfare,” he chuckled.
Applying for unemployment was its own mess.
Then, in mid-May, after receiving unemployment on and off for nearly a year, he received a notice of ineligibility and lost his benefits for the key timeframe during which a person must have been on the unemployment rolls to receive a bonus. He was unemployed at the time and started receiving the unemployment benefits again shortly after, he said.
After dozens of phone calls to DES, he filed for a waiver and appealed the decision to cut his benefits for those weeks. But even if he wins his case, he’s not sure if it’ll happen in time to apply for a bonus.
These days, he’s holding two part-time jobs — not in politics, but at local restaurants. It’s enough to get by, barely, but he was really counting on that return-to-work bonus. That’s money that he needs to cover rent and feed himself and his dog.
“To me, it just feels like they don't want to give us that money,” he said. “The year was dramatic enough. And this was just a nightmare. It ruined me for a while, you know, I was really, really depressed and really worried about how I was going to pay rent.”
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