As we wrote yesterday, the implementation of HB4 – the radical restructuring of North Carolina’s unemployment insurance system – is just around the corner. Next Monday, on July 1^st, North Carolina will set itself apart. Our state will have the dubious distinction of being the ONLY state in the nation to:

• Reject participation in the 100% federally-funded emergency unemployment compensation (EUC) program. Due to the implementation date of July 1, North Carolina breaks a non-reduction rule prohibiting states from making benefit cuts while participating in the federal EUC program. As a result of the decision to implement changes in July 3013 instead of January 2014, 70,000 jobless workers in North Carolina will abruptly lose benefits next week. No other state has rejected federal participation in order to pursue benefit cuts.

• Have a sliding scale for the minimum number of weeks available. Read More…

As Sarah Ovaska details in the post below, in less than a week and a half, more than 70,000 North Carolinians will see their extended federal unemployment benefits dry-up as major changes take effect with the state’s employment security law.

Lawmakers, who fast-tracked this legislation earlier in the session, believe it will improve the state’s business outlook to repay the federal government more quickly the $2.5 billion borrowed at the height of the Great Recession.

But Bill Rowe with the NC Justice Center points out that the federal emergency extension of benefits is already drawing to an end for states at the end of the year. By prematurely making these changes to the state system now, North Carolina is rejecting $600 million to $700 million dollars in federal money over the next six-months that would be pumped directly into local communities:

“When unemployed folks get those dollars, they are going to pay their landlords, they are going to pay their banks, they are going to pay their utility companies, they are going to buy the necessities for their families. And in some communities that are really hard hit by unemployment,those dollars are going to make a big difference for those small businesses,” explains Rowe. “It’s a two hit here, we’re going to hurt some families, but we’re also going to hurt some families that run some businesses.”

Rowe believes legislative leaders with the political will could add a provision to the state budget changing the effective date of the new law from July 1 to January 1, 2014 and allow the emergency benefits to remain in effect through December.

So far, neither budget negotiators nor Gov. Pat McCrory have expressed an interest in doing that.

For a preview of Rowe’s weekend radio interview with Chris Fitzsimon, click below. Also be sure to read Friday’s Fitzsimon File, which has more on the unemployment cliff.