State Rep. Greg Alexander on Wednesday opposed a plan that will increase costs for small businesses throughout the Thumb while putting more reliance on a state agency that has shown an inability to handle expanded responsibilities.

House Bill 5827 increases the maximum number of weeks that an individual may receive unemployment compensation from 20 to 26 weeks beginning on Jan. 1, 2025.

“Small businesses have already been through enough the past few years, from COVID-19 shutdowns to inflation and increased red tape from Lansing,” said Alexander, of Carsonville. “Many were put out of business for good. Continuing to ding our local job providers with added costs and make them pay more into this system will chase them out of our state and discourage others who are looking to locate here. It creates a poor environment going forward and will impact our state and local economies.”

Alexander noted that the state’s current unemployment number is 3.9 percent – below the national average. He questioned added weeks when the state’s unemployment numbers do not suggest a need for action.

The current 20-week limit was implemented in 2011 due to problems the state’s Unemployment Insurance Agency (UIA) was facing at the time, which included debt and high costs. In addition, UIA experienced numerous issues with fraud and its fraud prevention tools during the COVID-19 pandemic when hundreds of thousands of Michigan residents saw their livelihoods shuttered.

A state audit released in December showed that UIA did not do enough to identify and investigate potential fraud as unemployment claims came in and instead paid out over $245 million to ineligible claimants – including dead people – between Jan. 2020 and Oct. 2022. A separate audit from Deloitte estimated that from March 2020 through Sept. 2021, missteps from UIA cost the state an estimated $8.5 billion.

Alexander noted the bill was sent directly to the House floor without receiving a hearing in a committee, cutting out the chance for public input through their elected officials. HB 5827 moves to the Senate for further consideration after being approved by the House along party lines.