Delaware legislators go to aid of federal employees caught in shutdown crunch

DOVER — Legislation introduced and passed by the House of Representatives Tuesday would help federal employees feeling a financial crunch from the longest government shutdown in U.S. history.

The bills are expected to be passed by the Senate today and could be signed immediately afterward.

One measure, House Bill 3, was approved unanimously by the House, while the other, House Bill 2, saw four votes against it. Reps. Rich Collins, R-Millsboro; Shannon Morris, R-Harrington; Bryan Shupe, R-Milford; and Jesse Vanderwende, R-Bridgeville, were the “no” votes.

House Bill 2 would allow federal government employees, including contractors, to seek a temporary stay from a court on a wide variety of payments, from rent to fines to insurance premiums.

A stay could last through the entire duration of the shutdown and up to 120 days thereafter for employees determined to have “been materially affected by the shutdown.”

Under House Bill 3, the state would guarantee loans to federal employees who are not being paid during the shutdown. Loans of one month’s pay up to $5,000 would be available through M&T Bank, with interest rates at 2.5 percent. Other financial institutions could also opt to participate.

While M&T Bank declined to comment on the specifics of the loan, the governor’s office said individuals could apply at any one of a dozen locations statewide through West End Neighborhood House.

Under the bill, the state would set aside $80,000 to guarantee loans.

The government closure, which officials estimate is causing 525 Delaware workers to go unpaid, reached 32 days Tuesday.

“I never in my wildest dreams thought it would go (32) days. I didn’t think it would go seven days, let alone (32),” said House Speaker Pete Schwartzkopf, D-Rehoboth Beach. “Every day we wake up, hoping it’d be over and it’s not over and it doesn’t sound like it’s going to be over for a long time.”

The General Assembly, he noted, will not be in session until March 5 after this week, creating a sense of urgency among officials.

The federal government partially closed on Dec. 22 after Congress and the White House failed to agree to a spending plan. President Trump has refused to sign any bill that does not contain $5.7 billion to construct a security wall along the southern border, while the Democratic majority in the House has refused to provide that funding.

Complicating matters is Senate Majority Leader Mitch McConnell, R-Kentucky, who has rejected calls to bring to the floor a bill that does not include the requested funds for the security wall.

President Trump altered his offer over the weekend, pledging to provide temporary protections for some immigrants living in the country illegally in exchange for funding for a barrier between the United States and Mexico. However, his compromise failed to appeal to Democrats, including the three members of Delaware’s congressional delegation.

The state began taking unemployment claims for federal employees on Jan. 11, and as of Friday, 78 Delawareans had filed for unemployment. Individuals who are not working can receive up to $330 a week for 26 weeks.

While some government employees are currently performing their duties with the expectation they will be paid at some point, others are furloughed, meaning they are losing income they can’t make up without taking another job.

Businesses and nonprofits around the country are taking steps to aid federal employees, offering loans, discounts and even some freebies. Other states are also providing low-interest loans, and public universities in Connecticut are delaying tuition payments for individuals hurt by the shutdown.

The legislation the House passed Tuesday, supporters said, would give much-needed relief to hundreds of Delawareans.

House Bill 2 would allow federal workers to get court orders temporarily halting evictions and would bar companies from canceling any insurance policies because an impacted federal employee fails to pay premiums or interest.

The measure would also restrict interest rates on any contract signed by a federal employee even if it was agreed to well before the shutdown. During the shutdown and up to 120 days after it ends, interest rates of more than 6 percent would be forbidden for a small subset of Delawareans.

Lawmakers briefly discussed the two bills on the House floor, with Rep. Collins being the only one to detail his opposition before the vote. The Millsboro Republican said he wanted to assist federal employees but feared the bill would send a message that Delaware is anti-business and would adversely impact companies.

“It seems like we’re trading pain for one group and giving that pain to another group,” he said.

“I guess if I were a corporate attorney and I’m looking at a state to either incorporate my business or move my business to Delaware, would I say this type of bill, this type of legislation with so little notice, does it give me a warm spot in my heart for the state of Delaware or not? If I were a corporate attorney or an accountant, I would say this makes me nervous.”

“If I was a federal worker, I’d think it would make me very happy to be here,” Rep. Schwartzkopf replied.

Asked if he had considered filing legislation to expand unemployment to federal workers who are performing their duties but not being paid right now, Rep. Schwartzkopf said he did not think he could change that.

Labor Secretary Cerron Cade said Tuesday the work requirement exists in both state and federal law. Once the shutdown ends, Washington will provide funds to Delaware to compensate the state for federal workers who received unemployment. Any expansion to allow individuals working without pay to get benefits would not be covered by the federal government.

NPR reported last week California planned to expand unemployment to federal workers who are not furloughed despite opposition from the Trump administration.

While approximately 800,000 federal workers haven’t been paid since 2018, they aren’t the only ones impacted by the shutdown. Tens, if not hundreds, of millions of Americans receive some form of assistance from Washington, and many of those benefits could be in danger if the shutdown drags on.

The 136,000-plus Delawareans in the Supplemental Nutrition Assistance Program got their food stamps for February early, and funding for the program may be in trouble should the shutdown stretch into March.

A spokeswoman for the Delaware Department of Health and Social Services said Friday the agency had requested more information from the federal government in the event the closure continues.

Rep. Schwartzkopf said he has no plans to file legislation that would set aside funding for SNAP recipients. According to DHSS, the federal government distributes about $15.8 million monthly to Delaware for the program.

“We have to take care of the workers that we can. I would love to take of everybody but … I don’t even know whether we can,” Rep. Schwartzkopf said.

Staff writer Matt Bittle can be reached at 741-8250 or mbittle@newszap.com. Follow @MatthewCBittle on Twitter.

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