MARVIN MANDEL, Governor                       3997

Unemployment Insurance Law.

May 15, 1975.
Honorable John Hanson Briscoe
Speaker of the House of Delegates
State House
Annapolis, Maryland

Dear Mr. Speaker:

In accordance with Article II, Section 17 of the
Maryland Constitution, I have today vetoed House Bill
578.

This bill provides unemployment insurance for all
persons whose employer contributions to one of the State
retirement systems are paid by the State, with the
exception of elected and certain appointed officials.
This somewhat awkward language has the effect of
including some 22,000 State employees and 52,000 teachers
and educators under the unemployment compensation law, at
a cost to the State of $232,800 in fiscal year 1976 (for
which no provision has been made in the budget) and over
$1,200,000 in fiscal year 1977. With respect to the
teachers, the bill requires that the State pay the
expense of reimbursing the Unemployment Insurance Fund,
even though they are local employees, hired, paid, and
dismissed by the local governments.

My principal objection to the bill concerns the
effect of its provision that, although employment service
rendered after March 31, 1975, is covered, the benefits
may not be paid until "after December 31, 1975, or upon
termination of the Emergency and Unemployment Assistance
Act of 1974, providing for special unemployment
assistance, whichever shall be later..."

We have received a telegram from the United States
Department of Labor indicating that this provision,
delaying benefits for covered employment until the
expiration of the Federal program, is inconsistent with
the Federal law authorizing that program (P.L. 93—567)
and with the Special Unemployment Assistance Agreement
entered into between the Department of Labor and the
State. According to the Employment Security
Administration, the effect of the bill may be to cause
the Department of Labor to refuse to reimburse the State
for the supplemental unemployment benefits paid under
that program. Between January 1, 1975, and April 30,
1975, nearly $1,000,000 in such benefits were paid to
over 5,000 claimants. The cost to the State, on an
annualized basis, if it received no Federal
reimbursement, could approximate $3,000,000 — a cost it