CALL SENATORS: Tax bill could wipe out RRB unemployment/sick fund

Published: December 19, 2017

The Republican tax bill that is being voted on today has the potential to wipe out Railroad Retirement Board-administered unemployment and sickness benefits.

This is your last chance to call and tell your senators to VOTE NO.

A call to action posted by SMART Transportation Division last week told you about $9 million in potential cuts to that RRB benefit if sequestration – mandatory cuts – are triggered in 2018 by the increased debt that the tax plan will bring.

Now an updated analysis by the RRB warns that unchecked sequestration can result in that fund being “zeroed out.”

Under the federal “Pay-As-You-Go” (PAYGO) Act of 2010, federal spending is required to balance or offset any increases to the federal budget deficit (also known as sequestration). As a result, the tax bill would trigger automatic budget cuts across all federal programs including the RRB’s Railroad Unemployment Trust Fund, which is targeted for a 6.6 percent cut or approximately $9 million in the 2018 fiscal year by the administration.

If Congress does not act to avert sequestration run amok, said RRB labor member counsel Michele Neuendorf in an email, pay for sick or unemployed rail workers will be gone.

“Essentially, if PAYGO goes into effect and there is 100% sequestration, there could be 100% reduction in benefits, meaning that these benefits to railroaders will be zeroed out,” she wrote.

Sick and unemployed rail workers may have paid in, but they’ll lose out. The RRB says in its report:

“These benefits are subject to sequestration. Current sickness and unemployment benefits are set at a maximum of $72.00 per day or $720.00 per two-week or 10-day claim period. However, this benefit rate has been reduced by sequestration in effect since FY 2013 due to the Budget Control Act of 2011. The actual maximum benefit currently paid is $672.48 per 10-day claim period which is a 6.6% reduction…

“Any further reduction resulting from another sequestration would significantly degrade the benefit protections enacted by Congress and harm those employees suffering either unemployment or sickness. For example, if 100% sequestration is triggered by PAYGO rules, railroad employees eligible for sickness and unemployment benefits would receive nothing. Their benefit payments would zero out.”

So someone might be getting a gift from this tax bill this holiday, but it’s not our ailing brothers and sisters or those who are out of work.

Call your senators and urge them to vote against the tax bill.

Find out who your members of Congress are by accessing the SMART-TD Legislative Action Center or call the U.S. Capitol switchboard at (202) 224-3121.

Read a PDF of the RRB’s analysis.