Some more good news out of those final, dreary days of the state legislative session: Both chambers passed SB 1350 last Saturday, triggering seven additional weeks of federally-funded unemployment insurance via the federal stimulus package (raising the total, federally-funded extension to 20 weeks). In negotiations with the business community, labor representatives also managed to extend eligibility to those who leave their job voluntarily for extenuating personal or family reasons (i.e. sexual abuse, spousal relocation or sickness) and establish a $15 allowance for all dependents of unemployment filers, scheduled to start in 2011. "Did we want more? Sure," says Tim Drea, secretary-treasurer of the Illinois AFL-CIO. "But we didn't want to bankrupt the system. And we came away happy with what we got."

On a related noted, ProPublica teamed up with American Public Media's Marketplace to study the nation's vast and decentralized unemployment insurance system. Their piece paints a nasty picture of an outdated collection of state agencies struggling to keep up with increasing demand:

A compromise dating back to 1935 means each state has its own unemployment insurance system, with wide latitude to set taxes and benefit levels. As state systems buckle under the weight of skyrocketing unemployment, the fault lines of the current structure have been brought into stark relief. States have been left on their own to financially founder or prosper, and benefits vary nearly as much as the health of state systems.

Fourteen states have simply run out of money to pay benefits and been forced to borrow from Washington a total of more than $8 billion. That number is almost certain to grow as more states reach the brink.

Despite our state's catastrophic deficit, Illinois isn't yet dealing with those problems.

The state's total unemployment benefit fund balance sits just north of $500 million dollars -- the 14th largest total in the U.S. And unlike other comparably large states such as New York ($29 million with $1.3 billion in debt) and Ohio ($29 million with $862 million in debt), we haven't borrowed one dime to fill the coffers. While the average weekly benefit amount is $338.38, the 11th highest average in the country, only 50 percent of the state's unemployed are receiving benefits (tied for 21st in the nation).

That last statistic is an important one.  As we noted back in February, the fund surplus may be partly due to employers' denying unemployment claims.  There is great incentive for them to do so (it keeps their premiums down, after all) and the appeals process is a huge ordeal for those unjustly denied beneifts.  Our original post included some recommendations from the Legal Assistance Foundation for how state policy could be changed to level the playing field.

UPDATE (6/29): Both legislative chambers passed Senate Bill 1350 last month, which modifies state law to trigger an additional 7 weeks of extended benefits (on top of the 13 already triggered in April). On June 26, it was sent to Gov. Pat Quinn's desk. He has 60 days to sign it into law. 

UPDATE (8/26): We've created an open thread for readers to learn about the unemployment insurance process and discuss any questions or advice they have. Follow the link here.