WINDFALL FOR JOBLESS STATE MAKES $100-A-WEEK BENEFIT RAISE RETROACTIVE TO 9-11.

Byline: Evan Pondel Staff Writer

All one million Californians who were jobless after the Sept. 11 terrorist attacks last year will start receiving checks this week for up to $2,600 - a controversial retroactive benefit that will cost $540 million.

Beginning Monday, those who collected unemployment last year between Sept. 11 and Dec. 31 could receive $100 a week - in some cases even more - in back benefits. The increase reflects the difference between the maximum weekly unemployment benefit of $230 last year, compared with the dramatically increased benefit of $330 that took effect Jan. 1, and the lowering of the threshold for the full benefit.

``Most people will actually be in shock when they start receiving the extra money,'' said John Connolly, a 51-year-old unemployed actor. ``Right now, I can only say these checks are certainly needed.''

The retroactive payments stem from a bill sponsored by state Sen. Richard Alarcon, D-Van Nuys. It was signed into law in May.

``These checks show that if our nation is attacked, California will find ways to help people recover,'' Alarcon said.

Federal legislation intended for job creation and worker assistance due to the economic impact of Sept. 11 provided $938 million to California, and $540 million of that will be used to pay retroactive benefits to everyone who was jobless last fall. The Democratic-controlled Legislature intends to use the rest of the money for work-related programs.

State Republican leaders opposed Alarcon's bill because they wanted all the money to be used to bolster the state Unemployment Insurance Trust Fund, to keep employer costs down in face of the recession.

``We support providing benefits for the unemployed,'' said H.D. Palmer, a spokesman for the state Senate Republican Caucus. ``But we don't support using the remaining funds for anything else but unemployment insurance.''

Cal-Tax, a Sacramento-based advocacy group, expressed concern because the money went to all unemployed people and not just those who lost their jobs as a direct result of Sept. 11.

``Now the entire unemployment fund will be put at risk,'' said Ron Roach, a Cal-Tax spokesman. ``And it wouldn't surprise me if we saw a significant increase in taxes paid by the employer because of this bill.''

Bruce Doering, executive director of the International Cinematographers Guild Local 600, lobbied for Alarcon's bill and sees it as a precedent.

``The fact that this bill actually passed sets an example of how simply caring and political action can work,'' he said.

Last year, the state boosted weekly unemployment benefits from $230 to $330 effective Jan. 1 and to $370 effective Jan. 1, 2003.

Julianne Broyles, the California Chamber of Commerce's director of insurance, said the unemployment benefits are obviously important, but that the state's employers will probably see their taxes rise.

``There are structural problems in the state's unemployment insurance fund right now,'' she said. ``At this point it's bleeding money.''

Unless reforms are introduced to streamline the insurance fund's expenditures, money will continue to drain and taxes are likely to gain significant ground.

``It's always easy to take care of the short-term problems through federal funding. Yet the long-term structural damage will continue to exist,'' Broyles said.

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John Connolly, a 51-year-old actor, is among the one million Californians who will receive an increase in unemployment benefits made retroactive to September 11.

Gus Ruelas/Staff Photographer