In this Sept. 2, 2020, file photo, shoppers pass by a former Clark's shoe store that is now one of several vacant retail spaces among the outlet shops in Freeport. Credit: Robert F. Bukaty / BDN

AUGUSTA, Maine — There is bipartisan support in the new Legislature to make changes in Maine’s labor department after it struggled to handle record unemployment claims during the coronavirus pandemic, but a massive revenue shortfall could limit its options.

The majority of Mainers on unemployment — or some 35,000 people — are expected to lose benefits by the end of the year as winter approaches and coronavirus cases surge. Additional payments for those not typically covered under unemployment laws will also run out at the end of the year, affecting millions nationwide.

Like many of its counterparts in other states, the Maine Department of Labor struggled this year as unemployment skyrocketed. Many experienced long wait times, delayed claims and fraud that kept them from getting benefits. Democrats want more resources to help the department. The department hinted at a push to overhaul unemployment infrastructure. A top Republican says change is necessary but was wary of a projected $1.4 billion revenue shortfall over three years.

New money is likely to be scarce as the pandemic continues, although a new state forecast may come by next week. Congress has been deadlocked for months on a new stimulus bill, something Gov. Janet Mills said Wednesday has kept the state from reinstating stricter economic restrictions that were meant to slow the virus’ spread.

Rep. Mike Sylvester, D-Portland, who co-chairs the Legislature’s labor committee, said the main issue at the department was communication, which could be fixed with more staff. The department has also come under fire for its arrangement with a five-state consortium that manages the system, but Sylvester said technology changes may not be the answer.

“There’s no substitute for someone who knows what the problem is,” he said.

Rep. Ryan Fecteau, D-Biddeford, the likely incoming House speaker, said he would like the state to explore enhancing the benefit payout to bring it closer to a Mainers’ actual paycheck, possibly by borrowing from the federal government. He noted the state’s average weekly benefit — $294.60 as of September — was nowhere near what most actually make.

But he noted that such changes would likely be dependent on additional aid from Congress. States are allowed to borrow from the federal government to maintain unemployment insurance funds — as 21 states have done this year — but not to increase payments, said Jessica Picard, a labor department spokesperson. States control their individual benefit amounts.

Picard said the agency is still refining its proposals for next year, which will focus on its continued efforts to “rebuild its infrastructure after years of degradation.” She said the brunt of any changes made to the consortium would be borne by Maine unless the other states agreed to it, in which case the costs would be shared.

The issue is also top of mind for incoming Senate Minority Leader Jeff Timberlake, R-Turner. But he said those conversations with his caucus are still developing as leadership figures out how to convene the Legislature in December. He said he was against cuts at the Department of Labor, but the state would also not simply be able to “just throw money” at a solution.

But he said “something” must be done to speed up the department’s response times, saying he has heard from constituents who have been trying to get benefits since March.

“It’s unacceptable,” Timberlake said. “There is a real disservice being done to our constituents.”