When Angela Hogan was laid off about a year ago from her job as an office clerk in Providence, she applied for unemployment benefits.

Based on her record of work and earnings, she qualified for $186 a week. But she wound up receiving $16 a week instead.

Hogan, 80, of Providence, ran into a bizarre state law that essentially punishes people — mainly the elderly — who collect unemployment and Social Security benefits at the same time.

It generally works like this:

When calculating the amount of your unemployment compensation, the state Department of Labor and Training first checks to see if you receive Social Security benefits, too.

If so, the state essentially deducts half your Social Security benefits from the amount of unemployment benefits that you’d normally be eligible to receive.

That’s why Hogan ended up with only $16 a week. And she doesn’t think that’s fair.

Hogan was among several people who testified yesterday at a House Finance Committee hearing at the State House in favor of legislation that would end the Social Security offset. (The Senate approved the measure last month.)

No one spoke in opposition, but there were several supporters, including the AARP, a membership organization for people 50 and older.

Dr. Anthony Regine, 73, of Middletown, a retired dentist, is the new president of the AARP’s state chapter in Rhode Island.

He told the committee that 42 other states have eliminated the penalty, including Massachusetts.

Only eight states still have the so-called Social Security offset provision on the books. One of them, Maine, is expected to halt the practice later this year, Regine said.

That would leave Rhode Island as one of only seven states — no others in New England — that still require a Social Security offset, according to an AARP summary of the issue.

Among those affected is Constance Alger, of North Kingstown, whose experience was the focus of a MoneyLine column last year.

She retired in 2005, after working most of her life as an accountant for a number of firms. But she found that she couldn’t live on her Social Security benefits alone, and was having to tap her savings as a result, she said.

So she returned to work, this time as a tour guide in Newport, a seasonal job. When she was laid off, she applied last year for unemployment benefits.

She qualified for $135 a week — but wound up receiving just $16 a week instead.

Why? She happened to be receiving the weekly equivalent of about $237 in Social Security retirement benefits.

So the state reduced her $135 unemployment benefit by $119 (half her Social Security benefit), leaving her with $16 a week.

This year, she applied for unemployment benefits again. She qualified for $129 a week, but ended up receiving just $6 a week instead, a result she considers almost ridiculous.

“I have two of [the $6 checks], which I’m saving,” she told the committee yesterday. “I think I’ll frame them,” she quipped.

It’s not a joke, though, she and others said; it’s an important pocketbook issue.

Hogan, for instance said she had to sell her house in Providence, unable to afford the high cost of local property taxes. She now rents an apartment, and said she needs every bit of income she can get.

Anne Callan, 71, of Barrington, said that she, too, has bills to pay. She retired in 1998, but was forced back to work, in a part-time job, to help pay for local property taxes.

When she is laid off from her job as a tour guide, the state cuts her unemployment benefits because she is also receiving Social Security benefits, she said.

And that’s not fair. Workers who’ve earned the right to unemployment benefits should receive the full amount to which they’re entitled, with no offset for Social Security, she said. “What we’ve earned, we should get,” she told the committee.

Changing the law for Callan and others “is a matter of simple fairness,” said Kathleen S. Connell, state director of the Rhode Island chapter of AARP. “This is a matter of doing what’s right,” and about state government keeping is promises to workers, she told the committee.

Changing the law would benefit not only Rhode Island’s large population of older voters, but would help others, too — including younger people when they reach retirement age, said state Rep. Thomas Slater, D-Providence, chief sponsor of the House bill. “Sooner or later, we’re all going to be up there in age,” Slater said.

What happens next? There’s reason to be hopeful. The committee decided yesterday to hold the measure for further review, but that was largely a procedural move, said the committee’s chairman, state Rep. Steven M. Costantino, D-Providence.

“Rarely does my committee vote on [a bill] the first day we hear it,” Costantino said in an interview during a break in the hearing.

He said he still wants to gauge any financial consequences the measure might have to the state.

If the law is changed, some employers would probably have to pay more money into the trust fund that the unemployment insurance program maintains, and other employers might have to pay more.

The AARP has said that, at least in the short run, the cost to employers of eliminating the offset would, on average, be relatively small.

Costantino noted yesterday that no employer groups testified yesterday against the measure. He said the bill — H 5296 — might come back up before the committee in about a week.

“I think it has a good chance of passage,” he said. That would be good news to the bill’s backers — including lots of older workers who need the extra income to help make ends meet.

Neil Downing is a Journal staff writer and author of The New IRAs and How to Make Them Work for You. Questions about your money matters? Call us at 1-401-277-7484 and leave a message, or e-mail:

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