As this article and others have explained in recent days, many states are struggling to repay the federal government for loans it made to help cover unemployment benefits as joblessness surged during the recession.
“More than 30 states have had to borrow billions from a federal fund to cover unemployment benefits for their jobless residents in recent years.” – CNN Money
More than $1 billion in interest is due to the federal government by tomorrow. The Idaho Department of Labor says the state’s share of those interest payments — $5.5 million — has already been sent. “We paid it on Monday,” said spokesman Bob Fick.
The state also paid off the more than $202 million balance of the loan, money borrowed in 2009 and 2010 when Idaho’s Unemployment Insurance Trust Fund went broke. It financed both payments by issuing bonds this summer, a move that won approval from the Idaho Legislature earlier this year.
Idaho’s repayment means that employers will not face higher federal unemployment taxes come January. By contrast, some states are turning to employers and asking them to pony up.
Spokesman Fick says the Idaho Department of Labor has not had to borrow money from the U.S. Department of Labor since July of 2010. The state’s Unemployment Insurance Trust Fund currently holds $139 million. That amount should rise under the measure signed by Gov. Otter in March.