Latest Post | Last 10 Posts | Archives
Previous Post: ChatGPT is starting to win me over
Next Post: Another day, another lawsuit
Posted in:
* Press release…
Immediately after receiving word that Governor Pritzker had signed the budget bill (SB 2801) authorizing repayment of the remainder of the COVID-19 unemployment insurance Comptroller Susana A. Mendoza Monday began making the transfers of $1.37 billion so that IDES could pay the federal government.
The payoff saves Illinois $20 million in interest costs that would have been due in September had the loan not been paid off. Other states such as California, New York and Connecticut have yet to pay off their COVID-19 unemployment insurance loans.
In preparation for this day coming, Comptroller Mendoza had directed staff to begin setting money aside so the check could be sent the moment Governor Pritzker signed the bill passed by the General Assembly in recent days and save on interest.
“We have been preparing for this day to pay back the remainder of the COVID-19 unemployment insurance loan and stop the interest-meter running for taxpayers,” Comptroller Mendoza said. “This is one more sign Illinois is earning the upgrades from the bond-rating agencies who see the work we have done to fix Illinois’ finances.”
The agreement announced by Governor Pritzker in November between business and labor negotiators, bipartisan members of the General Assembly and the administration to use $1.37 billion in better-than-expected state revenues to pay off the remainder of the $4.5 billion loan eliminated the need to ask state businesses to pay more into the fund or to cut unemployment benefits for state workers.
The COVID-19 pandemic in 2020 caused unprecedented unemployment claims as businesses shut down, patrons stayed home from restaurants and theaters and business owners had to lay off workers. Illinois, like other states, exhausted its reserves of funding for unemployment claims and needed advances from the federal government.
The agreement will contribute more than $1.8 billion in state funds to the unemployment insurance trust fund. In addition to paying off the $1.37 billion to the federal government, an additional $450 million will be placed into the trust fund from state funds as an interest-free loan to help strengthen the fund. As the loan is repaid over the next 10 years, funds will be deposited directly into the state’s Rainy Day Fund.
“Any chance the state has to contribute more money to the Rainy Day Fund, we should take,” Comptroller Mendoza said. “Catching up to other states’ Rainy Day reserves signals to the bond-rating agencies how serious Illinois is about fixing our finances. That leads to credit upgrades, which means lower costs for taxpayers.”
posted by Rich Miller
Monday, Jan 23, 23 @ 4:20 pm
Sorry, comments are closed at this time.
Previous Post: ChatGPT is starting to win me over
Next Post: Another day, another lawsuit
WordPress Mobile Edition available at alexking.org.
powered by WordPress.
Good move. Better to pay this off now before costs catch up with the general funds revenue surges.
Comment by Dirty Red Monday, Jan 23, 23 @ 4:30 pm
This is smart fiscally, great to see this type of governing being done.
Paying bills is good government
Comment by Oswego Willy Monday, Jan 23, 23 @ 4:32 pm
Good plain and boring government is what I like to see.
Comment by Baloneymous Monday, Jan 23, 23 @ 4:33 pm
If only JB was as smart as Bruce Rauner at managing the State’s finances… oh wait a minute…
Comment by Lincoln Lad Monday, Jan 23, 23 @ 5:05 pm
” … Comptroller Mendoza had directed staff to begin setting money aside … .”
Was the money transferred between funds, or was the fund balance(s) allowed to build up?
Comment by Anyone Remember Monday, Jan 23, 23 @ 5:08 pm
The State purposefully missed the repayment deadline in November, which has resulted in every employer in the State having to pay higher FUTA taxes.
Here’s the email I received from ADP on Friday explaining why they had to charge my company the extra surcharge:
Our records indicate your company will be assessed additional Federal Unemployment Tax Act (FUTA) tax by the federal government for 2022 because you have employees working in one or more FUTA Credit Reduction states: California, Connecticut, Illinois, New York.
A FUTA credit reduction state means a state has taken loans from the federal government to meet its unemployment benefits obligations and has not repaid the loans within the allowable time frame. As a result, the usual credit against the full FUTA tax rate is reduced by 0.3% and the employer will owe a greater amount of tax in those states.
Comment by Occam Monday, Jan 23, 23 @ 5:46 pm
Saving 20 million is nice unfortunately Illinois lost in excess of 200 million in lost income taxes solely related to Citadel and Griffin relocating to FL. Griffin was the best performing hedge fund in 2022 with profits exceeding 16 billion. Assume Griffin’s take on that was his typical amount then Illinois is out 200 million in income tax -so Mendozahas more work to do
Comment by Sue Monday, Jan 23, 23 @ 7:32 pm
I’m with Sue. We should have rolled over on our backs, gutted all our agencies, and enacted every single he wanted just to keep him here. Pandering to the rich is what society should be all about, right?
Comment by Jibba Monday, Jan 23, 23 @ 7:58 pm
Good for Gov. Pritzker and Comptroller Mendoza to get this paid off. Kudos!
Comment by Fivegreenleaves Monday, Jan 23, 23 @ 8:15 pm
Sue, all I can say is from this fiscally responsible Republican that is a CFO in State government, your comment is inane. And I would apologize for my opinion but it is simply a fact.
Comment by Lurker Tuesday, Jan 24, 23 @ 12:19 am
I looked all day on the Illinois Policy Institute’s website for news on the government meeting its obligations but never saw an article. Instead, I saw silly cartoons and click-bait for morons. I guess they know their audience.
Comment by Travel Guy Tuesday, Jan 24, 23 @ 12:43 am
Fiscally responsible? Are you grading on a curve?
Only California and New York had higher unpaid unemployment trust fund deficits as of last month.
https://crsreports.congress.gov/product/pdf/RS/RS22954
https://igpa.uillinois.edu/wp-content/uploads/2022/08/IGPA__TRUST-FUND-PolicySpotlight_F.pdf
At least JB admitted he wished Ken Griffin didn’t leave the state to CNBC
Comment by Lucky Pierre Tuesday, Jan 24, 23 @ 7:12 am
- Sue -
Your gushing admiration for a rich man who associations and his ruinous way he sees people because.., “money”… is shallowly sad.
Society needs people who see value *in* pepper, not see them as the ills to an agenda
Comment by Oswego Willy Tuesday, Jan 24, 23 @ 7:35 am
===Fiscally responsible? Are you grading on a curve?===
You first complained the state took the money, used the money to phony a budget… now you’re complaining they are paying back… ahead of time?
Are you being dishonest? Again?
Comment by Oswego Willy Tuesday, Jan 24, 23 @ 8:12 am
@willy
Payment was due in November. 46 other states made timely payments. Illinois missed it and employers statewide were forced to pay on the states behalf. Not responsible. I’d thank Springfield for saving us from another $20MM late fee, but my company is still smarting from the $13K we paid for their first miss.
https://www.irs.gov/businesses/small-businesses-self-employed/futa-credit-reduction
Comment by Please Show Your Work Tuesday, Jan 24, 23 @ 8:08 pm
=== I’d thank Springfield for saving us from another $20MM late fee, but…===
Which is exactly what I said. It’s good.
Responsible.
Comment by Oswego Willy Wednesday, Jan 25, 23 @ 7:38 am