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 | | Subject: California's unemployment fund is insolvent Sun Jul 09, 2023 6:42 am | |
| - elsewhere, Turd_Ferguson wrote:
Kookafornia's unemployment is insolvent
« on: Today at 06:37:08 am »
https://californiaglobe.com/articles/breaking-california-edd-structurally-insolvent/
The Unemployment Insurance (UI) trust fund the California Employment Development Department uses to pay benefits is now “structurally insolvent” a new Legislative Analyst’s Office report states.
The report – a reaction to the “May Fund Forecast” released by the EDD last week states quite bluntly that the “temporary” – now about 15 years and not the six or seven years the EDD originally projected – federal surcharge will be used to cover on-going bills before actually paying the $18 billion-dollar federal debt the agency incurred due to gross incompetence during the pandemic.
That additional tax works out to be about $1,500 per California employee over the next 15 years (it starts at $21 per employee and rises until it hits $420 per year until the debt is paid.)
The state is using that money now to pay benefits (which are guaranteed by the feds so no matter what financial shape the EDD is claimants will still get paid.)
But the report notes that even without the pandemic debt, the state would still have to borrow money over the next few years, an utterly novel situation in a putatively “good” economy (though the pandemic debt is the cause of the insolvency and the size of the tax hike.)
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