Journalism in the Public Interest


Fla. Unemployment Borrowing May Top $1 Billion

A man talks to a recruiter for the Broward Sheriff's department as he looks for a job during the RecruitMilitary Career Fair on Aug. 20 in Miami. (Joe Raedle/Getty Images)Florida has become the 19th state to borrow money to keep unemployment benefits flowing after the trust fund ran dry.

So far the state has borrowed $45 million, but officials estimate that it will have borrowed $1.2 billion by the end of the year.

As we detailed earlier this year in our series with public radio's Marketplace, states operate their own unemployment insurance systems with little federal control over benefit levels and how well they choose to finance their systems. Like many states, Florida requires employers to pay unemployment insurance tax only on the first $7,000 of each employee's income -- the federal minimum, which has not been updated since 1983.

Is your state's trust fund in danger of running out? See our interactive map.

Because of the stimulus bill, states have until January 2011 to pay back their loans with no interest. But if Florida's balance is not repaid before then -- a process that in many states has necessitated business tax increases or benefit cuts -- Florida will face tens of millions of dollars of interest payments that must be repaid from its general fund, taking money away from other state priorities.

Business as usual….the FL CFO Alex Sink, had the initial responses to last years market dive, very similar to other political tag team buddys Crist, & McCullom.  All 3 of these individuals as top board members of a now shaken FL pension fund, all 3 have their pat answers about how they were surviving, as compared with others states (in response to NOV. 2008 $29B loss in state pension fund).  Now the same CFO is already endorsed by the teachers union, in her democratic bid for governor.  McCullom is in same race dressed in republican garb.  I wonder what the candidates expect to do about the climbing unemployment payouts, and of course the credit supporting such action.

You dont have to believe me… the ‘other’ democratic candidate Farid A Khavari gets it said in statement today..