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* Crain’s…
Gov. J.B. Pritzker is moving to pay off more than $1 billion in remaining debt in the state’s unemployment insurance trust fund and set aside with a little extra for hard times that may be ahead—actions already drawing a sigh of relief from the state’s business community.
In an announcement today in Springfield, Pritzker said he intends to allot, subject to General Assembly approval, a total of $1.8 billion to the fund, which pays weekly benefits to laid-off workers.
The bulk of the money, $1.36 billion, will pay off what’s left of what had been $4.5 billion in borrowing from the U.S. Treasury at the height of the COVID-19 pandemic. The remaining $450 million will be loaned without interest to the unemployment insurance trust fund. As the loan is repaid over the next 10 years, funds will be deposited directly into the state’s rainy-day reserve fund, rather than being spent.
Watch the press conference here.
…Adding… Pritzker stressed this agreement was reached through the agreed bill process. That process brings labor and business to the table.
…Adding… Here’s the press release…
Governor JB Pritzker announced today an historic agreement to pay off the remaining $1.36 billion unemployment insurance loan balance, replenish the fund for the future, and protect benefits for working families. The agreement will save taxpayers an estimated $20 million in interest costs that would be due next September and preserves hundreds of millions of dollars in future federal tax credits for Illinois employers.
The agreement between representatives from business, labor, bipartisan members of the General Assembly, and the state, will contribute more than $1.8 billion in state funds to the unemployment insurance trust fund, which includes the payment of the remaining federal loan balance borrowed under Title XII of the Social Security Act. The remaining $450 million will be placed into the trust fund from state funds as an interest-free loan. As the loan is repaid over the next ten years, funds will be deposited directly into the state’s rainy-day fund.
“I’m proud to announce that together, we’ve reached a historic, bipartisan agreement to eliminate pandemic-induced UI Trust Fund debt, replenish the fund for the future, protect benefits for working families, and further fuel Illinois’ strong economic trajectory,” said Governor JB Pritzker. “Republicans and Democrats are delivering a historic state investment of $1.8 billion to the Unemployment Trust Fund. This bipartisan agreement eliminates the final portion of the $4.5 billion debt forced upon our state during the pandemic and saves Illinois businesses and taxpayers hundreds of millions of dollars over the next decade.”
“The people of our state deserve a secure future, one that supports working families and continues to make Illinois a great place to live,” said Lt. Governor Juliana Stratton. “Through collaboration and a shared vision among the stakeholders who came together in the work, this agreement is another example of our commitment to responsible, forward-thinking leadership that builds the groundwork for a strong economy for years to come.”
“In my brief tenure as Senate President, what I’m most proud of is the work we’ve done to restore fiscal stability, said Senate President Don Harmon (D- Oak Park). This agreement is yet another step forward. I applaud everyone involved for coming to the table with workable ideas and the desire to be part of a solution.”
“The pandemic created unprecedented challenges for unemployment insurance systems across the nation and without action, Illinois employers would have faced crushing tax increases in the midst of other challenges. This agreement will ease that pressure and provide greater stability for our system, while also ensuring employers pay over $900 million less in taxes over the next five years than they otherwise would have,” said Rob Karr, President and CEO of the Illinois Retail Merchants Association. “On behalf of the Joint Employers, we extend our appreciation to our partners in organized labor, Gov. JB Pritzker and his staff, the Illinois Department of Employment Security, and the Democratic and Republican caucuses in the House and Senate for their dedication to working together to solve what we hope is a once-in-a-lifetime crisis.”
“Responsible fiscal decisions and new lows in unemployment claims have put our state in an advantageous position,” said State Senator Bill Cunningham (D-Chicago). “Thanks to the collective work of so many, our budgets are balanced, and we have the opportunity to fully pay down our debt in a timely manner.”
“This action is just the latest building block in our efforts to improve the financial status of our state,” said State Senator Linda Holmes (D-Aurora). “By paying what we owe and continuing to pass responsible budgets, our state’s fiscal status only continues to improve.”
“I’m proud of the long hours negotiators on both sides have put into creating this agreement,” said State Senator Sue Rezin (R-Morris). “It’s good to know we’re working together to pay off debt and even better to know that the funds previously allocated to paying down that debt will now go to shoring up the state’s Rainy Day Fund.”
“Paying off the unemployment insurance trust fund debt is a crucial step in our state’s continued recovery from the fiscal crisis brought on by the COVID-19 pandemic,” said State Representative Marcus Evans (D-Chicago). “Thanks to the hard work of my colleagues in the legislature, Governor Pritzker, and numerous stakeholders in the business community and organized labor, we can now proudly say we are on the path toward fiscal security in the state of Illinois.”
“This monumental agreement is an example of what is possible when sound financial choices are made,” said State Representative Jay Hoffman (D-Swansea). “Through these actions, we’re saving taxpayer and employer dollars while maintaining unemployment benefits and building on the state’s record of success in meeting our obligations.”
“This has been a long and tough process, but everyone stuck with it even when there were disagreements,” said State Representative Mike Marron (R-Fithian). “As a result, Business, Labor, Republicans, Democrats, the Governor, the Legislature, and IDES came together to get this deal done that will help both small business owners and Illinois workers.”
“This is a good agreement for both employees and the business community in the State of Illinois,” said State Representative Dan Ugaste (R-St. Charles). “Across-the-aisle cooperation of this type is what provides the best results for everyone in the State.”
“The Illinois Department of Employment Security has been proud to work alongside the partners of the agreed bill process and is pleased the outcome is beneficial to the state, workers, and employers,” said IDES Director Kristin Richards. “The state’s Trust Fund is a critical resource, and ensuring its healthy future is in the best interest of our state’s economy.”
The agreement strengthens the state’s trust fund, alleviates a burden looming over businesses, and ensures there are no reductions in both the standard number of weeks of unemployment benefits and the amount a person can claim. The agreement is expected to pass via bipartisan legislation during upcoming legislative sessions.
The unemployment trust was forced to borrow $4.5 billion in federal funds to provide economic relief to the unprecedented number of unemployed workers throughout the Covid-19 pandemic.
This is the third significant contribution to the outstanding loan balance. In March of 2022, Governor Pritzker signed legislation which provided an historic $2.7 billion contribution to assist the state’s unemployment trust fund via one-time federal ARPA dollars; in September of 2022, another $450 million payment was made toward the loan balance from the fund itself due to months-long historically low unemployment claims.
In addition to months of historically low unemployment claims, the state has created 770,000 more jobs since the bottom of the pandemic recession and surpassed one trillion dollars in GDP for the first time in history.
…Adding… IL Chamber…
Following today’s press conference, Illinois Chamber President and CEO Todd Maisch issues the following response:
“We were happy to participate in the negotiations that led to today’s agreement on the unemployment insurance trust fund deficit,” Maisch said. “Today’s agreement illustrates the results that can be achieved when everyone works together cooperatively to tackle the big issues facing our state. As we head into an uncertain economy, employers will benefit from the minimization of tax increases.”
…Adding… IL AFL-CIO…
Following Governor Pritzker’s announcement to pay off the state’s unemployment deficit and provide structural funding reforms to the unemployment trust, IL AFL-CIO Secretary Treasurer Pat Devaney released the following statement:
“Governor Pritzker’s announcement to pay the state’s remaining $1.36 billion debt to the unemployment trust fund and implement structural funding reforms is a win for both businesses and working people.
Today’s achievement is the result of bipartisan, bicameral negotiations led by Governor Pritzker’s Administration. Organized labor, businesses of all sizes, and elected leaders set aside their differences to advocate for working people. As a result, taxpayers will be spared millions of dollars in interest payments and our unemployment trust fund will move from a state of deficit to solvency – now and in the future.
Illinoisans can rest easy knowing that the future of our state’s unemployment system will reflect the needs of working people and those facing economic hardship. We are grateful to Governor Pritzker, the Illinois General Assembly, business, and labor leaders who came together to agree on commonsense policy that will benefit working families across Illinois.”
…Adding… IMA…
The Illinois Manufacturers’ Association (IMA) released the following statement regarding an agreement between business, labor and Democratic and Republican lawmakers to address the remaining $1.36 billion debt that currently exists within Illinois’ Unemployment Insurance Trust Fund:
“This bipartisan agreement will save manufacturers and other businesses more than $900 million in higher taxes while preserving the solvency of the Trust Fund at a time of economic uncertainty,” said Mark Denzler, President and CEO of the Illinois Manufacturers’ Association. “We applaud the Governor and lawmakers for contributing $4 billion in federal dollars to help eliminate the debt resulting from the global pandemic that would have otherwise been forced upon struggling businesses across Illinois.”
posted by Rich Miller
Tuesday, Nov 29, 22 @ 2:42 pm
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Imagine a governor enacting fiscal solvency, as opposed to a governor kicking that can down the road through the annual budget reconciliation process.
This is as it should be. Kudos to our current governor.
Comment by H-W Tuesday, Nov 29, 22 @ 2:47 pm
Is this what a functioning government looks like?
Comment by Techie Tuesday, Nov 29, 22 @ 2:47 pm
I’ll look forward to those pearl clutches that took it upon themselves to argue (many times righty so) that this liability must be handled/plaid… and to give credit for this move.
And while giving that credit acknowledge, the agreed aspects of where labor and business are involved.
For me, big kudos, anytime a liability can be reduced/eliminated, that should be celebrated in a good governance prism.
Comment by Oswego Willy Tuesday, Nov 29, 22 @ 2:51 pm
More adult governance from our governor. Effective too. This prevents the business community nightmares from coming true.
Thoughts LP (this should be fun)?
Comment by JS Mill Tuesday, Nov 29, 22 @ 2:58 pm
I’m sure this will cause property taxes to go up. /snark/
Comment by JoanP Tuesday, Nov 29, 22 @ 3:00 pm
Amazing, awesome and fantastic. Illinois voters know how to pick great leaders. No need to hold our collective breath, waiting for applause from the Eastern Block, Proft and the IPI.
Comment by froganon Tuesday, Nov 29, 22 @ 3:05 pm
Thanks to Governor Pritzker and legislative leaders from both parties as well as leaders of business and labor to reaching this significant agreement that will help shore up our state’s fiscal foundation while giving business and labor a break in doing so.
Comment by west wing Tuesday, Nov 29, 22 @ 3:07 pm
“actions already drawing a sigh of relief from the state’s business community”
Paying bills and debt is one of the primary acts of being pro-business. In this sense, Illinois’ business climate greatly improved—and not with the low income right wing policies like stripping workers’ rights or big spending cuts.
Comment by Grandson of Man Tuesday, Nov 29, 22 @ 3:15 pm
A certain person on this board has been bellyaching about this debt not being paid. Now that it has I look forward to that certain person saying what a great thing this is. But knowing this certain person has no ability to say anything positive I’m sure this certain person will somehow spin this is being negative.
Comment by Demoralized Tuesday, Nov 29, 22 @ 3:19 pm
My thoughts are I am very glad the Governor and Legislature took my advice even if it took 6 months
Comment by Lucky Pierre Tuesday, Nov 29, 22 @ 3:27 pm
===took my advice===
Are you taking credit for a policy win by the governor, leaders, business and labor?
Are you delusional or is snark now part of your bot programming?
(That last question is 71.4% snark)
Comment by Oswego Willy Tuesday, Nov 29, 22 @ 3:31 pm
This is so refreshing after years of poor administrations. I still remember when Blago won, and (it seemed like) one of the first things he did was announce “free health care for all Illinois children!” Any reasonable adult knew this was a terrible idea; there were bills to pay.
Good governance rules!
Comment by Lefty Lefty Tuesday, Nov 29, 22 @ 3:34 pm
==even if it took 6 months==
Considering everyone at the table, 6 months isn’t very long. But keep spelunking . . .
“This has been a long and tough process, but everyone stuck with it even when there were disagreements,” said State Representative Mike Marron (R-Fithian). “As a result, Business, Labor, Republicans, Democrats, the Governor, the Legislature, and IDES came together to get this deal done that will help both small business owners and Illinois workers.”
Comment by Henry Francis Tuesday, Nov 29, 22 @ 3:38 pm
Pat Devaney summed it up.
“Governor Pritzker’s announcement to pay the state’s remaining $1.36 billion debt to the unemployment trust fund and implement structural funding reforms is a win for both businesses and working people.”
Great job by the Governor and all involved in this long process.
Comment by Mike Murphy Tuesday, Nov 29, 22 @ 3:41 pm
So let me get this straight, the original plan was to have Illinois employers pay this deficit in the unemployment trust fund which would have been the largest tax hike in Illinois history on businesses large and small all across Illinois.
I said at the end of last session that was a huge mistake and would harm our economy and hurt workers. The usual suspects disagreed with me.
Now the Governor and the legislature change course and everyone agrees it is great policy and a huge win.
Comment by Lucky Pierre Tuesday, Nov 29, 22 @ 3:46 pm
“This is so refreshing after years of poor administrations”
A state audit found nearly $2 billion in federal money intended to help unemployed during the pandemic was lost to fraudulent claims. And Illinois Paid Deloitte $14.3 million for a uFACTS system to prevent fraud - tax dollars also went to for another $42.7 million for call centers that didn’t collect accurate data on PUA claims.
Comment by Donnie Elgin Tuesday, Nov 29, 22 @ 3:48 pm
Nice quote by Rep. Marron. Proof there are reasonable ilgop reps. Now, if they could only elect 40 or 50 more somehow.
Comment by JS Mill Tuesday, Nov 29, 22 @ 3:51 pm
===A state audit found nearly $2 billion in federal money===
Proving, once again, that some people will complain about literally everything.
Comment by Rich Miller Tuesday, Nov 29, 22 @ 3:51 pm
===the original plan was to have===
False.
That was never the plan. They’ve been meeting for months to come up with a plan.
Comment by Rich Miller Tuesday, Nov 29, 22 @ 3:52 pm
===The usual suspects disagreed with me.===
You can cite that, if you’d like.
I can’t think of anyone stating that paying it down or paying it back was a bad idea.
Comment by Oswego Willy Tuesday, Nov 29, 22 @ 3:54 pm
It makes sense that the state pays some or all of these pandemic-worsened costs that businesses would be on the hook for. That is what a state does for the general betterment of our society. Having said that, is it too much to ask businesses to cease and desist all future bellyaching over measures needed to pay pensions, another societal-level problem not caused by the pensioners?
Comment by Jibba Tuesday, Nov 29, 22 @ 3:58 pm
The Illinois Economic Policy Institute (ILEPI) applauds this agreement to shore up the Unemployment Insurance Trust Fund, which can improve investor confidence in Illinois.
Additionally, ILEPI continues to encourage employers, workers, and the media to familiarize themselves with the WorkShare IL program, a voluntary program implemented in 2021 that allows employers to temporarily reduce the hours of their workers during recessions as an alternative to layoffs, with workers keeping their jobs (and health and retirement benefits) and receiving prorated unemployment insurance benefits to supplement lost earnings from reduced hours. Greater usage of this program during the next economic downturn—whenever that occurs—would reduce unemployment insurance costs borne by taxpayers. For more: https://ides.illinois.gov/employer-resources/workshare-il.html
Finally, it’s nice to see the reference to Illinois’ $1 trillion economy, which is a historic accomplishment that reveals the competitiveness of Illinois’ businesses and the high productivity of its workers.
-Frank Manzo IV
Comment by Frank Manzo IV Tuesday, Nov 29, 22 @ 4:00 pm
OW
Forget it. LP just once again shows us just how dishonest he is. The only comment required from LP was that this is a good plan. Period. But his dishonesty prevents him from doing that. It’s why nobody takes anything he says seriously.
Comment by Demoralized Tuesday, Nov 29, 22 @ 4:06 pm
Every fiscal success the Governor touts comes at the expense of vulnerable children who have been failed by DCFS, vulnerable disabled failed by DHS, and our prison populations that have been subjected to years of unconstitutional treatment. Nevermind the impact the failure to staff agencies as appropriated has had on the people who work there.
This good news casts a terrible shadow.
Comment by Candy Dogood Tuesday, Nov 29, 22 @ 4:09 pm
I’m glad to hear that they did this. It doesn’t help my company or others like ours that received this notification this year, but at least down the road we’re going to be in a better spot. We just need to make sure that we stay the course and don’t deviate because of some new pet project or program.
“Hello,
Our records indicate your company will be assessed additional Federal Unemployment Tax Act (FUTA) tax for 2022 because you have employees working in a FUTA Credit Reduction jurisdiction.
A credit reduction jurisdiction means it has taken loans from the federal government to meet its unemployment benefits liabilities and has not repaid the loans within the allowable time frame. A reduction in the usual credit against the full FUTA tax rate means that employers paying wages subject to unemployment insurance (UI) tax in those jurisdictions will owe a greater amount of tax.”
Comment by Just a guy Tuesday, Nov 29, 22 @ 4:10 pm
It is a good plan but it would have been a much better plan to use a portion of the 8.1 billion in Federal Funds to pay this debt back in March.
Imagine how much quicker the economic recovery would have been if this was resolved then. Perhaps we wouldn’t lead the nation in unemployment.
Nothing dishonest about that whatsoever.
https://capitolfax.com/wp-mobile.php?p=53545&more=1
Comment by Lucky Pierre Tuesday, Nov 29, 22 @ 4:14 pm
===a portion of the 8.1 billion in Federal Funds===
Money is fungible. And they managed to do both tax cuts, debt paydown and other one-time things in the meantime.
Comment by Rich Miller Tuesday, Nov 29, 22 @ 4:19 pm
===Forget it. LP just once again…===
My beef is as always with - LP -
* Missing the reasonable take outside the partisan want
* Overly partisan to not recognize good governance
How - LP - thinks his take was the thought, that’s an odd angle to any thinking.
To bring this back to actual governing and this post, with incredible updates, statement after statement…
It’s been a *long* time, even to Quinn trying to take the state back from Blago thoughts once Blagojevich was removed… it’s been that long where a consistent and continual want to actual governing has been seen to a weekly norm.
I also get where - Candy Dogood - sits.
The agency deficiencies and leadership lacking, that’s glaring at times at the most visible and most controversial agencies.
Campaigns are hard, governing is difficult.
Congratulations to ALL that carried this over the finish line, including the governor.
Comment by Oswego Willy Tuesday, Nov 29, 22 @ 4:29 pm
===Perhaps we wouldn’t lead the nation in unemployment.
Nothing dishonest about that whatsoever.===
What is dishonest is presenting the unemployment number as bad… because of a state to state measure…
… when in reality, the measure of the unemployment number you want in that measure is seen in the window of “full employment” by economic measure, AND…
… folks will *then* complain… “our company can’t find any workers” in the same breath.
You’re dishonest to the application of a number or measure to its intent… the measure of what it means to have “high”, “low” unemployment to the universe of actual… employment.
Good try.
Comment by Oswego Willy Tuesday, Nov 29, 22 @ 4:33 pm
This is a great thing. What LP, Wirepoints and all the other nattering nabobs of negativism will never accept is that this administration and Governor Pritzker when given the option to do the fiscally responsible thing or the fiscally irresponsible thing keep choosing the responsible thing. They are balancing priorities, funding government, building the rainy day fund and paying off debt. No, they can’t pay off everything at once, but they’re making the right choices which is why the State has gotten six credit upgrades and kudos from the usual skeptics at the Civic Federation. JB is doing everything right that Rauner did wrong. Sorry, LP, that this flies in the face of your misguided worldview.
Comment by New Day Tuesday, Nov 29, 22 @ 4:35 pm
“This shocking attempt to buy votes on the cusp of the election using taxpayer dollars is just the sort of corrupt gimmick we’ve come to expect from a failed billionaire governor, but voters are too smart for these tricks. They see right through these political games, and will send a message that their votes are not for sale.
Wait, the election has already happened? And this was not used to win votes? And he was reelected handily anyway?
…crickets…
Woe is us who wrung our hands and clutched our pearls for six long months. What took the governor so long?”
-Republicans, probably
Comment by thechampaignlife Tuesday, Nov 29, 22 @ 4:42 pm
- LP - applying, as an example, the unemployment number as the worst in the country while it’s within the window of “full employment”…
… is exactly like - LP - saying Pritzker is in the “bottom 10” in gubernatorial popularity… while Pritzker is/was both above water and over 50% most of that time.
It’s the dishonest presentation to a factual measure in it’s wrong context or application to the state of Illinois.
What was achieved today with so many buying in to complete the work here, it’s good governing.
It’s not a whole bunch of actual actors that do the work to steer and help Illinois *finally* listening to … - Lucky Pierre -… which is another head scratcher to claim somehow a piece of this accomplishment.
Comment by Oswego Willy Tuesday, Nov 29, 22 @ 4:44 pm
I was one of those worried this debt would fall on small businesses. Huge kudos to the Gov and stakeholders on this one. Thank you, Gov Pritzker.
Comment by allknowingmasterofraccoondom Tuesday, Nov 29, 22 @ 5:22 pm
LP: $2.7 billion in federal funds were used in March. And not a single republican voted for that bill.
Comment by Hello there Tuesday, Nov 29, 22 @ 5:29 pm
I’m happy they listened to LP. Finally.
Comment by Lurker Tuesday, Nov 29, 22 @ 5:51 pm
==is a good plan bu==
The fact that you said but is proof of your dishonesty
Comment by Anonymous Tuesday, Nov 29, 22 @ 5:57 pm
Having a Gov doing right by all of us shouldn’t be controversial… it was just Thanksgiving. Didn’t last long I see LP
Comment by Lincoln Lad Tuesday, Nov 29, 22 @ 7:19 pm
What will the GOP complain about now? The agreed bill process? Oh, wait….
Comment by Excessively Rabid Tuesday, Nov 29, 22 @ 9:30 pm