Kentucky Saves $165M by Paying Off Fed Unemployment Loan Early
Kentucky businesses will save about $165 million on federal unemployment taxes after state officials paid off a close to a billion dollar federal loan early.
Gov Steve Beshear says the Commonwealth has paid off the $972 million federal loan needed to meet unemployment insurance benefit obligations during the Great Recession at least two years ahead of schedule.
The early payoff means employers will see a reduction of $105 per employee.
“Throughout my time in office, I have partnered with lawmakers and business leaders to grow Kentucky’s economy and to manage us through the worst recession of our lifetime,” said Beshear. "This partnership allowed us to reach this point today of early payoff of the federal loan and to ensure the solvency of our UI Trust Fund for the future.”
Last month, the governor placed an $82.5 million budget surplus into the state's "rainy day fund" increasing the fund balance to $209.4 million.
Kentucky was one of 30 states forced to borrow money from the federal government when high unemployment meant more people qualified for unemployment benefits than the state had money to pay.
Kentucky's current unemployment rate is at 5.1 percent, the lowest since 2001 and down from a high of 10.9 percent in January 2009.