Winter weather photos
SI cover features area model
Madison vs. Waynesville
State must borrow from feds to pay the jobless
Monday, January 12, 2009
COLUMBUS — Ohio's unemployment compensation fund went broke on Monday, Jan. 12, requiring the state to borrow $50 million from the federal government to continue paying benefits to unemployed workers.
The federal government has approved lending the state $500 million to cover benefits for January and February. The last time Ohio had to do such borrowing was in the 1980s.
The state had thought it might need $50 million for December but got by without that loan.
For the week ending Jan. 3, the last week for which data was available, 245,782 Ohioans were receiving regular benefits, a jump of nearly 60 percent from a year ago.
The money in the unemployment compensation trust fund comes from taxes paid by employers.
The fund had been expected to go broke, as a result of the strain caused by high unemployment and also the inability of the Unemployment Compensation Advisory Council and the legislature to come up with a new formula to bolster the fund.
The state took out loans from 1980-1988. They included interest free loans of $992.7 million from 1980-1982 and $2.8 billion in interest-bearing loans from 1982-1988, according to state records. The state ended up paying $263,735,578 in interest.
Gov. Ted Strickland and other governors have requested help from President-elect Barack Obama to boost the trust funds in their states.
Contact this reporter at (614) 224-1608 or whershey@DaytonDailyNews.com.
