Unemployment Insurance Claims Empty Kansas Worker Trust Fund
On Wednesday, Kansas Labor Secretary Jim Garner made the revelation that the state’s Unemployment Insurance Trust Fund is handing out $13 million more per week than it was last year. A quarter of the claims filed last year totaled $78 million. In June 2009 alone, Kansas paid out almost the exact same amount. While the state has yet to actually borrow any money from the U.S. Treasury, the labor department is seriously considering the idea.
There are 96 000 people in Kansas who are currently receiving unemployment benefits, but Garner reassures them that there will be enough money to go around. “This will not impact benefits to people who are qualified,” he said. “They will just be getting their benefits from the federal treasury instead of the trust fund”.
Kansas’ trust fund started 2009 with a $566 million balance, which has now dwindled to $349 million in just over half a year. The fund is financed by tax money that employers pay on wages but because of budget cuts, the tax money can no longer sufficiently meet the increasing demand for unemployment insurance.
18 states have already dipped into the federal government’s treasury to pay for unemployment insurance benefits. It is estimated that the number will rise to 30 over the course of the year. Kansas’ Labor Board has yet to determine how much it will need to borrow, but it will take a cue from other states, estimating the loan will be equal to the cost of insurance benefits for the next quarter.