ALBANY- One thousand days have passed without New York State officials addressing the state’s Unemployment Insurance (UI) debt bill and The Business Council of New York State is calling for action. The state borrowed federal funds to pay unemployment benefits following mandated business shutdowns during the COVID pandemic, and the state’s outstanding debt still totals nearly $7 billion.
Members of the Business Council are calling for action because of the 30 states that borrowed money from the federal government to fund their UI programs, only New York has yet to paid their debt. The Business Council fears the state will alleviate its burden by shifting the cost to private sector employers.
“The Business Council began warning state lawmakers shortly after the pandemic began that, if not addressed, this multi-billion-dollar deficit would have a severe impact on the state’s employers, particularly small businesses,” said Heather Mulligan, President & CEO of The Business Council. “The current $7 billion debt, driven by state-mandated shutdowns, is expected to take up to a decade to pay back through elevated payroll taxes on New York employers. Sadly, this deficit is on top of the already increasing costs of doing business in New York State.”
One way the state could address the debt is to raise UI rates, or pass a special assessment on to employers. New York businesses already pay among the highest UI rate sin the nation.
Earlier this year, the Business Council unveiled a clock that monitors how many days have passed without New York lawmakers taking action. They hope bringing awareness to the issue will spark action, especially ahead of state budget negotiations, which begin in January.
Much criticism has also been laid with the state’s Department of Labor after State Comptroller Tom DiNapoli released a report in 2022 that indicated as much as $11 billion was lost to UI fraud in 2020 alone.
