To the Editor,
Your recent letter writer (Ian Greer, Cornell University ILR) is wrong on several fronts. California did appropriate over $2 billion in federal funds to pay down its unemployment insurance debt, even though they didn’t pay the entire debt. New York has spent zero public dollars to address the huge debt caused by its forced shutdown of businesses in March 2020. Instead, this debt, at just over $7 billion today, is being paid using increased federal and state taxes on New York employers, who will likely pay elevated UI taxes for much of this decade.
Interestingly, California also uses public dollars to pay federal interests on UI debt, while New York imposes an additional UI tax on employers, totaling more than $250 million over the past two years. Also, until this debt is paid and the fund is strong again, Greer’s proposal for a higher taxable wage base simply raises UI taxes across the board, a bad idea given higher labor, energy and other costs impacting all businesses.
Finally, the UI tax system wasn’t set up to be progressive. It is experienced rated, with businesses with more layoffs paying proportionately higher taxes. Even so, in “reforms” passed in 2013, New York did make the UI tax tables more “progressive,” shifting costs to employers with few layoffs, regardless of whether they were big corporations or small business. But using state or federal funds to pay New York’s UI debt and interest – as did thirty-three other states — will certainly help small employers.
Ken Pokalsky
Vice President
The Business Council of New York State Inc.
