Indiana Unemployment Will Feel Tighter Amid State's Looming Bankruptcy

Jan 2, 2011

Indiana Unemployment numbers feel and look staggering in a state that is struggling to make good on paying back a $2B federal loan. The site is busy with searches today as the General Assembly gears up to meet Wednesday to discuss a budget for the new fiscal year.

Indiana lawmakers are scrambling to find a solution to the issue of unemployment benefits and payments for thousands of laid-off Hoosier workers. For years the government has been struggling from the impact of the recent recession that claimed many jobs due to higher imposed taxes. In its wake, Indiana unemployment has been rising, according to the Journal Gazette.

Faced with how to keep the government working, officials borrowed $2 billion from the feds but is struggling with paying back a $60M interest payment. That's just one of the many problems the state faces and it doesn't feel good for anyone involved, especially laid-off workers who fear the weekly benefit is subject to a cut.

The only piece of good news is that the state had an unexpected windfall from recent tax revenue. This may be a sign that local businesses now have the ability to pay into the Unemployment Benefit Fund as part of their licensing agreement with the state.

This money can be used of offset any Medicade and educational cuts. That has to feel great to the residents of the state who also feared schools and police would fall victim to budget cuts.

When lawmakers meet to discuss a new budget, it must begin with how the state can build on the new revenue, and devise feel-good ways to get the Indiana Unemployment Fund in the black.

Currently, according to lawmakers, if something is not done, it will take ten years to get the fund out of a deficit as it is paying out more than it collects in tax revenue.



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