CCTA’s Monthly Public Meeting
May 19th
North Carolina is slated to pay off over $2.7 billion in debt to the federal government in the next few months. On May 19th, Dale Folwell, Assistant Secretary of Commerce, will explain the implications of this payoff and what it means for North Carolina’s businesses and unemployed citizens. The discussion will also include plans to build a budget surplus to prepare for future recessions, and bring down tax bases on employers.
Unemployment Insurance and the related unemployment benefits are completely funded by businesses (employers). The higher the benefit payments and the longer the benefits are available, the more cost must be covered by employers. North Carolina had an “I’ve had all I can stands and I can’t stands no more” moment in early 2013. They made tough decisions to stop perpetuating unemployment benefits pushed and “aided” by loans from the federal government, further burying the state in federal debt burden. The result of these actions is retirement of the state debt to the federal government associated with this program now projected for May of this year, well ahead of the original timeline. This debt elimination will trigger an associated reduction in Unemployment Insurance tax paid by businesses (employers). This is an example where North Carolina took corrective action that made them ineligible for federal funds (help!), resulting in timely elimination of a major financial burden for the state and the businesses (employers). Assistant Secretary of Commerce Dale Folwell, will be presenting details associated with this conservative value success story at our CCTA May 9th public program. This is a great example of our North Carolina Government interceding on behalf of the state’s citizens, to prevent further federal government over-reach and control.
Below are articles that summarize actions taken by North Carolina to manage thru a challenging period of unemployment and associated costs:
Mar 06, 2013: The unemployment insurance reform bill, which Gov. Pat McCrory signed in February, cuts benefits to the jobless in two ways. It reduces the amount of weekly benefits for some of the state’s unemployed and the total number of weeks that benefits are paid. The way these benefit changes are structured will cause additional federal cuts to kick in – reducing by 74 percent the maximum number of weeks that jobless North Carolinians receive unemployment checks. With North Carolina’s unemployment rate at 9.4 percent (December 2012), an unemployed North Carolinian has now had his or her potential period of benefits cut from 78 weeks to 20 – the shortest in the nation. Overall, 170,000 people will lose their unemployment benefits, resulting in a net loss of $780 million in benefits.
Jun 28, 2013: With changes to its unemployment law taking effect this weekend, North Carolina is not only cutting benefits for those who file new claims, it will be the first state disqualified from a federal compensation program for the long term jobless. State officials adopted the package of benefit cuts and increased taxes for businesses in February 2013, a plan to accelerate repayment of a $2.5 billion federal debt. Like many states, North Carolina had racked up the debt borrowing from Washington after its unemployment fund was drained by jobless benefits during the Great Recession. Because North Carolina leaders cut average weekly benefits for new claims, about 170,000 workers whose state benefits expire this year (2013) will lose more than $700 million in Emergency Unemployment Compensation (EUC) payments.
April 03, 2014: The massive debt that the state racked up paying unemployment benefits in the wake of the recession should dip below the $1 billion mark by mid-year and should be paid off by the end of 2015. Note: Current projection is now May of 2015. Dale Folwell, who heads the state Division of Employment Security, laid out that timeline for lawmakers at a committee meeting Wednesday. The state’s debt to the federal government, money it borrowed to pay unemployment benefits, peaked at $2.8 billion and triggered higher federal unemployment taxes for the state’s employers. That prompted the Republican-led legislature to revamp its unemployment system — over the protests of Democrats and advocacy groups for the poor — in order to accelerate repayment of the debt. The measures included reducing the maximum benefits a laid-off worker could receive by one-third as well as cutting the maximum weeks of benefits. “Good news for everyone,” he said. “It’s good to see a plan working like we had planned.” Folwell said the debt is currently just under $1.65 billion, “a pretty dramatic reduction from this time last year.” The debt was about $2.5 billion in February 2013. That’s because the state unemployment taxes paid by employers are front-loaded, given that those taxes are pegged to the first $21,000 in salary earned by the employer’s workers. In addition to avoiding another increase in federal unemployment taxes, retiring the debt would also eliminate prior $21-per-employee-per-year tax hikes. Employers pay both state and federal unemployment taxes. Workers don’t pay any unemployment taxes.
Please Join Us on May 19th!
The CCTA public meeting is free and open to members and non-members alike. The meeting will begin at 7 PM in the Stanley Hall Ballroom. Refreshments and educational displays are available 30 minutes before the meeting.
Our meetings are held at the Stanly Hall Ballroom, in downtown New Bern at 249 Craven Street (elevator) and 305 Pollock Street (stairs) second floor.
Adequate parking is available directly across Pollock St. adjacent to City Hall and the Tax Offices where parking is free and open to the public after 5:30pm.
A number of restaurants are within walking distance if you want to come early and have a meal prior to the meeting.
We meet every 3rd Tuesday for our Public Information Program Meeting.
OPEN TO THE PUBLIC–PLEASE COME OUT AND JOIN US!
