Liberty Index Update June 2012 Part 5: Key Votes – Act 60 of 2012 – REFINANCING UNEMPLOYMENT COMPENSATION- Debt to Federal Government
Over the years, the unaffordably generous unemployment compensation debt caused Pennsylvania (in reality, its productive taxpayers)
TIER 3 FOR LIBERTY A “YEA” Vote is a Vote FOR LIBERTY
“YEA” VOTE ADDS 50 POINTS TO GRADE; A “NAY” SUBTRACTS 50 POINTS FROM GRADE. This refinance pays off a taxpayer debt to federal government and reduces future costs for Pennsylvania’s Employers and Taxpayers.
This year, employers throughout the commonwealth will pay higher unemployment compensation taxes to cover the $354 million in interest payments and lost federal unemployment tax credits. Despite having some of the highest state unemployment taxes, this program was bound for bankruptcy.
Nearly 70 percent (the highest percentage in the nation) of the state’s unemployed were eligible for some of the country’s most generous unemployment benefits
First, it pays off debt to the federal government through a $4.5 billion bond effort. This minimizes tax increases on job creators while at the same time saves $2.3 billion over the next six years because of lower interest charges. It is projected that solvency will be reached by 2019. The plan maintains a benefits freeze until solvency and implements program eligibility reforms for seasonal work and higher income earners.
Pa Independent, (2 June 2012) also, sums up Act 60 of 2012 Governor signs bill to refinance federal debt The [Act 60] allows Pennsylvania to refinance the debt it owes to the federal government’s Unemployment Trust Fund by borrowing a $4.5 billion bond, which has a lower interest rate. The bill also includes eligibility tweaks that will save the state millions in unemployment benefits by limiting access to around 50,000 workers.