By: Brian Dicken, Vice President Advocacy and Public Policy, Toledo Regional Chamber Commerce
On May 25, the Ohio House of Representatives and Ohio Senate approved legislation that will pay off the balance of the federal loan related to unemployment compensation. The bill is now awaiting Governor Kasich’s signature. This is an issue that has been a high priority in the Toledo Regional Chamber’s advocacy efforts on behalf of our members.
As a result of these efforts, employers will see a dramatic decrease in their federal unemployment tax (FUTA) rate starting in 2017. Ohio employers currently pay $147 on the first $7,000 of every employee. Had the loan to federal government not been repaid by November, that tax would have increased to $168 per employee. The actions by the legislature will save employers in the Toledo region millions of dollars in additional taxes. In January, the full FUTA credit will be restored dropping the amount employers to just $42 per employee.
As a result of these efforts, employers will see a dramatic decrease in their federal unemployment tax (FUTA) rate starting in 2017. Ohio employers currently pay $147 on the first $7,000 of every employee. Had the loan to federal government not been repaid by November, that tax would have increased to $168 per employee. The actions by the legislature will save employers in the Toledo region millions of dollars in additional taxes. In January, the full FUTA credit will be restored dropping the amount employers to just $42 per employee.
The loan will be repaid by taking a one-time loan from the state’s unclaimed funds account to the Unemployment Compensation Fund. It is expected that this amount will be between $220M and $240M. It is required that the loan to the unclaimed funds account must be repaid by the end of February 2018, through a one-time charge of approximately $45 per employee in 2017. The reduced FUTA rate and one-time loan repayment will still be almost 50% less than if the federal loan was not repaid by November.
Although the unemployment debt issue has provided relief to businesses in the short-term, the Chamber remains committed to working with legislature and the Administration to address the long-term solvency of the state’s unemployment compensation system. Work will continue on this issue over the summer and we expect action to be taken by the legislature in the fall.
Although the unemployment debt issue has provided relief to businesses in the short-term, the Chamber remains committed to working with legislature and the Administration to address the long-term solvency of the state’s unemployment compensation system. Work will continue on this issue over the summer and we expect action to be taken by the legislature in the fall.
 | As the Vice President of Advocacy and Public Policy for the Toledo Regional Chamber of Commerce, Brian oversees the Chamber’s advocacy and public policy efforts with local, state and Federal governments. With nearly 20 years of experience, he has held positions in state government in the offices of the Ohio Lt. Governor, Ohio Auditor of State and Ohio Treasurer of State. He also worked for the late U.S. Representative Paul Gillmor and in the Office of the Vice President of the United States. |
Please contact Emily Dammeyer, Communications Manager, Toledo Regional Chamber of Commerce to submit a story for our blog.
RSS Feed
