A bipartisan proposal to restore Connecticut’s insolvent unemployment compensation fund was announced Tuesday, with advocates predicting the plan will create “long-term viability” for the fund that has taken a huge financial hit during the pandemic.
Financed by employers, the fund has been insolvent for 48 of the past 50 years, according to Lamont’s office, forcing the state to borrow money from the federal government. So far, $712 million has been borrowed during the current recession, a huge sum that many employers feared they would have to repay in higher unemployment taxes.
Besides restoring the fund’s solvency, proponents said the proposal, which needs legislative approval, will reduce taxes on at least 73% of businesses by reducing rates on certain employer taxes, reforming benefits and other changes.
Chris DiPentima, president and CEO of the Connecticut Business and Industry Association, called the package of reforms “the most significant set of reforms in the history of the state’s unemployment system.”