North Carolina Governor Pat McCrory announced today that North Carolina has paid off the unemployment insurance debt owed to the federal government. That debt was as high as $2.8 billion and stood at $2.5 billion when Governor McCrory took office in January 2013.
“This will give employers certainty about the cost of doing business in North Carolina,” said Governor McCrory. “Getting more North Carolinians jobs and fixing our broken unemployment system was a top priority when I entered office. Thanks to quick action and tough decisions, North Carolina’s unemployment system is more efficient, more customer friendly and the time needed to settle appeals has been dramatically reduced. These steps, along with paying off this debt, are helping get more people back to work.”
Legislative leaders in North Carolina also hailed the success.
Senate President Pro Tempore Phil Berger said the reforms put into place in 2013 have paid off for North Carolina workers and job creators.
“In just two short years, North Carolina has successfully paid off a massive federal debt that was threatening our ability to keep existing jobs and making it harder to create and recruit new ones,” Senator Berger said. “ Sen. Bob Rucho and Rep. Julia Howard deserve special recognition for their leadership during the 2012 interim in bringing stakeholders together to find a solution to remove this tremendous burden off the backs of North Carolina businesses and create a sustainable unemployment system.”
Speaker of the House Tim Moore praised the legislative reforms passed by the General Assembly.
“Several years ago a tough economy led the North Carolina House to make some tough decisions. Today, because of House Bill 4, many North Carolinians are back to work, and we get to witness how responsible leadership led to paying off our debt, ” Moore said.
The debt was incurred when the state’s unemployment trust fund ran out of funds in February 2009. North Carolina had to borrow from the federal government to pay for regular unemployment benefits and racked up the debt.
“With this debt paid off, our state will be more attractive to employers who want to move here and create jobs,” said North Carolina Secretary of Commerce John E. Skvarla, III. “This gives North Carolina a level playing field with 42 other states.”
Department of Commerce Assistant Secretary of Employment Security Dale Folwell noted that North Carolina is paying this debt off early, which will result in savings to employers.
“Had the debt not been paid by November 2015, employers in this state would have been subjected to an additional $282 million in additional FUTA (Federal Unemployment Tax Act) penalties,” Folwell said. “These monies can now be used by the employer community to assist with the expansion of their business and workforce.”
UWC recognized the leadership of Rep. Julia Howard and Senator Bob Rucho with UWC UI Integrity Award. We have continued to work with Assistant Secretary Folwell as the Department Commerce has implement the legislation and taken a number of administrative steps to put North Carolina in much better fiscal shape.
Congratulation to North Carolina for successfully taking on this difficult issue.
