North Carolina must begin to deal this year with interest payments on a $2.5 billion debt to the federal government — money borrowed over time since February 2009 to provide for increased unemployment benefits as a result of the economic downturn, according to a report today in the News & Observer of Raleigh.
One of 30 states in the same borrowing predicament, according to the N&O, N.C.‘s unemployment insurance fund is otherwise solely dependent on a tax on employers for 5.7 percent of taxable payroll. The report indicates that state officials have been reluctant to raise that percentage, which could increase financial pressure on the businesses involved.
The incoming legislature must now factor in plans to start paying off the debt to the feds as well as idealing with an announced $3.7-billion budget shortfall.
by Nelda Holder, contributing editor