Wednesday, May 29, 2024

Louisiana legislative leader still expects October special session; unemployment trust fund to be high on agenda

by BIZ Magazine

By David Jacobs | The Center Square

Legislative leaders expect to hold a special session in October in which lawmakers will decide what to do with expected federal pandemic aid, Louisiana Senate President Page Cortez said Thursday.

Shoring up the state’s unemployment insurance trust fund will be on the agenda. As the trust fund is depleted by unprecedented demand, the law requires increased taxes on employers to keep the fund solvent and continue paying benefits.

If any money is left over from the $1.8 billion in federal CARES Act relief the state already has received, Cortez wants to use it to replenish the fund, he said Thursday. But the money already has been appropriated to reimburse state and local governments for expenses incurred during the pandemic, to set up a grant program for small businesses, and to give front line workers $250 “hazard” payments.

However, there is an expectation that state governments would have discretion over how to spend at least some of the next aid package, Cortez noted.

“I think [the trust fund] would be one of the first priorities, to make sure we don’t put a backdoor tax on businesses,” he said to members of the Louisiana Economic Recovery Task Force in an online meeting held Thursday.

The fund, which had a balance greater than $1 billion in March, is now at less than $300 million and could run out by mid-September. State officials are expected to apply for a federal loan to cover three months of projected benefits, said Jim Patterson with the Louisiana Association of Business and Industry.

Louisiana residents made 13,042 new claims for unemployment benefits last week, down from 18,511, according to the Louisiana Workforce Commission. For a pre-pandemic comparison, during the week ending August 3, 2019, 2,126 initial claims were filed.

But despite the drop in new claims, continuing claims last week increased to 327,467, up from 324,357 the week before. There were 18,179 continued claims for the week ending August 3, 2019, the LWC says.

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