SPRINGFIELD, Ill. (AP) — Gov. J.B. Pritzker on Thursday signed into law a measure that officials say will eliminate a $1.8 billion debt in the pandemic-battered account that pays out unemployment benefits.
An unexpected surge in revenue fuels the plan, with $1.36 billion paying off a federal loan distributed to Illinois and numerous other states when the coronavirus pandemic shut down businesses and sent unemployment rates to 40-year highs. That loan’s retirement carried a $20 million interest payment due next fall.
The package, brokered among business and labor, Democrats and Republicans, also puts an additional $450 million into the Unemployment Insurance Trust Fund. It will act as an interest-free loan which employers, who pay taxes to keep the fund operating, will pay back over a 10-year period.
Negotiator and Rep. Jay Hoffman called the deal “real action to support working families.”
“This plan protects benefits, saves employers money, improves our state’s financial outlook and provides long-term security for workers across Illinois,” the Swansea Democrat said.
The money paid back by business will flow through to the state’s Budget Stabilization Fund, a savings account for unexpected fiscal downturns. Pritzker noted in a news release that he has funneled $1 billion into the so-called Rainy Day Fund, whose balance not long ago fell to as low as $60,000.
Critics castigated Pritzker for his stay-at-home orders for most businesses and schools in spring 2020 as COVID-19 intensified. Pritzker stood by his decision and contends it saved thousands of lives.
Since the coronavirus was first detected in Illinois in January 2020, the Illinois Department of Public Health has counted 3.89 million cases of COVID-19, leading to 35,494 deaths.