ILLINOIS — Unemployment benefits in Illinois are paid from the Unemployment Trust Fund and that fund found itself $4.5 billion in debt due to the COVID-19 pandemic.
Tuesday, Gov. JB Pritzker announced the balance of the trust fund had increased enough to pay down $450 million of the remaining debt. This move comes a couple months after the state legislature directed $2.7 billion of federal American Rescue Plan Act dollars to reduce the original debt to $1.8 billion.
According to Pritzker, this latest move will cut the balance by 25% down to less than $1.4 billion and save the state approximately $10 million in interest payments on the loan. He added he is confident the entire debt will be paid off by the end of 2022.
Watch the entire press conference in the video above.
The Illinois Department of Employment Security borrowed federal funds to continue making unemployment benefit payments during the height of the COVID-19 pandemic. It made a similar move during the 2008 Great Recession when it borrowed $1.4 billion. It was repaid in five years through a joint funding agreement with the state’s business community.