By Shelley Kofler, KERA News
http://stream.publicbroadcasting.net/production/mp3/kera/local-kera-848353.mp3
Dallas, TX –
Texas expects the federal government to confirm next week that it's providing a federal loan to cover the state's rising unemployment benefits. KERA's Shelley Kofler reports Texas requested the loan because the state's fund is on a path to go broke.
Earlier this year the Texas Workforce Commission warned that the fund that covers unemployment benefits in Texas would dip below mandated levels by October. With state unemployment above seven percent, that has already happened. The state is supposed to keep $850-million in the fund. At the end of May it had just $617 million.
Ann Hatchitt of the Workforce Commission says the state has requested a $160-million dollar interest-free loan from the federal government for the month of July.
Hatchitt: We have until the end of December 2010 to repay any money we borrow interest free. That is an excellent option and that's the first option we are going to take.
Hatchitt says the state could be making similar loan requests each month. She says the state may have to sell bonds to repay the loans. The insurance taxes paid into the fund by employers could also be raised.