Ohio to pay off jobless loan, means no interest for the state
Ohio is sending a $1.5 billion check to the federal government to pay off a loan the state took to keep unemployment checks flowing during the pandemic.
Gov. Mike Dewine said Wednesday that paying off the loan will allow Ohio to avoid paying 2.3% interest. The payoff also means Ohio employers won't see increases in their unemployment insurance premiums that would have cost them $650 million over the next three years.
Ohio's troubled unemployment insurance system went broke in June 2020. The state is using federal funds to repay the loan.
Ohio's unemployment insurance system has been slammed with claims during the coronavirus pandemic, swamped with fraud and hampered by antiquated information technology systems.
Claims for jobless benefits skyrocketed in March 2020 following the statewide shutdowns to slow the spread of the coronavirus. Like more than a dozen other states, Ohio had to borrow from the federal government to continue sending out unemployment checks.
Previously, the system was insolvent in January 2009 during the Great Recession. Ohio borrowed $2.6 billion from the feds then and had to pay $250 million in interest
The system provides benefits to workers who lost their jobs through no fault of their own and are willing to work.
Laura Bischoff is a reporter for the USA TODAY Network Ohio Bureau, which serves the Columbus Dispatch, Cincinnati Enquirer, Akron Beacon Journal and 18 other affiliated news organizations across Ohio.