LANSING – The state’s Unemployment Insurance Agency (UIA) announced it has paid off a $3.2 billion debt to the feds, meaning a break for Michigan businesses that no longer have to pay the obligation assessment as part of their unemployment taxes.
Gov. Gretchen Whitmer’s office said this means $55 million will now stay with businesses, as the UIA made its last payment on the debt at the end of 2019, rather than the projected date of May 2020.
“This is good news for Michigan businesses, their hardworking employees, and our economy as a whole,” Whitmer said in a statement. “It will give employers more opportunities to grow their businesses and give back to their communities.”
In 2012, the UIA worked with the state Treasury to refinance a $3.2 billion debt owed to the U.S. Treasury by issuing bonds to cover the “unprecedented increase in unemployment claims during that time,” according to the Governor’s Office.
The bonds were to be repaid by quarterly obligation assessments on employers, which the Michigan Manufacturers Association (MMA) said represented a 37% increase on top of the $1.24 billion employers pay in unemployment taxes each year.
Published by the Small Business Association of Michigan.