Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.
Issue link: https://www.epageflip.net/i/106363
OPINION Fixing a System that Is Broke and Broken by DOUG PETERS North Carolina currently faces a more than $2 billion debt to the federal measures. In fact, of 120 quality checks performed by the department on government for loans used to fund the state's share of unemployment our state's unemployment agency since 1997, it has passed only twice. compensation benefits — this is the third largest unemployment insurance The responsibility to pay off this debt falls squarely on employers. Under debt in the United States. current federal guidelines, and given the state's Record-high unemployment rates, outstanding loan balance, North Carolina a very slow economic recovery and employers will repay approximately $2.5 billion extended benefits mandated by the in principal and more than $500 million in federal government led to a significant interest from 2011 to 2019 to extinguish the increase in claims that quickly depleted state's loan. the state's unemployment trust fund. On Nov. 10, 2012, North Carolina missed When the trust fund was solvent in good another deadline to repay the federal UI loan economic times, there was a reduction in order to avoid additional tax penalties. This in UI taxes, while at the same time translates into a tax increase on every job from benefits were being expanded. The $63 to $84 per employee, and will continue combination of these factors resulted to rise annually until the debt is paid. These in an unsustainable system that was crippling tax increases at the federal and state ultimately not prepared for the severity levels year-after-year will cost North Carolina of the recession. jobs, making our unemployment problem Neither the tax rates nor the benefit worse. Inaction on this issue cost employers a structure single-handedly led to the total of $395 million in 2012 alone. debt crisis and, similarly, fixing just one While tax adjustments are an appropriate of these factors is not a viable solution part of a comprehensive solution, it would be to creating a solvent and effective UI irresponsible not to address the problem as a system for the future. Our state's UI whole, which includes ensuring that employer system has an annual deficit of $470 investments into the fund are managed million a year. The benefit payout has efficiently and inserting accountability simply outstripped the ability to pay for measures into the system. the program and inaction for many years It is important that we make common-sense caused the problem to quickly go from reforms to align tax revenues with benefits and bad to worse. A number of measures allow North Carolina to be competitive with have to be considered in order to bring other states which helps attract business and balance to the system. North Carolina's investment. The goal is that no one will ever UI benefits paid are more generous reach the end of their benefits. A job is the than the national average and above the ultimate economic stimulus and changes to Record-high unemployment rates, a very slow economic recovery regional area. affordability would be consistent with the goal and extended benefits mandates by the federal government led North Carolina's unemployment of an enhanced focus on reemployment of UI to a significant increase in claims that quickly depleted the state's insurance system is not only broke but claimants. unemployment trust fund. also broken. The broken UI system has The Fayetteville Regional Chamber has joined leaked $556 million in improper jobless a Reemployment Coalition of benefits payouts between 2008 and 2011, businesses, local chambers and of which millions involved allegations of fraud. An investigation uncovered allied business organizations to address the state's broken UI serious problems that contribute to UI fraud going back 15 years. system and advocate for reforms DOUG PETERS, Chamber of Commerce, It gets worse. According to the U.S. Department of Labor, North that put the focus back on jobs. COMMENTS? editor@upandcomingweekly. Carolina had the worst scores in the country on important quality-control com. Does your advertising leave you feeling this way? Advertising can be pretty complex. You may not know which way to turn. There is a sign you can rely on — ours. Call us today so that our professionals can make the most of your advertising investment. 484-6200 wwwupandcomingweekly.com Another sign we're working for you. Free Papers Working For You WWW.UPANDCOMINGWEEKLY.COM JAN. 30 - FEB. 5, 2013 UCW 5