COLUMBUS - 

State Senator Larry Obhof (R-Medina) today announced that the state legislature has passed a bill to repay Ohio’s lingering unemployment-compensation debts amassed during the recession. The debt – owed to the federal government – led to substantial tax penalties for Ohio’s employers.

“Paying off this debt is a major milestone in Ohio's turnaround," said Obhof. “This will allow Ohio employers to reinvest in their businesses, grow, and hire more people, instead of sending millions of dollars in penalties to the federal government.”

During the recession, Ohio and 35 other states were forced to borrow from a federal trust fund to continue paying jobless benefits. Ohio borrowed nearly $2 billion in 2009. As a result, Ohio’s employers began paying federal tax penalties in 2012, with the amount of the penalty getting larger each year.

Under House Bill 390, which was co-sponsored by Senator Obhof and passed both the Ohio Senate and the House of Representatives this week, the remainder of the loan (around $225 million) will be repaid by the state. The federal unemployment tax rate on Ohio businesses will revert to normal levels – saving employers hundreds of millions of dollars – and employers will pay a smaller surcharge in the first half of 2017 to repay the State of Ohio.

Under the repayment plan, instead of paying $168.00 per employee in a 12-month period, employers will pay $87.00. The following year, the amount will return to its pre-recession level of $42.

"It is important that we get this over the finish line," said Obhof. “This plan will keep more than $400 million here in Ohio, strengthening our small businesses and helping support Ohio jobs.”


House Bill 390 now goes to the governor for his signature.

 
 
 
  
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