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true

Indiana Plans To Borrow $300 Million For Jobless Benefits

By Associated Press

Posted September 20, 2020

help wanted sign

Indiana’s unemployment rate, which was 3% before the pandemic, reached 17.5% in April before dropping to 6.4% for August. (Lauren Chapman/IPB News)

A flood of unemployment claims related to the coronavirus pandemic has caused Indiana officials to seek as much as $300 million in loans from the federal government.

The borrowing is needed because the state’s unemployment fund had about $40 million at the end of August, down from nearly $1 billion before joblessness exploded in March.

The state is seeking $60 million to cover shortfalls for September, plus a projected $120 million each for October and November, said Josh Richardson, chief of staff at the Indiana Department of Workforce Development.

“We know that we’re going to borrow,” Richardson said. “There was no reason to wait any longer.”

Indiana is among more than 20 states and territories seeking federal loans.

About 162,000 people in Indiana were being paid jobless benefits as of Sept. 5 from the insurance fund, which comes from taxes paid by businesses, according to federal reports. Some 217,000 more Indiana residents sought payments from the federal pandemic unemployment assistance program, which expanded coverage to workers otherwise ineligible for state benefits, as of Aug. 29.

The state has paid out about $5 billion under the state and federal programs since March 1, including more than $1.2 billion in state benefits, Richardson said.

Indiana’s unemployment rate, which was 3% before the pandemic, reached 17.5% in April before dropping to 6.4% for August.

The state borrowed about $2 billion from the federal government to pay unemployment claims from the 2007-09 recession, paying off those loans in 2015.

For the latest news and resources about COVID-19, bookmark our Coronavirus In Indiana page here. 

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