State weighs business tax hike for jobless fund

Wednesday, Sept. 16, 2009 | 4:49 p.m.

Unceasing recession spurs more tax talk (8-14-2009)
Nevada jobless trust fund nearly broke (8-3-2009)
Unemployment benefits in each state (7-27-2009)
Lawmakers hear support for increasing jobless benefits (3-18-2009)
Gibbons undecided about accepting jobless money (3-2-2009)
Jobless fund might be broke by end of year (2-2-2009)

CARSON CITY – Assembly Speaker Barbara Buckley says she doesn’t think this is the time to boost the rates charged to businesses to finance the near bankrupt unemployment trust fund.

After a meeting with Gov. Jim Gibbons and other legislative leaders, Buckley, D-Las Vegas, said she doesn't favor “raising rates when times are tough.”

An estimated 60,000 employers pay into the fund to finance jobless benefits to the unemployed. The fund will be out of money in October.

The advisory council of the unemployment trust fund meets Oct. 6 to make a recommendation whether to boost the rates.

Robin Reedy, chief of staff for the governor, said she wouldn't be making any recommendation to the council.

Buckley said the unemployment trust fund is to be depleted three months earlier than expected. She said any rate increase should be delayed until economic times are better and then a surplus should be built up to meet the downturns.

Gibbons and Cynthia Jones, administrator of the state Employment Security Division, have asked the federal Labor Department for a loan of an estimated $280 million to carry the state through the rest of the year.

Gibbons is asking that the loan be made interest free. A number of other states have already asked the federal government for loans to help cover the checks to the unemployed.

Senate Minority Leader Bill Raggio, R-Reno, did not have any recommendation on the rates charged to the 60,000 employers. But he said there may be some necessity to have the rate increased.

Employers must pay a tax rate ranging from 0.25 percent to 5.40 percent on the first $26,600 in wages. The rate is based on the employee turnover in the business.

The average rate now is 1.3 percent with the payment at $353 per year per employee.

Employers starting a new business must pay unemployment insurance tax at a rate of 2.95 percent. After a period of 14 to 17 calendar quarters, the business is eligible for an “experience” rating, which means the rate could go lower if the employee turnover is kept down.

A spokeswoman for the employment security division says it will make its recommendation public at the meeting next month.

The statewide unemployment rate in July was 12.5 percent, the third highest in the nation. There were an estimated 179,300 out of work.

The jobless rate for August will be released this Friday.

Discussion: 14 comments so far…

By tvegas

9/16/09 at 4:58 p.m.

Suggest removal

All extended unemployment benefits must stop.

Find a job or start a business.
By Det__Munch

9/16/09 at 5:36 p.m.

Suggest removal

Easier said than done, tvegas. I'm sure all those unemployeed want to find work but can't in this one trick pony town since the powers that be get on their knees and/or bendover for the casinos.

With the thousands and thousands of people unemployed here in Vegas alone - where the hell is someone supposed to find a job? How can you support a family, pay rent/mortage on a $8 an hour job?? NOT everyone works in the casino industry eeither; plenty of professoinals that are also unemployed. for every job opening, there are 100-200 applicants.

so just keep quiet on something you know nothing about.
By Det__Munch

9/16/09 at 5:37 p.m.

Suggest removal

PS Las Vegas and the State of Nevada created this mess. Let's build more casinos.
By neiman1

9/16/09 at 5:44 p.m.

Suggest removal

Let's borrow more and keep spending. That's hope and change. Jimmy Carter did it in the 70's.
By SgtRock

9/16/09 at 6:01 p.m.

Suggest removal

The Democrats raised taxes on employment.

They want to do it again.

Buckley, go for it.

We need no stinking jobs.
By texexnv

9/16/09 at 6:14 p.m.

Suggest removal

Babs hat size is about 1-1/4 - IF she teases the state's worst hairdo up. Goober's is measured in mms with a micrometer.

However....that mag-lev is a sure thing to put everyone back to work!

Can Goober really think Pres O will even open his letter? Or would one from Rory work better since he was Hillary's campaign manager here?

'Ya gotta get along to play long.
By LasVegas2009

9/16/09 at 6:42 p.m.

Suggest removal

Send all the illegals back to Mexico and we wont have an unemployment problem. They make up 14% of the population in Las Vegas and the unemployed citizens are at 12% so pack all the illegals up send back across the border.
By Harley

9/16/09 at 11:09 p.m.

Suggest removal

Another example of a mandated government ponzi-scheme deserving failure.
By VegasInsider

9/16/09 at 11:23 p.m.

Suggest removal

Yes, have the dumbacrats raise taxes so more small businesses lay people off and continue not to hire people.
By UNLVStud

9/17/09 at 12:22 a.m.

Suggest removal

Surprise, surprise - the Republican leaders in Nevada have no solution to yet another problem. 2010 can't come soon enough.
By wizardofOz

9/17/09 at 2:47 a.m.

Suggest removal

Crank up the Bread-Lines Autie May, they're comin' next for you.

We're in a sorry mess. There are very few times I would say what I'm gonna say, but, I'm gonna.

Since we have very few things left in this State even worth a lousy 5% no-money-down mortgage, the ONLY thing we can say that we really have left is:

OUR PEOPLE.

Barbie and friends gotta do sumthin'. And soon. Even if they gotta tie up the Hydrologist to a chair until he signs. And the rest should be helpin' holdin' Mr. Hyro while BB gets the chair and ropes ready, too.

AND JUST WHERE is Harry, Shelly, Dina and Dean on HR3548 (it's REAL rescue money)...

Uhhh, Harry, I thought you and Chi-man were tight. Michigan and the Sarah-look-a-like got theirs.

I am so deeply sorry I have to be so callous on this. I apologize.

But this is deeply... sorry... times.
By dipstick

9/17/09 at 7:09 a.m.

Suggest removal

jeez; i thought detroit had it bad, vegas is hurtin'. even if the illegals left town who would want to clean garbage cans for $6 an hour?
By Patrick_R_Gibbons

9/17/09 at 8:21 a.m.

Suggest removal

Business pay taxes by charging customers more, paying workers less, hiring fewer people, and paying lower dividends on investments.

Most likely the taxes are paid by workers and consumers, making taxing businesses to pay for unemployment benefits a major irony.

Worse still, the state's payroll tax comes directly out of the worker's wages while also reducing the potential number of employees a company may employ.

So if Buckley et al., really wanted to reduce unemployment they would slash the modified business tax to 0% immediately.