Las Vegas Sun

July 31, 2014

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Legislature 2013:

Panel approves two bills that would raise companies’ unemployment tax

Nevada’s 57,000 employers may soon be getting hit with higher rates to pay off the federal government for money borrowed during the recession to cover jobless benefits.

The Senate Finance Committee on Monday approved two bills to pay off the interest on the loan and to issue bonds to retire the estimated $540 million owed.

Renee Olson, administrator of the state Division of Employment Security, said Assembly Bill 482 will permit the agency to add a temporary assessment to pay the $17 million in interest due to the government by Sept. 30.

That will increase the monthly employer assessment by 0.08 percent, or $22 per year per worker, she said.

A second bill, Senate Bill 515, will permit the agency, with the approval of the state Board of Finance, to issue bonds to return Nevada’s unemployment fund to solvency.

It will be several months before the amount of the bonds to be issued will be decided. Olson said it plans to structure the bonds to achieve the lowest interest rate.

When that becomes final, the employers may face another increase in their monthly assessments. But the amount has not been decided.

The average unemployment tax now is 2.25 percent on the first $26,000 of a worker’s salary.

Two years ago, the Legislature allocated general fund dollars to pay off the interest owed to the federal government. Now the employers will pick up the tab.

Both bills go to the floor of the Senate.

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