Posted by: Andrew PiaIndiana will take longer to resolve money troubles with the state's bankrupt unemployment insurance fund than expected when a law aimed at fixing the system was enacted in April, officials said Wednesday.
Lawmakers enacted a hike in unemployment taxes on employers, which is set to take effect next year, and made operational changes in the system that are designed to help make the fund solvent. It has borrowed $1.1 billion so far from the federal government to stay afloat, a figure expected to climb to $1.7 billion by year's end and $2.7 billion by the end of next year.
The Indiana Department of Workforce Development said Wednesday that the state had been expected to stop borrowing from the federal government by 2012. But newer, less optimistic unemployment projections predict it will now be 2015 before the state can stop borrowing, and then it will take several more years to pay back the federal loans.
"The picture is much worse," Josh Richardson, the agency's director of government affairs, told a new committee -- comprised mostly of legislators -- which was created to help oversee the department.
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