Pennsylvania plans to borrow a $4.5 billion bond to help pay off debt from the federal Unemployment Trust Fund, which stands about $3.9 billion, the third highest in the nation.
But legislators were divided over who would benefit from this bill: employers, employees or both?
Both chambers this week passed Senate Bill 1310, sponsored by state Sen. John Gordner, R-Columbia, a move that will save Pennsylvania anywhere from $175 to $200 million in annual interest payments and prevent it from borrowing federal dollars.
Gordner explained that the amount was larger than the debt to help ensure the state won’t have to begin borrowing again. That, combined with other provisions, means “for decades to come, this fund will be solvent,” he said.
The bond will allow the state’s unemployment fund to be solvent by 2019, with the bond paid off the following year. Over the next seven years, the bill is expected to net $2.3 billion savings.
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