The state's already shaky unemployment compensation fund ran out of money when the COVID-19 pandemic hit and businesses started to close, forcing Ohio to borrow dollars from the federal government. Now the state is starting to pay that money back, in time to avoid paying interest.
Ohio Gov. Mike DeWine said it should only be a matter of days for the state to pay back the $1.5 billion it borrowed, starting in June of last year.
The debt will be paid using federal coronavirus relief funds.
DeWine said avoiding interest and increased unemployment fees for business owners is part of the overall response Ohio has taken to the pandemic, such as a hiring freeze and spending cuts early in 2020.
"If you look at outside agencies that are looking at what we've done, I think they agree. Bond-rating is higher than it's been since 1979. That's been our approach, it's been a cautious approach, it's been a conservative approach," DeWine said.
The governor's administration was criticized for the backlog in unemployment claims and fraud.
DeWine said a next step is fixing the unemployment fund's structural issue to make it solvent for the next recession.
"We know that paying off this debt takes care of a debt but we also know that we have a structural problem so this is going to take some sacrifice on both sides of this issue," DeWine said.
Ohio lawmakers have tackled unemployment compensation reform in recent years but it has been a challenge. "This has to be a political solution in the sense that it has to be a coming together of business, labor, to get this done," DeWine said.
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