RICHMOND — A record 33 states, including Virginia, have depleted their unemployment benefit funds and must borrow billions from the federal government, according to a study on unemployment insurance trust funds.
The report predicts that national unemployment will remain near 10 percent throughout 2010 and average more than 9 percent next year, perhaps dragging even more states into unemployment-insurance insolvency.
Currently, 12 states have borrowed more than $1 billion from the federal government, with California topping the list at $8 billion, according to the study. The report was released last week and sponsored by the nonprofit National Employment Law Project.
Virginia, which is expected to borrow $1.26 billion to pay benefits in the coming years, was $317 million in debt at the time of the National Employment Law Project report.
A January report by the Virginia Commission on Unemployment Compensation projected that the state unemployment trust fund’s deficit would be $545.7 million by the end of this year.
The study argues that the crisis of states’ unemployment funding has been exacerbated by bad decisions that have been years in the making.
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