The South Carolina Department of Employment and Workforce made an early payment of $75 million to the federal government toward the agency’s unemployment trust fund loan.
“What this means is that the loan balance is now at $120 million,” Director of Information Services of the department, Adrienne Fairwell told South Carolina Radio Network Monday.
With the early payment the state will not have to pay as much interest. “And saves South Carolina approximately $1.3 million in interest because the loan payment was made early,” Fairwell said.
“When the 2014 unemployment tax rate was set, the federal government estimated 1,968,209 South Carolinians were employed. As of December, 2,069,190 people were earning paychecks in the state, leading to additional tax collections,” Fairwell said in explaining the savings in interest.
In addition, South Carolina paid about $80.7 million less in unemployment benefits between January 2014 and December 2014 compared with the same time frame in the previous year.
South Carolina experienced record-high employment throughout 2014, as benefit payouts continue to decline monthly enabling this $75 million early payment to be possible.
The state borrowed $977 million from the federal government during the depths of the Great Recession to cover unemployment checks that were being paid to out-of-work South Carolinians. To date, South Carolina has repaid more than $857 million of that loan.