Congress Restores Funds to Federal Unemployment System

Congress Restores Funds to Federal Unemployment System

A concerted effort by employers nationwide has helped to defeat a proposed appropriations bill amendment that would have diverted $125 million in funds from the Federal Unemployment System. The amendment was introduced by Senators Charles Schumer during debate on the Senate floor. The funds would have been transferred to the New York State Uninsured Employers Fund and to the Centers for Disease Control in continuing efforts to assist in the aftermath of the events of September 11, 2001.

The national unemployment insurance system is paid for with employer payroll taxes and employers nationwide, concerned about the profound effects of an under-funded Federal Unemployment System, generally opposed the amendment. Many argued that full funding is crucial to the proper functioning of the system and that diverting funds would require states to increase payroll taxes, thus thwarting economic and business recovery across the nation and especially in Louisiana, where individuals and business struggle in the aftermath of Hurricane Katrina.