In 2009, to shore up its Unemployment Insurance Trust Fund following the late 2000’s recession, New York State borrowed $3.5 billion from the federal government to ensure it was able to meet its Unemployment Insurance obligations. In 2011, as part of the SFY 2011-12 Adopted Budget, the Legislature extended for two years, the authority of the Commissioner of Labor to assess interest payments or an “Interest Assessment Surcharge” (IAS) on employers for the loans borrowed from the Federal government.
Starting in 2012, all employers who pay unemployment insurance contributions to the state are liable for the Interest assessment surcharge. The Department of Labor has just announced that the maximum amount most employers will be assessed in 2014 has dropped to $5.95 per employee, compared to $12.75 per employee in 2013 and $21.25 per employee in 2011.
The debt owed on these federal loans is being decreased at a fast rate largely because of Unemployment Insurance reforms that Unshackle Upstate helped shape with the Governor’s Office in last year’s State Budget.
While we opposed the Interest Assessment Surcharge from the beginning, we are pleased to see that its negative impact on businesses and the economy is being mitigated.
Information for employers on the Interest Assessment Surcharge for 2014 is available through the New York State Department of Labor website.