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Pritzker promises Illinois will pay off unemployment fund debt by year’s end

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By John O’Connor | Associated press

SPRINGFIELD, Ill. — Illinois Governor JB Pritzker said Tuesday that the state’s relatively low unemployment rate will help him keep his promise to pay off coronavirus-era debt in the State Trust Fund. unemployment insurance by the end of the year.

The Democrat announced he will transfer $450 million from the account set aside to pay unemployment benefits toward debt that has swelled to $4.5 billion during COVID-19-forced business shutdowns.

This reduces the remaining federal loan balance to $1.8 billion, which Pritzker has promised to eliminate by the new year. Illinois has joined dozens of other states in borrowing money to pay unemployment claims, which in Illinois jumped in the spring of 2020 to levels not seen since 1982.

“With the COVID-19 pandemic, a different kind of disaster has happened…” Pritzker said at a press conference in Chicago. “Across the United States, to ensure that those who are eligible can access unemployment benefits, extraordinary measures have been taken by state unemployment trust funds, because almost none … were sufficiently funded to cover this type of emergency.”

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The Democratic-controlled General Assembly and Pritzker agreed last spring to use $2.7 billion in federal pandemic relief funds to more than halve the debt. Republicans argued for paying the entire balance with federal money while it was available and for sparing employers who fund the account a tax increase.

But a robust economy has played a key role, said Kristin Richards, director of the Illinois Department of Employment Security. August unemployment in Illinois was 4.8%, down from 6.1% a year earlier. Year-over-year declines in unemployment occurred in nearly all 102 counties.

Tuesday’s announcement reflects the continued growth of the state’s economy, Richards said.

“Wage employment across the state is up from a year ago,” she said. “We are seeing significant gains in the recreation and hospitality, professional and business services, trade, transportation, and utilities sectors in 97 counties across the state.