Louisiana seeking federal loan as unemployment fund runs dry

Louisiana News

Senate President Page Cortez, R-Lafayette, center, gestures as he talks with Commissioner of Administration Jay Dardenne, left, the governor’s chief budget adviser, and House Speaker Clay Schexnayder, R-Gonzales, right, on Friday, Sept. 25, 2020, in Baton Rouge, La. The three men, all members of the Revenue Estimating Conference, spoke ahead of the conference’s meeting. (AP Photo/Melinda Deslatte)

BATON ROUGE, La. (AP) — Louisiana will start borrowing money from the federal government in early October to keep paying benefits to jobless workers.

The state’s once-healthy unemployment trust fund is nearly empty because of the coronavirus outbreak.

Lawmakers meeting in a special session that starts next week are scrambling for financing options to refill the fund that topped $1 billion before the pandemic, rather than relying on federal loans long term.

Senate President Page Cortez and House Speaker Clay Schexnayder refused Friday to officially acknowledge the near-bankruptcy of the trust fund in a state forecasting meeting.

Such a formal recognition would trigger increased taxes for business and a drop in jobless benefits for unemployed workers in 2021.

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