The state of Ohio has opened a multibillion-dollar credit line with the federal government to replenish its ailing unemployment payment system, Gov. Mike DeWine announced in his Tuesday news conference.
DeWine said he does not expect the state to need all of the $3.1 billion it is now eligible to borrow from the United States Department of Labor, but its existing unemployment fund would have been emptied within days without an external cash infusion.
The state had paid $4.1 billion to 699,000 unemployment Ohioans so far in 2020, much of it to people who lost their jobs as a result of the COVID-19 pandemic.
The state borrowed slightly more from the federal government in 2009 to cope with the last recession — $3.3 billion, paid back over the course of seven years.
Ohio Department of Jobs and Family Services director Kim Hall said Tuesday there is no set timeline for Ohio to repay what it borrows in 2020. However, if the loan is not paid off by November 2022, employers will see a gradual increase to their unemployment taxes starting in January 2023.