Federal Government Shutdown – Minimal Short-term Impact on State UI Agencies
Each October 1st is the beginning of the new fiscal year (FY) for the U.S. federal government. Because Congress failed to agree on appropriations for the FY 2014 budget by the time the FY 2013 budget ended on Monday, September 30, 2013 at 11:59 p.m., or at least pass a continuing budget resolution, a systematic temporary suspension of federal government departments and agencies has begun.
In the short-term, since the shutdown affects only federal agencies, minimal impact on state UI agencies is expected. They are conducting business as usual with regard to unemployment claims, adjudications, charges, appeals/hearings, taxes, etc., so Equifax Workforce Solutions will be conducting business as usual, too. Of course, we anticipate increased UI claim activity for federal workers who are furloughed during the shutdown, and are prepared to handle the workload.
Over the long-term, if Congress fails to come to a budget agreement or pass a temporary continuing budget resolution, and the “federal shutdown” continues for weeks, the primary concern for state UI agencies will be federal administrative funding – funds provided to states so they can carry out the daily claims and tax functions of the UI program. In general, state UI agencies are currently able to continue administering the UI program with funding already allocated to them prior to October 1st; however, new funding will not be available until there is at least a continuing budget resolution. At this time, it is not known how state UI agencies would need to respond to a lengthy federal shutdown.
Funding for benefit payments remains largely unchanged for regular UI, UCFE, UCX, EB and EUC – states are able to access benefit accounts to pay existing and new claimants who are eligible. For those states taking Title XII loans in order to continue paying benefits, funds are available for at least three weeks and possibly longer.
We will continue to monitor the federal government shutdown and advise our clients of any pertinent information.
Source: UWC, Inc., USDOL
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