APA Supports Colorado Unemployment Trust Fund Proposal
The APA urged Colorado legislators to support provisions in Gov. Jared Polis’ budget proposal to deposit $500 million of state discretionary funds and $100 million of federal funds from the American Rescue Plan Act (ARPA) into the Unemployment Insurance Trust Fund (UITF). “That will save both employers and employees money,” Gov. Polis said in a media briefing on his budget proposal. “Our top priority is preventing large increases in the payroll tax.”
Trust Fund Depletion
The Colorado UITF, which was fully depleted as a result of high unemployment claims during the COVID-19 pandemic, is set to be replenished through increased unemployment insurance premium surcharges paid by employers with an estimated $5.3 billion in additional payments between 2023 and 2027, according to a January 2022 report by the Common Sense Institute. The budget allocation will move the base premium rate to a lower rate schedule beginning in 2024 and remove the solvency surcharge in 2025 instead of 2026.
The APA supports efforts by government decision-makers to find ways to reduce the burden on payroll professionals, their employers, and employees. The APA applauds efforts by state governors and legislators to appropriate funds to secure state UITFs and take measures to prevent fraud, like Colorado’s budget proposal. In 2021, the APA supported a similar proposal by Virginia’s former governor.
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Mike Linehan is the Assistant Manager of Government Relations for the APA.