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Lawmakers hear that South Carolina UI trust fund reached $590 million; questions remain on tax path to statutory reserve
Summary
Director Cheryl Stanton told the joint committee the unemployment insurance trust fund held more than $590 million as of April 30 and outlined a five‑year rebuild plan; members pressed how quickly employer tax rates should fall and whether the statutorily calculated reserve remains appropriate.
Cheryl Stanton, director of the South Carolina Department of Employment and Workforce, told the joint Labor, Commerce and Industry committee that the unemployment insurance (UI) trust fund balance stood "over $590,000,000" as of April 30 and that the agency has moved from crisis to reserve rebuilding.
Stanton said the agency paid off federal UI debt during her tenure and is following a statutorily based formula to set a reserve level tied to three worst‑recession multipliers and the state’s taxable‑wage base. "Our current projections of where we will need to be in 2020… is somewhere between 946,000,000 and 970,000,000," she said, describing why September balances matter for annual tax‑rate setting.
Committee members asked for clarity on how the $590 million figure related to required reserve targets and whether employers are being charged more than necessary to reach the statutory rebuild. Thomas Alexander, chair, pressed the point that private employers might feel overburdened: "So it seems like we're are gouging our private employers at a rate that's not necessary," he said.
Stanton answered with the agency’s approach: the department projects benefit payouts, consults with federal and state analysts and sets aside a portion of collections each year for reserves. She said the agency is tracking weekly claims and payouts and would notify the legislature if trends require course correction.
The committee did not take a formal vote on any change to tax policy. Stanton committed to providing updated post‑April 30 collections data and noted the agency’s plan to return to the committee if benefit payouts meaningfully increase.
