Director Stanton says UI debt is paid and trust fund holds more than $590 million; lawmakers press on tax pace

Cheryl Stanton, director of the South Carolina Department of Employment and Workforce, told the Labor, Commerce and Industry joint committee that the agency had paid off federal unemployment insurance debt and that the trust fund balance was "over $590,000,000" as of April 30.

Stanton said the department is following a five-year rebuild set by statute and that the reserve calculation depends on a formula tied to three worst recessions 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 told the committee. Members pressed whether the pace of employer tax collection and the planned rate path risk over- or under-collecting as wages and employment change.

Committee members repeatedly sought clarity on timing and projections. Stanton described weekly monitoring of initial claims and benefit payouts — "we're hovering at about 2.8 to 3,000,000 dollars in benefit payouts a week" — and said that if payouts begin to creep up she would report back to lawmakers and the business community. She also told the committee that annual consultations with the Congressional Budget Office and the U.S. Department of Labor inform the taxable wage base and rate decisions that feed the multi-year plan.

The session concluded with committee members noting the tradeoffs between protecting the trust fund against future recessions and the near-term tax burden on employers; Stanton said the agency seeks a balance so employers are not "overtaxed" while avoiding a return to federal borrowing.