(Host) Vermont faces a looming deficit in its Unemployment Insurance Trust Fund and will soon have to borrow money from the federal government to make up the shortfall.
Congressman Peter Welch has introduced legislation that could save the state about $20 million dollars in interest on that federal debt.
Welch’s bill would extend a provision in the last year’s stimulus bill. The state would still be liable for paying back the principal on the loans.
Welch says the bill is not a bailout for the states. He described it as a stopgap measure that will allow Vermont lawmakers and the Douglas Administration to come up with a long term solution.
(Welch) "It’s going to give them a little bit of breathing room. That’s really the extent of it. So I come here with a lot of modesty, frankly, because when the request was made of me to introduce legislation to just extend this interest waiver, that’s a long way from a bailout."
(Host) The administration and lawmakers are trying to come up with a package of reforms that could involve changes in benefits and higher taxes for business.
If the state doesn’t address the fund deficit, Vermont could have to borrow $310 million dollars over the next ten years to make up for the shortfall.