XPost: alt.california, alt.fan.rush-limbaugh, alt.society.liberalism
XPost: talk.politics.guns
From: moron.newsom@pelosi.com
On 26 Feb 2022, Kurt Nicklas posted some
news:sve53e$1rkr2$5@news.freedyn.de:
> Dechucka wrote
>
>> Ha! Ha! Incompetent Democrats!
Unbeknownst to many Californians, they are now finding themselves
financially responsible for the state’s nearly $20 billion federal loan
default, which was taken out to address California’s unemployment fund
deficit during the COVID pandemic. The reality of this responsibility came
to light when the state ceased making payments on the loan. According to
federal law, when a state defaults on a federal unemployment insurance
loan, its businesses must repay the debt. The default is further
exacerbated by the outdated IT system of California’s Employment and
Development Department (EDD), which enabled more than $30 billion in
fraudulent unemployment claims during the pandemic.
Fraudulent beneficiaries included felons behind bars, individuals
impersonating a toddler, and a single address receiving payments for
roughly 60 separate claimants. As a result of the unpaid federal
unemployment insurance loan, the federal government increases the
unemployment insurance tax by 0.3 percent for each business in the state,
with an additional 0.3 percent increase each year until the loan is
repaid. The typical federal unemployment insurance tax rate is 0.6 percent
per year, meaning California businesses will pay several times the
standard rate before the loan is settled. The state’s Legislative Analyst
Office projects that loan repayment through higher business taxes won’t
occur until 2029 or 2030 and could take longer depending on California’s
economic performance.
The state had several chances to pay off the debt, including a roughly
$100 billion budget surplus the previous year, $27 billion in federal
COVID assistance, and a budget record of $300 billion-plus for 2022–2023.
The state might have resumed payments this year despite failing, lowering
the tax burden on businesses as intended in the 2023–24 budget. The state
has reneged on its promise to resume payments or offset rising company
federal unemployment insurance fees, though, as its financial outlook
deteriorates.
California is one of four states that have not serviced their debts out of
the 22 states that received federal unemployment loans during the
pandemic. Among these four states, California owes $27.5 billion (almost
two-thirds of the total) in unpaid federal unemployment insurance as of
the previous year.
The EDD’s IT system dates back to the 1980s and uses software over 50
years old. After multiple attempts to fix the errors, the scope of the
problems became magnified. In 2013, the EDD was granted funding by the
Obama administration to purchase fraud detection software from Pondera
Systems, which was used until 2016. The software, costing around $2
million per year, was discontinued due to the price, which represented
less than 1% of the EDD’s budget.
In response to the EDD’s ongoing issues, Governor Newsom established a
“strike force” in July 2020 to assess the department. The strike force’s
report highlighted numerous deficiencies, but this information wasn’t new.
EDD had been audited 10 times in the past decade, with little improvement.
The EDD’s failure to pinpoint the extensive fraud that occurred has been
further highlighted by a third-party data and analytics company Lexis-
Nexis, which estimates the fraud amount at around $32.6 billion, compared
to the EDD’s $20 billion estimation.
https://theatlasnews.co/business/2023/05/07/california-defaults-on-18-5-
billion-dollar-debt/
--- SoupGate-Win32 v1.05
* Origin: you cannot sedate... all the things you hate (1:229/2)
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