Coronavirus: Ohio jobless fund to go broke by June without bailout, Husted says

Workers work on a manufacturing line at Honda plant in Anna, Ohio. BILL LACKEY

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Workers work on a manufacturing line at Honda plant in Anna, Ohio. BILL LACKEY

Without a federal bailout, Ohio’s unemployment compensation fund will go broke sometime in June, forcing Ohio to borrow money, cut benefits or raise employer taxes to keep it going, Lt. Gov. Jon Husted said on Wednesday.

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“One thing I want to reassure folks on is that does not mean you’re going to lose your benefits,” he said. “What the solution will be will in large part be up to the General Assembly. We need to work with them on this for a prescription on how we’re going to do this.”

Ohio’s unemployment compensation system has been in big trouble for more than a decade as the taxes paid by employers weren’t enough to keep up with benefits paid out. State leaders have failed to agree on a fix for years.

During the Great Recession, the fund went broke Jan. 12, 2009, forcing the state to borrow from the federal government to keep issuing unemployment checks. The state borrowed $3.4 billion and had to pay more than $200 million in interest on the loan.

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The economic slowdown and huge spike in jobless claims means Ohio will have to come up with a fix.

“This is a responsibility we’ll all have to address. This is a zero sum question: it’s either going to come from the employer or the people who are unemployed. We just have to strike the right balance,” Husted said.

The system is now getting slammed with more claims in the past month than were filed in the previous two years, Husted said. The state boosted call center employees from 42 to more than 1,100 and is scrambling to add more workers and capacity.

“I just want to reassure you that until it’s delivering the level of customer service that people deserve, they will continue to make those improvements,” Husted said.

Husted said a system for self-employed workers, who file 1099 tax forms, to file for unemployment benefits will be launched by the end of next week and payments will begin flowing by mid-May.

That’s nearly two months after many independent contractors and gig workers were forced out of work in mid-March.

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The Ohio Department of Health on Wednesday reported 7,628 confirmed coronavirus cases, 161 probable cases, 2,237 hospitalizations, 346 deaths and 15 deaths attributed to probable coronavirus infections.

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Gov. Mike DeWine reported that test results are pending on two more inmates at Pickaway Correctional Institution who apparently died of suspected COVID-19 disease. Previously, an inmate at Pickaway and a corrections officer at Marion Correctional died of confirmed COVID-19.

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The DeWine administration has yet to offer concrete details on how and when Ohio will lift the shut down orders that helped slow the spread of the coronavirus but also put the brakes on the economy.

Other housekeeping items announced Wednesday by DeWine:

— Battelle Memorial Institute will sanitize personal protective masks — N97 masks — for law enforcement and emergency medical services throughout Ohio at no charge. The Ohio Highway Patrol will coordinate drop off and pick up at local posts.

— Hospital executives have been asked to come up with a plan for resuming electives surgeries while also keeping in mind the need to conserve the limited personal protective equipment.

Ohio Health Care Association executive director Pete Van Runkle, who represents Ohio nursing homes, said he would be concerned about the personal protective equipment aspect of hospitals resuming electives.

Many Ohio nursing homes and other long term care providers have been struggling to source enough masks, gowns and other protective gear.  “I would hope that the plan he (DeWine) requested would ensure the hospitals have enough PPE to re-start elective surgeries without shorting long-term services and supports providers,” Van Runkle said.

Staff writer Kaitlin Schroeder contributed to this report.

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