Number: RS22954
Title: The Unemployment Trust Fund (UTF): State Insolvency and Federal Loans to States
Authors: Kathleen Romig, Analyst in Income Security; Julie M. Whittaker, Specialist in Income Security 
Abstract: During some recessions, current taxes and reserve balances were insufficient to cover state expenditures for unemployment compensation (UC) benefits. UC benefits are an entitlement, and states are legally required to pay benefits even if the state account is insolvent. Some states may borrow funds from the Federal Unemployment Account (FUA) within the Unemployment Trust Fund (UTF) in order to meet UC benefit obligations. This report summarizes how insolvent states may borrow funds from the federal account within the UTF in order to meet its UC benefit obligations.
Pages: 6
Date: January 21, 2009