Small businesses bracing for a seismic spike in unemployment insurance taxes
DENVER, June 2, 2021—The state’s largest and leading small-business association today renewed its call for Gov. Jared Polis and the Colorado General Assembly to take the unemployment insurance trust fund crisis more seriously.
“The unemployment trust fund balance as of June 30 will certainly be bad news for Colorado small-business owners. The balance as of that date is what will set the unemployment tax rate paid by employers for 2022,” said Tony Gagliardi, Colorado state director for the National Federation of Independent Business (NFIB). “No, governor, this can’t wait until 2023, as you dismissively put it, and giving the Legislature the option to use some of the American Recovery Plan Act (ARPA) money to shore up the UI Trust Fund has produced exactly what we expected, nothing but two shell bills (SB 21-188 and SB 21-291) that allow ARPA funds to be used for anything. We need decisive action, and we need it now.”
Colorado received $3.8 billion in ARPA money, which NFIB has confirmed with the Legislature’s Joint Budget Committee can be used to pay off or pay down the state’s UI tab with the federal government. At the beginning of this month, to the tune of just over $1 billion, Colorado was one of only 19 states to need federal loan assistance to keep its Trust Fund stuffed with cash. New Mexico is Colorado’s only border state to also need the help. Unemployment insurance benefits are funded solely by taxes on businesses, which Gagliardi said are staring down the barrel of massive solvency surcharges on their UI taxes, which will severely cripple any hiring or rehiring plans they might have had.
“In his revised budget, California’s governor offered a paltry $1.1 billion toward his state’s $21 billion debt to the federal government, but at least that was a small acknowledgment of the problem, which we can’t seem to get from Colorado’s policymakers,” said Gagliardi.
ATTENTION Editors: NFIB will release its monthly Jobs Report tomorrow. Will it show a fourth consecutive month of historic highs in job openings small-business owners cannot fill or a tapering?
Keep up with the latest Colorado small-business news at www.nfib.com/colorado or by following NFIB on Twitter @NFIB_CO or on Facebook @NFIB.CO
For 78 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is a nonprofit, nonpartisan, and member-driven association. Since its founding in 1943, NFIB has been exclusively dedicated to small and independent businesses and remains so today. For more information, please visit nfib.com.
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