As the 2021 legislative session begins Monday January 11, GOP leaders are going to push for part of the state's "rainy day fund" to be used to help offset exploding unemployment insurance rates.

House Minority Leader J.T. Wilcox released information Sunday indicating the GOP will push for some of these reserve funds to be used to "backfill" the unemployment insurance 'defecit.'

Many people believe the reason for the rate increases is due to the ESD Nigerian scam,  that caused hundreds of millions of dollars be stolen from fraudulent claims. The state said most of the money was recovered, although a specific concrete number has not been released by the state.

However, this is an issue that's actually related to COVID.  Many expected unemployment insurance rates to go up in 2021, but it's actually already begun. Businesses are seeing rate go up anywhere from 300-400 percent or higher.

Last October, according to the Washington Policy Center, quoting Senator Randi Becker of the State Ways and Means Committee, ESD said they projected the rates could up as much as 700 percent.

The shocking increases would be to make up for the largest number of claims filed in state history due to the COVID economic lockdowns and business shutdowns. ESD said the tax increases would be to make up the revenue.

You may not know that Washingon is one of only a handful of states that require businesses to repay increased unemployement taxes, due to COVID, when they re-open their doors. For businesses that didn't  close, they also saw the increase.

The only time the state will waive this repayment requirement is if the business had a verified case of COVID at their site. Even if the repayment was waived, businesses are still facing these rate increases going forward.

For example, at the most recent Benton County Republican meeting, Kennewick City Councilman Bill McKay remarked that his business saw a 400% increase in the taxes.

Wilcox had this to say about how to deal with this increase:

"Many, many businesses are seeing three-to-five-hundred percent increases in their unemployment insurance rates. And we should use part of the rainy-day fund to backfill that.”

The Washington Policy Center, as well as many legislators and business leaders, say this massive unemployment tax increase will only discourage businesses from re-opening. It could also cause some owners to decide to just close up shop even if they're open.

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