During the COVID-19 pandemic, businesses across the state shut down in efforts to stop the spread which led to an unprecedented number of unemployment insurance claims. New York paid $1.2 billion towards the Unemployment Trust Fund (UTF) in May but still owes $7.6 billion to the federal government, second only to California and is one of six states that still owes money to this fund. Almost a year ago, Comptroller Tom DiNapoli warned the state as to what will happen if this debt remains unpaid by November 10, 2022, but New York has yet to act and instead the Department of Labor issued letters to businesses about a new Interest Assessment Surcharge (IAS).
In early July, Assemblyman Billy Jones (D-Chateaugay Lake) and 21 other assemblymembers wrote a letter to the Governor in support of the state allocating extra revenue to pay off the debt to the UTF. Today Jones joined Garry Douglas, CEO and President of the North Country Chamber of Commerce, Robin Pierce, executive director of the West Side Ballroom, and Shannon Wilkins, business manager of Rulfs Orchard and owner of Livingood’s Restaurant and Brewery at the West Side Ballroom to call on the state to pay off the debt to the federal government before it’s too late.
“Local businesses are just now starting to recover from the losses they experienced due to the pandemic,” says Assemblyman Jones. “Now is not the time to charge an Interest Assessment Charge or increase their tax rates to help pay off the state’s debt to the federal government. The businesses that were forced to close shouldn’t be punished, and the ones who were able to stay open or keep their employees on payroll shouldn’t be burdened with the state’s debt. Small businesses are the backbone of the North Country economy, and they will be the ones most impacted by this. They need our support right now, not to be slapped in the face. The State failed to allocate federal stimulus money from the pandemic to pay off this debt despite pleas from Comptroller DiNapoli, economists, and my colleagues and I in the State Legislature. Mobile sports betting and sales taxes raised more revenue than projected and this extra money should be allocated to pay off New York’s $7.6 billion debt to the Unemployment Trust Fund.”
"As employers continue to recover from the pandemic and now deal with inflation, the last thing they need is a major hike in their unemployment insurance costs, yet that is what is about to happen as New York remains one of a few states which have not paid down their UI debt from the shutdown period," says Garry Douglas, President of the North Country Chamber of Commerce. "There are remaining federal aid resources which can be applied to this debt, and we urgently need action to do that. The massive outlays of unemployment benefits during the shutdown were not the fault of employers but a mandate by the state. And the more than $8 billion debt will now fall on everyone, including businesses who had few or no layoffs. We thank Billy Jones and our other North Country legislators including Senator Stec and Assemblyman Simpson for their solidarity and support. We need Albany leaders to step up and take action to stem this impending hit."
“West Side Ballroom was very close to having to shut its doors for good due to the COVID-19 pandemic,” says Robin Pierce, executive director of West Side Ballroom. “The government’s restrictions created extreme challenges for all businesses to stay viable. The West Side Ballroom provides a venue for conferences and weddings. We are just now beginning to see business getting back to normal as people are more comfortable gathering and the government- imposed restrictions have been lifted, but we still have a way to go. Now New York State is imposing an Interest Assessment Surcharge (IAS) to pay back money that was paid out in unemployment claims that were not due to the action of the employer, but New York State and the Federal Government. There were many claims throughout the state that were paid out without fully vetting them. As employers we were not able to dispute them due to the pandemic era processing. We should not be responsible to paying for the shortfall, especially the small businesses who are barely making ends meet. I am asking for New York to not impose this surcharge. It going to be the straw that breaks the camel’s back for some of our small businesses.”
“As a small business owner, we have seen many increases in expenses this year,” says Shannon Wilkins, business manager of Rulfs Orchard and owner of Livingoood’s Restaurant and Brewery. “Any extra expenses, such as this unemployment insurance surcharge, can put a lot of stress onto a small business. We have seen so many challenges running an essential business during a pandemic, we were fortunate that we could stay open, but it wasn’t easy. Businesses already pay many taxes and fees to operate, I think New York is wrong to expect businesses to help pay back money owed to the federal government.”