Compromise Unemployment Compensation Plan to serve as stop gap until solvency solution is determined

Blog Post

Late Thursday night, December 8, 2016, the Ohio Legislature passed a measure containing an amendment designed to serve as a sign of good faith to bring interested parties together and hammer out an unemployment compensation solvency proposal in the beginning of next year.

Substitute Senate Bill 235 was amended to include the unemployment compensation compromise that:

• Raises, for a two-year period (2018-19), the taxable wage base used for the payment of unemployment contributions from $9,000 to $9,500;
• Repeals an automatic tax increase on businesses in the event the state is forced to again borrow from the federal government to cover the cost of benefits triggered by high unemployment (the tax increase was enacted earlier this year with HB 390, which allowed the state to retire the debt that it had accumulated when it borrowed to cover rising costs during the Great Recession); and
• Freezes, for a two-year period (2018-19), the maximum weekly unemployment benefit amounts at the maximum benefit amounts in effect on the bill's effective date.

SB 235 passed both chambers with bipartisan support. It was one of many legislative “Christmas trees” – bills with a multitude of amendments making state law changes that plowed through both legislative chambers during an all-day marathon of activity.

Industry groups across the state were divided on the issue and the compromise that found its way into the bill. You can read the Associated General Contractors of Ohio’s December Newsletter for more in depth analysis of this legislation.