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Program C: Worker Income Stabilization

Program Authorization: R.S. 23:1471

PROGRAM DESCRIPTION

The mission of the Worker Income Stabilization Program is to promote a stable, growth-oriented Louisiana through the administration of a solvent and secure Unemployment Insurance Trust Fund, supported by employer taxes, and pay Unemployment Compensation Benefits to eligible unemployed workers.

The goal of the Worker Income Stabilization Program is to provide financial security to unemployed workers through timely and accurate payment of Unemployment Compensation Benefits funded by employers' payments of quarterly unemployment taxes.

The program administers the Unemployment Insurance Trust Fund supported by employer taxes to pay Unemployment Compensation Benefits to eligible unemployed workers. The program's main activities include: Investigation of Unemployment Claims, Payment of Unemployment Claims, Review and Determination of Appealed Cases, and Collection of Unemployment Taxes.

OBJECTIVES AND PERFORMANCE INDICATORS

1. During FY 1998-99, the Office of Employment Security, through its Worker Income Stabilization Program, will issue Unemployment Compensation Benefits within 14 days of the first payable week ending date, and recover 55% of unemployment benefit overpayments established annually.

1 Does not include federal claims.

2. During FY 1998-99, the Office of Employment Security, through its Worker Income Stabilization Program, will collect 100% of unemployment taxes from liable employers, quarterly, depositing 90% of taxes in 3 days and transferring to the Unemployment Insurance Trust Fund within 3 days, in order to provide benefits to the unemployed worker and maintain solvency and integrity of the Unemployment Insurance Trust Fund.

RESOURCE ALLOCATION FOR THE PROGRAM

SOURCE OF FUNDING

This program is funded with Fees and Self-Generated Revenues, and Federal Funds. The Fees and Self-Generated Revenues consist of monies collected as a 5% penalty (for a maximum of 5 months) and 1% per month interest assessed on employers who are delinquent in the payment of their contributions to the Unemployment Trust Fund. The money is placed in a special account in the State Treasury to be expended to offset the cost of administration which is not payable from federal funds. The Federal Funds are Employment Security Grants which are granted to each employment security agency, under the provisions of the Social Security Act. The purpose of the grants is to defray administrative costs in the operation of statewide unemployment insurance and employment service programs. All operations performed in these fields must be in accordance with existing federal rules, regulations and guidelines under the immediate supervision of the Dallas Regional Office of the United States Department of Labor, Employment and Training Administration.

ANALYSIS OF RECOMMENDATION

GENERAL FUND

TOTAL

T.O.

 

DESCRIPTION

 

 

 

 

 

$0

$29,818,440

508

 

ACT 18 FISCAL YEAR 1997-1998

 

 

 

 

 

 

 

 

 

BA-7 TRANSACTIONS:

 

 

 

 

 

$0

$500,000

0

 

Funding provided for the imaging process/remittance processes to assist the department in processing unemployment checks accurately and more efficiently

$0

$9,200,000

0

 

Implements Act 442 (establishes any monies credited to the account of this state in the unemployment trust fund may not be requisitioned from the state's account or used except for the payment of benefits and for expenses incurred), 1114 (allocated $500,000 for the Office of Information Services and $700,000 for Administration), 537 (allocates $1.8 million for property improvements and/or automation enhancements, etc) and 1053 (allocates $6 million for the Workforce Development Training Account and $2 million for the Employment Security Administration Fund).

 

 

 

 

 

$0

$39,518,440

508

 

EXISTING OPERATING BUDGET - December 10, 1997

 

 

 

 

 

$0

$800,667

0

 

Equipment/Major Repairs Adjustment(s) (Non-recurring; -$1,199,333; Replacement/New: +$2,000,000)

$0

$3,702,266

0

 

Attrition Adjustment(s)

$0

($1,770,754)

(67)

 

Personnel Reductions

$0

($100,301)

0

 

Retirement Rate Adjustment(s)

$0

($5,018,787)

0

 

Reductions in various Expenditure Categories; Including Reductions to fully fund Salaries

$0

$0

0

 

Means of Financing Substitution(s) - Replace Interagency Transfers with Federal Funds because the interagency transfers were being transferred from the Office of Worker's Compensation for fraud investigations; the number of fraud investigations has decreased

$0

$0

0

 

Means of Finance Substitution(s) - Replace Self-Generated Revenues with Federal Funds because the department previously paid salaries from penalty and interest collections but this special assessment (Act 46 of 1995) will no longer be collected in fiscal 98-99

 

 

 

 

 

$0

$37,131,531

441

 

TOTAL RECOMMENDED

 

 

 

 

 

$0

($2,386,909)

(67)

 

DIFFERENCE (TOTAL RECOMMENDED AND EXISTING OPERATING BUDGET)

The total means of financing for this program is recommended at 94.0% of the existing operating budget. It represents 99.1% of the total request ($ 37,437,202) for this program. The decrease is primarily due to reductions in various expenditure categories because of declining federal support. This program has positions eliminated because these are unfunded vacancies.

PROFESSIONAL SERVICES

$33,543

 

Accounting/Auditing services for Employment Security Grants as required by federal regulations

$466,457

 

Attorney fees for collecting delinquent unemployment taxes

 

 

 

$500,000

 

TOTAL PROFESSIONAL SERVICES

OTHER CHARGES

$1,347,279

 

Disaster Unemployment Assistance (DUA) - This program is enacted when a disaster is declared in Louisiana by the President of the United States. Trade Readjustment Assistance (TRA) - This program benefits individuals who are displaced from their jobs because of foreign trade. The company could move overseas or have a layoff due to foreign competition. Unemployment Compensation Federal Employees (UCFE-UCX) - Unemployment Compensation Ex-servicemen - Both of these programs are for military employees that are separated from their jobs. The Federal Government pays 100% of the benefits.

 

 

$660,137

 

The Work Opportunity Tax Credit Program provides tax credits to employers for hiring specific groups of workers. There are seven groups eligible under the Work Opportunity Tax Credit Program. For example, Qualified IV-A recipients who are recipients of welfare or Aid to Families with Dependent Children (AFDC); Qualified veterans who have received welfare or AFDC and have received benefits for at least a nine-month period ending during the 12-month period ending on the hiring date, or who have received assistance under the Food Stamp Act of 1977 for at least a three-month period ending on the hiring date; Qualified ex-felons who are economically disadvantaged and hired no later than one year after conviction or release from prison and High risk youth who are at least 18 but not yet 25 years of age and whose principal place of abode is within a designated empowerment zone or enterprise community, etc.

$5,840,942

 

Funding provided per Act 1053 of the 1997 Regular Session - This act establishes the Worker Training Fund in the Employment Security Administration Fund to be known as the Worker Development Training Account. This account is a social charge account which is collected by LDOL and placed in the Office of Employment Security Clearing Account, allocated according to law with portions forwarded to the UI Trust Fund, and portions deposited in the Workforce Development Training and Employment Security Administration accounts in the Employment Security Administration Fund.

 

 

 

$7,848,358

 

TOTAL OTHER CHARGES

ACQUISITIONS AND MAJOR REPAIRS

$2,000,000

 

Funding provided for the following equipment: IBM Enterprise Server Upgrade, EMC DASD Upgrade, Highlight Printer, Intelligent Mail Inserter, Nearline-Silo Cartridge, Almis, Networking, Thin Client Win Frame, Halon System Enhancement and year 2000 compliance

 

 

 

$2,000,000

 

TOTAL ACQUISITIONS AND MAJOR REPAIRS

14 DEPARTMENT OF LABOR


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