Wisconsin owes the federal government $1.4 billion in borrowed unemployment funds, according to the Department of Workforce Development.
Wisconsin is one of 32 states that borrowed from the federal Unemployment Insurance Trust Fund in order to maintain their unemployment programs during the recession, Wisconsin DWD Communications Director John Dipko said in an e-mail.
Although these loans originally were given free of interest, they will begin to rack up nearly $50 million a year in interest and must be paid back this fall, according to The Capital Times.
UW-Madison applied economics professor Andrew Reschovsky said the loans would be paid for by taxing employers, but the state could change the method.
Dipko said the Unemployment Insurance Advisory Council will address the issue of trust fund solvency this year.
Cullen Werwie, spokesperson for Gov. Scott Walker, told The Capital Times that the governor is aware the interest payments are coming due later this year and is following it closely.
""He's working with the Unemployment Insurance Advisory Council and the Legislature on some of the options available to improve the fiscal condition of the fund,"" Werwie said.
