Stakeholders Reach Historic Agreement to Eliminate Pandemic Unemployment Debt and Protect Workers' Benefits

Springfield, Ill. – This week, Governor JB Pritzker and lawmakers announced a bipartisan agreement to pay off the remaining $1.36 billion unemployment insurance loan balance and replenish the fund for any future emergencies. This historic agreement saves taxpayers an estimated $20 million in interest costs that would be due next September and preserves hundreds of millions of dollars in future federal tax credits for Illinois employers.

The agreement between representatives from business, labor, and bipartisan members of the General Assembly will contribute more than $1.8 billion in state funds to the trust fund, which includes the payment of the remaining federal loan balance. The remaining $450 million will be placed into the trust fund as an interest-free loan to the business community. As the loan is repaid over the next decade, funds will be deposited into the state's rainy-day fund.

"Although it was a long and difficult process to reach this agreement, this is how policy decisions should be made," said House Speaker Emanuel "Chris" Welch. "I want to thank those who pulled up a seat at the negotiating table and made a true effort to find common ground and reach a solution. I'm proud to take another step toward restoring Illinois' fiscal house and continue to make decisions that help us build a strong economy for years to come."

"I'm proud to announce that together, we've reached a historic, bipartisan agreement to eliminate pandemic-induced UI Trust Fund debt, replenish the fund for the future, protect benefits for working families, and further fuel Illinois' strong economic trajectory," said Governor JB Pritzker. "Republicans and Democrats are delivering a historic state investment of $1.8 billion to the Unemployment Trust Fund. This bipartisan agreement eliminates the final portion of the $4.5 billion debt forced upon our state during the pandemic and saves Illinois businesses and taxpayers hundreds of millions of dollars over the next decade."

This is the third significant contribution to the outstanding loan balance, which was accrued when the state borrowed $4.5 billion in federal funds to provide economic relief to the unprecedented number of unemployed workers during the pandemic. In March of 2022 lawmakers passed, and Governor Pritzker signed legislation that provided $2.7 billion ARPA dollars to put towards the trust fund and in September, there was another $450 million payment toward the balance.