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The Nevada Legislature passed Assembly Bill 482, creating a temporary assessment on employers which will be used by the state to pay the interest on the Title XII advances received from the United States Treasury Department to pay regular unemployment insurance benefits.
Employers will receive a bill for the temporary assessment by June 30 and payment is due by July 30. The amount will be based upon each employer’s total taxable wages paid during 2012 but the average employer can expect to pay about $25 per employee. Staffing firms are not excluded.
“The staffing firm would be responsible because they are the ones that pay the wage,” said Mae Worthey, public information officer for Nevada’s Department of Employment, Training and Rehabilitation.
However, the legislation concerns Jim Annis, president and CEO of Applied Staffing Solutions, the largest privately held staffing firm in Northern Nevada.
“We don’t have any information from the state as to how they are figuring our assessment,” said Annis. “We just don’t know.”
The retroactive component of the bill is especially troubling, he says. “We can’t easily go back to our clients and get our money back.”
Nevada began the recession with more than $800 million in its trust fund, but depleted it due to the overwhelming number of people receiving benefits. The state had to borrow from the federal government to continue payment of regular unemployment insurance benefits.
“The temporary assessment will be collected only so long as necessary,” said Renee Olson, administrator for the Employment Security Division of the Department of Employment, Training and Rehabilitation. “We understand that the recession has taken a toll on Nevada’s businesses, but it is vital that we pay the interest on the loan and begin to make the trust fund whole again.”
The interest on Title XII loans is about $17 million and is due by Sept. 30, 2013. The current outstanding loan balance is approximately $560 million. The Employment Security Division will pursue the private financing of outstanding unemployment insurance loans, principal, and interest through a bond scenario.