CHARLESTON, W.Va. — West Virginia’s unemployment rate continued dropped to 6.3 percent in the month of December. Despite the improved number, months of a growing jobless rate in the state have hit the state’s unemployment compensation fund hard. The fund is starting to grow dangerously low as payouts are increasing and payment into the fund is starting to slow.
Now Gov. Earl Ray Tomblin wants lawmakers to allow him to borrow $50 million to shore up the unemployment fund from the Rainy Day Fund. Tomblin says it’s been done before, and there’s a reason it makes better sense.
“A few years ago we were able to borrow from the Rainy Day Fund when so many other state’s borrowed from the federal government,” said Tomblin. “You pay a huge interest on that, plus if you don’t have it paid back on time there’s a huge surcharge that automatically goes on every business in West Virginia.”
Tomblin said now is not the time to be piling onto businesses in the state which are already struggling to get through the present economy.
“These kind of times when we can get through by borrowing from ourselves, that wouldn’t impact the employers in the state of West Virginia.” he said.
Lawmakers have been reluctant to move on any of the governor’s budget proposals so far. The state is facing a $354 million dollar revenue shortfall in the current fiscal year. Tomblin believes borrowing from Rainy Day Fund will be the far better option than through a federal loan. The governor called it a “bridge loan” to get the state through a rough patch and get back on solid financial footing.