(Sean Whaley/Nevada News Bureau) – The average tax rate most Nevada employers will pay to provide unemployment insurance coverage to their workers will remain at 1.33 percent for the coming year following a public hearing today.
Cynthia Jones, administrator of the Employment Security Division, adopted the recommendation of the Employment Security Council to maintain the rate unchanged from this year despite the depletion of the fund due to the bad economy and high unemployment rate.
The average rate on taxable wages applies to 35,116 employers, 59 percent of the state’s total. Newer employers pay different rates.
Jones said the rate is likely to go higher in future years after the economy recovers to pay back federal loans now being used to pay unemployment claims to Nevada’s jobless.
Nevada began borrowing money in late October to keep paying claims and has borrowed nearly $60 million so far.
Gov. Jim Gibbons had recommended that the rate actually be lowered to help businesses in the tough economic conditions, but employers who testified at previous public hearings asked only that the rate not be raised.
Nevada’s fund is expected to pay out $1 billion this year while bringing in only $430 million in taxes. With all federal extensions included, nearly $1.9 billion will be paid out this year to unemployed Nevada workers.
The state’s fund is expected to have a deficit of $828 million on Sept. 30, 2010.
The regulations must still be adopted by the Legislative Commission to take effect. A request earlier this month to pre-approve the regulation so it could take effect by Jan. 1 was rejected by lawmakers.
Gibbons has criticized lawmakers for not acting on the regulation. Emergency regulations are now being developed to ensure there is no interruption in the payment of benefits starting next year.
