Bill allows Illinoisans to keep unemployment overpayments

[June 19, 2021]  By Kevin Bessler

(The Center Square) – Illinois lawmakers want to allow people who were overpaid unemployment benefits during the COVID-19 pandemic to keep the money despite a $5 billion deficit in the state's Unemployment Insurance Trust Fund.

The provision was part of a bill that included reforms at the much-beleaguered Illinois Department of Employment Security. The bill passed both chambers

State Rep. Jay Hoffman, D-Swansea, said there is a stipulation regarding overpayments.

“It must be in equity and good conscious, in other words, you have to show specifically that you don’t have the ability to pay it back,” said Hoffman.

State Rep. Steven Reick, R-Woodstock, said the bill is missing a key component regarding the Unemployment Insurance Trust Fund.

“The thing that I don’t like is the fact is that this bill does not even address what we are going to do to pay this back,” he said. “We are going to leave it to future negotiations.”

Illinois’ fund was depleted by $1 billion during the pandemic and it borrowed $4.2 billion from the federal government, leaving the total hole at $5.2 billion.

“We are sitting on $8 billion dollars of ARPA (American Recovery Plan Act) funds, which would be perfectly allowable as the means by which this deficit could be paid back,” Reick said.

Gov. J.B. Pritzker signed the Fiscal Year 2022 budget into law this week, but the Unemployment Insurance Trust Fund deficit was not addressed.

Illinois Director of the National Federation of Independent Business Mark Grant said lawmakers are leaving employers on the hook for the debt.

"Lawmakers are divvying up tens of billions of dollars in state and federal revenue while small businesses, the engine driving Illinois’ economic comeback, are about to be stuck with a $5 billion tax bill in the form of huge hikes in unemployment taxes brought on by the pandemic shutdowns,” Grant said.

The bill also prohibits IDES from including a person’s social security number in mailings or emails to prevent identity theft. The agency has been hit by fraudsters and bogus unemployment claims.

It has been more than 500 days since Illinois Department of Employment Security offices were open to the public.