Advocacy Action Center

Urge State to Use ARPA Funds to Fix UI Trust Fund Crisis

The state recently passed legislation designed to address sizeable spikes in Q1 UI Tax bills received by Massachusetts employers resulting from pandemic-related layoffs.  The new law shifted pandemic-related unemployment claims, previously charged to the program's solvency fund, into a new COVID fund which will be amortized over a 20-year period through bonding. 

In the short term, the move provides employers relief from the increased solvency assessments experienced in their first quarter UI bills, however, the burden of paying off the program’s existing $7 billion deficit over the 20-year period will remain squarely on the shoulders of the Commonwealth’s employers.   As these costs are primarily the result of state and federal government decisions to enhance and expand UI benefits and shut down private business operations during the pandemic, it is only fair that government take on a shared responsibility for these costs. 

Our federal and state elected leaders determined eligibility, the emergency benefits (which for most recipients resulted in more income than they earned on the job), and the business restrictions over the past year and a half period.  Therefore, our federal and state leaders should not expect employers to cover the entire $7 billion program deficit for layoffs triggered by their decisions, not those of business owners.    

In an effort to mitigate the impact of this burden being imposed solely on employers, RAM continues to advocate for the use of some portion of the billions of dollars in ARPA funds received by the state to lessen the tax burden.  RAM recommends an investment of at least $1.5 billion.  

The Legislature is currently conducting public hearings and receiving written comments on how to best spend these ARPA funds. RAM members are strongly encouraged to contact their elected officials, and the Governor, to request that they support the use of federal recovery funds to alleviate this significant UI tax burden being imposed on employers. 

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