SLS 21RS-206 ORIGINAL
2021 Regular Session
SENATE CONCURRENT RESOL UTION NO. 5
BY SENATOR REESE
UNEMPLOYMENT COMP. Suspends the provision of law providing for an unemployment
insurance solvency tax.
1 A CONCURRENT RESOL UTION
2 To suspend until sixty days after final adjournment of the 2022 Regular Session of the
3 Legislature of Louisiana the provisions of R.S. 23:1536(E)(1), relative to the
4 unemployment insurance solvency tax on employers.
5 WHEREAS, Article III, Section 20 of the Constitution of Louisiana empowers the
6 legislature to suspend a law; and
7 WHEREAS, the current public health emergency caused by COVID-19 has required
8 an extended shutdown of many businesses resulting in a dramatic decline in their revenue
9 and the layoff of their employees; and
10 WHEREAS, the widespread layoffs have led to massive unemployment of workers
11 and increased demands for unemployment benefits; and
12 WHEREAS, state unemployment benefits for Louisiana workers are funded by state
13 unemployment taxes paid by employers that are collected by the Louisiana Workforce
14 Commission and submitted to the United States Department of Labor to be pooled into the
15 state's unemployment compensation trust fund account; and
16 WHEREAS, the dramatic increase in the volume of unemployment benefit claims
17 has resulted in a drastic reduction in the balance of the state's unemployment compensation
18 trust fund account; and
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SLS 21RS-206 ORIGINAL
1 WHEREAS, R.S. 23:1536(E)(1) requires the secretary of the Louisiana Workforce
2 Commission to report when the state's projected unemployment compensation trust fund
3 balance for the next four calendar quarters, together with projected state unemployment
4 taxes to be collected less the projected amount of unemployment benefits to be paid during
5 the next four calendar quarters, will result in a trust fund balance of less than one hundred
6 million dollars and provides that a solvency tax shall be added to an employer's state
7 unemployment taxes for the calendar quarter beginning six months after the end of the
8 calendar quarter in which the projection is made; and
9 WHEREAS, the exact amount of the solvency tax is dependent on the amount the
10 unemployment compensation trust fund balance is projected to be below one hundred
11 million dollars and the amount of state unemployment taxes projected to be collected from
12 employers; and
13 WHEREAS, in October of 2020, the secretary of the Louisiana Workforce
14 Commission reported that the projected fund balance for the next four calendar quarters,
15 together with projected state unemployment taxes to be collected less the projected amount
16 of unemployment benefits to be paid from the state's unemployment compensation trust fund
17 during the next four calendar quarters, will result in a fund balance of less than one hundred
18 million dollars, triggering the solvency tax; and
19 WHEREAS, the impact of the imposition of the solvency tax at this time on many
20 employers already suffering from dramatically reduced revenues could negatively affect
21 their ability to hire back or to retain employees and stay in business.
22 THEREFORE, BE IT RESOLVED that the Legislature of Louisiana hereby suspends
23 the provisions of R.S. 23:1536(E)(1) relative to the unemployment insurance solvency tax
24 on employers.
25 BE IT FURTHER RESOLVED that this suspension shall become effective upon
26 adoption of this Resolution and shall extend through the sixtieth day after final adjournment
27 of the 2022 Regular Session of the Legislature of Louisiana.
28 BE IT FURTHER RESOLVED that a copy of this Resolution be transmitted to the
29 secretary of the Louisiana Workforce Commission.
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SLS 21RS-206 ORIGINAL
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Yoursheka George.
DIGEST
SCR 5 Original 2021 Regular Session Reese
Suspends present law that provides that if the secretary of the La. Workforce Commission
reports, in any calendar quarter, that the projected state unemployment trust fund balance for
the next four calendar quarters, together with projected state unemployment taxes to be
collected plus any other amounts otherwise pledged thereto, less the amount of projected
unemployment benefits to be paid from the fund during the next four calendar quarters, will
result in a fund balance of less than $100,000,000, there shall be added to the employer taxes
a solvency tax for the calendar quarter beginning six months after the end of the calendar
quarter in which the projection was made.
Present law further provides that the solvency tax shall be determined by the secretary of the
commission and that it shall be a ratio, expressed as a fraction. Provides that the numerator
of the fraction shall be the amount by which the projected unemployment trust fund balance
during the next four calendar quarters is less than $100,000,000 and the denominator of the
fraction shall be the amount of the projected unemployment taxes to be collected from
employers for the calendar quarter beginning six months after the end of the calendar quarter
in which the projection was made. Provides that the ratio shall be applied as a percentage to
each employer's unemployment tax rate for the calendar quarter beginning six months after
the end of the calendar quarter in which the projection was made, provided that the aggregate
of the added solvency tax for any quarter shall not exceed a total of 30% of the employer's
regular unemployment taxes for that quarter.
Present law also requires that prior to adding the solvency tax to an employer's regular
unemployment taxes, the secretary of the commission is to notify the House and Senate
committees on Labor and Industrial Relations, the House Committee on Ways and Means,
and the Senate Committee on Revenue and Fiscal Affairs of the status of the state's
unemployment trust fund and of their intention to add the solvency tax. Requires their report
to also contain recommendations of alternative actions which may be taken either
administratively or legislatively to protect the solvency of the fund. Also requires that prior
to adding the solvency tax to an employer's unemployment tax, they shall conduct within
such calendar quarter in which the projection is made a public hearing for informational
purposes only after public notice thereof. The notice of such hearing shall be published once
in the official journal of the state at least 15 days prior to the hearing date.
Effective through the 60th day following final adjournment of the 2022 R.S.
(Suspends R.S. 23:1536(E)(1))
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