PIERRE, S.D. (KELO) — The balance in South Dakota’s reemployment assistance trust fund finished strong enough last month that the state’s tax rates for the program will go down in calendar year 2020.
Legislators approved the reduction plan during the 2019 session. The new law in HB 1034 required the balance as of June 30 to be at least $115.3 million. The balance was $128.3 million.
The cuts will be reflected in rate changes starting with the April 2020 payments.
“We will definitely have that reduced-rate schedule,” Pauline Heier of Aberdeen said. She is director for the reemployment assistance division in the state Department of Labor and Regulation.
Her remarks came during a presentation Tuesday to a state advisory council.
Another change the Legislature passed last winter was creating a new name for the program to better reflect the modern intent of the program — getting people back to work.
What previously was unemployment insurance is now reemployment assistance under HB 1035.
Regardless of the name, the fund’s current forecast calls for finishing calendar year 2019 with a $137.4 million balance.
“It does point to a really strong economy and fewer people collecting benefits,” state Labor and Regulation Secretary Marcia Hultman said.
Hultman noted the trust-fund presentation now features a recap from the past decade and shows revenues, benefits and ending balance by year.
During 2009, for example, the fund brought in $31.6 million but paid out $63.6 million and ended with a $7 million deficit.
State government borrowed $24 million from the federal government to get through what now is known as the Great Recession.
By contrast, the fund in 2018 saw $31.9 million of revenue, distributed $25.5 million of benefits and closed with a positive balance of $127.8 million.