Another lawmaker has urged Gov. Phil Murphy to utilize federal recovery funds to eliminate or defray a $252 million tax increase on New Jersey businesses to replenish the state’s Unemployment Insurance (UI) Trust Fund.
In a letter to the governor, Assemblyman Gordon Johnson (D-37) noted that “many other states” have used federal funds from the American Rescue Plan to alleviate UI Trust Fund obligations.
“The depletion of the Unemployment Trust Fund was….not due to the actions of individual employers, yet they will be penalized for taking responsible steps,” Johnson wrote.
“Any tax increase should be linked to improved services from the Department of Labor. The public still cannot visit an unemployment office in person to resolve a problem with a claim or employer account.”
Johnson is the latest Democratic lawmaker to urge the governor to use federal COVID-19 aid to reduce the unemployment payroll tax on employers.
In recent weeks, Senator Troy Singleton (D-7) noted in a letter to the governor that the American Rescue Plan was created to assist state and local governments with their economic recovery from the coronavirus pandemic and that a steep increase in the unemployment insurance tax would hurt businesses trying to recover.
Senator Dawn Addiego (D-8) issued a statement saying: “We have plenty of federal dollars to go around, and there is no reason businesses should be burdened with an unemployment tax hike when laying off employees was the only way they could stay afloat through last year’s shutdown.”
Assemblyman Roy Freiman (D-16) also voiced support in the New Jersey Globe.
These asks were in addition to the more predictable public requests from Republican lawmakers such as Sens. Steven Oroho, Anthony Bucco, Mike Testa, Jim Holzapfel and Assemblymen Greg McGuckin, John Catalano, Hal Wirths and Parker Space.
Senator Declan O’Scanlon went a step further urging the Legislature, currently in summer recess, to reconvene to pass legislation to “force the Governor to do the right thing and stop this tax from going into effect.”
When asked about addressing the UI fund depletion with federal funds this week, Gov. Murphy was noncommittal.
“Folks should expect we will be doing more,” he said. “So whether it’s specific or not to the unemployment insurance question, you should know that we are constantly thinking through how we can continue to plus-up help and aid to small businesses.”
