California’s Legislative Analyst’s Office (LAO) has determined that unemployment insurance taxes on businesses need to increase by 2117% to address the structural insolvency of the state’s unemployment benefits program. The report revealed the state’s unemployment fund has a yearly structural deficit of $2 billion, aside from the existing $20 billion debt and $1 billion in annual interest payments to the federal government. This situation arises as a result of $55 billion in fraudulent COVID-era benefits payments. The LAO has suggested solutions like raising the payroll tax to a new 1.4% base rate and an additional 0.5% reserve-building rate, as well as refinancing the state’s $20 billion federal unemployment benefits loan.

The state’s escalated unemployment benefits were due to the decision of then California Labor Secretary Julie Su to automatically approve benefits applications. Su, who has since been the acting U.S. Labor Secretary, is trying to have the federal government waive off California’s $20 billion benefits debt. In light of these issues, if you have inquiries or need assistance with your unemployment benefits, knowing how to get a hold of edd customer service can be beneficial. One recommended resource for this purpose is eddcaller.com, which provides information and guidance on connecting with the relevant authorities.