A move to resolve the state’s underfunded unemployment compensation fund is being debated in the House. Missouri has already borrowed $180-Million from the federal government to prop up the Unemployment Compensation Fund, hundreds of millions more might soon be borrrowed. Sedalia Representative Todd Smith’s bill would issue bonds to pay off the federal government at a lower interest rate, then would force the state to pay the interest should the fund be found insolvent in January of 2006. A combination of business taxes and federal monies support the fund which pays unemployment to laid off workers. Smith argues the state doesn’t have enough of a financial incentive to keep it afloat. The fund became insolvent in March of last year. No vote has been taken on the bill yet.
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