LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: SB 55 SLS 202ES 63
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: October 22, 2020 7:31 AM Author: CORTEZ
Dept./Agy.: Workforce Commission
Subject: Unemployment Analyst: Tanesha Morgan
UNEMPLOYMENT COMP EN SEE FISC NOTE SD See Note Page 1 of 1
Provides for the unemployment insurance procedure to be applied by the administrator for calendar year 2021. (gov sig)
(Items #8 and #30)
Proposed law provides that notwithstanding any other provision of present law the Louisiana Workforce Commission shall
apply Procedure 2 for calendar year 2021. Procedure 2, in present law, provides the formula for calculating unemployment
benefits, that the taxable wage base shall be $7,700, and the maximum weekly benefit amount shall be $247, when the UI
Trust Fund balance range is between $750 M and $1.15 B.
EXPENDITURES 2020-21 2021-22 2022-23 2023-24 2024-25 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other SEE BELOW SEE BELOW $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $0 $0 $0 $0
REVENUES 2020-21 2021-22 2022-23 2023-24 2024-25 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other SEE BELOW SEE BELOW $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $0 $0 $0 $0
EXPENDITURE EXPLANATION
Based on present law, if the applied trust fund balance range is below $750 M, then the benefit formula changes and
maximum weekly benefit amount falls from $247 to $221. Based on testimony from LWC before REC, it is anticipated that
under present law the applied trust fund balance range for 2021 would be less than $750 M and trigger the lower maximum
weekly benefit amount and formula for calculation of benefits. Thus, under present law, per recipient benefit disbursements,
from the trust fund would decline in the second half of FY 21 and first half of FY 22 (2021 calendar year).
The effect of the proposed bill is that the unemployment benefit calculation formula for a recipient and the maximum weekly
unemployment benefit amount applied in calendar year 2020 shall remain the same for the calendar year beginning Jan. 1,
2021. Thus, under proposed law per recipient benefit disbursements from the trust fund would not decline in the second half
of FY 21 and first half of FY 22 (2021 calendar year).
It should be noted that the unemployment trust fund is not an appropriated fund within the state budget, but is held by the
U.S. Treasury in the federal Unemployment Insurance trust fund, where each state has a separate account for covering
normal unemployment insurance benefits.
REVENUE EXPLANATION
Based on present law, if the applied trust fund balance range is below $750 M, then the taxable wage base increases from
$7,700 to $8,500. Based on testimony from LWC before REC, it is anticipated that under present law the applied trust fund
balance range for 2021 would be less than $750 M and trigger the higher taxable wage base. For illustrative purposes,
employers paid $205.5 M in UI taxes in 2019 when the wage base was $7,700. If the wage base had been $8,500 in 2019,
employers would have paid at most an estimated $226.8 M in UI taxes, which is an increase of $21.3 M.
The effect of the proposed bill is that the taxable wage base in calendar year 2020 ($7,700) shall remain the same for the
calendar year beginning Jan. 1, 2021. Present law defines the “taxable wage base” as the portion of wages paid by an
employer to an employee in a given calendar year upon which the employer shall be liable to pay state UI taxes. Thus, per
employer unemployment tax payments and receipts of the trust fund will not change in the second half of FY 21 and first
half of FY 22 (2021 calendar year), as a result of a taxable wage base change.
It should be noted that the unemployment trust fund is not an appropriated fund within the state budget, but is held by the
U.S. Treasury in the federal Unemployment Insurance trust fund, where each state has a separate account for covering
normal unemployment insurance benefits.
Senate Dual Referral Rules House
13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Alan M. Boxberger
x 13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} or a Net Fee Decrease {S} Staff Director


Statutes affected:
SB55 Original: 23:1541(D), 23:1553(B)(8)