Washington state is running out of dollars for unemployment claims — and may need to borrow money

Carolyn Adolph

June 29, 2020 / 6:33 pm

caption: Andy Aronis, Assistant General Manager of King's Hardware, smokes a cigarette outside of the boarded up bar and restaurant on Tuesday, March 17, 2020, on Ballard Avenue Northwest in Seattle. "I always felt good working in the bar industry because it's recession proof," said Aronis, who planned to file for unemployment. "The only thing you don't consider working in this industry is if there is a medical pandemic and then we are in the worst industry you could be in."

Unemployed workers have been relying on the state's Employment Security Department to keep them out of poverty during this pandemic.

Now, that agency says it could run out of money by the end of the year.

Washington fell into this recession back in March with one of the healthiest unemployment trust funds in the nation. Our accumulated $4.7 billion was a byproduct of the boom that also made us a powerhouse, with a sustained unemployment rate below 4%.

But with more than one million individuals filing unemployment claims, and hundreds of millions of dollars unrecovered after a wave of fraud, the fund is already down to $2.8 billion.

Now, with unemployment expected to remain high throughout 2020, the Employment Security Department says by year end, it may need to ask the federal government for an interest-free loan in order to continue supporting Washingtonians.

Employment Security commissioner Suzi LeVine said in a statement that the state would likely be among the last to ask the federal government for money. At present, a dozen states, led by California, are borrowing billions to continue supporting workers.

The news comes as a handful of workers sue the Employment Security Department. The workers say they have been told they are "eligible" to receive $0 a week in unemployment benefits, but have been denied a way to appeal or resolve their cases. The department says 80,000 people still haven't been paid.

Employment Security says it will have more details on the state of the unemployment trust fund later this week. That information is slated to be available here.