New York State Pays Off UI Trust Fund Debt
Per the notice below, New York State has paid off the outstanding Unemployment Insurance (UI) Trust Fund debt.
Governor Hochul and Labor Leaders Announce New York State Pays Off Multi-Billion Dollar Unemployment Insurance Trust Fund Debt
Governor and New York State Legislature Paid Off Trust Fund Loan in FY 2026 Budget, Bringing the Fund to Solvency, Increasing Benefits for Unemployed New Yorkers and Cutting Costs to Businesses
Part of Governor Hochul’s Efforts To Increase Benefits for New York’s Workforce and Save Businesses Money
Governor Kathy Hochul today rallied with the Hotel and Gaming Trades Council, AFL-CIO to announce New York State has paid off the nearly $7 billion federal Unemployment Insurance (UI) Trust Fund loan — a move that will bring the fund to solvency, increase benefits for unemployed New Yorkers, and cut costs to businesses. The Governor announced this action back in May as part of the Fiscal Year 2026 Enacted Budget.
“By paying off this unprecedented Unemployment Insurance Trust Fund debt, we are delivering long-overdue relief to New York’s workers and businesses,” Governor Hochul said. “This is about doing what’s right — raising benefits for unemployed New Yorkers who need support, cutting costs for businesses that are driving our economy forward, and putting money back into New Yorkers’ pockets. I’m proud to stand with our labor partners in making this progress possible.”
Senate Majority Leader Andrea Stewart-Cousins said, “Paying off New York’s Unemployment Insurance debt is a major victory for our entire economy. Our nearly three million small businesses are New York’s true economic engine. As federal leaders imposed damaging tariffs and trade wars, we lifted a heavy burden off small businesses while strengthening the safety net for working people. I thank Governor Hochul and Speaker Heastie for their partnership on this issue that will help our businesses thrive and support workers across all regions of our state.”
Assembly Speaker Carl Heastie said, “By paying off the Unemployment Trust Fund debt we’re securing relief to our local businesses – especially our small businesses – and ensuring that the UI benefits can keep up with inflation,” said Speaker Carl Heastie. “The Assembly Majority and especially Assembly Labor Chair Harry Bronson fought hard for this inclusion in the budget as we understand the vital support this provides to businesses and hardworking families as they get back on their feet.”
Before the COVID-19 pandemic, the UI Trust Fund had a positive balance of nearly $2.5 billion. However, due to the economic downturn caused by the pandemic, the balance was paid out to New Yorkers, requiring the State to borrow from the federal government to continue paying eligible claims. Paying off the debt and making the fund solvent allows the state to increase the maximum UI benefit rate so that it better aligns with other states and changes the taxable wage base to help build up reserves and stabilize the UI Trust Fund for the future. The maximum weekly benefit to unemployed workers, which has been frozen because of the debt, will increase from $504 to $869 in October. By paying off the debt, the State is also putting money back in the pockets of business owners, whose contribution rates had continued to climb while the debt was paid down. Employers are projected to save an average of $100 per employee in 2026 and $250 in 2027. Additionally, the taxable wage base will increase in 2026, strengthening the trust fund over time and helping to maintain affordable tax rates for New York’s employers in the long term.
New York State Department of Labor Commissioner Roberta Reardon said, “Paying off New York’s Unemployment Insurance Trust Fund debt is a win for workers and businesses. It will put more money in the pockets of unemployed New Yorkers at a time when they need it most and will also cut costs for our businesses. I thank Governor Hochul for stabilizing this critical safety net for our workforce and making the state more affordable for all.”
For more information on the Unemployment Insurance Trust Fund, please visit the New York State Department of Labor’s webpage.
New York State AFL-CIO President Mario Cilento said, “Increasing the maximum unemployment insurance benefit will make a tangible difference for unemployed workers struggling to make ends meet, while also providing relief to employers. The maximum benefit, stagnant at $504 per week since 2019, fell far short of meeting the basic needs of families facing financial hardship through no fault of their own. Increasing this benefit will enable them to better support themselves and their families during a particularly stressful and challenging time. We express our deepest gratitude to Governor Hochul for recognizing the positive impact of substantially raising UI benefits, and we also extend our thanks to Senate Majority Leader Stewart-Cousins and Speaker Heastie for their instrumental role in passing this critical legislation.”
“By paying off this unprecedented Unemployment Insurance Trust Fund debt, we are delivering long-overdue relief to New York’s workers and businesses.”
Governor Kathy Hochul
Hotel and Gaming Trades Council President Rich Maroko said, “Today, I’m proud to stand with our members in celebrating a victory that will provide real, immediate relief for hardworking New Yorkers and their families. Paying off the Unemployment Insurance Trust Fund debt will be a lifeline for workers who are laid off or lose their jobs. This policy, along with reducing the benefits delay for striking workers fighting for a fair contract to the lowest in the nation, is crucial as we officially mark one year until the expiration of our industry-wide contract. We thank Governor Hochul, Majority Leader Stewart-Cousins, and Speaker Heastie for delivering this critical win for working families.”
State Senator Robert Jackson said, “New York’s decision to pay down its Unemployment Insurance debt is more than a budgetary fix—it’s a statement of values. It says we won’t allow the fallout of a global crisis to be paid for by the very people who kept this state running. Small businesses deserve relief. Workers deserve security. And our economy deserves a foundation rooted in fairness. I applaud Governor Hochul for advancing this effort—and urge my colleagues across government to keep pushing for an economy that protects, respects, and invests in the people who make New York work.”
State Senator Jessica Ramos said, “Securing the repayment of the UI Trust Fund debt was a top priority for me in this year’s budget because it’s about restoring dignity to workers and stability to our economy. Solvency means unemployed New Yorkers will finally see their benefits increase for the first time in years, and small businesses will see relief from rising costs. This is the kind of structural change that strengthens our safety net and puts working people first.”
Assemblymember Harry Bronson said, “Through the leadership of Governor Hochul and Speaker Heastie, and the partnership of AFL-CIO and the Business Council, we were able to help both businesses and workers. As Chair of the Assembly Labor Committee, it has always been my strong belief that when business and labor work together, you get the very best result for all. By eliminating the Unemployment Trust Fund debt, while also increasing the maximum benefit, we are providing much needed relief to businesses, especially small businesses, while also making sure that those who become unemployed will be able to make ends meet during the transition to their next job. Our small businesses and hardworking families are the backbone of New York’s economy. This win affirms the Assembly’s strong commitment to making New York more affordable for both our families and businesses.”
Assemblymember Jon D. Rivera said, “This year’s budget delivers a long-overdue win for both workers and businesses. By fully paying off our $7 billion unemployment insurance debt, we’re lifting an unfair burden that has strained New York’s employers for years. Simultaneously, we’re finally increasing unemployment benefits for the first time in six years — providing a stronger and more dignified safety net for workers who fall on hard times. This is what balanced, worker-centered economic policy looks like, and I look forward to delivering more wins for our state’s small business community.”
Assemblymember Alex Bores said, “This is a smart move that makes New York work better for everyone. Clearing this debt lowers costs for employers and strengthens a system that people rely on in tough times. It’s the kind of practical step that helps build a safer, easier, and more resilient New York.”
Assemblymember Manny De los Santos said, “Paying off New York State’s Unemployment Insurance debt is a critical milestone that delivers real relief for our small businesses and working families—especially in communities like Inwood, Washington Heights, and Marble Hill. This achievement means lower taxes for our local employers and a stronger safety net for neighborhood workers who power our economy. I commend Governor Hochul for taking decisive action to strengthen New York’s economy and protect the livelihoods of those who keep our communities running.”
Assemblymember Nikki Lucas said, “Every New Yorker deserves fair treatment, protection, and the chance to thrive. Securing worker protections is an opportunity to realize these goals. Streamlining the process for our young people to enter the workforce, providing benefits to New Yorkers to exercise their right to strike, protecting vulnerable New Yorkers after losing their jobs and stabilizing unemployment insurance for our employers contribution rates are examples I am proud to stand behind for the members of my district. I applaud that this is a budget that takes meaningful steps to address the challenges many workers and employers face by strengthening key safety nets to protect us all.”
Assemblymember Judy Griffin said, “Paying off New York State’s Unemployment Insurance (UI) debt is one of the best ways we can help businesses across our state. Easing this burden on our small businesses is critical, since these high rates are not sustainable. This vital step will also benefit workers since their unemployment benefits insurance will increase based on the higher cost of living.”
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