Division Unemployment Insurance Funding Mechanism

The act updates the funding mechanism for the division of unemployment insurance (division) by changing the name of the "employment and training technology fund" to the "unemployment insurance program support fund" and expanding the use of the fund to include the information technology and administrative costs of the division.

Colorado law specifies how the division must disburse money collected from the employer support surcharge. The act modifies the disbursement of this surcharge to:

• 11% for the employment support fund (decreased from 35%);
• 54% for the unemployment insurance program support fund (increased from 32%);
• 20% for the workforce development fund (increased from 14%); and
• 15% for the benefit recovery fund (decreased from 19%).

The act requires all money collected in each fund that is in excess of the maximum balance amounts authorized for the fund to be credited to the unemployment compensation fund. The act ties the adjustments of the fund caps to the change in average weekly earnings instead of to the consumer price index. The act also adjusts the cap for the unemployment insurance program support fund.

(Note: This summary applies to this bill as enacted.)