Indiana pays off federal unemployment loan

Gov. Mike Pence says Indiana has paid off a $250 million debt owed on a recession-era federal loan that was used to pay unemployment benefits after the state depleted its own funds.

Pence said Tuesday that the payment will save Indiana employers $327 million in taxes, which equates to $126 per employee in the state.

The Republican governor first announced his plans to pay off the loan in October and said he would borrow $250 million from the state's budget surplus to make the payment.

Businesses pay taxes into the unemployment fund. Indiana once had a flush unemployment fund, but it was depleted after lawmakers increased benefit payments and lowered premiums. The fund at one point owed $2 billion in federal loans.

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