How is the contribution rate schedule determined?
Under South Carolina law, rate schedules adjust automatically each year based on a formula that considers factors such as the amount of reserves in the trust fund, the recent and projected benefit costs paid, and the amount of outstanding loans. For 2011, South Carolina projects that benefit payments will average $500 million, loan repayments will be $146 million, and interest payments will be $34 million. The 2011 tax rates are set to raise approximately $680 million to fund these three components. As the amount of required income falls, tax rates also fall. As the taxable wage base increases, the tax rates also adjust downward. The projections for the amount of benefits that will be paid in the upcoming year are based on historical relationships between the national unemployment rate and the state unemployment rate and between the state unemployment rate and the amount of benefits previously paid. An estimate for the national unemployment rate for 2011 comes from the Congressional Bu
