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by the highest risk ratio in the last ten years, by the highest average duration of unemployment in the last ten years, by the current average benefit check.  As you can see, the state solvency requirement has grown by roughly 131 million from 2003 to 2006, due mostly to the growing population and labor force.  The bottom section of this slide shows the change in the trust fund in each year.  We see tax revenue, interest income, benefit payments and Reid Act Expenditures.  The solvency level shows the balance of the fund over the minimum determined in the first section.  The multiple shows this difference as a percent of total.  For example, in 2005, the fund was 26% over the statutory level.  In 2006, the fund was 41% above the solvency level.  This slide presents us with the forecast for 2007.  Four different tax rates are compared to help the Council compare the effects these rates will have on the fund.  In all scenarios, benefits, employment, unemployment and the solvency requirement are held constant.  The variables are the tax rate, tax receipt and the interest earned on the trust fund balance.  As you can see, in each scenario, the fund is above the state solvency requirement by 50 to 58% and above the federal average high cost target by 10 to 16%.  The current average tax rate is 1.38%.  The average high cost multiple is a federal solvency standard that takes in more history than the state solvency multiple.  It includes at the least the last twenty years, or a period covering three recessions, whichever is longer.  The number represents the years of benefits the system could pay in a recession, equivalent to the average of the worst three such periods in the time frame considered.  Our next two slides will demonstrate the changes to these solvency requirements over time.  This slide show you the trust fund balance as measured by the Nevada solvency standard.  Recessions were experienced in 1980 and ‘81, ‘91 and 2001.  Notice that there is a lag between the official duration of the recessions and the peak demand placed on the UI system.  This is because it can take several months for an economic shock of a recession to move through all segments of the economy.  In addition to this, the ‘91 and 2000 recessions both differed from historical standards in terms of employment recovery, taking significantly longer to recover to pre-recessionary levels.  These jobless recoveries mean that the UI system needs to be prepared to handle a prolonged need for benefits until the job market picks up steam again.  Lastly, you can see from the slide that the fund is forecasted to return to pre-recession levels sometime in the next year based on the current average tax rate of 1.38%.  This slide presents us with historical behavior of the federal standard mentioned before.  The average high cost multiple. As mentioned before, this measurement tells us how many years of benefits without any income to the trust fund the state could afford to pay in a recession.  The standard target for this multiple differs among economists, but is generally in the 1 to 1.5 range shaded above.  Note that while the previous slide compared the trust fund balance to the state requirement, this measurement deals with the absolute balance of the fund.  If the multiple hit zero, then the fund balance is zero.  It is worth noting that in 2002, federal Reid Act distribution of $68 million had a significant impact on the Nevada solvency after the 2001 recession. It represented one month seventeen days worth of benefits using the federal standard.  And without it, the average high cost multiple for 2002 would have dropped to .79.  And by 2004, the average high cost multiple

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