The promised weekly $300 boost in unemployment benefits could end for laid-off Americans just a few weeks after it starts.
President Trump signed an executive action last week partially restoring the $600-a-week unemployment supplement after Congress failed to cut a deal on another coronavirus aid package.
Under the edict, the federal government will give unemployed workers an extra $300 in weekly payments. Trump allocated $44 billion to cover the sweetened aid, using money from the Disaster Relief Fund, which is managed by the Federal Emergency Management Agency.
But according to a recent memo issued by FEMA about the relief, states applying for the federal grants will receive an “initial obligation of three weeks of needed funding.”
The agency will then make additional disbursements to states on a weekly basis “in order to ensure that funding remains available for the states who apply for the grant assistance,” according to the memo.
The sweetened benefits will last until the $44 billion runs out, the balance of the fund falls below $25 billion or through Dec. 6, 2020, according to the memo Trump signed. As of July 31, the fund had a balance of $68.4 billion.
The Washington-based American Action Forum estimates the money will last for about five weeks.
“Assuming there are 30 million individuals claiming UI benefits and are eligible for the supplement, that $44 billion from the DRF would only allow the federal contribution of $300 per individual to last 5 weeks,” a recent analysis from the non-profit said.
That means some out-of-work Americans may only receive a lump-sum payment before the money runs out again. At the end of July, some 30 million workers were collecting the financial aid, or roughly one in five Americans, according to federal data.
FEMA has already approved seven states for the program: Arizona, Colorado, Iowa, Louisiana, Missouri, New Mexico and Utah. Several more have said they intend to apply.
So far, South Dakota is the only state to reject the $300-a-week aid: Last week, Gov. Kristi Noem, a Republican, said workers did not need the help, citing the state’s economic recovery from the virus-induced recession.
Democrats were quick to criticize the executive measure.
On Monday, Rep. Don Beyer, the vice chairman of the Joint Economic Committee, tweeted that the action required states — which are hobbled by notoriously out-dated software — to build “an entirely new unemployment benefit from scratch.”
“How long will that benefit last? FEMA can only guarantee it for three weeks.” he wrote.
Beyer and other rank-and-file Democrats are pushing the party’s leadership to vote this week on extending the $600-a-week benefit that expired at the end of July. The letter has garnered the support of at least 50 Democrats so far.
Only individuals who are receiving at least $100 in unemployment assistance through regular state programs or other aid initiatives like a shared-work program are eligible for the boosted benefits, according to Trump’s memo.
Benefits are calculated based in part on a worker’s former income, which could mean that some of the country’s lowest earners are excluded.
