WASHINGTON -- That $400 a week in additional COVID-19 unemployment benefits President Donald Trump announced Saturday? Cash-strapped states have an easy out to provide only $300.
The memorandum that Trump signed Saturday announcing a new "lost wages" program to replace the now lapsed $600 weekly federal pandemic supplement said states would be required to put up 25% of the advertised $400 replacement benefit. That's in accordance with long-standing Federal Emergency Management Agency disaster relief rules under the Stafford Act, since FEMA's main disaster fund is the source of federal cash for the new program.
But the Labor Department is giving states some significant wiggle room so they don't have to part with any cash they weren't going to previously: They can simply count $100 of regular state unemployment benefits as their 25% matching share.
While that would deprive beneficiaries of the extra $100 they'd get if the state paid up, it's a way for states to dispense with the hassle of finding the extra money to meet the matching requirements otherwise necessary to get even a dime of federal aid.
"In practice, this means that an unemployed claimant will receive $300 per week in new FEMA-funded benefits, in addition to his or her existing weekly state-funded benefit amounts," says guidance reviewed by CQ Roll Call that was sent out to state agencies by Assistant Secretary for Employment and Labor John Pallasch. "This option requires no new expenditures of state funds beyond what the state would already be paying out from state funds in regular unemployment compensation benefits."
The early guidance says that to be eligible for the extra $300 from the federal government, jobless individuals must be receiving at least $100 a week from one of several other sources, including state unemployment assistance.
States could still decide to meet the matching requirements if they choose, but that would require a nearly $15 billion contribution from state governments, which are reeling from the pandemic economic shutdown.
They are pleading with Congress for some $500 billion in federal assistance, which is hung up in a fight between the parties. Trump's memorandum says states can also use any leftover funds from the first round of $150 billion in direct aid to states and localities distributed in March; the Treasury Department has reported that state and municipal governments have been slow to use those resources.
New York's Democratic governor, Andrew Cuomo, has already come out swinging, calling Trump's plan a "nonstarter."
"States can't afford it. It will be challenged in court. No American in need will get anything," Cuomo tweeted Monday.