Carlos Ponce joins other demonstrators participating in a protest asking Senators to support the continuation of unemployment benefits on July 16, 2020 in Miami Springs, Florida.
Joe Raedle | Getty Images
Workers in a handful of states may soon see a $300-a-week bump in their unemployment benefits.
The federal government has approved funding for seven states — Arizona, Colorado, Iowa, Louisiana, Missouri, New Mexico and Utah — to offer the $300 supplement to jobless benefits, according to the Federal Emergency Management Agency, which is overseeing the assistance.
The aid, part of an executive measure recently signed by President Trump, comes after a $600-a-week federal subsidy enacted by Congress early in the recession ended. It had been in place for about four months, from early April to the end of July.
More from Personal Finance:
Here’s the financial relief you can actually count on
Millions of Americans are facing longer periods of unemployment
Postal service battles could mean delays for stimulus checks
Many other states haven’t yet committed to offering the $300 federal subsidy. Officials have cited cost, legal and administrative concerns.
South Dakota isn’t applying for the assistance, according to Gov. Kristi Noem.
It’s unclear what, if any, additional states have applied for the assistance but have yet to receive approval.
A FEMA spokesperson declined to comment. The agency will continue to update its website as additional states are approved, she said.
States approved for the “lost wages assistance” could potentially start paying out the $300 federal subsidy as soon as this week.
The funding will be available within one business day once the federal grant is approved and signed by states, according to a recent memo FEMA issued about the program. The seven states had received approval over the weekend, according to FEMA.
Exact timing is unclear, though. States still must figure out how to administer the funds and adjust their systems accordingly.
At least one state estimated it will pay out the aid, which is retroactive to Aug. 1, in less than one week from its grant award, according to the agency memo. The memo didn’t name the state in question.
The agency estimates states will be able to pay out the assistance by Aug. 29, on average.
But it will likely take much longer, perhaps at least well into September, according to unemployment experts.
For one, the aid isn’t technically unemployment insurance. That means officials must build out an entirely new system that interacts with the current unemployment framework.
Plus, there are restrictions that may prove complex relative to administration. People getting less than $100 a week in unemployment benefits aren’t eligible for the $300 federal subsidy, for example. That could omit around 1 million people or more, by some estimates.
The supplement comes on top of the weekly assistance states pay.
States paid $308 a week, on average, in June, according to the Labor Department. Some, like Louisiana and Mississippi, paid less than $200.
States approved for funding are only guaranteed to get three weeks’ worth of federal assistance, according to the FEMA memo. Early adopters may get more than other states, experts said.
Any forthcoming congressional agreement on a federal unemployment supplement would supersede the lost wages assistance.
Congress has yet to reconcile disagreements over the lapsed $600-a-week in aid, however. House Democrats passed a bill in May to extend the $600 subsidy. Senate Republicans countered at the end of July with a $200-a-week plan.
Trump’s directive was originally billed as a $400-a-week boost in benefits, splitting the difference between Democrat and Republican proposals. But it will amount in just $300 a week in many cases. The measure lets states kick in an additional $100 a week if they choose, but many are unlikely to choose to do so due to already-strapped budgets.