States expected to roll out weekly $300 unemployment boost in late August

President TrumpDonald TrumpTrump defends indicted GOP congressman House to vote Thursday on holding Bannon in contempt Youngkin calls for investigation into Loudoun County School Board amid sexual assault allegations MORE's promised top-up in unemployment benefits is expected to begin rolling out the last weekend in August, a full month after a larger benefit expired, according to the Federal Emergency Management Agency (FEMA), which will administer the funds.

Congress approved additional weekly unemployment benefits of $600 in March's CARES Act to keep millions of people afloat through the coronavirus pandemic, but those benefits expired at the end of July.

After a tense standoff between congressional Democrats and the White House over restoring the funds, President Trump issued an executive order directing FEMA to use an existing disaster relief fund to create a new supplement.

ADVERTISEMENT

Though Trump advertised the new top-up at $400, only $300 was set to come from FEMA, with the rest coming from states' existing relief funds. Many states voiced opposition to the plan, citing the immense damage the pandemic has caused to their finances.

Treasury Secretary Steven MnuchinSteven MnuchinThe Hill's Morning Report - Presented by Alibaba - Biden jumps into frenzied Dem spending talks Former Treasury secretaries tried to resolve debt limit impasse in talks with McConnell, Yellen: report Menendez, Rubio ask Yellen to probe meatpacker JBS MORE initially said the additional funds would be available immediately, but then revised his estimate to say it would take two weeks.

The FEMA document cited Labor Department figures estimating that on average, the benefits would start rolling out three weeks after the Aug. 8 order was signed, setting the average start date at Aug. 29.

But the timeline may vary widely from state to state. FEMA noted that one state already was able to roll out the benefit, including retroactive payments through the start of the month. Other states may struggle longer to update their outdated unemployment software on decades-old computer systems to conform with the new rules.

One state contacted by The Hill said it would not be able to start sending out benefits until mid-October, and another two states said they did not yet have a timeline, raising questions about the estimates.

The $44 billion in the fund, which is also key for responding to natural disasters such as hurricanes and wildfires, would limit initial disbursements to states to three weeks, meaning some states could theoretically only produce one lump-sum payment before additional payments expire again.

ADVERTISEMENT

"Trump's order forces states to build an entirely new unemployment benefit from scratch they aren't allowed to use their current federally-funded resources to process it," Rep. Don Beyer (D-Va.), the vice chairman of the Joint Economic Committee in Congress, wrote in a tweet.

"How long will that benefit last? FEMA can only guarantee it for *three weeks*" he added.

Timing was a crucial element in the negotiations. Democrats blamed Republicans for putting off talks over renewed benefits for months and allowing them to expire. By the end of July, they said, only an extension of the $600 benefit would ensure that people's benefits didn't lapse.

Republicans have noted that the $600 amount leads a large proportion of recipients to earn more on unemployment than they did working, and argue the disincentive is both unfair and will keep people on unemployment.

Economists said that a prolonged lapse in benefits could undermine the recovery and leave lasting financial damage to people and families who were unable to pay their rent, buy food or keep car payments up.

"The recklessness of Donald Trump and [Senate Majority Leader] Mitch McConnellAddison (Mitch) Mitchell McConnellFixing Congress requires fixing how it legislates McConnell: GOP should focus on future, not 'rehash' 2020 Hoyer: Democrats 'committed' to Oct. 31 timeline for Biden's agenda MORE in allowing unemployment benefits to lapse makes it that much harder to get the economy out of the ditch," he added.

The expiration of an evictions moratorium in July raised the stakes. Families that are evicted tend to have a harder time getting their economic lives on track again.

"Bills will pile up, and families will go hungry, falling further behind on the rent and unable to afford medicines," Wyden said.

Updated at 5:34 p.m.