Coronavirus stimulus: States are running out of unemployment benefits ordered by President Trump

While most states have not yet distributed the additional $ 300 per week under the President's Executive Memorandum, a handful are already running out of funds to pay the additional benefits.
"It seems like it's going to end, it seems like we're going to hit the wall," Michele Evermore, senior policy analyst with the National Employment Law Project, told Yahoo Money. "They cut states off after six weeks to make sure every state gets some of that money."
Read More: Here's What You Need To Know About Eligibility for Unemployment Benefit
Officials in Montana, Texas, and Arizona have said their states have exhausted six weeks of additional unemployment benefits. And the Federal Emergency Management Agency (FEMA) confirmed to Yahoo Money Thursday that funding will only be available for six weeks, which means that unemployed Americans will have to rely on their regular state unemployment benefits afterward, unless Congress passes new laws.
"FEMA will provide grants to allow states, territories, and the District of Columbia to provide LWA 300 additional wage payments to eligible applicants for six weeks," a FEMA spokesperson told Yahoo Money. "States should plan to make payments to eligible applicants for a maximum of six weeks starting the week leading up to August 1, 2020."
A total of 15 countries have started to pay out the additional unemployment benefits available under the Lost Wages Assistance (LWA) program. Graphic: David Foster / Yahoo Finance
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"Making a fire under the Congress"
On August 8, Trump signed several executive acts to bypass deadlocked negotiations with Democrats over a new stimulus package amid the coronavirus pandemic. This included LWA funding, which enabled additional unemployment insurance of $ 300 to $ 400. However, funding is capped at up to $ 44 billion, which will be diverted from FEMA.
Read more: Unemployment Insurance: What It Is And How To Get It
Since all states except South Dakota are applying for the benefit and 31 states have already been approved, the total funds are distributed proportionally among all states. According to the latest FEMA guidelines, each state receives a full six weeks of additional unemployment for its eligible recipients.
States that pay the benefits now or in the coming weeks can pay the six weeks at once.
"It will likely be the case in many states where they only pay a large lump sum," Evermore said.
Read more: Do you have to pay taxes on unemployment benefits?
Regardless of how states pay out the benefits, there will likely only be six weeks of that money. This means no additional benefit will be added to unemployed American checks for the next few weeks, potentially forcing Congress to act.
"Now that states have announced that they are no longer paying, there may be a fire under Congress," Evermore said. "I haven't heard any urgency from Congress to negotiate a deal and get together."
WASHINGTON, DC - SEPTEMBER 9: U.S. Senate Majority Leader Mitch McConnell (R-KY) leaves the room after the weekly Senate Republican Politics lunch at the Hart Senate Office Building on September 9, 2020 on Capitol Hill in Washington, DC. (Photo by Alex Wong / Getty Images)
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When Congress returned to Washington DC this week after hiatus, Republicans tabled a scaled-down stimulus proposal, expected to cost around $ 500 billion, and include the extension of additional unemployment benefits through the end of the year. However, the overall proposal is unlikely to move forward.
"It's a bit distracting and, in my opinion, a bit of a waste of time," said Evermore. "I don't see Congress acting anytime soon."
"Unfortunately we don't have unlimited amounts of money"
President Trump announced last week that he would like to unlock an additional $ 300 billion for stimulus measures, but needs action from Congress to make it happen.
"Now we have $ 300 billion in an account that we didn't use - $ 300 billion," President Trump told reporters on Friday. “And we are ready to take advantage of that. I would be willing to post it subject to Congress and use it as an incentive. "
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Treasury Secretary Steven Mnuchin confirmed the limited funding in recent congressional statements.
"The president has used executive violence to raise unemployment up to $ 400 per person," Mnuchin said during a hearing last week. "Now unfortunately we don't have unlimited amounts of money to do that, but the President wanted to move forward."
Denitsa is a writer for Yahoo Finance and Cashay, a new personal finance website. Follow her on Twitter @denitsa_tsekova.
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