With millions of Californians unemployed during the COVID-19 pandemic, Govin Gavin Newsom said Monday that the state would counter “massive” budget cuts if it implemented President Trump’s plan to give states $ 100 from a $ 400 additional weekly unemployment benefit .
Newsom and lawmakers are calling on federal officials to overcome a stalemate that Congress and the president have experienced in providing additional funding to states now that a $ 600 weekly unemployment benefit from the federal government has expired. He noted that the plan would cost the state at least $ 700 million a week and up to $ 2.8 billion if funding for Coronavirus Aid, Relief and Economic Security Act is excluded.
“The state does not have an identified source of $ 700 million a week that we have not already committed,” Newsom said. “There’s no money in the piggy bank.”
Newsom’s comments follow Trump’s announcement Saturday that he has signed an executive order to deliver $ 400 a week to unemployed Americans, as long as states raise a quarter of the cost.
“The states have the money,” Trump told reporters Saturday. “It’s there.”
Trump suggested that states use their share of the CARES Act fund, but Newsom said 75% of its share has been spent and the rest has been allocated.
Coming up with $ 700 million to $ 2.8 billion “would create a burden that even a state as large as California could never absorb without massive cuts to key services or even more burdensome businesses and individuals,” Newsom said.
In addition, programming the state’s unemployment anti-technology system to process $ 400 weekly claims shared by the federal government and state “would create time delays and cause enormous consternation for those who receive these benefits,” warned Newsom. .
The governor said he was disappointed that a congressional proposal to pass the $ 600 bill was not in line with Republicans, including Trump.
“We have been waiting for Congress, we have been waiting for the President to respond to this,” Newsom said. “Unfortunately there was a disconnect, and as a result that program no longer exists and there has been no bridge.”
Some Democrats have questioned Trump’s legal authority to extend unemployment benefits through executive order without congressional approval.
Trump’s plan was also criticized Monday by state Rep. Anthony Rendon (D-Lakewood).
“The president’s executive action is unreasonable and impractical,” Rendon said in a statement. ‘We need significant, comprehensive legislation from Congress to support Californians. They’re in trouble now – they can no longer wait. ”
Pressure for federal action also came from state Senate President Pro Tem Toni Atkins (D-San Diego), who oversees the recent passage of a state budget that cuts cuts in the hope that extra federal money would to arrive.
“We’ve been saying all along that California needs financial support from the federal government to meet the needs created by this pandemic,” Atkins said. ‘We have Congress and the [Trump] administration to provide cooperation as soon as possible and provide significant COVID-19 relief to the families of California. “
The governor said he is in talks with leaders of state legislatures about alternatives to help Californians who lost jobs following Newsom’s order in March to reduce the spread of the coronavirus.
Democratic lawmakers said last month that they were ready to ensure that Californians continue to receive the $ 600 weekly allowance that expired at the end of July, and that they could borrow money from a federal trust fund if necessary.
If Trump’s order delivers only $ 300 a week, California would have to come up with the same amount to maintain the additional payment of $ 600.
Assemblyman Phil Ting (D-San Francisco), chairman of the Assembly’s Budget Committee, said Monday that legislative leaders are working to find a solution.
“Additional unemployment benefits have worked in the short term to help many families keep a roof over their heads and put food on the table,” Ting said. “That stability is now a risk. If federal payments fall short of $ 600 a week, California must do everything possible to make up the difference, as long as unemployment remains high. “
Ting is a leader of a legislative working group that the state proposed considering borrowing money from a federal trust fund to extend additional benefits for unemployment. The state has borrowed from that fund to help pay benefits to the more than 9 million Californians who have applied for unemployment.
Traditionally, federal loans are repaid by increasing payroll taxes paid by employers.
“We are discussing with the governor’s office how we can move forward on this aid, including ways to finance it without imposing additional burdens on small businesses,” Ting said.
Newsom also said Monday that he and legislators are in talks about additional tenant protections against evictions, given that a moratorium has been set to expire this month.
