The Trump administration says new unemployment benefits will be available 'in the next week or 2.' But governors say they will take much longer to implement.

REUTERS/Joshua RobertsPresident Donald Trump.
  • On Monday, the Trump administration said most states would be in a position to implement a $US400 jobless-aid supplement in two weeks.
  • But experts and governors are casting doubt on that ambitious timeline, saying states are strapped for cash.
  • “It’s absolutely 100% impossible states will have this up in a couple of weeks,” an unemployment expert said.
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The Trump administration said on Monday that states would be able to design and carry out a new $US400 unemployment supplement for jobless Americans within the next two weeks. But experts and governors are casting doubt on that ambitious timeline from the White House.

Over the weekend, Trump signed an executive order to implement a boost to unemployment benefits. The $US600 bulked-up payments from the federal government expired at the end of July without any replacement, and nearly 32 million Americans are now relying on state benefits that usually cover only half their lost wages.

Treasury Secretary Steven Mnuchin said on Monday that “within the next week or two, most will be able to execute” the plan. It calls for states to provide $US100 of the benefit and the federal government to supplement another $US300.

But experts and governors say setting up the system will take much longer than that, since it needs to be designed from the ground up. Some states in dire financial straits may not be able to enact it at all.

Read more: 3 Wall Street analysts lay out exactly what you need to know about Trump’s coronavirus orders

Many states are grappling with steep drops in tax revenue that have wrecked their budgets, and some workforce agencies are still overwhelmed by a backlog of jobless claims.

“It’s absolutely 100% impossible states will have this up in a couple of weeks,” Michele Evermore, an unemployment expert at the National Employment Law Project, told Business Insider. “We don’t even have guidance yet from [the Department of Labour] or FEMA.”

Evermore added: “State unemployment insurance agencies have to figure out how to set up a whole parallel program.”

‘This is not something that any state will be able to do quickly’

The bipartisan National Governors Association said in a statement on Monday that it was “concerned” about the order’s costs on strained budgets.

“We appreciate the White House’s proposals to provide additional solutions to address economic challenges; however, we are concerned about the significant administrative burdens and costs this latest action would place on the states,” Democratic Gov. Andrew Cuomo of New York and Republican Gov. Asa Hutchinson of Arkansas said.

They called on Congress to pass a comprehensive spending package that includes $US500 billion in federal aid to states. On Sunday, Cuomo said the idea that states were in a position to assume 25% of the cost was “just laughable.”

Other governors also raised concerns about its implementation. Pennsylvania Gov. Tom Wolf said it would take time to assemble the system from scratch.

“This is not something that any state will be able to do quickly,” Wolf’s administration said in a Monday statement.

So far, only West Virginia has announced it will implement the plan, and Ohio is moving ahead with a limited version. Other states such as Texas, North Carolina, Oklahoma, and Nevada are still determining whether they can do it.

The White House has said states can tap into $US150 billion in funding already granted under the Coronavirus Aid, Relief, and Economic Security Act.

But a recent survey from the National Association of State Budget Officers found that 75% of the funds had already been allocated, meaning cash-strapped states seeking to participate in the program might need to draw funding away from other priorities, like contact tracing or reopening schools.

The Department of Labour told states in an advisory email they didn’t need to shoulder some of the costs associated with implementing the program, Bloomberg reported. Instead, they could count existing benefit payments toward their cost-sharing requirement.

As a result, the bulked-up payouts in some states could amount to only $US300 per week.

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