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Several states are already exhausting funds for Trump’s $300 unemployment benefits

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  • Several states say federal funding for Trump’s $300 unemployment benefits are being exhausted.
  • Texas, New Mexico, Iowa, and Montana say they are ending their Lost Wages Assistance programs after distributing six weeks of benefits.
  • FEMA said in a statement that every state that applies by September 10 will get enough funding to make $300 weekly benefit payments for six weeks dating back to August 1, meaning last week would be the final one for eligible people.
  • “People will someday get a really big check and not another one. That’s chaos in a really chaotic time that’s not very helpful to people,” national unemployment expert Michele Evermore said.
  • Visit Business Insider’s homepage for more stories.

At least 18 states are paying out President Donald Trump’s $300 weekly unemployment aid. But several say they are already ending their programs as they exhaust federal funding after distributing six weeks of benefits for jobless people.

State officials in the following four states said on Wednesday and Thursday that federal money from the Federal Emergency Management Agency (FEMA) are running dry after the benefit week ending September 5:

In Arizona, the Department of Economic Security warned federal benefit payments could end this week, a likely scenario.

Normal state unemployment benefits — which typically cover around 30% to 50% of a person’s past wages — will continue in states where the Lost Wages Assistance Program expires.  

A FEMA spokesperson told Business Insider the federal government has distributed $30 billion to 48 states, as well as Guam and the District of Columbia. It will also make six weeks of benefit funding available for other states still getting their programs off the ground.

“Regardless of where the states and territories are in their process to receive and distribute the FEMA funding, FEMA will fund six weeks in $300 supplemental unemployment benefits to every state and territory that has applied for this assistance by September 10,” the spokesperson said.

The agency spokesperson said the payments would be dated back to August 1, meaning last week would mark the end of the program for approved states.

Michele Evermore, an unemployment expert at the National Employment Law Project, said the six-week benefit limit would likely ensure states can tap into the disaster relief funding to aid their unemployed residents.

“This should be comforting to people in states that have been slower to get the system set up,” Evermore told Business Insider. “Lack of certainty is especially hard on unemployed folks these days.”

But Evermore said the abrupt cutoff as states get their programs up and running could still heighten uncertainty among unemployed people during the pandemic.

“The farther down you are on the income scale, the more stability and planning you need in life,” Evermore said. “So here, people will someday get a really big check and not another one. That’s chaos in a really chaotic time that’s not very helpful to people.”

Last month, Trump signed an executive order to implement a federal unemployment aid program after the $600 benefit expired at the end of July. It authorized $44 billion in disaster relief aid from FEMA to be used to fund  unemployment benefits.

It was originally designed to boost unemployment payments to $400, but the Trump administration revised its guidelines after many state officials said they couldn’t afford to pay their $100 share. It made the portion optional, and at least four states are paying out the full amount: Kentucky, Montana, West Virginia, and Kansas.

Evermore and Andrew Stettner, a senior fellow at the Century Foundation, projected last month the aid would be enough for six weeks.

“It’s too little, too short, and too late,” Evermore said of the “Lost Wages” program. “This was in no way a substitute for an actual extension.”

Logistical hurdles caused delays for states trying to jumpstart their assistance programs. California is expected to distribute aid this week, along with Florida, according to officials in those states. New York will start distributing the $300 payments next week.

Nearly 29 million people across the US are collecting unemployment benefits, according to the Labor Department. Congress still has not agreed on a federal unemployment extension, with Republicans and Democrats in fierce disagreement over the amount.

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