Colorado officials are starting up another financial assistance program for unemployed residents during the coronavirus pandemic, called the State Extended Benefits. The program will extend unemployment benefits for 13 more weeks, after regular benefits and the federal unemployment benefits end. Like many states across the country, Colorado is seeing thousands of residents unemployed during the pandemic, with more than 15,000 people filing for unemployment for the first time last week.
"Based upon the economic conditions of the state of Colorado, and actually, this has happened nationwide, we have triggered what’s called state extended benefits or SEB," Jeff Fitzgerald, director of unemployment insurance at Colorado's Department of Labor and Employment, said Thursday, reports the Colorado Sun. The state's unemployment trust fund will be exhausted next week, meaning Colorado will need a federal loan to keep paying unemployment benefits. So far, states have already borrowed $20 billion on from the federal unemployment account, economist Ryan Gedney told the Sun, adding that 85% of that was sent to residents in California, New York, and Texas.
Colorado has already paid out $4.5 billion in unemployment benefits, and that will likely climb as more people lose jobs when their employers cannot fully open due to the pandemic. The regular unemployment benefits run 26 weeks, and over 7,200 Coloradans have already seen those benefits expire. They received the federal emergency unemployment benefits for 13 weeks, and will soon receive benefits from the SEB program. Colorado launched the SEB when the 13-week average unemployment rate hit 6% in the state.
The SEB is separate from the executive order President Donald Trump signed last weekend to send unemployed Americans $400 per week through Dec. 6, replacing the $600 weekly benefit program that ended in late July. The order created the Lost Wages Assistance Program (LWA), with the plan to use $44 billion from FEMA's Disaster Relief Fund. States will also be asked to cover $100 of the $400 weekly benefit. Colorado Gov. Jared Polis will have to apply for the FEMA funds and will only find out how much the state will receive after that. The governor's spokesman told the Sun he planned to file the application Friday, but still hoped Congress could pass a larger coronavirus relief package.
Trump signed the executive order on unemployment benefits after the White House and Congressional Democratic leaders failed to reach a deal for a new coronavirus relief bill on Aug. 7. There was bipartisan criticism from states on how the LWA would work, especially with so many facing budget shortfalls. This week, the Labor Department sent a letter confirming that it was not mandatory for states to provide $100 weekly, meaning that many Americans will only receive $300, not $400, notes Forbes.