Trump Administration Offers Zero Payment Option for Unemployment Plan

Governors said states couldn't afford the president's proposal
August 12, 2020 Updated: August 17, 2020

President Donald Trump’s administration has given at least one governor the option of paying no money for his new unemployment plan in a bid to ease concerns about how to afford the proposed 75–25 percent split.

Governors across the country expressed concern over affordability after Trump on Aug. 8 signed an executive order resuming additional payments for the unemployed, but mandated that states provide a quarter of the funds.

A White House official sent a message to Ohio Gov. Mike DeWine, a Republican, about an option that would see the state pay no extra money but still get an enhanced unemployment benefit.

States can choose to allocate funds to satisfy the 25 percent requirement, and unemployment claimants would get an extra $400 a week. Or states can count their existing unemployment insurance benefit payments as the cost share requirement, but claimants would only get an extra $300 a week, according to the message, which was obtained by The Epoch Times.

The second option requires no new expenditures, a White House official told DeWine’s office.

Ohio’s governor chose the second option.

Epoch Times Photo
Mississippi Republican Gov. Tate Reeves delivers a televised address in Jackson, Miss., on June 30, 2020. (Rogelio V. Solis/AFP via Getty Images)

The new option, which was also outlined in a memo from the Department of Labor, came after the Center on Budget and Policy Priorities, which says it’s a nonpartisan research and policy institute, alleged in a statement over the weekend that Trump’s plan “will force states to choose between letting the federal supplemental unemployment benefits end entirely and slashing other parts of their budgets.”

A number of governors, both Republicans and Democrats, said this week that their states cannot afford the 75–25 percent split.

GOP Mississippi Gov. Tate Reeves, for instance, told reporters during an Aug. 10 press conference that the state’s unemployment fund has $489 million left. The state would approximately double its current $22 million per week outlay if it followed Trump’s plan, effectively draining it in 10 weeks.

Reeves praised Trump and called on Congress to fund an enhanced unemployment payment.

“The president has done his part. Now I hope the Congress will do theirs,” he said.

Congress is locked in a stalemate on a new stimulus package, with Democrats refusing to go beneath $2 trillion and Republicans declining to go above approximately $1 trillion.

Another administration official said on “Fox News Sunday” that states could pay for the responsibility outlined in Trump’s order with stimulus money from the CARES Act, the package approved earlier this year.

“On the 25 percent, that’s coming from money we already gave the states. So this is effectively 100 percent paid for by the federal government,” Treasury Secretary Steven Mnuchin said.

Republican Arkansas Gov. Asa Hutchinson, Republican Florida Gov. Ron DeSantis, Democratic New York Gov. Andrew Cuomo, and Democratic Kentucky Gov. Andy Beshear are among the other state leaders who have expressed concerns about the money required to meet the 25 percent state responsibility.

Epoch Times Photo
House Speaker Nancy Pelosi (D-Calif.) center, accompanied by Senate Minority Leader Chuck Schumer (D-N.Y.), speak to reporters following a meeting with Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows as they continue to negotiate a CCP virus relief package on Capitol Hill in Washington on Aug. 7, 2020. (Andrew Harnik/AP Photo)

DeSantis told reporters on Aug. 11 that the state has obligated or spent all the stimulus money. The only other option is borrowing from the Department of Labor, which could bring legal challenges.

“I want make sure that there’s no legal risk for us. If someone were to challenge this, then we’d be left on the hook,” DeSantis said.

Several governors have said Trump’s plan is fine with them.

West Virginia Gov. Jim Justice, a Republican, told reporters Aug. 10 that the state would step up and meet the 25 percent responsibility, using the $687 million in stimulus funds he set aside.

“Hands down, period, West Virginia is going to pay it. We do so very willingly,” he said.

“I believe that the federal government will eventually reverse their stance on that and that they will pay the full 100 percent in the end,” he added. “But we’ve got the money set aside to make it work either way.”

Epoch Times Photo
West Virginia Gov. Jim Justice (L), attends a roundtable with First Lady Melania Trump in Huntington, W.Va., on July 8, 2019. (Saul Loeb/AFP via Getty Images)

Trump told reporters on Aug. 9 that some states may pay nothing. Each state will make an application, and each application will be dealt with in turn by administration officials.

“They’ll pay nothing in some instances or maybe they’ll—a little bit like the National Guard, as you know. Sometimes we’ll pay all of it, depending on the tragedy, or whatever it may be, the disaster. Sometimes the state will pay 40 percent, 25 percent, 10 percent or nothing—depending on how it works out,” he said.

Democrats were pointed in their criticism of Trump’s executive action. Cuomo called the state funding requirement “simply impossible.” Michigan Gov. Gretchen Whitmer said in a statement that Trump “is requiring states that are facing severe holes in our budgets to provide 25% of the funding.” Illinois Gov. J.B. Pritzker described what Trump did as “legally questionable theatrics.”

The White House didn’t respond to a request for comment. Administration officials say all four orders were legal, citing specific laws or authorizations for each one.

Cuomo and Hutchinson, who helm the National Governors Association, this week in a statement called on Congress and the Trump administration to come up with a workable solution, including some $500 billion in aid to states.

The article “Trump Administration Offers Zero Payment Option for Unemployment Plan,” published on Aug. 13, gave an incorrect date for President Donald Trump’s comments to reporters about some states not having to pay for a stimulus. The president spoke to the reporters on Aug. 9. The Epoch Times regrets the error.

Follow Zachary on Twitter: @zackstieber