Tennessee will apply for a federal grant program that will extend unemployed Tennesseans’ benefits by $300 per week, though questions about the program remain unanswered.
The grant program is outlined in a presidential memorandum issued by President Donald Trump on Aug. 8 after Congress failed to reach an agreement about the potential extension of supplemental unemployment benefits.
The deadline for states to apply for the grant is Sept. 10, but Tennessee plans to submit its application by the end of the week — if not by Wednesday — Tennessee Department of Labor and Workforce Development Commissioner Jeff McCord said during a press conference Tuesday.
The grant provides a $400 weekly bonus to unemployed individuals in participating states, lower than the previous $600 federal bonus that expired on July 25. The federal government will pay $300 of the weekly bonus, and states are responsible for paying the remaining $100.
Tennessee has chosen to use the state’s existing unemployment benefit payments for the $100 weekly match, meaning if the state is approved, unemployed Tennesseans will receive their usual state unemployment benefits plus the additional $300 federal supplement for the duration of the program.
Tennessee’s maximum weekly unemployment benefit is $275, and the maximum weekly amount unemployed Tennesseans could receive under this program is $575 (not accounting for federal tax withholding).
To be eligible for the $300 weekly benefit, unemployed Tennesseans must already qualify for a weekly minimum of $100 in regular state unemployment benefits.
It’s unclear when eligible Tennesseans will begin to receive these funds.
How long will the program last, and how long will payments take?
The federal grant funds will be capped at $44 billion and arer issued from FEMA’s Disaster Relief Fund, which typically funds emergency responses to natural disasters. The program is slated to run through Dec. 26 but could end earlier. The time frame of the grant depends on how quickly the $44 billion in funds is exhausted, meaning it hinges on how many states participate and how many individuals in each state qualify to receive the weekly federal grant.
By some estimates, McCord said, the program could run in Tennessee for five to six weeks.
But legal complications could also mean an earlier end to the program. It is unclear if Trump has the authority to side-step Congress to issue enhanced unemployment benefits without Congressional approval.
Trump’s memorandum has also left many unemployment experts and lawyers confused, because it draws funds from the Stafford Disaster Relief and Emergency Assistance Act. The act allows the government to provide assistance to people who do not qualify for traditional unemployment. Because of this, it is unclear if states will be able to legally use their existing unemployment systems to pay out the benefits.
If Congress passes additional legislation addressing enhanced unemployment benefits before the grant funds run out, the program would end before Dec. 26, McCord said.
Tennessee will create a fourth unemployment system to process the supplements, McCord said, though the system will run from the same website and interface as Tennessee’s current systems.
The new system will use the same software but have new processes and new rules, which the state department of labor is currently working to create.
McCord said the state department of labor is “working diligently” to avoid the weeks-long delays that it experienced when unemployment claims first spiked in March, prompting Tennessee to overhaul its unemployment system. Tennessee is still struggling to process thousands of unemployment applications, though the number of new weekly applications has fallen, particularly over the past two weeks.
“We are going to implement this as fast as we possibly can, and again, we have anticipated this decision, even though it wasn’t made until today, and we are working on that concurrently,” he said.
USA Today and Natalie Allison contributed to this report.
Reach Cassandra Stephenson at [email protected] or at (731) 694-7261. Follow Cassandra on Twitter at @CStephenson731.