States on hook for billions under Trump’s unemployment plan

President Donald Trump walks to his car after arrive in Southampton, N.Y., on Marine One, Saturday, Aug. 8, 2020. Trump is attending two fundraisers during his visit to the Hamptons. (AP Photo/Susan Walsh)
President Donald Trump walks to his car after arrive in Southampton, N.Y., on Marine One, Saturday, Aug. 8, 2020. Trump is attending two fundraisers during his visit to the Hamptons. (AP Photo/Susan Walsh) (Copyright 2020 The Associated Press. All rights reserved.)

(AP) – Whether President Donald Trump has the constitutional authority to extend federal unemployment benefits by executive order remains unclear. Equally up in the air is whether states, which are necessary partners in Trump's plan to bypass Congress, will sign on.

Trump announced an executive order Saturday that extends additional unemployment payments of up to $400 a week to help cushion the economic fallout of the pandemic. Congress had approved payments of $600 a week at the outset of the coronavirus outbreak, but those benefits expired Aug. 1 and Congress has been unable to agree on an extension. Many Republicans have expressed concern that a $600 weekly benefit, on top of existing state benefits, gives people an incentive to stay unemployed.

But under Trump's plan, the $400 a week requires a state to commit to providing $100.

Many states are already facing budget crunches caused by the pandemic. Asked at a news conference how many governors had signed on to participate, Trump answered: “If they don't, they don't. That's up to them.”

Trump expressed a different view on Sunday night, following a day of state officials questioning how they could afford even $100 per person in additional weekly payments. He told reporters as he returned to Washington that states could make application to have the federal government provide all or part of the $400 payments. Decisions would be made state by state, he said.

Several state officials questioned how Trump's initial proposal would work and often expressed doubt that they could afford to participate at the level Trump initially set without using federal funds.

Aubrey Layne, secretary of finance for Virginia Gov. Ralph Northam, a Democrat, said in a phone interview Sunday he believes it would be feasible for Virginia to participate in such a program if states are allowed to use money that's been allocated to them under the already passed CARES Act. He said his preliminary understanding is that states can do so, but he and others are waiting to see the rules published.

The better solution, Layne said, would be for Congress to pass legislation.