Tens of thousands of unemployed South Carolinians could soon be eligible for additional jobless benefits that are being offered by the federal government.
Gov. Henry McMaster instructed officials at the S.C. Department of Employment and Workforce on Wednesday to opt into a plan that will temporarily provide an extra $300 per week in federal assistance to those without a job amid the coronavirus pandemic.
That money was made available by President Donald Trump earlier this month after his administration failed to reach a deal with Congress to continue sending an extra $600 per week to every eligible unemployment applicant in the United States.
By issuing an executive memorandum, the president redirected up to $44 billion that was intended for federal disaster relief to be used for unemployment aid.
Dozens of other states across the country filed paperwork with the federal government in the past two weeks in order to capture part of those federal funds.
South Carolina leaders, however, waited to sign up because they were concerned about what Trump's plan might cost the state government.
“The governor supports the President’s plan in the absence of Congressional action and is working with legislative leaders to determine what, if any, financial liability South Carolina taxpayers would possibly incur and whether the State has sufficient funds to pay for the match before applying to participate,” Brian Symmes, the governor’s spokesman, said in a prepared statement late last week.
It was initially reported that Trump's proposal might require states to pay an extra $100 per week to every person on their unemployment rolls before they could obtain the additional $300 per week being offered by the federal government. But the U.S. Department of Labor later clarified the rules surrounding the money, explaining that states could use their existing payments to unemployed workers to match the federal funds.
As a result, South Carolina won't need to chip in any additional money. That's good news because it would have cost the state an estimated $20 million per week to meet that 25 percent match, which is required by law.
The state government saw an estimated $1.8 billion budget surplus evaporate amid the coronavirus pandemic.
Dan Ellzey, DEW's director, sent a letter to McMaster and state lawmakers on Tuesday informing them that Trump's plan could be a good deal for the state.
He noted that South Carolina could net roughly $280 million for unemployed individuals over five weeks, and he said participating would cost the state very little in return.
That letter was enough to reassure McMaster, a Republican and Trump ally.
“We’ve chosen to participate in this program in a way that will provide additional unemployment relief from the federal government while maintaining our strong record of fiscal responsibility and protecting the interests of South Carolinians," McMaster said in a press release Wednesday afternoon.
But anyone receiving unemployment benefits in South Carolina shouldn't look for the extra money to show up in their bank account just yet.
In his letter, Ellzey said it could take DEW up to three weeks to update its unemployment system and start disbursing the federal funds.
"We know there are citizens who are still in great need," Ellzey said in a statement Wednesday. "DEW has been testing changes in its benefits portal based upon guidance provided by the U.S. Department of Labor. If South Carolina is approved, we will work as quickly as possible with our vendor to get the application into the system.”
Ellzey also explained that anyone receiving less than $100 per week in unemployment benefits from the state wouldn't be eligible for the new federal assistance. That rule, which was set by the federal government, will disqualify roughly 12,500 people in South Carolina.
For those who are eligible, the $44 billion that Trump allocated may not last very long. States are required to back date the $300 payments to the beginning of August, and with more than 30 million Americans still unemployed, the funds are likely to be drawn down very quickly.
The federal government, Ellzey said, is only promising states enough funding for an initial three weeks of benefits. After that, the state will have to apply week to week.
Democrats in Congress have proposed to restart the extra $600 per week that was being provided earlier this year, and they want that funding to continue until 2021. But many Republicans, including Sen. Lindsey Graham, are resistant to that plan. They've argued that giving every eligible unemployment applicant an extra $600 per week could encourage people who lost low-wage jobs to remain out of work.
Meanwhile, federal data shows there are roughly three job seekers for every job that's available in the United States.