Congressional Research Service IN11492.1 (COVID-19: Supplementing Unemployment Insurance Benefits (Federal Pandemic Unemployment Compensation vs. Lost Wages Assistance))

Summary

CRS Insight IN11492.1, COVID-19: Supplementing Unemployment Insurance Benefits (Federal Pandemic Unemployment Compensation vs. Lost Wages Assistance), dated August 31, 2020. It explains that Federal Pandemic Unemployment Compensation (FPUC) under the CARES Act (P.L. 116-136) added a federally financed $600 weekly benefit to all UI benefits from March 29, 2020 until July 25, 2020 in most states, and that this authority has expired. On August 8, 2020, President Donald Trump issued a memorandum authorizing other needs assistance for lost wages under Section 408 of the Stafford Act. The Insight describes the resulting FEMA Lost Wages Assistance (LWA) grants, payable at $300 a week in federal funds, or more if a state adds $100.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

                                                                                               INSIGHTi



COVID-19: Supplementing Unemployment
Insurance Benefits (Federal Pandemic
Unemployment Compensation vs. Lost Wages
Assistance)

August 31, 2020
Among other temporary Unemployment Insurance (UI) provisions authorized under the Coronavirus Aid,
Relief, and Economic Security Act (CARES Act; P.L. 116-136; enacted March 27, 2020), Federal
Pandemic Unemployment Compensation (FPUC) provided an additional, federally financed $600 weekly
benefit that augmented all UI benefits from March 29, 2020, until July 25, 2020, for most states (July 26,
2020, for New York). The FPUC authority is now expired.
On August 8, 2020, President Donald Trump issued a presidential memorandum authorizing other needs
assistance (ONA) under Section 408 of the Robert T. Stafford Disaster Relief and Emergency Assistance
Act (Stafford Act; P.L. 93-288, as amended; 42 U.S.C. §5174(e)(2)) for lost wages. As described in
Federal Emergency Management Agency (FEMA) guidance, this Lost Wages Assistance (LWA) program
provides grants to states to supplement the weekly benefits of certain eligible UI claimants in
participating states, subject to a cost sharing requirement. LWA grants may be paid in the amount of $300
a week in entirely federal funds; or, if a state chooses to contribute an additional $100 a week in state
funds, the total is $400 a week. LWA grants are available for weeks of unemployment ending between
August 1, 2020, and December 27, 2020, but the program could terminate earlier if Congress enacts
supplemental COVD-19-related unemployment compensation (e.g., reestablishes the FPUC authority) or
certain conditions are met related to the balance of the Disaster Relief Fund (DRF).
This Insight discusses the now-expired FPUC benefit and currently authorized LWA grants to states,
including key differences in authorization and administration, benefit amount, eligibility, and funding. For
a preliminary legal analysis of LWA, see CRS Legal Sidebar LSB10532, President Trump’s Executive
Actions on Student Loans, Wage Assistance, Payroll Taxes, and Evictions: Initial Takeaways.




                                                                          Congressional Research Service
                                                                           https://crsreports.congress.gov
                                                                                                   IN11492

CRS INSIGHT
Prepared for Members and
Committees of Congress
Congressional Research Service                                                                              2




Authorization and Administration: FPUC (now expired) vs. LWA
FPUC was created under Section 2104 of the CARES Act (P.L. 116-136). While authorized, FPUC was
an additional, federally financed benefit that augmented all weekly UI benefits, including regular
Unemployment Compensation (UC), Pandemic Unemployment Assistance (PUA), Pandemic Emergency
Unemployment Compensation (PEUC), Extended Benefits (EB), Disaster Unemployment Assistance
(DUA), Short-Time Compensation (STC), Trade Readjustment Allowance (TRA), and Self Employment
Assistance (SEA). All states administered weekly FPUC payments through agreements with the U.S.
Department of Labor (DOL). DOL provided guidance on FPUC to states. FPUC was structured as an
entitlement for UI claimants to be paid until the expiration of the program (July 25, 2020).
LWA is authorized under the August 8, 2020, presidential memorandum, which references the statutory
authority for ONA under the Stafford Act. LWA may augment the weekly benefits of certain eligible
claimants (see below) receiving UC, PUA, PEUC, EB, STC, TRA, and SEA; but not DUA. FEMA is
administering LWA; states may apply for LWA grants by September 10, 2020, and provide LWA in
conjunction with their UI systems. Additionally, DOL is providing technical assistance on LWA. LWA is
not an entitlement, but is subject to state application and availability of funds. There is a 25% cost sharing
requirement for LWA, as required by ONA in statute (42 U.S.C. §5174(g)(2)), which states can satisfy by
either paying $100 a week to eligible claimants or by demonstrating that the total UI benefits paid with
state unemployment funds in the aggregate meets the amount of the 25% match. FEMA maintains an
updated list of states that have approved LWA applications.

Benefit Amount: FPUC (now expired) vs. LWA
When it was authorized, FPUC provided an additional $600 a week to claimants in all UI programs. This
amount was 100% federally financed. FPUC income must be disregarded for the purposes of Medicaid
and the Children’s Health Insurance Program (CHIP).
LWA may not exceed $400 a week, which includes up to $300 a week in federal funding plus an optional
$100 a week in non-UI state funds. (As of this date, two states—Kentucky and Montana—have
announced an intention to pay the additional $100 a week.) Under the Stafford Act, ONA is disregarded
“when determining eligibility for or benefit levels under federally funded income assistance or resource-
tested benefit programs.”

Eligibility: FPUC (now expired) vs. LWA
When it was authorized, FPUC was payable to all UI claimants receiving at least $1 in underlying UI
benefits.
LWA is payable to UI claimants (in all programs except for DUA) who are receiving at least $100 a week
in underlying benefits (before offsets for any earnings during a period of partial unemployment or before
benefit reductions based upon participating in the STC program ) and self-certify that they are
unemployed or partially unemployed due to COVID-19.

Funding: FPUC (now expired) vs. LWA
During its authorization period, FPUC payments, as well as administrative costs related to FPUC, were
100% federally funded. The FPUC authorizing language under Section 2104 provided for the
appropriation of “such sums as necessary” for benefit payments and costs incurred by states in
administering the payment, including implementation and staffing.
Congressional Research Service                                                                                    3




LWA is funded through the Disaster Relief Fund (DRF), subject to funding limitations. After any of the
following conditions are met, LWA will no longer be payable:
        FEMA has expended $44 billion on LWA.
        The DRF balance reaches $25 billion.
        Enactment of legislation providing supplemental federal unemployment compensation, or
         similar compensation, for unemployed or partially employed individuals due to COVID-
         19.
        The program end date of no later than December 27, 2020, is reached.
FEMA is to initially provide three weeks of LWA grant funding to approved states—and then on
a weekly basis, thereafter—based on estimated payments. States may not use any UI funding
sources for LWA administrative costs. Instead, FEMA is to provide up to 5% of the total LWA
grant to states for administrative costs.


Author Information

Katelin P. Isaacs                                         Julie M. Whittaker
Specialist in Income Security                             Specialist in Income Security




Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United
States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However,
as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the
permission of the copyright holder if you wish to copy or otherwise use copyrighted material.




                                           IN11492 · VERSION 1 · NEW


File and source

File

IN11492.1.pdf

Size

656,506 bytes

SHA-256

2cda6d77a3be68006e93cb3f0974dbfcbd8a1128c13e28079f98c69329c2fce4

Our copy

IN11492.1.pdf

Original

crsreports.congress.gov