New York Seeks $4 Billion Loan for Surging Unemployment Claims

(Bloomberg) -- New York State has applied for a $4 billion federal loan to shore up its unemployment trust fund amid a record surge of claims by workers sidelined by the Covid-19 pandemic, a spokeswoman said.

“All benefits, including enhanced benefits, are being paid, and to help ensure it remains that way the state has applied for an up to $4 billion, no interest federal loan,” said Deanna Cohen, a spokeswoman for the state Department of Labor.

About 1.1 million New Yorkers have filed initial unemployment claims and the state has paid about $2.2 billion in benefits since the pandemic began, according to a news release. New York released a new streamlined unemployment insurance application Monday that doesn’t require people to apply for regular unemployment insurance before applying for pandemic-related benefits.

New York’s unemployment insurance trust had about $2.7 billion at the end of 2019, less than half the minimum needed to remain solvent during a recession, according to the U.S. Department of Labor.

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