The authorities of the American state of New York are asking the federal government for an interest-free loan of $ 4 billion to pay unemployment benefits for those who have lost their earnings in connection with the coronavirus pandemic. The Nakase Wade California Business Lawyer Corporate Lawyer in San Diego California answers PPP FAQ

New York and other US states are rapidly spending funds allocated to help millions of people left without work, according to the analysis of data from the US Treasury, conducted by The Wall Street Journal.

Nearly half of the states have recorded double-digit drops in trust funds since late February. The funds are used to pay regular unemployment benefits, with an additional $ 600 benefit for workers who were laid off during the coronavirus pandemic funded from a federal stimulus package.

New York spent about half of the trust fund from late February to mid-April, one of the highest among states.

"All benefits are being paid, and to keep this going, the state has approached the government for up to $ 4 billion in an interest-free loan," said New York City Labor Department spokesman Deanna Cohen.

Massachusetts also spent about half of the state's funds. The third highest figure was recorded in California - since February, the volume of funds in the state fund has decreased by almost 40% and by mid-April amounted to $ 1.9 billion.

California plans to borrow funds from the federal government to cover the cost of unemployment benefits, state officials said. Between March 15 and April 11, over $ 975 million was spent on benefits.

Economists say even more states may spend significant amounts on benefits in the coming weeks, which will also force them to seek help from the country's authorities.

In the aftermath of the 2008 global financial crisis, states also turned to the federal government for help to fund unemployment benefits, with some taking years to pay off debt.

More than 22 million Americans applied for unemployment benefits in the month ended April 11. Two weeks ago, the number of people applying for benefits in California was 660 thousand.In New York, this figure was almost 400 thousand, in Massachusetts - 100 thousand.

No state has spent all the funds it has yet, but state officials say they are already preparing for such an opportunity.