California has been approved to borrow what is expected to be billions of dollars from the federal government to pay unemployment benefits to those left jobless by the coronavirus pandemic, raising concerns about the cost of repaying the debt.
The state made the request as its reserves for paying unemployment benefits are being quickly depleted, requiring California to begin borrowing in just a few weeks, officials said Wednesday.
“We have protocols in place for difficult moments such as this to ensure critical safety nets remain in place,” California Labor Secretary Julie Su said.
With more than 2.7 million Californians filing new claims for unemployment benefits in the last month, experts say the state will probably have to borrow more than the $10.7 billion in loans it received from a federal trust fund during the Great Recession.
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