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Change in federal unemployment extensions ending Sept. 4 looking unlikely | Dollars and Sense

Between Delta variant and continuing economic recovery, Assemblymember David Chiu says now is not the time to let benefits end.

SACRAMENTO, Calif. — Saturday, Sept. 4 marks a big day for many Californians who are collecting unemployment, it’s the day all federal benefits extensions but one expire. The single holdout, FED-ED, is slated to end a week later.

Things will revert to the way they were before the pandemic. Those who still qualify for unemployment will be eligible for 26 weeks of benefits per claim year. Without the $300 weekly boost the federal government has been providing, the maximum benefit will be $450 per week and could be as little as $40 per week. Many who are still struggling will face the loss of their only income.

That’s likely going to snap the financial tightrope that so many have been walking during the pandemic.

ABC10’s Dollars and Sense team spoke with state Assemblymember David Chiu (D-San Francisco), a member of the subcommittee that approves the budget of the Employment Development Department (EDD) — the heavily criticized organization charged with delivering the state’s unemployment benefits.

Chiu says the timing couldn’t be worse for the extensions to end. He’s hoping help will come from Washington D.C.

“When the Delta variant is surging, now's not a great time to take resources away from folks who are really struggling. I know there's talk about what more we can do at the state level, but we're talking about federal benefits and federal funding, and we really need our partners in Washington to extend those benefits,” Chiu said.

While he hopes that will happen, he not sure how likely it is.

“I know that in recent weeks, the administration and Congress have been very focused on the infrastructure package. So, I just don't know what appetite there is to extend unemployment benefits,” Chiu said.

Recently, President Biden suggested states could extend benefits by using some of the billions in federal aid they’ve received this year. If California heads down that road, it could lead to some hard choices in terms of taking away money from programs where those funds already have been allocated.

“I know that our state, we are putting every penny we've received from the federal government to good use, and we had already decided how those monies would be used in all sorts of different ways," Chiu said. "So, I appreciate the President's comment will likely require difficult decisions of unemployment benefits versus other sorts of ways that we have already decided we're going to help people.”

One of the extensions that will be ending on Sept. 4, is Pandemic Unemployment Assistance (PUA) which has been providing benefits to independent contractors and the self-employed, who normally don’t qualify for unemployment. When asked whether the state economy had recovered enough for the average contractor or gig worker to support themselves, Chiu expressed concern.

“I don't think that anyone can really say that that's the case," Chiu said. "Our economy was just starting to come back when the Delta variant hit, and we've seen so many things put on pause. These workers — independent workers, gig workers — are some of our most vulnerable workers in the economy, and I don't think things have come back for them.”

RELATED: Northern California Help: A resource guide for struggling Families and individuals

While looking for options for the end of the extensions, Chiu says state legislators also continue to push for more accountability at EDD to make sure the infamously backlogged department gets caught up on existing claims that are still in administrative limbo.

“EDD's been struggling since the beginning of this pandemic, and the agency has really been challenged in many, many ways. That being said, it's a system that had been failing for the better part of a decade and the challenges were exposed with the beginning of this pandemic,” Chiu said.

While he points to Governor Newsom’s “SWAT Team” and changes in leadership at EDD as positive steps, he says there’s still a lot left to do.

“We know that there are still hundreds of thousands of Californians who have not received the unemployment benefits that they are due," Chiu said. "Our legislative offices are working around the clock to help those individuals.”

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