CA receives $10 billion as it becomes 1st state to borrow from federal gov. for unemployment benefits

by Daniel Payne · May 5th, 2020 2:34 pm

The California government has become the first in the country to borrow money from the federal government to cover its rising unemployment costs, an indication the state's unemployment levels are putting significant strain on its finances.

California has logged more than four million unemployment claims since Gov. Gavin Newsom ordered the state to largely shut down its economy and residents to stay at home. That is nearly one out of every six unemployment claims filed nationally since the shutdowns began across the country.

The state has been permitted to use up to $10 billion to pay for the loans.

Illinois has also been approved for $12.6 billion in loans to cover its own unemployment programs. Connecticut, meanwhile, has been extended $1.1 billion in federal credit for the same purpose. Neither state had officially started borrowing money by the end of April.


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