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Minnesotans can get extended unemployment benefits; state funds not expected to run dry yet

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Karrie Heydt, owner of Tarsilla’s Cafe, leans on the counter, worried of the situation during the COVID-19 pandemic on Friday, March 20, 2020 at Tarsilla’s Cafe in Stewartville. “A Friday at lunch time, it would be pretty full, with Friday fish fry, Friday nights would be crazy busy also, especially during lent,” Heydt said. “It couldn’t have come at a worse time. I’m sad for my employees, because most of them I had to tell them no more work. I’m worried. The bills keep coming, you know maybe your rent can be put off but the electric bill keeps coming, the gas bill keeps coming, the water bill keeps coming. But, we are a tough family, and we have been through a lot already, so we will be fine. I truly believe that.” (Traci Westcott / twestcott@postbulletin.com)

ST. PAUL — With the economic turmoil of COVID-19 stretching on, officials say the hundreds of thousands of Minnesotans on unemployment right now can get a 13-week extension of benefits.

According to a Wednesday, April 15, news release from the state Department of Employment and Economic Development, Minnesota is now implementing the unemployment benefit extension passed in U.S. Congress's Coronavirus Aid, Relief and Economic Security (CARES) Act.

With Minnesotans continuing to shelter in place and businesses ordered to remain closed, DEED Commissioner Steve Grove said approximately 8,000 Minnesotans have exhausted or will soon exhaust their unemployment benefits. Now, thanks to the CARES Act, they get 13 more weeks of benefits, plus an additional $600 per week in federal aid.

During a Wednesday committee hearing with state legislators, conducted via video conference, Grove said the pandemic has "completely disrupted" Minnesotans' lives. Nearly 452,000 Minnesotans have applied for unemployment benefits since Gov. Tim Walz ordered nonessential businesses to shutter — more than double the number of unemployment claims the state received in all of 2019. Grove said over 90% of those who have applied for unemployment in the last month never applied for benefits before.

With over 14% of Minnesota's labor force out of work, the state's unemployment benefits bill is hefty: about $76 million a week, Grove said. As applicants continue to increase and Minnesotans remain out of work, Grove said that number may reach $105 million per week next month.

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Grove said under the state's most likely model, in which claims peak and then begin to tamper off as Minnesotans hopefully reenter the workforce, the state should be able to cover its own bills and the unemployment trust fund shouldn't run out. If this economic crisis stretches on, though, Grove said the state has the capability to keep paying about $76 million per week through October.

If that were to happen, Grove said the state could get a no-interest loan from the federal government to keep paying out benefits. The last time Minnesota's unemployment fund ran dry and federal help was needed was in the throes of the Great Recession in 2009. 90% of that federal loan was forgiven, Grove said.

For those who believe they qualify for the 13-week unemployment extension, DEED said they should apply on the department's website .

A third part of the CARES Act, intended to assist self-employed workers and independent contractors, has not been implemented yet, but Grove has encouraged those Minnesotans to still apply online as soon as possible. He said they will initially be denied benefits, but once the state is able to roll out those benefits, the state will have their information and reach out to them directly.

Mearhoff is a Minnesota Capitol Correspondent for Forum News Service. You can reach her at smearhoff@forumcomm.com or 651-290-0707.

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