Wisconsin Leads States Suing U.S. Over Canceled Jobless-System Grants
Wisconsin is leading a multistate coalition suing the Trump administration in the U.S. Court of Federal Claims over the cancellation of federal grants meant to modernize state unemployment-insurance systems and fight fraud, the governor's office announced Oct. 9.
The money came from the 2021 American Rescue Plan. In May 2025, the U.S. Department of Labor terminated the grants, including about $29 million for Wisconsin — roughly $10 million of it unspent — and more than $45 million across the coalition states. The Labor Department said the grants did not align with agency priorities.
Wisconsin Department of Workforce Development Secretary Amy Pechacek said the state was forced to cancel vendor contracts before the new system could be delivered, disrupting upgrades. State jobless systems were widely criticized during the pandemic for outdated technology and fraud, and states had counted on the funds to rebuild them.
The lawsuit puts a recurring fight — Washington awards money, states spend it halfway, then Washington pulls it back — before a federal judge. The outcome will affect unemployment-system upgrades in multiple states, and GSM will follow the case.
(Source: Wisconsin Governor's Office)
Source: Wisconsin Governor's Office
Published by GSM · USA (original Chinese edition)
Photo: 威斯康星州议会大厦 Photo: Michael Barera, CC BY-SA 4.0, via Wikimedia Commons
