Michigan and 13 Other States Sue US Labor Department Over Clawed-Back Unemployment Funds
WCMU Public Media reported on October 13 that Michigan and 13 other states are suing the US Department of Labor for clawing back funding for improvements to state unemployment insurance systems. The grants were created under the American Rescue Plan Act passed by Congress in 2021 to help modernize the technology used to administer state unemployment programs, better prevent fraud, pay benefits promptly and promote equitable access. The Labor Department awarded more than $780 million in total, and more than $45 million has been clawed back in the 14 plaintiff states, according to the lawsuit.
The states argue the department committed a breach of contract, saying the grant agreements are enforceable contracts that did not allow termination simply because of a change in federal priorities; the department sent letters in the first year of the Trump administration saying the agreements no longer effectuated its grant funding priorities. Michigan was awarded $6.78 million in equity grants, of which $2.83 million was clawed back, and $4.47 million in Tiger Team grants, of which $1.41 million was clawed back. Labor Department spokesperson Courtney Parella responded to the lawsuit, saying the previous administration squandered the funding on wasteful projects.
Published by GSM · USA (original Chinese edition)
Photo: 兰辛密歇根州议会大厦圆顶实景。图片来源：Wikimedia Commons，w_lemay 摄，CC BY-SA 2.0 授权
