LANSING, Mich. (AP) — Over 55,000 more claimants won’t have to pay back unemployment overpayments totaling $431 million from the Michigan unemployment agency during the COVID-19 pandemic, the state announced Wednesday.
The Michigan Unemployment Insurance Agency has to date waived more than $4.3 billion of overpayments to residents, totaling 400,000 claimants who were improperly awarded pandemic unemployment benefits.
Many were worried about having to pay back funds after 648,100 Michigan residents received letters in the summer of 2021 informing them that they would have to reapply for eligibility, according to a state audit released in November. Of those residents who received letters, 347,437 who had been deemed eligible for the benefits were later found ineligible.
The overpayments were the result of chronic miscommunication between the UIA and the U.S. Department of Labor over eligibility criteria while the UIA was distributing over $39 billion in unemployment benefits. Members of the state and the federal government have disagreed about who is responsible, but ultimately Michigan residents were not responsible for the overpayments and will not be required to pay them back.
Those who receive waivers are notified through their Michigan Web Account Manager accounts. The state will mail letters to those given waivers making them aware of the notification on the account.
The UIA will continue to review overpayments to extend waivers to anyone eligible, UIA Director Julia Dale said in a news release Wednesday.
“The federal jobless assistance programs were a critical lifeline for many Michiganders affected by the global pandemic and our action today means they will be able to continue to provide for their families without the fear of having to pay back benefits awarded through agency error,” Dale said.
The UIA has been the subject of intense scrutiny from Republican lawmakers over the course of the COVID-19 pandemic due delays in paying out benefits and constituent's having difficulties contacting the UIA. Dale was named the director of the agency by the governor in October after the acting director and her predecessor were criticized in legislative committees for distributing more benefits than ever in state history over two years.
Though the Department of Labor initially allowed for a pause on collection of funds through May 7, the UIA requested an extension to identify more individuals eligible for a waiver, the news release said.
Anna Liz Nichols is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.
Anna Liz Nichols, The Associated Press