On Friday, November 18, 2021, the Auditor General released a report that indicates the Unemployment Insurance Agency (UIA) made overpayments of almost $4B from March 2020 – August 2021.
Based on the actions of the UIA over the past two years, NFIB was disappointed, though not surprised. “As small businesses struggle to not just recover, but survive from government shut-downs and restrictions, the results of the Auditor General Report were disturbing, to say the least,“ said Amanda Fisher, NFIB Michigan assistant assistant state director in a statement.
According to the report, rank and file UIA employees were struggling to deal with the case load in a manner that complied with statute, but leaders in both the Agency and Administration agreed to abandon any measures that would provide accountability and stewardship of the CARES Act and Trust Fund dollars that were improperly paid out.
“This revelation, while not surprising given the actions of the administration in the last 18 months, is a slap in the face to every employer in Michigan,” added Fisher.
The Unemployment Insurance Trust Fund is funded entirely by employer contributions. Unemployment Insurance payments under the CARES Act were funded with both federal and Trust Fund dollars. In February of 2020, the Trust Fund balance was over $4B thanks to actions taken in 2011 to pay off billions of dollars of debt. However, with the Trust Fund depleted, in part to because of the egregious actions taken by the UIA, Michigan’s unemployment system is now unprepared for any kind of economic downturn.
“Between the draconian policies of business shut-downs, the overpayments made by the UIA, as well as the unwillingness of the Governor to sign any bills that would actually help small businesses who were directly affected by these policies, Michigan’s small employers are in a precarious position,” continued Fisher. “Any economic downturn could deplete the Trust Fund in a matter of weeks, causing a chain reaction of higher employment taxes, less jobs, and less tax revenues. This is why we are calling on the Governor to redress the situation and use federal recovery money to make a deposit of $1B into the UI Trust Fund without any strings attached.”
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For more than 75 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is nonprofit, nonpartisan, and member-driven. Since our founding in 1943, NFIB has been exclusively dedicated to small and independent businesses, and remains so today. For more information, please visit nfib.com.
