by Scott McClallen
The leaders of the Unemployment Insurance Agency (UIA) knew as early as Jan. 6 they erred in developing qualifications for benefits, but didn’t tell the 700,000 Michiganders affected for nearly six months.
The Detroit News first broke the story.
After Jan. 6, the UIA tried to retroactively charge some benefit recipients up to $27,000 for the state’s mistake, instead of admitting it erred.
Now, House Oversight Committee Chairman Steve Johnson, R-Wayland, called on the UIA to provide answers after a letter showed the agency didn’t disclose problems with benefits for over six months.
The letter shows the UIA failed to notify nearly 700,000 people regarding changes in qualification for federal Pandemic Unemployment Assistance (PUA) for nearly six months, frustrating Michiganders left without answers and hefty bills.
“This was not a model of transparency and competence,” Johnson said in a statement. “It took UIA half a year to come into compliance. They also kept the public in the dark and misled a standing legislative committee. There was no communication while this was going on. They simply sent people letters after a while saying they may owe over $20,000. That’s not an effective way for a state agency to assist people. The public should have been made aware of this error in a timely fashion. The Legislature should have been made aware so they could work with constituents who were going to be caught in this and keep them informed.”
The UIA has been under fire since March 2020 when the unemployment rate spiked to 22.7% in April, topping the state’s unemployment rate from the Great Recession while the state shuttered in-person unemployment offices as well as much of the economy.
“The feds made it very clear what they had to do, and it took them half a year to come into compliance,” Johnson said Tuesday. “Meanwhile, you had thousands of Michiganders who were potentially receiving money they weren’t entitled to. They could have addressed this a long time ago.”
Johnson called on UIA Director Liza Estlund Olson to appear before the Oversight Committee to explain the agency’s actions.
The UIA hasn’t responded to several requests for comment.
Aid recipients testified Tuesday to frustrating mismanagement of the agency.
Emily Mitchell, a then-Michigan State University student, collecting her final pandemic unemployment insurance benefit on May 1, 2021.
But on July 21, 2021, the UIA retroactively deemed her ineligible for those funds, claiming she wasn’t employed in 2019 or 2020, although she had two jobs. The UIA hit her with bills of $25,751 and $27,000.
“I followed all the rules, and I was transparent about everything,” Mitchell said. “Why should I and others be punished for doing what we were supposed to do?
This is the latest in a 17-month saga of screwups by the UIA. While some Michiganders have been told to repay benefits they were supposed to be eligible for, others are trying to stop the UIA from paying out benefits to fraudsters.
Ilona Boilore filed a fraud claim in Nov. 2020, but roughly 270 days later, she says the UIA is still doling out taxpayer dollars for which she’ll be taxed. She hasn’t been able to contact a UIA employee.
The mistake brought anxiety to Alex Hill, who was handed a $27,000 bill he submitted a waiver for, but he’s still unsure if it was received.
“It’s a shame that the people who suffered through this pandemic and relied on unemployment are having to pay for a mistake that isn’t our own,” Hill told lawmakers.
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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.
Photo “Rep. Steve Johnson” by Michigan House Republicans.