Whitmer signs bill to pour $140M into Michigan unemployment fund

LANSING, MI – Gov. Gretchen Whitmer signed a bill Monday to boost jobless aid funding and provide money to address unemployment fraud.

The legislation appropriates $139.8 million to the Michigan Unemployment Compensation Fund. This includes $106.8 million in federal funds, $24 million from the state general fund and $8.9 million of state restricted funds.

“This fiscally-responsible, bipartisan bill will lower costs for small businesses and fight waste, fraud, and abuse in our unemployment system,” said Whitmer in a statement.

The fund took a hit during the COVID-19 pandemic dropping from $4.6 billion to about $500 million in a year. Michigan employers, who pay into the fund, have to pay more whenever it drops below $2.5 billion.

“By making a deposit into the Unemployment Compensation Fund, we can help small businesses balance their books by lowering the costs of unemployment,” Whitmer said.

Michigan has paid out nearly $40 billion to unemployed Michigan workers since March 2020. Most of that, about $31 billion, came from federal programs and not state dollars.

Through the legislation, the Michigan Unemployment Insurance Agency can hire additional employees to escalate fraud enforcement efforts. It also helps the Michigan attorney general’s office pursue unemployment claimant fraud, employee fraud and identity theft, a news release said.

“Together, we will pursue anyone who improperly exploits unemployment benefits to pad their own pockets and ensure they are prosecuted to the full extent of our laws,” Whitmer said. “Attorney General Dana Nessel, Michigan’s UIA agency, our federal partners, and my administration will continue working together to utilize this funding as effectively as possible to crack down on fraud and save taxpayers money.”

Michigan created an Unemployment Insurance Fraud Response Team late last year after a report found the state paid out $8.5 billion in fraudulent benefits during the pandemic. That total includes nearly $4 billion the Michigan UIA paid out in error.

Due to the agency mistake about 530,000 people were asked to pay their benefits back. Many are still waiting on those bills to be waived, and the state last week announced collections will be paused on pandemic repayments until May 7.