After an audit revealed a significant liability due to the misallocation of federal pandemic relief funds, Massachusetts agreed to repay $2.1 billion over the next decade. The error, which traced back to the administration of former Gov. Charlie Baker, involved improper overdraws on unemployment benefits. While the potential bill could have exceeded $3 billion, negotiations with the U.S. Department of Labor helped reduce it. Gov. Healey expressed frustration over the oversight but emphasized a collaborative approach to reforming the state's Unemployment Insurance system to prevent future issues.
The $2.1 billion settlement represents a year and a half of extensive negotiations with the Department of Labor to minimize the impact on Massachusetts's residents, businesses, and economy.
We were dismayed to uncover early on in our term that the previous administration misspent billions of dollars in federal relief funds and that our state was facing what could have been a more than $3 billion tab to pay it back.
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