OAG Repeats UIA Pandemic Performance In Penultimate Report
The second-to-last report ordered by the Legislature of the Unemployment Insurance Agency was released by the Office of Auditor General and rehashed issues that plagued the agency during the COVID-19 pandemic.
A 126-page OAG report flagged 14 issues and made two observations that are a return to the previous excoriating audits of the UIA that have been released since 2021. The Legislature ordered five audits before the resignation of former UIA Director Steve Gray in 2020 over issues of mismanagement, fraud, and waste during the COVID-19 lockdowns.
“What we are seeing with this report is a rehash of issues that have been addressed, addressed and addressed again, and not only have been addressed in other audits and in oversight committees, but have also been remediated,” UIA Director Julia Dale said.
Several audit findings called out the billions in overpayments through several federal bailout funds that were available during the COVID-19 pandemic lockdowns and people who were using fraud to claim more money than they should.
The audit called out funds that were fraudulently paid out that could have been stopped if there were rules implemented, after the rules had been turned off because of the COVID-19 pandemic.
Dale said many of the fraudsters were attracted to the system when the fraud safety nets were removed. She added that 90 people were criminally charged and another 94 cases remain pending.
“As chair of the Joint Select Committee on the COVID-19 pandemic, I held these failed bureaucrats accountable and worked to fix our unemployment system for the working families that needed it most,” House Minority Leader Matt Hall (R-Richland Township) said.
Dale again questioned if beating a dead horse was really the best use of auditor time and taxpayer funds.
“The OAG has an audit ongoing right now. It’s solely focused on fraud,” she said.
Hall also said there was still a fifth outstanding audit in the works.
Several more of the audit findings dealt with the UIA fraud controls between the time Gray had resigned and Dale took over and had started the process to allow Grand Rapids-based Deloitte to help them update antiquated unemployment processes.
Dale said the deal was “ongoing and making great progress,” and could be completed by the end of the month.
“The question still remains as to why the UIA director decided to move the agency’s head of investigations and all 76 members of the investigation staff over to the benefits division to expedite payments and overexpose billions of public dollars to possible fraud, and whether the governor’s office agreed with that decision,” Senate Republican Leader Aric Nesbitt (R-Porter Township) said.
Dale said the question was answered during several of the Oversight panels that were held to put the UIA director’s feet to the fire.
She said in the face of the COVID-19 pandemic that leaders were calling to get benefits out quickly and the average number of weekly claims increased by 77 times overnight. That stretched the capacity of an already understaffed and underfunded UIA to the breaking point.
Three of the audit findings dealt with the federal jobless assistance programs that have already gone away.
“To call out the agency for a program that no longer even exists or a requirement that no longer exists under law, there is nothing we can do at this time to address that,” Dale said.
The audit also questioned why the UIA didn’t try to re-collect $3.3 billion in overpayments and called into question the validity of $1.7 billion overpayment waivers to the federal unemployment assistance payments.
“The three-year window for UIA to confirm intentional misrepresentation for the PUA overpayments starts to close in April 2023,” the audit stated.
Dale said the UIA has issued about 76,000 waivers worth more than $555 million of those funds and has been working through the backlog, but said there was more to go.
“Some of that was placed on hold as we worked on the collections implementation, that pause that was implemented at the end of December right before the Christmas holiday,” Dale said.
The UIA updated their software before Christmas.
There were also 400,000 Michiganders who were told they had to repay federal unemployment, but received a waiver from the Department of Labor.
There was also a lawsuit that was settled in October.
The last of the issues addressed by the audit was regarding UIA customer service and confusing or contradictory correspondence.
The issue was brought up by the OAG prior to the pandemic lockdowns, but was exacerbated because of the lockdowns.
Again, Dale decried the audit overlooking what UIA had done since she took over the state department from Gray in October 2021.
She said the agency had partnered with Civilla, a Detroit non-profit, to update language used in public letters. The UIA website had also been redesigned to help the public navigate and get frequently asked questions answered quicker.
She also pointed to the staffing and technology issues that plagued the agency for years in a letter sent to the OAG.
“The fact that we are revisiting some of these issues, one, two, three times the same issue, I do question whether or not we have the right focus when we’ve already been able to say and demonstrate, ‘Yes, OAG we have heard you, we’ve taken the feedback, we know that we need to make changes,’” Dale said.
Northern ACLU Group Seeks Court Action To Reinstate 2 Mental Health Board Members
A Traverse City attorney has asked Attorney General Dana Nessel to file action in the appellate court challenging the ouster of two Northern Lakes Community Mental Health Authority board members.
Michael Naughton, chair of the ACLU Northwest Michigan Lawyers Committee, wants Nessel to file action in the Michigan Court of Appeals arguing Justin Reed and Nicole Miller should be reinstated to the NLCMHA because they were removed “without any proper basis or cause.”
An AG spokesperson said the department received Naughton’s Thursday letter and is reviewing it.
When asked if a lawsuit is coming, Naughton said today, “We will evaluate next steps as they present themselves.”
Grand Traverse County Administrator Nate Alger said the county is aware of the letter, but will not comment on “potential litigation, alleged misconduct or requests for investigation by the Attorney General.”
In his letter, Naughton said the Grand Traverse County Board of Commissioners removed Reed and Miller by a partisan margin in July without identifying “any neglect of official duty or misconduct” by either.
“Instead, the record plainly demonstrates that the four commissioners who voted to remove them did so because they simply did not agree with a few votes taken by Mr. Reed and Ms. Miller in their capacity as board members of the NLCMHA,” he wrote.
Immediately afterwards, Naughton said, commissioners sought to replace Miller and Reed with “political allies” – an attempt to bypass the board’s bylaws and procedures.
News reports at the time said Reed and Miller, who were on the board as county representatives, were ousted after Commission Chair Rob Hentschel claimed the pair may have neglected their official duty or engaged in misconduct in office by allowing NLCMHA’s CEO to meet individually with health board members. Some board members said there was no basis for Hentschel’s claim.
New Ottawa County Health Official Could Set Up State, County Fight
The recently seated Ottawa County Commission – backing far-right politics – went on a firing spree during its first session Tuesday. Among the casualties was the public health director, a fact that could set up a fight with the state.
In November, eight members of Ottawa Impact, a PAC started during the height of the COVID-19 pandemic fighting masking and school closings, were elected to the Commission. The commission replaced county health director Lisa Stefanovsky, a 20-year veteran with the agency, with Nathaniel Kelly, who has a masters in public health and was critical of the governor’s COVID response moves during the pandemic.
In order for the appointment to be official, it needs the sign-off from the Department of Health and Human Services (DHHS). Spokesperson Lynn Sutfin said county boards need to send evidence of qualifications to the department to appoint them, including the resume and transcripts.
The Department of Licensing and Regulatory Affairs states a health officer needs to be board certified in preventative medicine or public health, have a Master of Public Health or Master of Science in Public Health, have at least two years, and have an unexpired provisional appointment.
The administrative health officer needs a Master of Public Health and three years of full-time public health administrative experience.
Sutfin said the county has not sent a request to replace Stefanovsky.
Kelly’s wife said in a tweet that he has a Master of Public Health.
My husband is now appointed as the New Admin Health Officer of Ottawa County, pending state approval of his robust qualifications.
The appointment puts DHHS in a spot because Kelly publicly opposed most of the strategies used by county health departments to prevent COVID spread. He’s a proponent of individuals taking natural immunity supplements like Vitamin D and Zinc to prevent symptoms as opposed to using a mask and social distancing. According to Bridge, he showed up in a home-spun parody video where participants mocked a Whitmer press conference on COVID-19 response.
Michigan Association for Local Public Health Executive Director Norm Hess said public health systems are set up different in each state and while the counties have autonomy to choose their own employees, in the case of public health the state has the final say as to whether the person is qualified to serve the post.
“So, this is an example where the state has the authority and the responsibility to vet those credentials and make sure that they line up and they’re adequate to meet a local public health department,” Hess said.
He said he was not aware of any time the state has used its authority to deny a health officer in the two years he has been with the association.
He said when Hess was confirmed he would be able to join the organization. MALPH acts as a liaison between the local health departments and MDHHS, Michigan Department of Rural and Agricultural Development, and the Department of Environment, Great Lakes and Energy.
Senate Health Committee Saw Most SBs Signed Into Law in ’22
The Senate committee that moved the most Senate bills that eventually were signed into law during 2022 was the Senate Health Policy and Human Services Committee.
Out of the 76 Senate bills that were signed into Michigan law last year, the Senate Health Policy and Human Services Committee supervised the initial progress and adoption of 15 of them, or roughly 20%.
Several committees did not adopt any Senate bills that turned into PAs last year, including the Senate Oversight Committee that met 19 times, the Senate Energy and Technology Committee that met seven times, the Senate Education and Career Readiness Committee that met 11 times and the Senate Government Operations and Families, Seniors and Veterans Committees that reportedly did not meet at all in 2022.
Throughout 2022, the Senate Health Policy and Human Services Committee was chaired by former Republican Sen. Curtis VanderWall (R-Ludington), who returned to the Legislature this year as a state representative in the now-minority party. The committee’s Democratic leadership post – the minority vice chair – was held by Sen. Winnie Brinks (D-Grand Rapids), who’s kicking off her new role as Senate majority leader for the new term.
While the Senate ultimately held 62 active, attendance-taking session days throughout 2022, the Senate Health Policy and Human Services Committee met on 21 days.
Some of the committee’s successful legislation included VanderWall’s SB 1012 – now Public Act 180 of 2022 – establishing the Student Mental Health Apprenticeship and Retention and Training (SMART) program.
The aforementioned project, overseen by the Michigan Department of Education and to be subjected to annual legislative appropriations, would provide a lump-sum of $15,000 per individual grants for a person interning in a public school for a graduate-level mental health professional program.
In return, the aspiring mental health care provider would be required to work in the respective public school for three years with encouragement to stay in the community.
The committee further oversaw SB 993, SB 994 and SB 995 – presently Public Acts 83, 84 and 85 of 2022 – that placed the $800 million Michigan acquired through a historic opioid settlement, as well as other future opioid-related settlements, into a newly created Opioid Healing and Recovery Fund.
The legislation also set up a special advisory commission to review community proposals to spend the money on prevention services, education, treatment, aid for impacted individuals and family members and other efforts combating the opioid epidemic.
Two other panels got the ball rolling on 13 other bills a piece that later became PAs in 2022. They were the Senate Economic and Small Business Development Committee and the Senate Appropriations Committee.
The Senate Appropriations Committee, the official budget-making arm of the Senate with multiple subcommittees, had obvious successes like SB 565 – now Public Act 53 of 2022 – dedicating around $4.7 billion into the state’s water infrastructure and other quality-of-life items.
The supplemental investment directed $506 million in federal Infrastructure Investment and Jobs Act (IIJA) funding – as well as $1.3 billion in federal COVID-19 relief resources – into state-run lead service line replacement grants and stormwater, drinking water and wastewater grants.
After holding 13 public and official meetings, the committee moreover pushed out the likes of SB 842 – Public Act 212 of 2022 – creating a $250 million state-funded scholarship program that more than 75% of Michigan high schoolers graduating in spring of this year are projected to be eligible for.
The Senate Economic and Small Business Development Committee held 12 public meetings, and delivered an accessible and affordable housing package consisting of SB 362, SB 364, SB 422 and SB 432 – currently Public Acts 236, 238, 237 and 239 of 2022.
The legislation aimed to remove financial and land-use roadblocks when it came to the development of attainable housing, such as by authorizing payments in lieu of taxes (PILOTs) for workforce housing efforts operating outside of federal and state subsidies or similar programs.
It additionally expanded Michigan’s Neighborhood Enterprise Zone (NEZ) Act to offer site rehabilitation incentives to a larger number of communities.
Overall, three Senate bills remain on the Governor’s desk that Whitmer could still technically sign or veto until Jan. 11. If the Governor does nothing with them as of Jan. 11, they officially die as pocket vetoes. They are:
– SB 39 and SB 43 by Sen. Roger Victory (R-Hudsonville) reacting to the Michigan Supreme Court 1996 conclusion in Brown v. Manistee County Road Commission, holding that the 120-day notice provision of someone seeking recovery for injuries caused by a defect in county road commission apply to lawsuits against county road commissions. The legislation would clarify the liability of counties for road maintenance-related injuries.
– SB 642 by former Senate Minority Leader Jim Ananich (D-Flint) sets in place a Qualifications-Based Selection (QBS) process ensuring that public agencies secure professional design services – such as from architects, engineers, and land surveyors – based on demonstrated competence and qualifications.