Labor Secretary Lori Chavez-DeRemer has recovered $1.4 billion in dormant COVID funds that states wrongfully held onto for years while looking to reclaim another $2.9 billion from the same pot.
At a Glance
- Labor Secretary Lori Chavez-DeRemer has recovered $1.4 billion in unused pandemic unemployment funds
- A 2023 audit revealed billions in COVID-era funds inappropriately retained by states
- The Labor Department is working to recover an additional $2.9 billion in mismanaged funds
- The funds were originally part of the 2020 CARES Act intended for temporary unemployment assistance
- The recovery aligns with the Trump administration’s focus on government efficiency and fiscal responsibility
Billions in Taxpayer Money Finally Returned
In a major victory for fiscal responsibility, Trump’s Labor Department under Secretary Lori Chavez-DeRemer has successfully reclaimed $1.4 billion in dormant COVID-era unemployment funds that states had been sitting on long after the programs expired. The recovered money has been returned to the U.S. Treasury’s General Fund, marking a significant milestone in the administration’s commitment to eliminating government waste and protecting taxpayer resources. This recovery represents just the first phase of a larger effort, as the department has identified approximately $4.3 billion in total unused pandemic unemployment funds that should be returned to American taxpayers.
The recovered funds were originally allocated through the Coronavirus Aid, Relief, and Economic Security (CARES) Act of March 2020, which provided states with money for temporary unemployment insurance programs during the pandemic. However, a 2023 audit by the department’s Office of Inspector General found that several states continued holding onto these funds despite no longer meeting the necessary requirements for their use. The audit revealed that as of July 31, 2023, nearly $5 billion in COVID-era unemployment funds remained unused, highlighting serious deficiencies in oversight and accountability.
Fiscal Responsibility Takes Center Stage
Secretary Chavez-DeRemer has made it clear that returning these funds to taxpayers is a top priority for the Labor Department under President Trump’s administration. The recovery effort emphasizes the administration’s commitment to rooting out waste, fraud, and abuse in government spending while ensuring that federal programs operate efficiently. The department’s focus on reclaiming these dormant funds aligns with President Trump’s broader goals of streamlining government operations and reducing unnecessary expenditures, as evidenced by initiatives like the Department of Government Efficiency (DOGE).
“There’s no reason leftover COVID unemployment funds should still be collecting dust,” stated Chavez-DeRemer. “Any money still sitting around for pandemic-era unemployment funds is a clear misuse of Americans’ hard-earned tax dollars.”
The recovery of these funds represents not just a financial win but a restoration of proper governance. Deputy Secretary of Labor Keith Sonderling highlighted the significance of this accomplishment, emphasizing that allowing billions of taxpayer dollars to remain unchecked years after a program has ended is simply unacceptable. The Labor Department’s proactive approach demonstrates a renewed commitment to financial oversight that had been sorely lacking under previous administrations.
Addressing Systemic Failures in Fund Management
The mismanagement of pandemic unemployment funds reflects broader issues of government inefficiency and inadequate controls. The Employment and Training Administration, which was responsible for overseeing these funds, lacked sufficient safeguards to ensure proper usage and timely return of unspent money. The investigation uncovered particularly egregious examples of fund mismanagement in several states, with the audit identifying $105.1 million in questionable costs in Delaware, Oregon, Mississippi, and Louisiana alone. These findings underscore the importance of the Trump administration’s focus on accountability and responsible stewardship of taxpayer resources.
“It’s unacceptable that billions of dollars went unchecked in a program that ended several years ago. In a huge win for the American taxpayer, we’ve clawed back these unused funds and will keep working to eliminate waste, fraud, and abuse,” said Deputy Secretary of Labor Keith Sonderling.
While the recovery of $1.4 billion represents significant progress, Secretary Chavez-DeRemer has made it clear that her work is far from finished. The department continues its efforts to recover the remaining $2.9 billion in unused funds, demonstrating an unwavering commitment to fiscal responsibility. This ongoing initiative reflects the administration’s broader focus on government efficiency and its determination to ensure that taxpayer dollars are used appropriately and returned when programs conclude. As Chavez-DeRemer aptly put it: “I’m keeping my promise to be a good steward of your money by rooting out waste to ensure American Workers always come first.”
