JEFFERSON CITY — A bipartisan chorus of lawmakers was livid with the Missouri Department of Labor on Tuesday, accusing its director of violating their trust by continuing efforts to collect repayment from Missouri residents who had received overpayments of unemployment benefits.
Speaking before the House Special Committee on Government Oversight, Director Anna Hui apologized repeatedly to lawmakers and to Missouri residents who have received letters from her department demanding the repayment of unemployment aid paid erroneously in the past year.
The continuation of those letters, which have included threats of confiscated tax refunds, garnished wages and liens on recipients’ homes, amounted to a violation of what lawmakers had understood to be an agreement with the department to relax collection efforts and take a “compassionate approach” with those impacted, according to Rep. Scott Cupps, R-Shell Knob.
Hui argued that the department had followed the stipulations of the bill passed in the House. But she announced to the committee Tuesday that all collection efforts would cease, effective immediately, “in a show of good faith.”
But that belated proclamation frustrated lawmakers.
“I just feel a little bit stupid, if I’m being honest,” said Cupps, who asked fellow lawmakers to trust the state labor department not to continue collection efforts. “I felt like we had one of the best departments of labor in the country, and I felt like we had one of the best directors in the country. I still feel that way … but there’s a little bit of a trust issue right now.”
After the department reported in February that 46,000 Missouri residents were overpaid unemployment benefits last year amid the pandemic, lawmakers in the House passed a bill in early March that would forgive the federal portion of the overpaid benefits, which the department estimates constitutes at least 75% of the $150 million in excess claims paid out by the state.
Many of the Missourians who were notified of overpayments hold occupations such as school bus drivers, school cooks and substitute teachers, a point of emphasis for lawmakers while they deliberated the bill.
While the bill received bipartisan support, Democrats argued unsuccessfully for the adoption of an amendment that would also waive the remaining state portion of the overpayments. Forty other states have policies that place the financial burden on states rather than recipients in the event of erroneous payment.
Republicans voted down the measure, fearing its impact on the stability of the state’s unemployment trust fund, which employers pay into.
Rep. Peter Merideth, D-St. Louis, called that a “false choice,” saying Gov. Mike Parson had the authority to inject the fund with money from the CARES Act.
“We simply have a governor and a department that said they don’t want to follow federal law on that, they want to recollect the money, and federal law gave them the discretion to decide whether or not to,” Merideth said.
Parson, who had earlier argued that Missourians who were overpaid unemployment benefits should pay them back, later placed $300 million in federal stimulus money into the fund.
Cupps said Merideth had ultimately been proven right and expressed puzzlement as to what the department had to gain by continuing collection efforts on the state portion of the overpayments until Tuesday.
Rep. J. Eggleston, R-Maysville, another member of the committee, also said Tuesday that the department’s continued efforts have led to a “trust issue.”
The bill, passed by the House in March, currently awaits deliberation in the Senate. Eggleston said the Senate has the option to add more requirements to the bill to ensure the administration sticks to its pledge.