Feds Yank $12 Million in Unemployment Grants From Oregon Citing Misalignment With Priorities

Four federal unemployment insurance grants to the Oregon Employment Department (OED) worth $12.2 million have been canceled by the U.S. Department of Labor.

OED received the notification of the immediate termination on 22 May and told that the recipients of the grants ‘no longer effectuate’ the Department of Labor’s priorities for funding.

However, two of the grants were due for completion this month. They are both geared to assist workers from historically under-served communities to receive unemployment benefits.

The Unemployment Insurance (UI) Navigator Grant of $3 million which was awarded in 2022 to fund partnerships with three community-based organizations would have expired in mid- June 2025.

Equitable Access to Unemployment Insurance (EAUI) worth $4.5 million was granted in 2022 and aims to remove barriers and improve access to unemployment benefits. This grant was also set to expire at the end of this month.

The other grants involved are the Unemployment Insurance Integrity Grant worth $1.7 million awarded in 2023 to boost overpayment recovery by funding eight limited-duration positions in the Contributions & Recovery Division; and the Unemployment Insurance Tiger Team Grant worth $3 million which funded several projects.

Work Has Not Started on One of the Funded Projects

Although most have been completed, $370,000 was awarded in 2023 to hire outside experts to help ensure OED’s most commonly used letters are easy to understand. Work on this portion of the grant had not started at the time of termination.

OED is assessing the impact of this decision, in partnership with Governor Tina Kotek and legal counsel.

However, because the Equitable Access and Navigator grants were staffed through job rotations, OED does not anticipate that terminating the grants a few weeks early will significantly impact customers.

On the other hand, terminating the Integrity Grant has resulted in the elimination of seven limited-duration positions in Contributions & Recovery, which will hamper OED’s efforts to recover money from customers who were not eligible for all of the benefits they received.