Dems pan handling of unemployment overpayments

JEFFERSON CITY, Mo. -- Democratic lawmakers on Wednesday decried the Missouri Labor Department's decision to offer clemency for some federal unemployment overpayments as too little, too late.

Democrat St. Louis Rep. LaKeySha Bosley said the state should have acted months ago to forgive the federal chunk of the unemployment overpayments. The agency's action Tuesday still leaves thousands of workers on the hook for the state portion of those overpayments.

"These are working families," Bosley told reporters Wednesday. "These are people who did nothing wrong."

The Department of Labor and Industrial Relations on Tuesday said workers will be notified this month if they qualify to apply for a waiver of whatever they owe in federal unemployment overpayments they were given during the pandemic.

The labor agency last year doled out $146 million in unemployment aid to 46,000 Missourians who didn't qualify amid a crush of unemployment claims. After a review, the agency discovered the mistake and has been trying to take that money back.

The problem is many of the low-income workers who received the money already spent it on rent and food, lawmakers have said.

Now they're facing liens, garnished tax returns and debts of thousands of dollars.

Bosley said workers who mistakenly received the overpayments because of a Labor Department error "should not be penalized for the government's mess up."

The Department of Labor's Tuesday announcement for leniency on the federal portion came shortly after House Democrats called a news conference for Wednesday to complain about Republican Gov. Mike Parson's handling of the issue.

Parson told reporters in his Capitol office he is "fine" with waiving the federal portion, but "we're still going to work on the state portion of that."

"If it was a legitimate mistake, we're fine with that," Parson said. "But if there's anything beside that, you're not going to get a blanket waiver."

The Labor Department on Tuesday said it will start collecting on the state unemployment overpayments in August.

A Republican-sponsored bill to exempt workers from having to pay back the state portion of unemployment overpayments passed the GOP-led state House 157-3 in March. But the measure didn't pass the Senate by the end of the legislative session in May and died.

Without that legislation, spokeswoman Maura Browning said in an email the Labor Department is prohibited from waiving the state overpayments.