(The Center Square) – Several Wisconsin departments are suing the U.S. Department of Labor claiming it owes the state $10 million in terminated grants related to a system upgrade of the state’s unemployment insurance program.
Wisconsin is one of 14 states that jointed the lawsuit over $45 million in total terminated grants.
The lawsuit from the Wisconsin Department of Justice and Wisconsin Department of Workforce Development said that the terminated grants the federal government breached the express terms of the grant agreements and that the termination violated the duty of good faith and fair dealing.
States were notified that the grants would not be paid in a May 22, 2025 letter from the Trump Administration. Evers sent four letters to the federal agency including in July, May, February and August 2025 requesting the funds be paid while sending one letter directly to Trump, claiming the communications have “largely gone unanswered.”
“After decades of my predecessors kicked the can down the road, following the pandemic, we made modernizing our unemployment system a top priority, and while we’ve seen tremendous results, our work is not done,” Evers said in a statement. “Projects of this scale require careful planning, and the Trump Administration’s sudden decision to terminate this funding is halting progress on work that’s been years in the making.”
The grants were part of the American Rescue Plan Act of 2021, which passed during the Biden Administration. In total, the bill led to $780 million being awarded to states to modernize unemployment insurance systems, with approximately $31 million awarded to Wisconsin.