On October 11, 2023, the Government Accountability Office (GAO) released a report reviewing how State and Local Fiscal Recovery Fuds (SLFRF) were spent and/or obligated. See GAO-24-106753, COVID-19 Relief: States’ and Localities’ Fiscal Recovery Funds Spending as of March 31, 2023
The report shows spending as of March 31st, noting that Contributions to state unemployment insurance trust funds represented the largest share of funds states reported spending (58 percent) in providing assistance to households. Specifically, 24 states reported spending $22 billion of their awards on contributing to state unemployment insurance trust funds.
Despite the use of these funds to improve state UI trust funds, many state trust fund balances remain below the balances prior to the pandemic and are below the US DOL recommended 1.0 Average High Cost Model level.
As of March 31, 2023—the most recent data available at the time of this report—states reported obligating 60 percent ($118.3 billion) and spending 45 percent ($88.2 billion) of the SLFRF awards they received. Localities reported obligating 54 percent ($67.5 billion) and spending 38 percent ($47.9 billion) of their awards during the same period.
Significant funding remains unobligated that could be obligated to restore state UI trust funds to pre-pandemic levels.
We continue to recommend that states with outstanding Title XII loans and those with balances below pre-pandemic levels consider using these funds to bolster the solvency of state UI trust funds.
