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Jan. 14 | This Week in Government: Test Scores Indicate Pandemic Slowed Student Learning; State of the State Goes Virtual Again

Each week, the Detroit Regional Chamber’s Government Relations team, in partnership with Gongwer, will provide members with a collection of timely updates from both local and state governments. Stay in the know on the latest legislation, policy priorities, and more.

  1. Report: Test Scores Indicate Pandemic Severely Slowed Student Learning
  2. Corbin Talks Attracting Talent, Programs to Increase Labor Participation
  3. UIA’s Dale Grilled Over Fraudulent Agency Payments; Subpoenas Possible
  4. State of the State Going Virtual Again
  5. HFA Revises Revenues Upward Billions Ahead of Conference

Report: Test Scores Indicate Pandemic Severely Slowed Student Learning

Student learning was severely slowed by the pandemic as indicated through testing scores reflecting less progress made in the 2020-21 school year than in previous years, a report released Monday said.

Michigan State University’s Education Policy Innovation Collaborative’s report collected data for K-8 students from assessments given twice a year. It also gathered data from the Michigan Student Test of Educational Progress given at the end of the academic year to examine students’ knowledge of grade-level material.

The tests were required to be administered due to the “Return to Learn” law.

Looking at patterns among several demographics, the report finds the gaps in achievement growth were greater for female, Black, and low-income students and students who learned remotely. Black, Latino, and low-income students were more likely to start and end significantly behind grade level.

The report found 27% of 4th-grade students who took the Northwest Evaluation Association measures of Academic Progress math test were behind in the fall, with the number increasing to 33% in the spring. The percentage of students falling behind was higher for Black and Latino students, with the former coming in at 49% in the fall and 66% in the spring while the latter came in at 35% in the fall and 43% in the spring.

White students reported 21% behind grade-level in the fall and 24% in the spring and Asian students reported 9% in the fall and 10% in the spring.

The patterns were consistent at every level and similar disparities were found for low-income students.

In a statement, Superintendent of Public Instruction Michael Rice said the report reflected the unfortunate national trends that show the pandemic reduced the amount of learning normally expected.

“This report is further evidence that time in school matters,” he said. “Time matters, and in-school time matters. Students and staff worked hard last year when remote, but it is difficult to recreate the time and value of in-person learning when remote for many of our children, particularly those most vulnerable — children with substantial disabilities, young, fledgling readers, and English learners.”

The report also found that districts offering in-person instruction all year had students scoring better than those who were remote. Schools that offered an additional month of remote learning reported nearly one percentage point more students scoring “significantly behind grade level” for math tests in spring.

On the flip side, those with an additional month of in-person were likely to have one-half a percentage point fewer students scoring “significantly behind grade level” for reading tests.

“We are seeing the same patterns in Michigan as we are seeing across the country — the pandemic has substantially impacted student learning, and these impacts are far worse for traditionally disadvantaged students,” EPIC Director Katharine Strunk said in a statement. “Achievement gaps grew during the pandemic and students who were already more likely to perform worse on achievement tests were the hardest hit. This is a major equity concern that will have long-lasting impacts on students’ lives.”

Corbin Talks Attracting Talent, Programs to Increase Labor Participation

The Department of Labor and Economic Opportunity has been working to rejuvenate the workforce participation in Michigan for a decade, and Director Susan Corbin has been highlighting programs the state has implemented during the pandemic to recruit economic investments for employers and employees.

Speaking with Gongwer News Service in December, Corbin described LEO as an expansive department, with 3,000 team members across 20 offices, bureaus, agencies, and commissions. She said despite its many moving parts, the core mission of LEO is to spread economic opportunities and prosperity to all.

Corbin was made permanent director of LEO in August after previously serving as acting director. She wants to be a strong partner to all the agencies in LEO, acknowledging that the design of certain agencies requires them to be slightly more autonomous.

In 2021, LEO focused on growing the economy by working on cultivating a more skilled and inclusive workforce, protecting the health and safety of workers and families, investing in mobility businesses and communities, and addressing child care barriers and housing insecurities.

“We rose to the challenge this year and continue rising to the challenge to ensure that working people have the protections they’re entitled to and that we’re providing safe workplaces,” Corbin said. “We confronted the housing crisis head-on, expanding access to state and affordable housing and protecting Michigan families from eviction through distributing federal dollars. And we continue to invest in Michigan’s economy by providing an environment where businesses can grow and thrive.”

She said the department has been traveling around the state to meet with local and state partners discussing the $2.1 billion investment in the MI New Economy Plan.

The governor has created multiple programs, including Future for Frontliners and Michigan Reconnect, which provide a tuition-free pathway to a two-year college degree or a skills certificate. Corbin said more than 170,000 Michiganders have signed up for both programs.

“We know in Michigan that that’s not enough. We need to have more people in Michigan with four-year degrees if we’re going to attract high-paying jobs to our state,” she said. “That’s an area we’ll continue focusing on, but we know that the bipartisan support that Reconnect has being created by the Legislature, that that’s a critical first step to … meeting our 30 by 60 goal.”

The pandemic and the subsequent lockdowns shed more light on careers and job fields in desperate need of workers. However, prior to the pandemic, the state was reportedly having issues attracting talent. She said she knew looking at the demographics, even before March 2020, that there was a labor shortage.

“In addition to our labor shortages, we heard from employers that they were not able to identify people in their local communities with the right skills set for the jobs that they have now,” Corbin said. “I think we still have more work ahead of us in terms of attracting talent or attracting people back to Michigan. I think that a lot of the governor’s proposals in MI New Economy will work to do that.”

Corbin said the state is below the national average in terms of workforce participation. She thinks by giving people skills that can be used to transition into higher-paying jobs will attract many back to the workforce.

She also said that in order to attract people state, there must be vibrant communities people would want to move into. There are some proposals in MI New Economy related to that, Corbin said.

The director said month by month there is an increase in new jobs being created in Michigan. She also said ending pandemic unemployment assistance earlier would not have impacted the number of individuals entering the workforce, saying she noticed insignificant upticks in labor participation for states who ended the federal benefit earlier.

“If you look at the labor market information in Michigan, month over month, more people have been going into the workforce. However, we know that there are still issues out there that are preventing people from returning to the workplace,” Corbin said. “People need to know that their workplace is safe and obviously the new variant and vaccination rates have an impact on that.”

She emphasized the importance of child care and acknowledged it as a barrier for many who wish to return to work. She said during 2021, she was made aware the labor force was down some 260,000 and they knew there were some 220,000 women who had not yet returned to the workforce, saying child care was a critical factor of that.

The Legislature allocated $1.4 billion to address child care problems and LEO has a grant program available for child care providers to gift bonuses to their employees. Gov. Whitmer also has an advisor in her office exclusive to child care issues.

“I think you’re going to see some additional things at the first of the year as it relates to attracting more people into the workforce as it relates to child care,” Corbin added.

During the last year, there was criticism regarding actions of certain agencies within LEO, especially the Unemployment Insurance Agency. Corbin spoke before the Senate Advice and Consent Committee where she defended the efforts of the UIA.

The pandemic exacerbated the work UIA needed to do, with Corbin saying the workload increased some 600% during 2020, and LEO calculated in just a few months, the agency had done as much work as it had done in the preceding six years.

“I think the UIA was tested by a once-in-a-lifetime crisis. The work that was put in front of them was very challenging,” Corbin said. “Of course, unemployment insurance agencies across the country were all dealing with the same thing … I told the Legislature at my confirmation hearing what I felt was most important for the agency was to have a strong leader at the helm who would be committed to investing their time and efforts with the agency.”

She said LEO has made the right decision for a strong leader by selecting current UIA Director Julia Dale, saying she is “really getting her arms around” the agency and its staff. They continue to work on initiatives to improve UIA, aiming to improve the complicated communications between the agency and claimants.

For 2022, Corbin said LEO’s priority will be to continue working with legislators on where best to spend the American Rescue Plan federal dollars, saying it would be impactful for local communities to use the monies. She also said there are “critical things” to come in the mobility space and around high-speed internet.

UIA’s Dale Grilled Over Fraudulent Agency Payments; Subpoenas Possible

Subpoenas could be used to compel testimony from Unemployment Insurance Agency division heads, as well as its former Director Steve Gray, as indicated following a joint oversight hearing Thursday on the billions of dollars in estimated fraudulent claims sent out by the UIA.

UIA Director Julia Dale faced withering criticism from legislative Republicans on the Senate Oversight Committee and House Oversight Committee during a hearing over a recent report on the estimated $8.5 billion in fraudulent claims being paid out during the coronavirus pandemic.

Republican members were unsuccessful in repeated attempts to demand clarity from Dale and Todd Cook, director of legislative affairs for the Department of Labor and Economic Opportunity, on several topics related to the response to the large volume of claims filed as well as payments made on fraudulent claims during the coronavirus pandemic.

Taken up by the committees was a Deloitte report released in December 2021 detailing the payment by the UIA of about $8.5 billion in fraudulent claims between March 1, 2020, and Sept. 30, 2021.

Of these payments, an estimated $2.7 to $2.8 billion was paid to claims involving likely imposter fraud, and an estimated $5.6 to $5.7 billion being paid to claims likely involving intentional misrepresentation fraud.

Much of the estimated fraud outlined in the report was federally funded payments through the multiple Pandemic Unemployment Assistance programs set up in response to the pandemic. About 3% of the fraudulent claims, or about $249 million, were paid out through the state program, with the rest being federal, the Deloitte report found.

It is also unclear how much overlap there is between the $8.5 billion in likely fraudulent claims and the $3.9 billion in payments to those who qualified under criteria later deemed ineligible.

House Oversight Committee Chair Rep. Steve Johnson (R-Wayland) told reporters following the hearing he was prepared to issue subpoenas to obtain testimony from Gray and Tim Kolar –the department’s top fraud investigator – as was done with former Department of Health and Human Services Director Robert Gordon. He said he would prefer the testimony come voluntarily.

“When you see $8.5 billion of fraud – and to find out we don’t know who was in charge of looking at the fraud at the time? That’s incredibly troubling,” Johnson said. “I’ve seen mud more transparent than this. … This agency continues to be broken, and they’re not taking accountability for their actions. There is still a lot of work to be done.”

The possibility of issuing subpoenas stemmed from exchanges by two lawmakers and Dale during the hearing: Sen. Lana Theis (R-Brighton) and Rep. Jeff Yaroch (R-Richmond).

Theis repeatedly asked who directed the agency set aside the Fraud Manager system criteria, to which she was not given a direct answer. During the early months of the pandemic the push to address the enormous volume of claims led to organizational, policy, and technological changes.

Dale in response pointed to the 2020 Deloitte report in which an agency official had claimed that Gray had told UIA personnel on a call that fraud prevention was not a high priority. Gray denied that claim when interviewed by Deloitte.

Yaroch asked Dale what is being done to determine accountability for who failed during the pandemic within the agency. She replied that her top focus is on driving the agency forward and developing solutions for issues that have confronted claimants experiencing problems with the process during the pandemic.

“I’m not looking to do an autopsy,” Dale said.

Questions were also asked as to why Kolar was moved on to different responsibilities when the fraud was most rampant in the pandemic’s early months before eventually being returned to his role. Agency officials were also unable to answer those questions, as well as whether anyone replaced him during the time he was placed on other duties. Dale said she could go back and check on what happened during that time.

Dale under questioning was against having any of her eight division directors testify.

“I remain firm in my belief that it is not the responsibility of the rank-and-file to accept the responsibility to be before the Oversight Committee,” Dale said, adding she could go back to Kolar and discuss the committee’s questions with him and provide responses.

During her testimony, Dale expressed anger over the level of fraud, saying the agency is seeking to chart a better path forward.

“I share your outrage at the level of fraud and criminality that took place. Like you, I want to make sure that it never happens again,” Dale said.

Dale said most of the fraud occurred before October 2020, saying levels of fraud have been pushed down to 0.57% since that time. She added that all other states have experienced significant problems with claims during the pandemic.

“We still do need to prosecute those who defrauded the agency and claw back as much taxpayer money as possible,” Dale said.

Sen. Ed McBroom (R-Vulcan), chair of the Senate panel, said he did not appreciate the emphasis on touting fraud that is being stopped now despite the billions sent out during the pandemic or the pointing to most of the money lost was federal funds.

He also did not like what he believed to be the department giving itself “a pat on the back” and pointing to other states’ problems to downplay the severity of the problem.

“To receive that kind of messaging from the department … does not reassure us that the department is putting on a new direction,” McBroom said. “It does not reassure us that anything has changed in the culture. It’s really disturbing and really frustrating.”

The focus of Democrats during the hearing, by contrast, was on those caught up in situations of having been falsely labeled of intentional misrepresentation in their claims.

“I am very concerned about our constituents who are caught up in this and who are suffering the consequences,” Rep. Julie Brixie (D-Okemos) said.

Johnson countered he believed the $8.5 billion was fraud, saying intentional misrepresentation indicates wrongdoing.

“The whole talking point of we should be sympathetic because these people were trying to put food on the table, no, these are criminals, we don’t just excuse that behavior,” Johnson said.

Sen. Jeff Irwin (D-Ann Arbor) fired back, saying he took offense to the implication that all $8.5 billion of estimated fraud in the report was criminal activity. He said he believed some of the billions in intentional misrepresentation were potentially innocent persons.

“My constituents who have been out of work and who have tried to apply for this system, they’re not criminals,” Irwin said. He pointed to the example of a constituent, a bricklayer, who made errors in his paperwork and has received a letter from UIA alleging intentional misrepresentation.

Irwin also said he considered it foolish for Congress to push such huge amounts of money through state unemployment agencies that are not set up to handle such a rush of claims.

He also attacked the Legislature’s past changes to the unemployment insurance system, saying he believed it was made difficult for people to process their claims as a method to make Michigan a pro-business state.

“Michigan’s a bad state to be an unemployed worker,” Irwin said.

At one point during the hearing, McBroom said he had received an email from a constituent who said he was disconnected from UIA after being on hold for two hours. He said the constituent claimed if he cannot address his claim, he could soon end up homeless.

Rep. Jack O’Malley (R-Lake Ann) repeated questions he had asked during a joint hearing in November 2021 as to who at the Governor’s office spoke with UIA during communications between the administration, UIA, and LEO. As in November, he did not get a specific answer.

“I have a pretty good B.S. detector, and I’ll tell you what, it’s going off right now,” he said.

State of the State Going Virtual Again

Gov. Gretchen Whitmer will deliver her annual State of the State address Jan. 26, and for the second consecutive year, the COVID-19 pandemic means she will not deliver the speech in the House chamber.

Last year, Gov. Whitmer delivered the speech from her Capitol office. The location was not announced Monday. In a statement, Gov. Whitmer’s office said it “will be held in a virtual format.”

The COVID-19 pandemic continues to hit Michigan hard with new cases and hospitalizations at record levels as of Monday.

“The State of the State address is a tradition rooted in history,” Gov. Whitmer and House Speaker Jason Wentworth (R-Farwell) said in a joint statement. “It is an opportunity for Michiganders to hear about the work of state government and see Republicans and Democrats come together to focus on the issues that will put Michigan families, communities, and small businesses first. This year, we’ve agreed that the State of the State address should once again be held remotely to ensure everyone can safely partake in this time-honored event.”

HFA Revises Revenues Upward Billions Ahead of Conference

The state saw $2.6 billion more in the 2020-21 fiscal year than previously forecast and is estimated to see $1.7 billion more in revenues for 2021-22, the House Fiscal Agency said in its outlook published Wednesday.

The report released ahead of Friday’s Consensus Revenue Estimating Conference continues the trend of revenues being revised upward after strong growth in spending and income tax, among other things. Last week, the Senate Fiscal Agency recommended increasing revenue projections as well.

The two fiscal agencies will join the Department of Treasury on Friday and iron out the differences from the May 2021 revenue conference to set final figures for the closing of the 2020-21 fiscal year and the upcoming years.

HFA said preliminary figures suggest an increase of $2.64 billion from the May 2021 adjusted consensus estimates for the 2020-21 fiscal year, due in part to continued strong growth in the components of the individual income tax, which reflects the income support provided by the federal government in response to the pandemic.

Additionally, sales and use tax revenue was strong as consumers continued to purchase taxable goods at a higher rate than untaxed services. Corporate income tax revenue reached new highs due to strong corporate profits, HFA said.

Specifically, the agency said the General Fund is $1.6 billion higher than estimated and the School Aid Fund $971 million for the last fiscal year.

For the current fiscal year, the agency said the state will see $1.7 billion more than previously estimated, driven by higher than anticipated collections from the use tax, sales tax, and corporate income tax.

Specifically, HFA is estimating $713 million more in the General Fund and $985 million more in the School Aid Fund.

HFA is projecting a $4.2 billion balance in the General Fund and $2.9 billion in the School Aid Fund for the 2020-21 fiscal year.