Nearly $60 million spent on training that did not lead to credentials

State Rep. Ann Bollin, chair of the House Appropriations Committee, today expressed frustration following the release of a new audit from the Michigan Office of the Auditor General finding notable deficiencies in the Department of Labor and Economic Opportunity’s administration and oversight of the Going Pro Talent Fund.

The audit found LEO awarded approximately $59.5 million through the Going Pro Talent Fund for reimbursement of new employee on-the-job training that did not lead to a credential, despite the program requirements stating that funded training must lead to a recognized credential, certification, license, or other transferable skill. The audit identified the issue as a material condition.

“The purpose of the Going Pro Talent Fund is to help Michigan workers gain valuable skills and credentials that will serve them throughout their careers,” Bollin said. “Instead, auditors found that nearly $60 million was spent reimbursing employers for basic on-the-job training that did not lead to a credential. That’s not what taxpayers were promised, and it’s not what this program was designed to do.”

The audit found that approximately one-third of all Going Pro awards issued during the three-year audit period were used for new employee on-the-job training costs, totaling more than $59.5 million. Auditors noted that had those funds not been used for training that failed to meet credential requirements, additional funding may have been available for other applicants seeking classroom training, customized training, apprenticeships, and other opportunities that result in credential attainment.

The report also concluded that LEO’s monitoring of the program was “not sufficient” and identified another material condition involving the department’s failure to adequately oversee Michigan Works! Agencies responsible for administering awards. Auditors found LEO did not conduct any required file reviews for nearly three years and failed to maintain sufficient documentation showing that desk reviews were completed.

“Unfortunately, we continue to see the same troubling pattern across state government: millions of taxpayer dollars are being spent, but basic oversight and accountability are missing,” Bollin said. “Programs only work when someone is ensuring dollars are being spent appropriately and according to the rules. This audit shows that wasn’t happening.”

The audit further found that LEO did not always provide adequate guidance to local administrators responsible for verifying employers met program requirements. Auditors found sampled files lacked documentation proving trainee eligibility had been verified, relied on self-reported wage information that was not independently corroborated, and often lacked documentation necessary to confirm training met program requirements.