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Labor commissioner: unemployment trust fund paid down, but $51.9M loan, grant clawbacks remain key budget risks
Summary
Department of Labor told the budget committee its FY2026 request seeks roughly $13.0 million in general‑fund support; the department reported a $28.4 million UI trust balance, a $51.97 million outstanding federal loan balance, recent $20 million pay‑down, and several federal grant clawbacks including a $12.5 million modernization award.
Department of Labor Commissioner Dr. Gary Malloy told the Legislature’s Budget Committee on June 26 that the department’s FY2026 general‑fund request of $12,984,698 is intended to sustain workforce programs, unemployment insurance administration, occupational safety and health (VY‑DOSH), workers’ compensation administration and a range of workforce development and youth programs.
“Mystery and complexity aside, our major challenge is not receiving our annual assessments in a timely fashion,” Malloy said, summarizing constraints that come from matching federal grants with local operations and from the ongoing need to administer unemployment and workers’ compensation systems.
Unemployment trust fund and loan. Malloy said the unemployment insurance (UI) trust fund held roughly $28.4 million as of June 18, 2025, but the territory still carries a federal loan balance of $51,974,488.96 plus accrued interest (commission staff referenced $1.26 million of accrued interest at the time of the hearing). The department reported it made a substantial $20 million payment earlier in FY2025,…
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