State grants for unemployment fraud prevention and recovery

CLASSIFICATION
   EMPLOYMENT AND TRAINING ADMINISTRATION                  Unemployment Insurance
                  ADVISORY SYSTEM                          CORRESPONDENCE SYMBOL
             U.S. DEPARTMENT OF LABOR                      OUI/DPM
                Washington, D.C. 20210                     DATE
                                                           August 11, 2021


ADVISORY:        UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 22-21

TO:              STATE WORKFORCE AGENCIES

FROM:            SUZAN G. LEVINE
                 Acting Assistant Secretary

SUBJECT:         Grant Opportunity to Support States with Fraud Detection and Prevention,
                 Including Identity Verification and Overpayment Recovery Activities, in All
                 Unemployment Compensation (UC) Programs

1. Purpose. To notify State Workforce Agencies regarding the availability of up to $140
   million to support states with fraud detection and prevention, including identity verification
   and overpayment recovery activities, in all UC programs.

2. Action Requested. The U.S. Department of Labor’s (Department) Employment and
   Training Administration (ETA) requests that State Workforce Agency Administrators:

      Review the funding opportunity to determine if the state will apply for funds under this
       solicitation;
      Coordinate with appropriate state staff to develop a SF-424 under this solicitation;
      Submit the SF-424 by e-mail to [email protected] by the close of business on
       September 13, 2021, with an electronic copy to the appropriate regional office. The
       subject line of the e-mail should include the name of the state and the title “ARPA Fraud
       Prevention Grant 2021.”

3. Summary and Background.

   a. Summary – The Department is making up to $140 million available for grants to states to
      support states with fraud detection and prevention, including identity verification and
      overpayment recovery activities, in all UC programs. States may use the funds made
      available under this UIPL to support innovative strategies and solutions to 1) strengthen
      identity verification of Unemployment Insurance (UI) claimants; 2) enhance fraud
      detection and prevention strategies; 3) improve data management and analytic
      capabilities; 4) increase cybersecurity; and 5) expand overpayment recovery efforts.




   RESCISSIONS                                              EXPIRATION DATE
   None                                                     Continuing

         Additionally, as a condition of receiving a grant under this UIPL, states must agree to
         information disclosure with the Department’s Office of Inspector General (DOL-OIG) as
         described in Section 5.c.i. of this UIPL.

    b. Background – Since the onset of the Coronavirus Disease 2019 (COVID-19) pandemic,
       the UI program has been an attractive target for international and domestic criminal
       organizations perpetrating identity fraud. States have worked tirelessly to combat
       relentless and sophisticated fraud attacks, while simultaneously responding to the highest
       claims workload in the history of the UI program.

         On March 11, 2021, the President signed the American Rescue Plan Act of 2021 (ARPA)
         into law (Public Law (Pub. L.) 117-2). Section 9032, ARPA, creates a new Section 2118
         of the Coronavirus Aid, Relief, and Economic Security (CARES) Act (Pub. L. 116-136)
         and provides for a $2,000,000,000 appropriation to the Secretary of Labor (Secretary) to
         detect and prevent fraud, to promote equitable access, and to ensure timely payment of
         benefits to eligible workers with respect to UC programs. Such funds may be used for
         federal administrative costs; system-wide infrastructure investment and development; and
         to make grants to states or territories administering UC programs for such purposes,
         including the establishment of procedures or the building of infrastructure to verify or
         validate identity, implement federal guidance regarding fraud detection and prevention,
         and accelerate claims processing or process claims backlogs due to the pandemic.

         Addressing both eligibility fraud and identity fraud remain a top priority for the
         Department and the entire UC system. As discussed in UIPL Nos. 23-20; 28-20; 28-20,
         Change 1; and 28-20, Change 2, ETA strongly encourages states to adopt an array of
         solutions and techniques to detect and fight fraud, to have robust strategies in place to
         verify the identity of individuals applying for unemployment benefits, and to strengthen
         efforts to recover overpayments, including fraudulently paid UC benefits. This includes
         implementing National Institute of Standards and Technology (NIST)-compliant1 Identity
         Assurance Level 2 (IAL2) and Authenticator Assurance Level 2 (AAL2) identity
         proofing (see section 4.b. of this UIPL for more information). States are also encouraged
         to make use of the tools, resources, and services of the UI Integrity Center, funded by the
         Department and operated in partnership with the National Association of State Workforce
         Agencies (NASWA). See Training and Employment Notice (TEN) No. 04-20 for further
         information on the Integrity Data Hub (IDH).

         As a reminder, states must refer allegations which they reasonably believe constitute UC
         fraud, waste, abuse, mismanagement, or misconduct to the DOL-OIG. Additionally,
         states are required to disclose confidential UC information related to the CARES Act, as
         amended, to the DOL-OIG for the purpose of UC fraud investigations and audits for the
         entire pandemic relief period. See UIPL No. 04-17, Change 1. States should also


1
 NIST Special Publication (SP) 800-63 provides technical requirements for implementing digital identity services.
The publication includes: an overview of identity frameworks; using authenticators, credentials, and assertions in a
digital system; and a risk-based process to select assurance levels at https://pages.nist.gov/800-63-3/sp800-63-
3.html.

       actively and regularly share information about suspected fraud with other state UI
       agencies and with local, state, and federal law enforcement.

       ETA is committed to supporting states by providing funding and investing in the most
       innovative and successful tools and resources to stay ahead of fraud schemes, which
       includes providing states with options to access NIST-compliant identity proofing and
       authentication solutions. This includes Blanket Purchase Agreements (BPAs) awarded
       by the Department that provide the Department with a procurement vehicle to enhance
       identity proofing in the state’s UI programs. In the near future, the Department plans to
       issue guidance to states on the BPAs and the procedures for the Department to issue
       orders under those BPAs, in accordance with federal procurement regulations. As part of
       that ordering process, the Department anticipates working with states to identify
       particular requirements applicable to a state UI program and to provide for the payment
       for services ordered using grants made available under this UIPL or another funding
       source identified by the state subject to requirements of federal appropriations law.

       Promoting Program Equity. As states consider additional tools to incorporate into their
       fraud management operations, equitable access to unemployment benefits must be at the
       forefront of the decision-making process, in line with Executive Order (EO) 13985 of
       January 2021 and UIPL Nos. 02-16 and 02-16, Change 1. At the most fundamental level,
       equity within the UC program means the provision of UC payments to eligible workers,
       regardless of one’s background, in a timely and fair manner, with an application process
       that is readily accessible to all workers. In the context of fraud management, equitable
       access means that there are alternatives to digital mechanisms of identity proofing; that
       the mechanisms used to prove identity or flag for fraud do not contain racial, gender, or
       other bias; and that data is available to understand the impact of fraud mitigation on
       eliminating barriers that prevent full and equal access to benefits for all eligible
       individuals.

       In the near future, the Department expects to issue additional funding opportunities for
       promoting equitable access and ensuring the timely payment of benefits with respect to
       UC programs. States may want to consider these additional funds when preparing their
       strategies to detect and prevent fraud under this UIPL.

4. Guidance. This section provides definitions for different types of fraud, namely eligibility
   fraud and identity fraud. States are encouraged to implement NIST-compliant processes for
   identity proofing and authentication to combat identity fraud.

   a. Types of Fraud. There are primarily two different types of fraud occurring within the
      UC program.

       i. Eligibility fraud generally occurs when benefits or services are acquired as a result of
          false information with the intent to receive benefits for which an individual or
          individuals would not otherwise be qualified. State law determines how this is
          evaluated within the UC program. Not all improper payments are considered
          fraudulent.

   ii. Identity fraud is when one person acquires and uses the identifying information of
       another person in order to illegally receive benefits. The fraud can happen either at
       the time of UI application submission, or by changing key user data like bank account
       information after a claim has been established. As discussed in UIPL No. 16-21,
       synthetic identity fraud occurs when real and fake information are combined to create
       false identities.

b. National Institute of Standards and Technology (NIST)-compliant IAL2/AAL2
   Identity Proofing and Authentication. The Department strongly encourages all states
   to implement NIST-compliant identity proofing, specifically IAL2 and AAL2, before
   claimants start filling out the UI claims application and for re-accessing their account.
   IAL2 and AAL2 are recommended for UC programs due to the personally identifiable
   information (PII) collected from individuals and employers. NIST Standard Publication
   (SP) 800-63 outlines components of identity assurance that states should take into
   consideration when reviewing available tools/solutions:

    i.   Identity Assurance Level (IAL) indicates how robust the identity proofing process is
         and how the identity in question is bound between an authenticator and a specific
         person. IAL2 requires evidence that supports the real-world existence of the
         claimed identity and verifies that the applicant is appropriately associated with this
         real-world identity. IAL2 introduces the need for either remote or physically-
         present identity proofing and includes filling out personal information (name,
         address, DOB, etc.) and submitting photos of approved government-issued
         identification or supporting documents for remote identity proofing.

   ii.   Authenticator Assurance Level (AAL) refers to the authentication process and
         indicates the confidence that the person trying to log in is the same person as the
         person attached to the account. AAL2 indicates the level of security behind the
         point of access, which requires the proof of possession and control of two distinct
         authentication methods.

   As states are implementing NIST-compliant IAL2/AAL2 identity proofing and
   authentication services or other identity verification methods, the Department strongly
   encourages states to include service delivery expectations that mitigate access barriers to
   individuals. The state must provide at least two options to individuals upfront to verify
   their identity (i.e., online, by phone, and/or in-person). An example of service delivery
   expectations that further mitigate access barriers include that incorrect identity proofing
   by denying the validation of an individual’s identity who has accurately represented
   themselves and submitted to identity proofing requirements (which is an example of a
   “false positive”) shall not exceed 0.5 percent of the total IAL2 identities processed.
   Timely determinations prevent fraudulent benefit payments while ensuring that qualified
   and eligible claimants receive benefits as soon as administratively feasible. See UIPL
   Nos. 04-01, 01-16, and 16-21.

5. Funding for States to Combat Fraud in All UC Programs. This section discusses the
   amount available to states, allowable uses of funds, application instructions, and reporting
   requirements.

    a. Amount Available to States.2 The Department is providing a total of up to $140 million
       to states to combat fraud in all UC programs. The methodology for state funding levels is
       based on size of UI covered employment in the state. For purposes of this methodology,
       states are assigned to four groups (Small, Medium, Large, and Extra-Large) based on the
       12-month average of UI covered employment for the four quarters in calendar year 2020
       reported on the ES 202 (Employment, Wages and Contributions). States are assigned to
       the size groups as follows:

             Small: covered employment under 1 million employees
             Medium: covered employment between 1 million and 2 million employees
             Large: covered employment between 2 million and 7 million employees
             Extra Large: covered employment greater than 7 million employees

        Attachment I lists funding available for each state.

    b. Allowable Use of Funds. States may use the funds made available under this UIPL to
       strengthen identity verification of UI claimants, enhance fraud detection and prevention
       strategies, improve data management and analytic capabilities, increase cybersecurity,
       and expand overpayment recovery efforts in all UC programs. Examples of permissible
       uses of these funds include but are not limited to the following activities:

         i.    Procuring, implementing, and paying reoccurring subscription costs and/or ongoing
               maintenance costs of identity verification and fraud detection solutions, such as
               NIST-compliant IAL2 and AAL2 tool(s)/strategy(ies) that provide identity
               verification and user authorization of all individuals applying for UC benefits.
               This includes using such funds to pay for services provided under an order issued
               by the Department against one of the Department’s identity proofing BPAs;

        ii.    Implementing or enhancing data analytics capabilities to understand the nature and
               prevalence of fraud and the impact of fraud mitigation efforts, such as tracking:
                  o Current and historical numbers of cases flagged as potential or resolved
                      fraud;
                  o Type of fraud (eligibility fraud vs. identity fraud);
                  o Type of perpetrators; and
                  o Investigation outcomes.



2
  Since Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, the Federated States of
Micronesia, the Republic of the Marshall Islands, and the Republic of Palau do not operate regular UC programs, this
grant opportunity is not being made available to these jurisdictions.

        iii.    Implementing cross-matching to detect suspicious activity, including synthetic or
                false identities, and identification of other patterns of fraudulent behavior (e.g., with
                a state’s own internal data or the IDH Identity Verification (IDV) solution);

        iv.     Implementing or enhancing cybersecurity perimeter defense for the websites and
                web applications responsible for initial application steps and regular certification
                (e.g., to protect against online bot attacks);

         v.     Costs incurred from working with banks and financial institutions to detect
                suspicious activity, ensure that accounts are not unduly suspended and eligible
                claimants with suspended claims are paid benefits, and facilitate the expeditious
                return of improperly paid UC funds;

        vi.     Costs incurred to capture and analyze additional data elements to measure the
                service delivery expectations. This includes capturing any data elements to
                measure effectiveness and equity outcomes of identity verification and fraud
                detection and prevention solutions, tools, and actions associated with the use of
                these funds to ensure that service delivery does not adversely affect people of color,
                individuals in poverty, and others who may have been historically underserved or
                marginalized.

                Examples include tracking which claims were flagged as potential fraud at any
                time, the length of time to resolve these investigations, and the outcome of these
                investigations (e.g., fraud, overpayment but not fraudulent, non-issue (i.e., “false
                positive”)) by demographic group.

                Other examples include reporting data on claimant experience with fraud fighting
                technology (e.g., speed of identity proofing broken out by subgroups such as race,
                ethnicity, gender, disability status, geographic location, age).

       vii.     Assessing and mitigating disproportionate impact of fraud measures on vulnerable
                communities such as communities of color, communities with disabilities, limited
                English proficient and immigrant communities, and certain geographic communities
                (e.g., rural versus urban).

      viii.     Assessing and mitigating security vulnerabilities (e.g., migrating from using PINs to
                strong passwords, locking accounts after multiple failed login attempts,
                immediately notifying users when key account information like when a mailing
                address or bank account is modified);

        ix.     Hiring staff or obtaining contract services to conduct fraud investigations, other
                eligibility fraud and identity fraud detection-related activities, and support
                overpayment recovery efforts;3

3
  Refer to UIPL No. 12-01, Change 2, for states’ ability to exercise flexibility in staffing models after the emergency
flexibilities under Section 9015, ARPA, expire on September 6, 2021.

   x.   Costs incurred as a result of a state’s participation in forfeiture and seizure efforts of
        law enforcement agencies (e.g., Department of Justice, United States Secret
        Service); and

  xi.   Administrative expenses incurred by the state to gather business requirements,
        program computer systems, or otherwise implement tools, strategies, or solutions to
        strengthen fraud detection, prevention, and recovery efforts.

c. Requirement to Receive Funding.

   i.   Required Disclosure to DOL-OIG. As discussed in UIPL No. 04-17, Change 1,
        states must refer allegations which they reasonably believe constitute UC fraud,
        waste, abuse, mismanagement, or misconduct to the DOL-OIG. Additionally, states
        are required to disclose confidential UC information related to the CARES Act, as
        amended, to the DOL-OIG for the purpose of UC fraud investigations and audits for
        the entire pandemic relief period, which for most states will be weeks of
        unemployment beginning after January 27, 2020 through weeks of unemployment
        ending before September 6, 2021.

        As a condition of receiving funding through this solicitation, the state must agree to
        provide all confidential UC information to DOL-OIG for purposes of both
        investigating fraud and performing audits through weeks of unemployment ending
        before December 31, 2023.

        States may use funds awarded under this UIPL, UI administrative grant under
        Section 302(a), SSA, or another source of funding to pay for this disclosure. See 20
        C.F.R. 603.8(b).

d. Application Instructions.

   States are required to submit an SF-424 (OMB No. 4040-0004)
   https://apply07.grants.gov/apply/forms/sample/SF424_4_0-V4.0.pdf . ETA encourages
   states to submit this form as soon as possible, but no later than September 13, 2021, by
   electronic submission to the ETA National Office at [email protected] with a copy to
   the appropriate ETA Regional Office. For additional information on completing the SF-
   424, please refer to Attachment II.

   In order to attest compliance with the requirement to receiving this funding under section
   5.c.i. of this UIPL, states should check the “I AGREE” box under Item 21 and include the
   appropriate language in Item 15 as indicated in the instructions for completing the SF-

    424. Additionally, please note that states should maintain any supporting documentation
   that serves as evidence for meeting this requirement in this UIPL.

   e. Reporting Requirements.

       States must provide a narrative Quarterly Progress Report (ETA 9178-ARPA) and
       Quarterly Financial Report (ETA 9130) containing updates on the progress and
       implementation of each grant project. The form ETA 9178-ARPA is provided as
       Attachment III. ETA will use the ETA 9178-ARPA report to track each state’s progress
       in addressing fraud with ARPA funds, ensuring that a state’s use of funds is consistent
       with the permissible solutions/activities outlined in section 5.b. of this UIPL, and
       ensuring fraud prevention solutions/activities do not have a negative impact on access to
       benefits.

       States must provide ETA with an ETA 9178-ARPA narrative update that identifies the
       specific issue a state’s proposed solutions/activities will impact, to report specific
       outcome metrics as they relate to the solutions/activities, including service delivery
       expectations that mitigate access barriers to individuals (see section 4.b. of this UIPL).
       Please refer to Attachment III for instructions for completion and the timeline of
       submission for the ETA 9178-ARPA.

       A note for states participating in the Department’s identity proofing BPAs. States that
       participate in the Department’s identity proofing BPAs may be subject to additional terms
       and conditions. The terms and conditions of any grant issued in accordance with this
       UIPL shall be read in harmony with, and as complementary to, the terms and conditions
       set forth in the identity proofing order and corresponding BPA.

5. Inquiries. Please direct inquiries to [email protected] with a copy to the appropriate ETA
   Regional Office.

6. References.

          American Rescue Plan Act of 2021 (ARPA), including Title IX, Subtitle A, Crisis
           Support for Unemployed Workers (Pub. L. 117-2);
          Consolidated Appropriations Act, 2021, including Division N, Title II, Subtitle A,
           the Continued Assistance for Unemployed Workers Act of 2020 (Pub. L. 116-260);
          Coronavirus Aid, Relief, and Economic Security (CARES) Act (Pub. L. 116-136),
           Title II, Subtitle A – Relief for Workers Affected by Coronavirus Act;
          Section 303 of the Social Security Act (42 U.S.C. 503);
          Executive Order 13985 of January 20, 2021; 86 FR 7009, page 7009-7013,
           https://www.federalregister.gov/documents/2021/01/25/2021-01753/advancing-
           racial-equity-and-support-for-underserved-communities-through-the-federal-
           government;
          UIPL No. 19-21, Benefits Held by Banks and Financial Institutions as a Result of
           Suspicious and/or Potentially Fraudulent Activity and the Proportional Distribution
           Methodology Required for Recovering/Returning Federally Funded Unemployment
           Compensation (UC) Program Funds, issued May 04, 2021,
           https://wdr.doleta.gov/directives/corr_doc.cfm?docn=9571;
          UIPL No. 16-21, Identity Verification for Unemployment Insurance (UI) Claims,
           issued April 13, 2021, https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=9141;

•   UIPL No. 14-21, Change 1, State Responsibilities After the Temporary Unemployment
    Benefit Programs under the Coronavirus Aid, Relief, and Economic Security (CARES)
    Act, as amended, End Due to State Termination of Administration or When the
    Programs Expire, issued July 12, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?docn=9502;
•   UIPL No. 14-21, American Rescue Plan Act of 2021(ARPA) - Key Unemployment
    Insurance (UI) Provisions, issued March 15, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5669;
•   UIPL No. 09-21, Continued Assistance for Unemployed Workers Act of 2020
    (Continued Assistance Act) - Summary of Key Unemployment Insurance (UI)
    Provisions, issued December 30, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3831;
•   UIPL No. 28-20, Change 2, Additional Funding to Assist with Strengthening Fraud
    Detection and Prevention Efforts and the Recovery of Overpayments in the Pandemic
    Unemployment Assistance (PUA) and Pandemic Emergency Unemployment
    Compensation (PEUC) Programs, as well as Guidance on Processes for Combatting
    Identity Fraud, issued August 11, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=7207;
•   UIPL No. 28-20, Change 1, Additional Funding for Identity Verification or
    Verification of Pandemic Unemployment Assistance (PUA) Claimants and Funding to
    Assist with Efforts to Prevent and Detect Fraud and Identity Theft as well as Recover
    Fraud Overpayments in the PUA and Pandemic Emergency Unemployment
    Compensation (PEUC) Programs, issued January 15, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=9897;
•   UIPL No. 28-20, Addressing Fraud in the Unemployment Insurance (UI) System and
    Providing States with Funding to Assist with Efforts to Prevent and Detect Fraud and
    Identity Theft and Recover Fraud Overpayments in the Pandemic Unemployment
    Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC)
    Programs, issued August 31, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=8044;
•   UIPL No. 23-20, Program Integrity for the Unemployment Insurance (UI) Program
    and the UI Programs Authorized by the Coronavirus Aid, Relief, and Economic
    Security (CARES) Act of 2020 - Federal Pandemic Unemployment Compensation
    (FPUC), Pandemic Unemployment Assistance (PUA), and Pandemic Emergency
    Unemployment Compensation (PEUC) Programs, issued May 11, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=4621;
•   UIPL No. 16-20, Change 5, Expanded Eligibility Provisions for the Pandemic
    Unemployment Assistance (PUA) Program, issued February 25, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3202;
•   UIPL No. 16-20, Change 4, Continued Assistance to Unemployed Workers Act of 2020
    —Pandemic Unemployment Assistance (PUA) Program: New Operating Instructions
    and Reporting Changes, issued January 8, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=6973;
•   UIPL No. 16-20, Change 3, Coronavirus Aid, Relief, and Economic Security
    (CARES) Act of 2020 - Eligibility of Individuals who are Caregivers for Pandemic
    Unemployment Assistance (PUA) in the Context of School Systems Reopening, issued
    August 27, 2020, https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3849;

   UIPL No. 16-20, Change 2, Coronavirus Aid, Relief, and Economic Security
    (CARES) Act of 2020 - Pandemic Unemployment Assistance (PUA) Additional
    Questions and Answers, issued July 21, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5479;
   UIPL No. 16-20, Change 1, Coronavirus Aid, Relief, and Economic Security
    (CARES) Act of 2020 – Pandemic Unemployment Assistance (PUA) Program
    Reporting Instructions and Questions and Answers, issued April 27, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5899;
   UIPL No. 16-20, Coronavirus Aid, Relief, and Economic Security (CARES) Act of
    2020 – Pandemic Unemployment Assistance (PUA) Program Operating, Financial,
    and Reporting Instructions, issued April 5, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=4628;
   UIPL No. 14-20, Coronavirus Aid, Relief, and Economic Security (CARES) Act of
    2020 – Summary of Key Unemployment Insurance (UI) Provisions and Guidance
    Regarding Temporary Emergency State Staffing Flexibility, issued April 2, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3390;
   UIPL No. 04-17, Change 1, Requirement for States to Refer Allegations of
    Unemployment Compensation (UC) Fraud, Waste, Abuse, Mismanagement, or
    Misconduct to the Department of Labor's (Department) Office of Inspector General's
    (DOL-OIG) and to Disclose Information Related to the Coronavirus Aid, Relief, and
    Economic Security (CARES) Act to DOL-OIG for Purposes of UC Fraud
    Investigation and Audits, issued August 3, 2021,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5817;
   UIPL No. 02-16, Change 1, State Responsibilities for Ensuring Access to
    Unemployment Insurance Benefits, Services, and Information, issued May 11, 2020,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5491;
   UIPL No. 02-16, State Responsibilities for Ensuring Access to Unemployment
    Insurance Benefits, issued October 01, 2015,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=4233;
   UIPL No. 01-16, Change 1, Federal Requirements to Protect Claimant Rights in
    State Unemployment Compensation Overpayment Prevention and Recovery
    Procedures - Questions and Answers, issued January 13, 2017,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=7706;
   UIPL No. 01-16, Federal Requirements to Protect Individual Rights in State
    Unemployment Compensation Overpayment Prevention and Recovery Procedures,
    issued October 1, 2015, https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5763;
   UIPL No. 19-11, National Effort to Reduce Improper Payments in the Unemployment
    Insurance (UI) Program, issued June 10, 2011,
    https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3036;
   UIPL No. 29-05, Memorandum of Understanding Regarding Unemployment
    Insurance Criminal Investigations Between the U.S. Department of Labor’s Office of
    Inspector General and the Employment and Training Administration, issued August
    2, 2005, https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=2104;
   UIPL No. 12-01, Change 2, States’ Ability to Exercise Flexibility in Staffing Models
    for the Performance of Certain Unemployment Compensation (UC) Administrative

           Activities, issued January 8, 2021,
           https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=8998;
          UIPL No. 04-01, Payment of Compensation and Timeliness of Determinations during
           a Continued Claims Series, issued October 27, 2000,
           https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=1746;
          TEN No. 04-20, Encouragement for States to Use the Integrity Data Hub (IDH)
           available through the Unemployment Insurance (UI) Integrity Center, issued August
           31, 2020, https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3588;
          TEN No. 03-20, Unemployment Insurance (UI) Integrity Center’s Integrity Data Hub
           (IDH) Fraud Alert System, issued August 31, 2020,
           https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=5585; and
          Employment Security Manual, Section 7511, The Secretary’s Interpretation of
           Federal Law Requirements, available at 20 C.F.R. Part 614, Appendix C, Standard
           for Fraud and Overpayment Detection.

7. Attachment(s).
       Attachment I: State Size Classifications and Funding Allocation to Support States
         with Fraud Detection and Prevention, Including Identity Verification and
         Overpayment Recovery Activities, in All Unemployment Compensation (UC)
         Programs;
       Attachment II: Instructions for Completing the SF-424; and
       Attachment III: ETA 9178-ARPA Quarterly Narrative Progress Report.

                                                         Attachment I to UIPL No. 22-21

State Size Classifications and Funding Allocation to Support States with Fraud Detection
and Prevention, Including Identity Verification and Overpayment Recovery Activities, in
                     All Unemployment Compensation (UC) Programs

   State                       Size Classification        UC Fraud Funding Allotment
Alabama                        Medium                     $2,456,000
Alaska                         Small                      $1,228,000
Arizona                        Large                      $3,684,000
Arkansas                       Medium                     $2,456,000
California                     Extra Large                $4,914,000
Colorado                       Large                      $3,684,000
Connecticut                    Medium                     $2,456,000
Delaware                       Small                      $1,228,000
District of Columbia           Small                      $1,228,000
Florida                        Extra Large                $4,914,000
Georgia                        Large                      $3,684,000
Hawaii                         Small                      $1,228,000
Idaho                          Small                      $1,228,000
Illinois                       Large                      $3,684,000
Indiana                        Large                      $3,684,000
Iowa                           Medium                     $2,456,000
Kansas                         Medium                     $2,456,000
Kentucky                       Medium                     $2,456,000
Louisiana                      Medium                     $2,456,000
Maine                          Small                      $1,228,000
Maryland                       Large                      $3,684,000
Massachusetts                  Large                      $3,684,000
Michigan                       Large                      $3,684,000
Minnesota                      Large                      $3,684,000
Mississippi                    Medium                     $2,456,000
Missouri                       Large                      $3,684,000
Montana                        Small                      $1,228,000
Nebraska                       Small                      $1,228,000
Nevada                         Medium                     $2,456,000
New Hampshire                  Small                      $1,228,000
New Jersey                     Large                      $3,684,000
New Mexico                     Small                      $1,228,000
New York                       Extra Large                $4,914,000
North Carolina                 Large                      $3,684,000
North Dakota                   Small                      $1,228,000
Ohio                           Large                      $3,684,000
Oklahoma                       Medium                     $2,456,000
Oregon                         Medium                     $2,456,000
Pennsylvania                   Large                      $3,684,000
Puerto Rico                    Small                      $1,228,000

Rhode Island     Small               $1,228,000
South Carolina   Medium              $2,456,000
South Dakota     Small               $1,228,000
Tennessee        Large               $3,684,000
Texas            Extra Large         $4,914,000
Utah             Medium              $2,456,000
Vermont          Small               $1,228,000
Virgin Islands   Small               $1,228,000
Virginia         Large               $3,684,000
Washington       Large               $3,684,000
West Virginia    Small               $1,228,000
Wisconsin        Large               $3,684,000
Wyoming          Small               $1,228,000
U.S. TOTAL                           $140,000,000

                                                            Attachment II to UIPL No. 22-21

                           Instructions for Completing the SF-424

I. Application for Federal Assistance (SF-424)

       Use the current version of the form for submission. Expired forms will not be accepted.
       SF-424, Expiration Date 12/31/2022, Office of Management and Budget (OMB) Control
       No. 4040-0004 (Grants.gov).
       https://apply07.grants.gov/apply/forms/sample/SF424_4_0-V4.0.pdf.

       Section # 8, APPLICANT INFORMATION:
        Legal Name: The legal name must match the name submitted with the System for
          Award Management (SAM). Please refer to instructions at
          https://www.sam.gov/SAM/.
        Employer/Tax Identification Number (EIN/TIN): Input your correct 9-digit EIN and
          ensure that it is recorded within SAM.
        Organizational DUNS: All applicants for Federal grant and funding opportunities are
          required to have a 9-digit Data Universal Numbering System (D-U-N-S®) number,
          and must supply their D-U-N-S® number on the SF-424. Please ensure that your
          state is registered with the SAM. Instructions for registering with SAM can be found
          at https://www.sam.gov/SAM/. Additionally, the state must maintain an active SAM
          registration with current information at all times during which it has an active Federal
          award or an application under consideration. To remain registered in the SAM
          database after the initial registration, there is a requirement to review and update the
          registration at least every 12 months from the date of initial registration or
          subsequently update the information in the SAM database to ensure it is current,
          accurate, and complete. Failure to register with SAM and maintain an active account
          will result in a rejection of your submission.
        Address: Input your complete address including Zipcode+4; Example: 20110-831.
          For lookup, use link at https://tools.usps.com/go/ZipLookupAction!input.action.
        Organizational Unit: Input appropriate Department Name and Division Name, if
          applicable.
        Name and contact information of person to be contacted on matters involving this
          application. Provide complete and accurate contact information including telephone
          number and email address for the point of contact.

       Section # 9, Type of Applicant 1: Select Applicant Type: Input “State Government”.

       Section # 10, Name of the Federal Agency: Input “Employment and Training
       Administration”.

       Section # 11, Catalog of Federal Domestic Assistance Number: Input “17.225”;
       CFDA Title: Input “Unemployment Insurance”.

Section # 12, Funding Opportunity Number and Title: Input “ARPA Fraud
Prevention Grant 2021”.

Section # 13, Competition Identification Number: Leave Blank.

Section # 14, Areas Affected by Project: Input the place of performance for the project
implementation; Example “NY” for New York.

Section # 15, Descriptive Title of Applicant’s Project:
    Input “ARPA Fraud Prevention Grant 2021”.

      Additionally, input: “State attests to meeting the requirement to receive funding as
       described in UIPL No. 22-21.”

Section # 16, Congressional Districts of:
   a. Applicant: Input the Congressional District of your home office. For lookup, use
       link at www.house.gov with Zipcode + 4.
   b. Program/Project: Input the Congressional District where the project work is
       performed. If it is the same place as your home office, input the congressional
       district for your home office. For lookup, use link at www.house.gov with
       Zipcode+4.

Section # 17, Proposed Project Dates
   a. Start Date: Input a valid start date for the project (earliest start date will be
       October 1, 2021).
   b. End Date: Input a valid end date for the project (September 30, 2023).

Section # 18, Estimated Funding ($):
Input the applicable funding allotment as listed for your state in Attachment I.

Section #s 19 – 20: Complete as per instructions for Form SF-424.

Section # 21, Authorized Representative: Please select the “I AGREE” check box and
provide complete information for your authorized signatory including contact
information such as telephone number and email address. If your Authorized
Representative has changed from your previous application submission for this program,
please include a letter from higher-level leadership authorizing the new signatory for the
application submission.

Remember to have the SF-424 signed and dated by the Authorized Representative.

                                                                      Attachment III to UIPL No. 22-21

                                         Form ETA 9178-ARPA

U.S. Department of Labor (DOL)                                                              OMB No. N/A4
Employment and Training Administration                                                 Expiration Date: N/A
Form ETA 9178-ARPA

                                 Quarterly Narrative Progress Report
                               American Rescue Plan Act (ARPA) Grants
                                            General Information
                                                         Report Quarter                    Date of
    State Name:                       Grant Number:
                                                         Ending:                           Submission:



     Project Name:                                            UIPL Number:
                                         Project Contact Information
    Name:                                                     Agency:
    Title                                                     Address:

    Phone:                               Ext:                 City:

    E-Mail:                                                   State:                     Zip Code:
                                                 Project Report
    A. Summary of Project
    Please limit your response to 1000 characters or less.
    States must use this section to provide a detailed executive summary of the project/activity/solution
    (project). Each funded project will have its own separate quarterly progress report (ETA 9178-ARPA)
    through the quarter the project ends. States must use this section to provide a short summary of the
    project’s purpose. This summary should only change during the life of the grant if the state has received
    an approved modification. Modifications only apply to grants that require a full application.
    B. Timeline for Grant Activities and Milestones or Deliverables
    Please limit your response to 1000 characters or less.
    States must use this section to provide the timelines for and the progress in completing grant activities,
    key milestones, and deliverables for this quarter. A timeline must still be developed for all project
    activities. The timeline must provide a project flow that includes start and end dates, schedule of
    activities, and projected outcomes. In order to reap the most benefit from the timeline, the timeline must
    be updated each quarter noting the actual date of completion as each activity is accomplished. Items to
    incorporate in the timeline include: project goals, milestones, special events, important deadlines and
    deliverables.

4
 Refer to section 2116(a) of P.L. 116-136, the Coronavirus Aid, Relief, and Economic Security Act, March 27,
2020.

C. Project Implementation and Funding Status
Please limit your response to 1000 characters or less.
States must use this section to provide a description of the implementation of key activities and/or
project status for the current quarter. Place an ‘X’ in one of the four check-boxes provided below to
provide an assessment of implementation progress. The assessment must be supported by the status
narrative noting if the project is on schedule, behind schedule, ahead of schedule, or complete this
quarter. Once the project is marked as complete this quarter, the state is no longer required to submit an
ETA 9178-ARPA report for the project.
In addition, please provide the funding status for this project for the end of the quarter, including the
total project funding, total obligated, funding balance, and time remaining to expend funds/expenditure
target.
                                             Behind                                          Complete this
State Self-          On Schedule                              Ahead of Schedule
                                            Schedule                                           Quarter
Assessment:
 Total Project Funding          Total Obligated             Funding Balance          Expenditure Target

D. Project Challenges, Risk Mitigation Efforts/Modification Requests, and Technical Assistance
    Needs
Please limit your response to 1500 characters or less.
States must use this section to summarize any significant challenges to project implementation
encountered during the quarter, and describe any risk mitigation efforts or actions taken to address the
identified challenges. In addition, a status update must be provided on the resolution of challenges
identified in previous quarters. This section should also include any questions you have for DOL and
note any identified needs for technical assistance from DOL or others. The narrative must also indicate
whether the grantee is requesting a modification to any project strategies and how the modification
request changes the original project proposal. If a modification has been requested, the narrative must
also indicate the status of the modification request. Modifications only apply to grants that require a full
application. If states have nothing to report, that should be specified.
E. Best Practices, Promising New Strategies and Success Stories
Please limit your response to 1000 characters or less.
States must use this section to describe promising approaches, innovative processes, or grant success
stories. States must also describe any lessons learned and how those lessons learned will be
implemented. Throughout the implementation of the project, states may discover new strategies that
emerge as a result of data-driven continuous improvement. As progress is made with a new and
promising strategy, or as data is gathered to support it, states must document the progress and data each
quarter. If states have nothing to report, that must be specified.
F. Additional Outcome Information
Please limit your response to 1000 characters or less.
This section requires states to report grant-specific outcomes not captured in other sections of the
quarterly narrative progress report, including, but not limited to, outcomes measuring equitable service
delivery, outcomes measuring fraud detection and prevention, outcomes measuring backlog reduction,
specific outcomes included in the grant application.

                                               Certification
Name of Grantee Certifying Official:
Phone:
E-Mail Address:

                        Instructions to Complete ETA 9178-ARPA

Contact Information:
This section is to provide the contact information (i.e., Name, Title, Address, etc.) for the state
official who is responsible for the day-to-day operation and implementation of the project. This
may be a different person that the certifying official.

Certification:
    Name of Certifying Official
         Use this section to provide the name of the state official who is certifying submission of
         the report to the U.S. Department of Labor (Department).
    Telephone Number
         Provide the area code and telephone number ((###) ###-####) of the authorized state
         official.
    Email Address
         Provide the email address of the authorized state official.

General Instructions
States receiving ARPA Grant Funds are required to submit quarterly progress reports to the
Department’s Employment and Training Administration (ETA) in order to comply with the
reporting and record keeping requirements of these funds. Each state recipient of funds must
submit a narrative Quarterly Progress Report (QPR) containing updates on the progress and
implementation of the project(s) undertaken as a result of the funding.

Report Form and Instructions
The QPR provides narrative updates on the implementation of project(s) undertaken as a result of
the funding and the status of each project per quarter.

Due Dates
All quarterly reports are due to ETA no later than 45 days after the end of each reporting quarter.
The table below shows the expected due dates for each reporting quarter.

                          Reporting Quarters                  Due Dates
                     October 1 – December 31
                                st               st
                                                         February 14th
                     January 1st – March 31st            May 15th
                     April 1st – June 30th               August 14th
                     July 1ST – September 30th           November 14th

Should the due date of the report fall on a Saturday, Sunday, or holiday, the report is due the
previous business day.

Submission Procedures
Information contained in the quarterly report (ETA 9178-ARPA) must be submitted by email
directly to the ETA regional office. An ETA Federal Project Officer will review and accept the
report within 30 days of receipt.

   OMB Approval. Section 2116(a) of the CARES Act, 5 U.S.C. 9032(a), states that “Chapter
   35 of Title 44, United States Code, (commonly referred to as the ‘Paperwork Reduction Act
   of 1995’) shall not apply to the provisions of, and the amendments made by, this
   subtitle.” As the OMB approval process is waived for these reporting instructions, these
   instructions should be considered final.