States SET TO LOSE Funding!

The Trump administration threatens to cut federal unemployment funding to states that fail to verify immigration status of benefit applicants, while facing judicial resistance to similar enforcement measures against sanctuary cities.

At a Glance

• Labor Secretary Lori Chavez-DeRemer warned states they could lose federal funding if they provide unemployment benefits to illegal immigrants
• States must use the Systematic Alien Verification for Entitlements (SAVE) database to confirm legal status of applicants
• A report found 6,300 illegal immigrants on the terror watchlist were receiving Medicaid and unemployment insurance
• A federal judge recently blocked the administration from withholding funds from sanctuary cities, showing judicial pushback
• The directive aligns with President Trump’s broader efforts to prevent illegal immigrants from accessing taxpayer-funded benefits

States Face Funding Cuts for Non-Compliance with Immigration Vetting

U.S. Secretary of Labor Lori Chavez-DeRemer has issued a clear warning to states: comply with federal requirements to verify the immigration status of unemployment benefit applicants or risk losing critical federal funding. The message came as part of the Trump administration’s intensified efforts to ensure that taxpayer-funded benefits are not being distributed to those illegally present in the country. States are now required to use the Department of Homeland Security’s Systematic Alien Verification for Entitlements (SAVE) database, which provides immigration status verification before benefits are awarded.

The announcement specifically targets the Title III UI administrative grant, which provides federal funding for state unemployment insurance programs. States that fail to properly verify applicants’ legal status could see this funding withdrawn. The verification requirement is designed to enforce existing laws that stipulate unemployment benefits are exclusively for individuals legally authorized to work in the United States. This includes verifying that applicants meet the standard requirements of being able to work, available for work, and actively seeking employment in roles they are legally permitted to accept.

Administration’s Push to Protect Taxpayer Resources

The Labor Department’s directive aligns with President Trump’s broader policy agenda outlined in a recent presidential memorandum and executive order. These directives instruct federal agencies to implement measures preventing individuals illegally present in the United States from receiving social security benefits and other taxpayer-funded assistance. The administration has pointed to concerning findings, including a report that identified 6,300 illegal immigrants on the terror watchlist who were receiving Medicaid and unemployment insurance benefits – precisely the kind of situation these new verification requirements aim to prevent.

“Our nation’s unemployment benefits exist solely for workers who are eligible to receive them. To qualify for unemployment, one must be able and available to work, actively seeking work, and be legally authorized to accept employment in the United States. Unemployment benefits are not a handout for those in our country illegally.”, said Lori Chavez-DeRemer.

Chavez-DeRemer described the SAVE database as a “critical tool” to ensure “illegal immigrants do not access our nation’s unemployment benefits.” The database provides states with a systematic way to confirm an applicant’s citizenship or immigration status before issuing benefits, helping to prevent fraud while ensuring legally eligible workers can still receive needed support. Beyond unemployment benefits, the administration is also pushing similar verification requirements for Supplemental Nutrition Assistance Program (SNAP) benefits, urging states to implement identity verification and legal status checks for all applicants.

Judicial Pushback Signals Potential Challenges

Despite the administration’s determination to enforce these requirements, judicial resistance suggests potential challenges ahead. A federal judge recently blocked the Trump administration from withholding federal funding from “sanctuary” cities that refuse to cooperate with federal immigration enforcement. The judge cited constitutional separation of powers concerns, arguing that the executive branch cannot impose conditions on federal funding that Congress has not authorized. This ruling could foreshadow similar legal challenges to the administration’s threat to withhold unemployment funding from non-compliant states.

The tension between federal enforcement priorities and judicial limitations highlights the complex interplay between immigration policy and federalism. While the administration asserts its authority to protect federal resources from misuse, courts have shown willingness to check executive power when they perceive overreach into congressional spending authority. For states caught in the middle, the situation creates difficult choices between following federal directives to maintain funding and potential legal challenges arguing that such requirements exceed proper federal authority.