City of Gary, Indiana v. United States Department of Labor

FLAUM, Circuit Judge.

In 1974, the City of Gary, Indiana received a $2,060,613 grant from the Department of Labor pursuant to the Comprehensive Employment and Training Act (CETA). The Department in 1974 and 1975 audited the City’s use of the funds and reported that almost $1,000,000 had been misspent and therefore would be recoverable by the Department. After subsequent audits and various other proceedings, the matter was placed before an administrative law judge, who in 1980 ordered the City to repay the Department $313,592.36. The AU further ordered that the City make this repayment out of…