The Colorado Department of Labor and Employment recently renegotiated its contract with JPMorgan Chase in an effort to cut down the fees assessed on the Colorado Automated Payment card, one of the options for the state’s unemployment insurance payments.
The new contract eliminates all point-of-sale fees, allows one free denied transaction per month, and increases the maximum ATM withdrawal limit to $809.
Unemployment claimants will have unlimited use at any Chase ATM and can have up to two teller withdrawals for free — but any more than that and claimants will have have to pay a $5 fee each month. There is a $1.50 fee for non-Chase ATMs.
Many other states had already begun similar programs when the state-issued debit card was first instated as a method for receiving unemployment payments in April 2008.
“We abandoned the notion of issuing a warrant, or check, to claimants,” said Bill Thoennes, a spokesman at the Department of Labor and Employment. “It was costing so much money to deliver the paper checks every week. There was the environmental concern, a paper cost concern, and a mailing cost concern.
“The debit card was a convenience, comparatively,” Thoennes said. “People didn’t have to worry about whether this was the day that their unemployment check would arrive.”
The department knew from the outset that Chase Bank would be associating some fees to certain transactions.
“We heard from claimants that they did not like that there would be fees assessed, so we expedited our plans to do the electronic direct-deposit option,” Thoennes said.
The direct deposit has been available since February 2009. However, many claimants still prefer the debit card for its instant and portable convenience.
The contract negotiations, which went into effect in August, will result in more than $500,000 in savings each year to unemployment insurance claimants, according to Cher Haavind, spokeswoman for the Department of Labor and Employment.
Kristen Leigh Painter: 303-954-1638 or kpainter@denverpost.com
