One thing seems clear in the tangle of events that led to the state improperly issuing millions in unemployment payments: The Colorado Department of Labor was woefully unprepared for the tsunami of unemployment claims it faced as a result of this deep recession, and prior leadership at the department did not make the changes necessary to deal with the onslaught of those seeking assistance.
That’s a shame, not only because $169 million in payments to ineligible people went out the door in 2010, but because applicants who were desperate for help found themselves waiting on phone lines, sometimes for hours.
An audit released earlier this week that examined a sampling of claims raised other problems.
The Colorado auditor’s office estimated $60 million in unemployment benefits in 2010 went to people who did not verify they were in the country legally.
Colorado law forbids such government benefits from going to people who are illegal immigrants.
Another $83 million was paid to people who did not verify that they had been looking for work.
Over the past three years, the department paid some $305 million to people ineligible to receive the benefits.
What a mess.
We talked Tuesday to Ellen Golom-bek, executive director of the state Department of Labor and Employment, and Jeff Fitzgerald, the director of the unemployment insurance program, about the depth and complexities of the problems and what they’re doing to solve them.
We have to admit, we were initially taken aback when they told us it would take until fall of 2012 to get the department to an 11 percent overpayment level, meaning 11 percent of total benefits paid out are done so incorrectly.
Federal guidelines say improper payments should not exceed 10 percent of total payments.
They explained the work that has to be done to get there — systems are being overhauled, employers are being notified of new procedures, and employees are being retrained and redeployed within the department.
More employees are manning the call center and taking on claim resolution issues. And the state is working to set up repayment plans for those who improperly received benefits.
They emphasized that a relatively small portion of the problem was fraud, some 4 percent. While that is not a huge issue, it still must be addressed, and the department has plans to do that.
All things considered, it seems that Golombek and Fitzgerald are charting a course toward order in the department.
Each of them has been at the department for less than a year, but they are taking ownership of the situation they walked into. We hope for their success in dealing with these thorny but important issues.
